1. Role of a modern university, like KBTU in PPAP (Public Private Academic
Partnership) Programs, in the Economy and in Society
By Ramesh G. Kini, KBTU
Presented at Digital Communications Event 2010
September 22nd, 2010
Almaty

3. 12.04 University-industry
collaboration in R&D
...............................111
4.01 Business impact of malaria
.......................................................1
4.02 Malaria incidence*
.......................................................1

4. Specialization of Regional Economies
Select U.S. Geographic Areas
Boston
Analytical Instruments
Education and Knowledge Creation
Communications Equipment
Los Angeles Area
Apparel
Building Fixtures,
Equipment and
Services
Entertainment
Chicago
Communications Equipment
Processed Food
Heavy Machinery
Denver, CO
Leather and Sporting Goods
Oil and Gas
Aerospace Vehicles and Defense
San Diego
Leather and Sporting Goods
Power Generation
Education and Knowledge
Creation
San Francisco-
Oakland-San Jose
Bay Area
Communications
Equipment
Agricultural Products
Information
Technology
Seattle-Bellevue-Everett,
WA
Aerospace Vehicles and
Defense
Fishing and Fishing
Products
Analytical Instruments
Houston
Heavy Construction Services
Oil and Gas
Aerospace Vehicles and Defense
Pittsburgh, PA
Construction Materials
Metal Manufacturing
Education and Knowledge
Creation
Atlanta, GA
Construction Materials
Transportation and Logistics
Business Services
Raleigh-Durham, NC
Communications Equipment
Information Technology
Education and
Knowledge Creation
Wichita, KS
Aerospace Vehicles and
Defense
Heavy Machinery
Oil and Gas
Note: Clusters listed are the three highest ranking clusters in terms of share of national employment
Source: Cluster Mapping Project, Institute for Strategy and Competitiveness, Harvard Business School

6. SIMS:
School of
Info. Mgt. &
Sys.
Haas School
of Business
Berkeley
Engineering

7. SIMS:SIMS:
School ofSchool of
Info. Mgt. &Info. Mgt. &
Sys.Sys.
HaasHaas SchoolSchool
of Businessof Business
BerkeleyBerkeley
EngineeringEngineering
U.C. Berkeley
Stanford

8. • Avalanche rescue beacons, e.g., the Ortovox X1 (www.ortovox.com), and Tracker
DTS, have become standard equipment for many skiers and snowmobilers – these
small radio transmitters, strapped to the body, use audio signals to aid rescuers in
locating someone buried under several feet of snow.
• Suppose Kairat, Kanat & Maxat (KKM), who are studying at KBTU, were to
submit a proposal for a new type of beacon detector (Digital Life Preserver)
• The proposed KKM model
is like the Tracker DTS (for
Digital Transceiving
System, patented by John
Hereford), in that it shows
the direction and distance
from the victim, and also
has digital displays to
interpret data, and flashing
lights to augment the audio
feedback signals.
• What process would we use
to take the KKM proposal
from Concept to
Commercialization to
Cash Positive (C2C2C)?

9. Evaluating the Concept and its Commercialization potential
Digital Life Preserver: Avalanche beacons help save lives by
allowing rescuers to find victims buried in snow. The beacons are
worn by a skier or snowmobiler and continuously transmit a radio
signal. When a victim is buried, people nearby can use their beacons
as receivers to search based on signal strength. Newer digital beacons
use microprocessors to more precisely guide searchers to the victim.

13. Technology
Board
Management
Board
PPAP Pr. Management
PPAP Program
(Board of Trustees)
Step I: Submit
Projects,
Proposals, Plans
KBTU
Faculty
Members
Students
Affiliates
KazCosmos
Stage I: Affiliation
Criteria: Time, Context, Scope
Resources, Sustainability, Value
Step II: Analysis,
Review
Feedback, Support
Step IA: Revise &
Rework Projects,
Proposals, Plans
•What is your target market?
•How big is it?
•Who will buy your product?
•Why do they need it?
•Who will pay for it?
•Who will use it?
•How do the users fix the problem you're addressing today?
•How important is the problem to them?
•How much are they willing to pay?
•Why would they buy from you?
•Are there any substitute products? Who are the rivals?

