ABSTRACT
A starting assumption for those making policy to grow innovative smaller fi rms is that small to medium-sized enterprises (SMEs) with the potential for high growth are often unable to access suffi cient capital from the private sector to fund their development, especially at the early stages. The provision of greater and better targeted fi nancial support through governmentsupported but partly private schemes (hybrid venture capital) to these fi rms would be benefi cial for their development and ultimately for the economy and society at large. Public-private partnerships in innovation fi nancing are seen by policymakers to combine public resources with private fi nancial resources and private expertise in the targeting and management of funds. On the face of it, this looks like the best of both worlds, but the consensus is that while this is a policy that can work, it is diffi cult to get it right.
