Why did the German government create an agency for disruptive innovations?

© DWIH Tokyo/iStock.com/bagira22

May 25, 2021

[by Toru Kumagai]

The German government is actively working to encourage innovation by providing significant financial support for individual and corporate research and development projects based on landmark ideas that would overturn conventional wisdom. Here, we will introduce you to SPRIN-D, the agency that the government has created to achieve this goal.

On March 9, 2021, the DWIH Tokyo discussed the topic of innovation, as well as disruptive innovation, in its first online “Coffee Talk” on the subject of “Japan’s New Science, Technology, and Innovation Basic Plan: Opportunities for German Research.”
Fumikazu Sato of the Japanese Cabinet Office and the German Embassy’s science and technology counsellor Dr. Lothar Mennicken spent one hour exchanging views on the significance of innovation to both countries, on the directions in which innovation will take in the 21st century, and discussing those areas in which German and Japanese scientists might collaborate in the future.
YouTube DWIH “Coffee Talk” #1: “Japan’s New Science, Technology, and Innovation Basic Plan: Opportunities for German Research”(DWIH COFFEE TALK #1 ”Japan’s new Science, Technology, and Innovation Basic Plan”)
In the talk, Dr. Mennicken spoke about the Federal Agency for Disruptive Innovation (SPRIN-D), which was jointly established by the Federal Ministry for Education and Research (BMBF) and the Federal Ministry for Economics and Energy (BMWi) on December 16, 2019 in Leipzig.

SPRIN-D Seeks Out and Supports Revolutionary Ideas

SPRIN-D is a landmark experiment for Germany. Through it, Germany will provide support for individuals and organisations with original ideas. The formal name for this agency in German is “Bundesagentur für Sprunginnovation” – Federal Agency for Disruptive Innovation, but it is also known by the acronym “SPRIN-D”, an allusion to a “sprint” in a race.
A “disruptive innovation” is an innovation that fundamentally overturns conventional wisdom and produces significant benefits for economic activity and people’s daily lives.
Examples of such disruptive innovations from Germany’s own history include the four-wheeled automobile with a small internal combustion engine and the pain-reliever aspirin in the 19th century, and such things as linear motor car technology and MP3 audio compression technology in the 20th century.
The internet and the smartphone – both of which have changed our lifestyles to a considerable degree – as well as remote conferencing, and the technologies behind automated driving that many carmakers are currently vying to bring into practical use are also all products that resulted from disruptive innovations.
SPRIN-D is a limited liability corporation that invites and promotes original ideas from both individuals and corporations. It channels financial support from the federal government to those projects that it believes possess great potential.
Germany has come up with a variety of innovations since the 19th century. However, since World War II, other countries as the United States and Israel have led the way in this area. It is the United States where the work was done to find practical applications for the aforementioned internet, smartphones and remote conferencing, and then bringing them to market. Both the US and Israel are also moving forward on developing automated driving technologies.
In the US in particular, the government’s Defense Advanced Research Projects Agency (DARPA) has been accelerator of innovation. Established in 1958, DARPA has been an important wellspring for disruptive innovations in that country. For example, to satisfy national defence and military requirements, DARPA developed the technology that would be a predecessor to the internet as well as global positioning system (GPS) technology.
Like DARPA, SPRIN-D is an organisation that aims to draw out original ideas from individuals and corporations and to promote disruptive innovations. However, unlike DARPA, SPRIN-D does not handle military technology. Its focus is limited to innovations in civilian technologies. (The Agency for Innovation in Cybersecurity established in Halle in 2020 solicits original ideas related to national defence concerns, particularly on defending from cyber-attacks.)

The Federal Government Playing the Role of Venture Capital

There are few start-ups in Germany in comparison to the US and Israel. Capable people greatly prefer to work at large corporations with ample benefits over self-employment with its harsher working conditions. Furthermore, there is less venture capital for financing start-ups in Germany than there is in the United States, the United Kingdom, or Israel. Even when there is a risk of a development project suddenly coming to a standstill, there are only few investors who would try to support start-ups.
Accordingly, even if an engineer or someone does start a business to put some original technology into practical use, they have difficulties with procuring research funds that will last until they can obtain sales and profits from that technology. To keep entrepreneurs and inventors from giving up in frustration as they make their way down this long, dark tunnel (sometimes called “the valley of death”), SPRIN-D selects promising ideas and directs part of the federal government’s budget toward them. It serves as a “promoter” who finds what one might call the nest egg that leads to disruptive innovations.
SPRIN-D has some points in common with the “Moonshot Research and Development Program” that the Japanese government has established to promote innovation. However, while the Moonshot Program focuses on seven main areas such as “Realisation of ultra-early disease prediction and intervention” and “Realisation of AI robots that autonomously learn, adapt to their environment, evolve in intelligence and act alongside human beings,” SPRIN-D does not limit itself to specific areas of new technologies.
SPRIN-D is led by Rafael Laguna de la Vera (56), a Leipzig-based software engineer and entrepreneur. He founded his first start-up at the age of 16 and has launched and financed a variety of information technology (IT) corporations, including Dicomputer, micado, and Open-Xchange AG. Laguna is known particularly as a pioneer of open source technology. With his background in having created various companies and investing in corporations with growth potential, Laguna is perfectly suited to be at the head of SPRIN-D with its goal of giving rise to disruptive innovations.
Laguna explains, “Germany has achieved much in terms of technology in the last 75 years. To revitalize that history, Germany needs to get rid of its ‘fear gene’ and replace it with a ‘courage gene’. Yes, failures are an unavoidable part of developing new technologies, but we should not be afraid to fail. We need to work together on a future that is viable for us, our children, and all other living things on the planet.”