14. Cash
Flow
+ve
-ve
Market-Driven
• Market Segmentation, Market Opportunity Validation
• Market Size & Trends (Dynamics: Market
Expansion/Contraction, Market Penetration/Saturation, Market
Share)
Technology-Driven
• Technology/Product: Design,
Development, Demonstration,
Deployment, Deliverables
Go - No Go Hurdles/Milestones
Execution,
Execution,
Execution
…
Concept Commercialization Cash-PositiveBusiness
Model/Strategy/Plan
Value Proposition, Value Creation Value Extraction, Value Capture Value Apportionment
Conventional
Funding
3F: Friends,
Family & Fools
Seed
(Public
Sector, etc.)
Angels Venture
Capitalists
Exit: Buyout/IPO (Private Equity, Mutual
Funds, Retail & Institutional Investors, etc.)
The C2C2C (Concept to Commercialization to Cash-Positive) Model

15. Technology
Board
Management
Board
PPAP Pro. Management
PPAP Program
(Board of Trustees)
Step I: Submit
Projects,
Proposals, Plans
KBTU
Faculty
Members
Students
Affiliates
KazCosmos
Stage I: Affiliation
Criteria: Time, Context, Scope
Resources, Sustainability, Value
Step II: Analysis,
Review
Feedback, Support
Step IA: Revise &
Rework Projects,
Proposals, Plans
Technology
Board
Management
Board
PPAP Pro. Management
PPAP Program
(Board of Trustees)
Step III: Submission for
Approval by Technology
& Management Boards
Technology
Board
Management
Board
PPAP Pro. Management
PPAP Program
(Board of Trustees)
Step IV: Submission
for Approval by
Foundation Board of
Trustees
Step IVA: Revise
& Rework
Step
IIIA:
Revise &
Rework
Profit
Sales
Revenue
Costs
Sales
Volume Price
Variable
Cost
Fixed
Costs
Unit
Variable
Cost
Sales
Volume
Business
Questions: What
are the Drivers of
Profit?
55
Features/Features/
PerformancePerformance
QualityQuality
Flexibility/Flexibility/
ResponsivenessResponsiveness
Cost/Cost/
PricePrice
Speed/Lead
Speed/Lead
Tim
eVariability
Tim
eVariability
001122334455 11 22 33 44 55
112233445511223344
Innovativeness/
Innovativeness/
Technological
Technological
C
apabilities
C
apabilities
R
eliability/
R
eliability/
Dependability
Dependability
Variety/
Variety/
ProductM
ix
ProductM
ix
Rival’s OfferingRival’s Offering
Firm’s OfferingFirm’s Offering
Customers’ NeedsCustomers’ Needs
Changes over timeChanges over time

16. Technology
Board
Management
Board
PPAP Pro. Management
PPAP Program
(Board of Trustees)
Step I: Submit
Projects,
Proposals, Plans
KBTU
Faculty
Members
Students
Affiliates
KazCosmos
Stage I: Affiliation
Criteria: Time, Context, Scope
Resources, Sustainability, Value
Step II: Analysis,
Review
Feedback, Support
Step IA: Revise &
Rework Projects,
Proposals, Plans
Technology
Board
Management
Board
PPAP Pro. Management
PPAP Program
(Board of Trustees)
Step III: Submission for
Approval by Technology
& Management Boards
Technology
Board
Management
Board
PPAP Pro. Management
PPAP Program
(Board of Trustees)
Step IV: Submission
for Approval by
Foundation Board of
Trustees
Step IVA: Revise
& Rework
Step
IIIA:
Revise &
Rework
Technology
Issues: Aerial
Scanning to
Expedite Process
Base StationBase Station
Alternative Suggestion from 4EAlternative Suggestion from 4E
Center Technology Board Members:Center Technology Board Members:
Mount Scanner on a small AerialMount Scanner on a small Aerial
DeviceDevice

17. Pro’s & Con’s of Scanning from the Air
 Larger Swept Areas, Quicker Sweeps & Faster
Zooming into Promising Areas (15-20 minute
window)
 Parallel Processing (Multiple Aerial Scanners
attached to single Base Station)
 Scan Areas that cannot be Manually Accessed
(Steep, Unstable Slopes)
 Limited Charge on Battery Cells (5-8 minutes)
 Susceptible to Ambient Conditions (Wind, etc.)

