How are businesses using their innovation grants?

Cleverland: three-dimensional toy bricks for children
The toy retailer will introduce the first toy developed and produced by the company itself.

“So far, we have invested around one million kroons in the development of the new toy,” says Cleverland’s owner and CEO Stanislav Ivanov. The toy in question is a set of huge building bricks, for children aged 6 to 8. It is an educational toy consisting of large blocks made of a foam material, which children can use to build various objects, such as buildings, vehicles etc. At the moment, the company is developing three different sets: a castle, a plane, and a ship. The blocks will be big enough to allow children to play in and around the object built. The children themselves are the architects and engineers.

Ivanov explains that they came up with the concept while running their everyday business. This toy aside, Cleverland is a toy retailer and distributor – spending each day in a world of toys and seeing what is offered in catalogues or at fairs, they felt that something was missing. “There are some similar toys out there but nothing quite like this,” explains Ivanov. For example, there is a set of similar big blocks that children can assemble into a house or castle taller than the children themselves and that are big enough to play inside. But that is the limit of these toys: the house has a pre-designed form and there is not much room for variation. Ivanov, however, wanted to take it a step further and give the children more freedom. “We will also put the picture of a castle on one of our products, but the particular castle might be built just once,” says Ivanov. “The children can build something completely different with the same blocks, such as two smaller houses or a rocket perhaps.” The level of freedom might not be on par with Lego bricks, but it is a big step towards larger-than-life Lego-like building bricks. Children can assemble the blocks into anything they can think of.
The money of the innovation grant was used to pay Tallinn University for an assessment of the product. The university’s experts received the prototype blocks and had children assemble and play with the blocks. The experts observed and filmed the entire process. “At the beginning of 2010, we will have a meeting with the designers to discuss which modifications we can make based on the recommendations,” adds Ivanov. The designers of the toy are also Estonians and were found with the help of the Estonian Academy of Arts. Production – set to start in 2010 – will also be based in Estonia. “We won’t be making the blocks ourselves; production will be outsourced,” says Ivanov. The business was not established with just the Estonian market or even the three Baltic countries in mind. Cleverland’s CEO says that they want to target the largest markets in Europe.


Foldplast: a foldable plastic jug
The unique foldable plastic jug for milk bags is available at Estonian supermarkets since May 2009.

Two years ago, designer Veiko Liis from the Estonian Academy of Arts entered his concept of a “foldable jug” in a product design competition. “Afterwards, I happened to mention it among friends and we decided not to let the idea go to waste. We decided to turn it into a product,” says Dan Murumets, the CEO and a co-owner of the company OÜ Foldplast (Veiko Liis is also a co-owner of the company).
The foldable jug is made of special type of plastic, which tolerates bending and folding very well, and is intended for milk bags. “Our biggest rival is the ordinary plastic jug that is traditionally used for these plastic milk bags,” says Murumets.
The foldable jug is no longer just an innovative concept on paper. Since May, the jugs are sold at Estonian supermarkets (currently available at the Prisma and Selver stores) for EEK 24.90 a piece. The Selver supermarket chain purports to support and favour Estonian products, and their self-proclaimed mission was used as a lever to get the foldable jugs in stores. After all, it is an Estonian product through and through, from design to production. One of the biggest challenges in the development of the business is breaking into the big retail chains. The company has negotiated with other chains but there are no agreements yet. “The production is outsourced. Considering our current volumes, it would not be practical to set up our own production facilities,” says Murumets about the production process. The company is now also exporting to foldable jugs to Lithuania.
Despite the initial success, the Foldplast foldable jug cannot be considered a cash cow. The production runs are small and the production cost is relatively high. “All of us still have a day job apart from this business,” explains Murumets about his and his partners’ involvement in Foldplast.
The innovation grant (EEK 30,390) received from Enterprise Estonia was spent on the legal protection of the industrial design in the European Union and Ukraine.

De Crab: revolutional crab claws from Tartu
A unique machine manufacturing business is being established in Tartu – it is called De Crab.

“You must put your heart in the product,” says Valter Teppan, member of the board of OÜ De Crab, established last year in Tartu. It has great industrial potential, unseen in Estonia for quite some time – it means Estonian production, Estonian industry, Estonian product development, Estonian machines.
The company’s name – De Crab – hints at the area of activity. De Crab is developing a hydraulic claw-like attachment for excavators, tractors and loaders. It can be used, for example, to crush reinforced concrete or compress different materials. The photo shows the prototype in action. First, there is an ordinary tractor (not produced by De Crab, of course). The yellow part attached to the tractor is De Crab’s most valuable and complicated part, as it contains the protected and patented elements. At the very end there is the black claw-like “beak”. “This is a changeable attachment,” explains Teppan. It can be changed depending on the task to be carried out (crushing or bending or compressing).
Fortunately, De Crab did not have to start from scratch. The De Crab attachment is based on equipment developed many years ago by Finnish man Martti Veijo Johannes Könönen, one of the company’s co-owners. “It is no longer feasible to manufacture or develop products in Finland,” adds Teppan.
The De Crab prototype is finished and fully functional. Next, the company will make a sample product, and then produce a test batch. At the end of spring, the company will showcase the sample product at the huge Bauma construction and mining machinery fair in Germany. According to Teppan, their goal is to keep the production cost of one item below one million kroons. Most of the work so far has been financed from the company’s own pocket. The company has already completed negotiations with two clients in Estonia. Teppan says that they plan to use the funds from these two sales for the production of the next orders, as a step-by-step progress. It would take a lot of money to set up large-scale production of machines in Estonia. “I don’t even think there would be such funds available in Estonia at the moment,” says Teppan. But he believes in this product. A certain passion can be detected in his voice. What is more, tests with the De Crab have been successful, and it has been promoted to customers as far as in the USA. “American customers have requested a hundred attachments, but they don’t seem to grasp the capacity and means of an Estonian business,” adds Teppan.
The EEK 30,544 innovation grant, provided by Enterprise Estonia, was used to research the patenting of similar equipment.