Part II - Major Advantages of BIRD Projects
Major Risk-Sharing
By providing a conditional grant, BIRD cost-shares up to 50% of a Project's development expenses. BIRD is entitled to repayments of a maximum of 150% of this Conditional Grant based on sales revenues derived from the Project. If a Project fails, BIRD will claim no repayments. Therefore, BIRD is a major risk-sharer with the Project partners.
No Equity; No Intellectual Property Rights
BIRD acquires neither equity nor any rights to intellectual property in BIRD-funded Projects.
Off-Balance Sheet Financing
BIRD's Conditional Grant is a form of off-balance sheet financing. Grant payments are usually recorded as a reduction of R&D expenses, and grant repayments are recorded as a royalty expense. Because both transactions are P&L items and the repayment obligation is not recorded as a liability, they do not have any impact on the balance sheet. In addition, repayments are considered as pre-tax expenses. This R&D leveraging instrument has proven popular with public and pre-public companies.
No Interference in Company - Company Relationship
BIRD is not involved in formulating the nature of the relationship between the partnering companies. Likewise, the precise conditions and terms of this relationship are not subject to BIRD approval. The two companies may simply cooperate on an ad hoc basis, linked through a corporate joint venture, or be commonly owned.
Seal of Approval
Project proposals submitted to BIRD are subject to a confidential review by qualified and experienced experts from the US National Institute of Standards and Technology (NIST) and from the Office of the Chief Scientist (OCS) of Israel's Ministry of Industry and Trade. Their professional recommendations, together with BIRD's familiarity with the participating companies, are further endorsements of the decision to undertake the joint venture.
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