Selecting 12 Projects from Among 400 Applicants

Individuals and corporations who believe they have an idea connected to some disruptive innovation that they want to put to practical use must first answer 15 questions posed by SPRIN-D. The list of questions includes such items as “Who will benefit if you are successful and what are the corresponding advantages for Germany and Europe?” “Has there already been a proof of concept regarding the transition to implementation, e.g., test results and prototypes, and if so, do you have documentation?” and “How much will your project cost and how much time will it take to execute?”
Technologists at SPRIN-D screen the documents submitted by the applicants and if they decide a project has the potential to be implemented and its implementation will be of considerable benefit to the public, the federal government will direct money to the development project. SPRIN-D is set to operate for 10 years, with 2019 having been the first. The federal government has put aside a budget for it of 1 billion euros (approximately 130 billion yen, at 130 yen to 1 euro).
The SPRIN-D screening is something of a “narrow strait.” In 2020, it received 400 research and development project submissions, of which it signed off on federal budgetary support for only 12. That makes for a scant 3% passing rate. The fact that 97% of the submitted projects were rejected demonstrates that SPRIN-D is making strict demands of the applicants when it comes to a project’s feasibility and its contributions to the economy and society.
What sorts of projects has SPRIN-D accepted to this date? Here are some examples of projects currently that are currently being developed with SPRIN-D support.

(1) Medicine to Treat Alzheimer’s Disease

Professor Dieter Willbold of Heinrich-Heine-University in Dusseldorf is using a new method to develop medicine to treat Alzheimer’s disease. Willbold also serves as director of the Department of Structural Biochemistry at Jülich research centre. The innovative aspect of the medicine Willbold is thinking about is that, unlike the approach used in existing treatments, it uses a physical and chemical approach to remove the abnormalities in proteins found in the brain of an Alzheimer’s patient. Moreover, Willbold aims to develop an orally ingested medicine with a relatively low cost that is easily administered.

In 2019, Willbold completed Phase I of clinical trials, in which healthy subjects were administered the drug to study its safety. He will begin a Phase II clinical trial in 2022 in which the drug will be administered to Alzheimer’s patients to study its effectiveness. He expects to obtain results in 2026. Nowadays, there are as many as 300,000 people around the world who suffer from Alzheimer’s disease. Willbold says that if this treatment method is a success, it could also be used to treat such conditions as Parkinson’s disease and diabetes. SPRIN-D announced on February 4, 2021, that it would be supporting this project.

(2) The Analogue Computer

Frankfurt-based IT engineer Bernd Ulmann is working to develop an analogue computer that would take the place of the mainstream digital computers of today. People in today’s IT world have been pointing out the limitations of digital technology entailed with the development of artificial intelligence, and many scientists and engineers are now researching computers that use analogue technology. Ulman explains, “The computational speed of analogue computers will be 100,000 times that of digital computers, and they will accomplish that using 1/100,000 the amount of energy.” He stresses, “Unlike digital computers that rely on algorithms, analogue computers perform various computations in parallel. Accordingly, this means they operate more like the human brain or nervous system. The future of computers lies in the analogue method.” He adds, “If I can get together a team of 10 to 15 people for two years, we can develop an analogue computer.”

(3) High-Altitude Onshore Wind Turbines

Leipzig-based engineer Horst Bendix is working to develop 250-meter tall onshore wind turbines. With the rotor blades at a higher altitude, they would regularly catch the wind and spin. They would generate more power and work more efficiently. Bendix explains that by using standard steel pipes and placing the generators at a lower part of the tower, he can reduce the total weight of such power-generating facilities by 50% and lower construction costs by 40%. By doing so, it would be possible to keep down the costs per megawatt of power that such blades would generate. To realise this project, Bendix is launching a limited liability company called, “New High Altitude Wind Power-Generating Facility Research Corporation.”

(4) A Device to Remove Microplastics from Water

Cologne-based engineer Roland Damann has been working since the 1980s on technologies for improving water quality at fish nurseries and similar facilities. The water treatment technologies that he has developed are being used by around 300 companies in some 50 countries, and they have been commended by the state of North Rhine-Westphalia. Damann is now developing a technology that would remove the microplastics that are polluting the oceans and inland waters. His method called “Microbubbles-Gasblasenmatrix” uses gas to create bubbles that causes microplastics to float to the surface. With this, it can remove microplastics not only from the oceans and inland waters but also from wastewater.

The German government decided to create SPRIN-D and use a considerable part of the federal budget to fund original ideas out of a desire to encourage disruptive innovations in this country and its heightened awareness of a need to close the gap in this area with the United States and Israel. The 21st century is likely to be an era that sees heightened competition amongst countries over disruptive innovations. No doubt SPRIN-D will have an important role to play here.

Click here to read other articles from the series “Toru Kumagai’s report on R&D trends in Germany”.

About Toru Kumagai

Born in Tokyo in 1959, Kumagai graduated from the Department of Political Science and Economics at Waseda University in 1982 and joined Japan Broadcasting Corporation (NHK), where he gained a wealth of experience in domestic reporting and overseas assignments. After NHK, he has lived and worked as a journalist in Munich, Germany, since 1990. He has published more than 20 books on Germany and Germany-Japan relations, as well as been to numerous media outlets to report on the situation in Germany.