18. FINANCIAL PROJECTIONS (Stocks & Flows)
Current Sales
Time
Bass-Model with
Lanchester Market-
Share Dynamics
Distribution CentersDistribution Centers Plant APlant A
Plant B...Plant B...
Distribution CentersDistribution CentersDistribution CentersDistribution Centers Plant APlant APlant APlant A
Plant B...Plant B...Plant B...Plant B...
PeoplePeople
HowHow
Much?Much?
How?How?
Why?Why?
Where?Where?
When?When?
Who?Who?
What?What?
ProcessProcessPlantPlantPartnersPartnersProcurementProcurementProductProduct
/ Parts/ Parts
MoveMove
StoreStore
MakeMake
PlanPlan
SellSell
BuyBuy
Value AddedValue AddedVisibilityVisibilityVelocityVelocityVariabilityVariabilityVarietyVarietyVolumeVolume
55
Features/Features/
PerformancePerformance
QualityQuality
Flexibility/Flexibility/
ResponsivenessResponsiveness
Cost/Cost/
PricePrice
Spe
ed
/L
ea
d
Spe
ed
/L
ea
d
Tim
e
Var
ia
bi
lit
y
Tim
e
Var
ia
bi
lit
y
001122334455 11 22 33 44 55
112233445511223344
In
no
va
tive
ne
ss
/
In
no
va
tive
ne
ss
/
Tec
hn
ol
og
ical
Tec
hn
ol
og
ical
C
ap
ab
ili
ties
C
ap
ab
ili
ties
R
el
ia
bi
lit
y/
R
el
ia
bi
lit
y/
D
ep
en
da
bi
lit
y
D
ep
en
da
bi
lit
y
Var
ie
ty
/
Var
ie
ty
/
Pro
du
ct
M
ix
Pro
du
ct
M
ix
55
Features/Features/
PerformancePerformance
QualityQuality
Flexibility/Flexibility/
ResponsivenessResponsiveness
Cost/Cost/
PricePrice
Spe
ed
/L
ea
d
Spe
ed
/L
ea
d
Tim
e
Var
ia
bi
lit
y
Tim
e
Var
ia
bi
lit
y
001122334455 11 22 33 44 55
112233445511223344
In
no
va
tive
ne
ss
/
In
no
va
tive
ne
ss
/
Tec
hn
ol
og
ical
Tec
hn
ol
og
ical
C
ap
ab
ili
ties
C
ap
ab
ili
ties
R
el
ia
bi
lit
y/
R
el
ia
bi
lit
y/
D
ep
en
da
bi
lit
y
D
ep
en
da
bi
lit
y
Var
ie
ty
/
Var
ie
ty
/
Pro
du
ct
M
ix
Pro
du
ct
M
ix
55
Features/Features/
PerformancePerformance
QualityQuality
Flexibility/Flexibility/
ResponsivenessResponsiveness
Cost/Cost/
PricePrice
Spe
ed
/L
ea
d
Spe
ed
/L
ea
d
Tim
e
Var
ia
bi
lit
y
Tim
e
Var
ia
bi
lit
y
001122334455 11 22 33 44 55
112233445511223344
In
no
va
tive
ne
ss
/
In
no
va
tive
ne
ss
/
Tec
hn
ol
og
ical
Tec
hn
ol
og
ical
C
ap
ab
ili
ties
C
ap
ab
ili
ties
R
el
ia
bi
lit
y/
R
el
ia
bi
lit
y/
D
ep
en
da
bi
lit
y
D
ep
en
da
bi
lit
y
Var
ie
ty
/
Var
ie
ty
/
Pro
du
ct
M
ix
Pro
du
ct
M
ix

19. Source: OECD (2010). Measuring Innovation: A New Perspecti8ve, based on Scopus Custom Data, Elsevier, July 2009; OECD, Patent Database,
January 2010; and EPO, Worldwide Patent Statistical Database, Sept. 2009. The list of environmental patent applications has been generated
through a search algorithm developed by the OERCD and EPO (European Patent Office).
Science for Green Innovation: Green Technologies draw upon a broad base of
scientific knowledge.
OECD: Multidisciplinary research is Emerging to Address Global Challenges

20. Sustainability themes –
Alternative energy,
Environmental
technologies, Biotechnology
Sustainable
Leadership
Integrating CSR& ESG…
… with key drivers of
sector …
… and sustained
competitive advantage
Dynamics: Industry,
Competition, Market,
Product
Drivers &
Dynamics:
Industry,
etc.
CSR  ESG: Corporate
Social Responsibility 
Environmental, Social,
Corporate Governance Issues
Environment
Economy Industry
Society
CSR

ESG:
Returns: TSR
(Total
Shareholder
Returns),
CFROI, etc.
Returns
Based on Goldman Sachs GS Sustain methodology for picking long term winners -- see
Exhibit 1 of GS SUSTAIN by Anthony Ling,Sarah Forrest, Marc Fox and Stephan Feilhauer)
What PPAP Programs
can do for
sustainability and
corporate performance

