Incubation

1. Incubation History, concepts, services …

2.  New Venture Creation Process Options to Support Venture Creation Incubation: Characteristics, Benefits, Risks Partnerships for Successful Incubation EU Policy Context: Network and Programs

3. Principle of entrepreneurship Goal: The creation of value for company, employees, customers, stock-holders and society The Entrepreneur: Links the innovation giver to the taker Target rapid growth > 20-30% + a year in revenue & staff Focuses on Management / Market / Money For the entrepreneur: Happiness is Positive Cash Flow and the satisfaction of meeting societal needs Characteristics: Innovative, Goal-Oriented, Independent, with Vision and Tenacity Markets do not create entrepreneurs – they create opportunity which the entrepreneur can sense and respond

4. What are the main problems of starting & growing an enterprise ? Typically, in many situations: Bureaucratic regulations. Not a “level playing field” Poor understanding of entrepreneur needs Inadequate management and marketing skills Lack of finance-credit, venture or angel capital Limited access to information and technology Difficulty in mobilizing a complete skills-set Little interest in training, quality, IPR “Clan-mentality” , lack of trust, cultural constraints Inability to look towards global markets Support services, such as business incubators, can help new ventures, to start, survive and succeed as “modern, innovative SMEs”

5. Venture Creation & Growth

6. Partnership for Innovation Design the National Innovation System as a public/-private partnership, with focus on innovation and empowerment Formulate policies to reduce regulations, enhance creativity Invest in Knowledge & Infrastructure: S & T education, R & D, vocational training, Entre’ship Development, consultant services. Stimulate competition and rivalry both at home and abroad, to promote manufactures, quality, productivity, and exports Build networks & strategic partnerships for technology & trade, out sourcing of services and production in supply chain Facilitate linkages to university, finance, services, state agencies Scientific research and its commercialization can enhance access to a variety of assets for all communities

7. Options for business support model to suit local conditions Small Business Development Center or “Incubator without walls” in special situations Business Incubator to serve as knowledge hub with satellite centers, to nurture entrepreneurs start and succeed with their technical and social innovations E-incubation to use the potential of ICT for distance counseling through web portal International Business Incubator designed to serve foreign firms and facilitate entry into complex markets Industrial cluster to mobilize competitive advantage and stimulate cooperation for competition

8. Evolution of the incubator model

9. Approaches towards new models Split incubation (process) vs incubators (fixed place) Radiate virtual services from a fixed physical hub Encourage in-person interaction but not under one roof Deal with community as a cluster, not as individuals Promote peer guarantees, cooperative ventures Links with peers who have relevant experience Learn from experience of Micro-Credit, Micro-Equity, Vouchers Blend advanced technology with traditional knowledge Leverage ICT to bring incubation to incubatee, not vice-versa Internet kiosks in remote areas Push informal entrepreneurs up the value Based on local materials, skills, products, markets

10. Technology business incubation ? Technology Business Incubation (TBI) is process that accelerates the development of selected young companies in knowledge-based products and services It must provide value adding business support services, both in the TBI and trough networks of professionals. It also offers workspace and shared office facilities Prerequisites to start a TBI: market feasibility analyses & business plan, with clear objectives & key parameters The process is guided by a governing board and served by a trained management team, with involvement of public-private partners for the overall benefit of the community The path sustainability starts from Day-One

11. Characteristics of incubation Business model, mission & objectives to meet sponsor needs and local conditions Rigorous entrepreneur entry and exit processes Selection to assess entrepreneur quality, market, resources, innovation Advisory, Mentoring, Facilitation Services Basic assistance by staff + Access to networks of external services from professionals, university, corps Flexible Workspace and Shared Facilities conference rooms, office equipment, IT… Access to capital: angel investors, venture capital funds, banks

12. Characteristics of incubation Good location in business infrastructure Functional building. Layout design for active people-flow, smart IT Sustainability Continuous Monitoring of Incubators & Clients, to help move towards plan objectives and milestones Strategic National & International Alliances, to participate in incubator community & global supply chain

13. Incubation has its limitations Elitist – caters only to potential “winners” depends on government – in policy, initial funding Limited outreach, expensive – few ventures per cycle Skills-intensive- requires strong management Poor at generating jobs – but creates good ones Creates dependency – shelters the entrepreneur …. But incubators are growing due to their special features: One-stop facility to provide counsel, skills, facilities Networking to mobilize services, mentoring, finance Facilitation to tackle regulations, enter markets Space/shared facilities at reasonable, flexible terms

14. Myths about incubators Incubation is a simple concept, easy to implement The incubator is a building with shared facilities Incubators make money Incubators rapidly create employment Incubators create dependency, as in babies & chicks

15. TechPark-Academia-R&D Linkage

16. EU Policy context: Programs and Contexts 1/3 The EU started supporting the development of incubators in mid1980s as part of its regional policy. Since then around 150 organizations assisted Whilst initially EU focused on establishing incubators in ‘lagging’ regions, in recent years it works more on incubators as support for high knowledge-intensive start-ups as part of the ‘Lisbon Agenda’. EU programs providing assistance to incubators the European Regional Development Fund (ERDF), European Social Fund (ESF) mainly for training, Leonardo Programme Sixth R&D Framework Programme, and others

17. EU Policy context: Programs and Contexts 2/3 EU provides grant aid to cover a proportion of capital and operation costs. Other EU programmes in the field of risk capital financing help incubator tenants. The new Structural Fund guidelines for the 2008-13 period place even more emphasis on business incubation as an instrument of regional development, entrepreneurship, cluster formation, and competitiveness generally. EU also supports benchmarking and best practice

18. EU Policy context: Programs and Contexts 3/3 EU-wide support networks: EBN ( European Business & Innovation Centre Network), ‘Gates to Growth’, and ‘Science Alliance’. National associations: France, Germany, UK Key priority: support incubator developments in the 10 new EU member states

19.  New Venture Creation Process Options to Support Venture Creation Incubation: Characteristics, Benefits, Risks Partnerships for Successful Incubation EU Policy Context: Network and Programs