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Bang for Buck in the Brave New World

Paul Durrant explains the thinking behind the Abertay-run national innovation grants

While the UK's tax breaks rollercoaster ride goes on, one measure that has been guaranteed is a grants programme, to be administered by Abertay University, that will see funding handed to prototyping projects while simultaneously creating work experience opportunities for students.

Here, the man behind that project - and also the Dare to Be Digital student competition - Paul Durrant, explains how the programme will work, and why it's a compelling alternative in the absence of wider tax incentives.

When I was the director of a start-up software technology company R&D tax credits recovered from the initial development phase were a useful element of 'free' cash that we secured (with some considerable work) around the time of second round venture funding. What they weren't was a primary source of working capital.

Although I have been supportive of the games development industry's campaign to secure production tax credits they certainly were never going to be the panacea for small, young development companies seeking to secure sufficient working capital to maximise the benefits of work-for-hire as well as developing their own IP. Tax credits don't help early cash flow.

Somehow, that message has often become confused. I'm on a mission as far as the opportunity for small games developers to take greater control of their working capital is concerned. That's why the Abertay University funding launch announced by Culture Minister Ed Vaizey at his Develop conference keynote is important. It's a starting point on the road to a new business support programme for the lifeblood of the future for the UK games development sector.

Mr Vaizey made it clear that interventions targeted by sector were off the agenda - but claimed that the coalition government wanted to provide a better climate for business generally. Whether that can be achieved remains to be seen, but now is the time for the sector to mobilise to exploit the generic interventions to the best of our advantage.

It's no coincidence that the challenge is inherently linked to skills too because we need talented young up-and-comings to feed the creative and entrepreneurial pipeline. The Minister's appointment of Ian Livingstone as skills champion - working with Charles Cecil and Alex Hope - is also very welcome and will also help us capitalise on generic business opportunities that surround new IP generation.

It's for that reason that our new business support programme for smaller SMEs launched by the Minister will seek to maximise the use of public funding by imposing a skills development requirement of grant recipients.

We are offering grants of up to £25,000 to create prototypes at a number of locations throughout the UK. The investment will have to meet a number of criteria including innovation, additionality and market potential but will also use talented students and graduates on paid employment to undertake part of the work funded by the grant. In this way we will get double the leverage from this public money: IP development in SMEs and work experience for young talent. avatar GamesIndustry International is the world's leading games industry website, incorporating and
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