21. What PPAP Programs
can do for
sustainability and
corporate
performance…
Environment
Economy Industry
Society
CSR  ESG:
…PPAP Program Partners can collaborate on
many fronts to set the agenda for the future

22. Dana
Banking & Other
Financial Institutions
Government
agencies,
Ministries,
etc.
Firm
Kanat
Development
Finance
Institutions
(DFIs),
Business
Incubators, IT
Parks, Science
& Technology
Parks
Zhanna
PPAP Programs: Who Brings What to the Table?
What is the Value of that Contribution?
Academic & other
R&D Institutions
-- National & Foreign Partners
Information
Investments Institutions
Individuals
Ideas Insights
Incubation
Infrastructure
Innovation
Startups
Legal, Accounting
& Advisory
Service Providers
Micro-Angel
Networks
Retirees,
Professionals
Individual Retail
Investors
Human Resource
Networks

23. Emission reduction
of CO2
Decrease by
substitution
Decrease by
reduction of energy
consumption
of fossil fuels
of clinker
of cement
components
of raw-meal
components
of electrical
energy
of thermal
energy
Recuperation
Generation
Making the Cement Industry “Greener”
and more Sustainable
Based on Toward a Sustainable Cement Industry, an independent study by Battelle, commissioned by the World Business Council for Sustainable Development

24. Making the Cement Industry “Greener” and more Sustainable
Based on Toward a Sustainable Cement Industry, an independent study by Battelle, commissioned by the
World Business Council for Sustainable Development

25. Potential
Impacts of
PPAP
Contributions
Total Shareholder
Return
Revenue Growth
Margin
Improvement
Value Creation Levers
Pricing
Power
Cost
Savings
Employee
Recruitment, etc.
Risk
Premiums
New Market
Entry
Market
Share
Cost of
Capital
• Greater
operational
efficiencies
• More efficient
use of resources
• Supply chain
optimization
• Lower costs
and taxes
Valuation
Multiple
Profits
Free
Cash Flow
PPAP Partners: Who Brings What to the Table?
What is the Value of that Contribution?

26. The PPAP Program would help KKM and other would be entrepreneurs to put
together a business plan, which would show potential investors convincingly:
1. How the idea/invention will be developed and successfully exploited
2. The capability and experience of the team responsible
3. How the investments needed will be financed, including second and
further rounds of financing
4. The proposed exit mechanism and timing, and the expected realization
value for the shareholders
Other key questions that need to be addressed by the Business plan are:
- what is unique about the innovation and is it protected (e.g. patents)?
- who will buy it and why?
- what price will it sell at and what will it cost to deliver?
- what will be the competition and how will it be resisted?
- when will the company start receiving income and when will it break even?

27. Base Station
Alternative Suggestion from PPAP
Program Technology Board
Members: Mount Scanner on a small
Aerial Device

28. PPAP Partners’ Role in Kazakhstani Society
• What role should the PPAP Partners e.g.,
universities, play in the economy, in society? How
could these PPAP Partners make Kazakhstan more
innovative, more competitive?
• How do you measure the performance of these
PPAP Partners, e.g., any University and its
Schools, Centers, etc.? Over the Short-Term,
Medium-Term and Long-Term? How do we factor
in Endogenous vs. Exogenous, Tangible vs.
Intangible, “Hard” vs. “Soft,” and so on, issues?
• What Metrics should we use?
• How should we tie these Metrics to the Partners’
Operating Objectives, Targets and Initiatives?
• What Skills, Capabilities and Core Competencies would individuals involved, e.g., Program
administrators and University Faculty Members, need and how do they get the Training,
Knowledge, etc., for this?
• How should we strike the right balance between:
o the need for Private Partners to make a Profit, for Public and Academic Partners to at least
break even, and so on,
o the Societal Needs and Aspirations of ordinary Kazakhstanis;
o without compromising on University Autonomy, Faculty Academic Freedom, etc.?
• How do the PPAP partners, e.g., the IT Park, the Universities, etc., become more Self-
Sustainable and Independent over time?
• How can these universities, for instance, become more like MIT, Stanford, etc., over time?

29. Universities
& other Academic Institutions
Schools &
Departments
(Faculty Members, Researchers
Students & Alumni)
National Healthcare
System:
Universities’ Medical
Schools, Hospitals,
Research Labs., etc.
R&D Centers for
• Space
• Energy & Environment
• Nanotechnology
• Biotechnology & Life
Sciences
• ICT, or Information &
Communications Tech.
Kazakhstan’s DFIs (Development Financial Institutions): NIF, other Samrukh-Kazyna entities
Government Ministries, Agencies & Support Departments: Finance & Accounting, Grants, etc.
The proposed PPAP (Public-Private-Academic-Partnership) Program
Science & Technology Parks,
IT Parks &
Business Incubators
Kazakhstani and
non-Kazakhstani
Corporate Partners
Startups, New
Ventures
•Intellectual
Property
•Joint R&D
•Licensing &
Royalties
•More Value from
Better Quality,
Lower Cost,
Differentiated
Products &
Services
•Better
Healthcare;
•Longer,
Healthier &
More
Productive
Lives
GDP Growth, Taxes,
Duties, etc., Import
Substitution
New Jobs,
Better Skills
& Capabilities
Other Kazakhstani Firms, Government of Kazakhstan and People of Kazakhstan
Payment in Cash vs. Equity?

30. The 10-I Roadmap for Translating Knowledge into Commercially Viable
Products and Services: Individuals + Ideas + Information + Insights +
Institutions + Infrastructure + Incentives + Investments + Incubation 
Intelligent Innovation
Academic & other
R&D Institutions
-- National & Foreign Partners
Dana
Banking & Other
Financial Institutions
OutboundOutbound
LogisticsLogistics
SupplierSupplier
SupplierSupplier
SupplierSupplier InboundInbound
LogisticsLogistics
CustomerCustomer
CustomerCustomer
CustomerCustomer
OutboundOutbound
LogisticsLogistics
OutboundOutbound
LogisticsLogistics
SupplierSupplier
SupplierSupplier
SupplierSupplier InboundInbound
LogisticsLogistics
CustomerCustomer
CustomerCustomer
CustomerCustomer
SupplierSupplierSupplierSupplier
SupplierSupplierSupplierSupplier
SupplierSupplierSupplierSupplier InboundInbound
LogisticsLogistics
CustomerCustomer
CustomerCustomer
CustomerCustomer
InboundInbound
LogisticsLogistics
InboundInbound
LogisticsLogistics
CustomerCustomer
CustomerCustomer
CustomerCustomer
CustomerCustomer
CustomerCustomer
CustomerCustomer
FirmFirmFirmFirm
FirmFirmFirmFirm
Government
agencies,
Ministries,
etc.
Firm
Kanat
Individuals
Development
Finance
Institutions
(DFIs),
Business
Incubators, IT
Parks, Science
& Technology
Parks
Zhanna
Innovation
Micro-Angel
Networks
Retirees,
Professionals
Human Resource
Networks
Individual Retail
Investors
Legal, Accounting
& Advisory
Service Providers
Ideas
Ideas
Ideas
Institutions
Infrastructure
Insights
Investments
Investments
Information
Incentives
Information
Investments
Institutions
Infrastructure
Incubation
Incubation
Incubation

31. Needs Analysis and Gap Analysis
(for each of the Four Phases) using
the 7P-5W-2H Mapping Approach
• Programs (Support & Networking Activity-mix and Customized Programs for each Vertical)
• Participants (on an Equity + Cash basis in the Incubation & Tenancy Programs for each Vertical)
• Partners (Academic Partners; Public and Private Sector Corporate Partners; Financial backers, etc.)
• “Physical Plant” (Office space, Conference rooms, Laboratories, ICT equipment, etc.)
• Process (Customization for each Vertical, Sequencing and Concatenation of Activities & Programs)
• People (Boards of Directors and Advisors; Admin., Domain Experts, Local vs. Foreign trained
Coaches, Counselors and Catalysts; PPAPAssociates, Affiliates and Faculty Members)
• Procurement (Facilities; Equipment; Make vs. Buy for expertise, services, courseware, etc.)
Roles of the PPAP Program Partners
Programs Participants Partners “Physical
Plant”
Process People Procurement
What?
Who?
When?
Where?
Why?
How?
How
Much?

32. Programs
How
Much?
How?
Why?
Where?
When?
Who?
What?
ProcurementPeopleProcess“Physical
Plant”
PartnersParticipants
The Innovation Park’s PPAP Partners might help answer most of the 5W-2H questions

33. Based partly on Figure 5.5, The Development of global innovation networks and the transfer of knowledge, by Dirk Pilat, Koen De Backer, Ester
Basri, Sarah Box and Mario Cervantes, Ch. 5 of Innovation and Growth: Chasing a Moving Frontier, Eds. Vandana Chandra, Denoz Erocal, Pier
Carlo Padoan, Carlos A. Primo Braga (original source, Chesbrough (2006), Open Business Models, Narvard Business Press, Cambridge, Mass.)
Own
Market
Revenue
Internal
Development
Costs
Revenue
Costs
Shorter Product
Life Cycles
Benefits to PPAP Corporate Partners from Open (rather than
Closed) Innovation in a Changing Business Environment
Rising Costs
of Innovation
Own
Market
Revenue
Internal
Development
Costs
Cost and Time Savings
by Leveraging External
Development through
PPAP Partners
Own
Market
Revenue
Internal
Development
Costs
PPAP Sales
Spin-offs, etc.
New
Revenue*
* New Revenue: from Sales to PPAP partners and their Affiliates, and from Spin-offs, Sales or
Divestitures of PPAP Joint Ventures and Incubator “Hatchlings,” and License Fees and Royalty
Payments from Jointly Developed Technologies

34. Incubator Tenants
for year n
Incubator Tenants
for year n-1
Graduation AttritionFresh
Intakes
Payment of Rent, etc., in (Equity + Cash)
Payment of Rent, etc.,
in Cash
Normal Rent
Paying Tenants
Retention Attrition Revenue Forecast
for year n
Pricing of
Support Services,
Networking, etc.
Projected Profit & Loss
for year n
Projected Balance Sheet
for year n
Projected Funds Flow
for year n
Balance Sheet
for year n - 1
IV
I
II
The Four
Steps in
drawing up
Innovation
Park’s
Financial
Projections
PPAP Public
& Private Sector
Partners
PPAP Program
Academic Partners
Payments
Foreign Inputs Programs
National
Innovation Fund New
Hires
Attrition
Local Capacity
Development
Program
Domain Experts &
Coaches,
Counselors,
Catalysts
Operating Plan
for year n
• 8M Resource Allocation
• Incubator Performance
• Network Affiliates’
Contribution
• PPAP Program Inputs
& Outcomes
• Performance Metrics
Materials Manpower
Machinery Money
Method Management
Meters2 Space
Market Position
8M
OPEX (Operating
Expenditure) Plan
Headcount (Salary, etc.) Costs
Admin.
&
Misc.
Costs
Utilities
& other
8M
Costs
Long Term
Financing Plan
CAPEX (Capital
Expenditure) Plan
Cash
Budget
Cash
Additional
Capital Issues,
Debt
Repayment,
Equity
Interest
Costs
Debt vs.
Equity
Long Term Debt &
Short Term Credit
III
Incubator Hatchlings
(Equity
+ Cash)

35. Operating
Revenues
Bank
Credit
Other
Credit
(e.g., from
IT Park’s
Partners)
Equity
New
Capital
Issues
Long Term
Debt
Repay-
ment
New
Borrowings
Soft
Credit
Debt,
Repayments
Years
Funds
(A - B)
+ ve
- ve
0
5 8
How can the Innovation Park
become Net Cash Positive earlier?
Salaries, Utilities, other
8-M Costs, etc.
Funds for
Operations
(expenses excl.
notional items, e.g..,
Depreciation)
Liabilities
Assets
(Cash +
other
Current Assets
+ Fixed Assets
+ Equity Stakes
in Tenants &
Hatchlings)
Interest
Taxes
Timing of
& Value
Realized
from IPOs
Dividends
Funds
Flow for
PPAP
Program
Partners,
e.g., the
Innovation
Park,
University
-based
Incubators
(B – A) = (D + E + G) – (C + F)
G
F
E
DC
A
B

36. Bottom Line: Complex
Financial model but
simple takeaways
• Shift from Cash only Rental
Model to Cash + Equity
Incubator model will mean that
funds will be needed to sustain
operations for first 5-8 years till
self-sustainability
• Uncertainty vis-à-vis success of
startups (80% success rate if all
goes right) and also timing of
exit through IPO or strategic
sale of Equity slices
• Cash from exits may not be realized in near future – staying power
• Shared ownership of Innovation Park (PPAP) but land and buildings to remain as
property of people of Kazakhstan in perpetuity and part of Public share of equity
(lease structure)
• OPEX and CAPEX Plans, Long Term Financing and Cash Budgeting: