Innovation Incubators


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  • Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010
  • Since 1959, thousands of small or midsize enterprises have come to the Batavia Industrial Center for the opportunity to see their dreams get started and
  • Source – InfoDev Asia Workshop 2006
  • Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010Graduation: Expansion
  • Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010Graduation: Expansion
  • Product developmentProof of concept developmentTechnology readiness
  • Innovation Incubators

    1. 1. Jamil Alkhatib
    2. 2. “ Incubation is one of the single most important global innovations of the 21st Century…” Jiang Zemin Chinese President 1993-2003
    3. 3.
    4. 4. Incubation <ul><li>The physical location where the incubation process take place </li></ul><ul><li>Offers defined set of services </li></ul><ul><ul><li>to individuals </li></ul></ul><ul><ul><li>or small companies </li></ul></ul>Incubator Incubation is a process which tends to be activated whenever there is a need to support entrepreneurs in developing their own business. (Source: EBN European Business Innovation Centers Network)
    5. 5. General Incubator System
    6. 6.
    7. 7. History of Incubation Concept *
    8. 8. Geographic Distribution of Incubators
    9. 9.
    10. 10. Research Invention New Business Viable Business “ Valley of Death” Incubator Bridge Lack of Capital Lack of Skills Incubator Role “Bridge over the Valley of Death” <ul><li>The Incubator is about </li></ul><ul><li>People (culture) </li></ul><ul><li>Process </li></ul><ul><li>Partnerships </li></ul><ul><li>Prosperity </li></ul><ul><li>Services </li></ul><ul><li>Incubator Tools </li></ul><ul><li>Programmes </li></ul><ul><li>Projects </li></ul><ul><li>Property </li></ul><ul><li>Infrastructure </li></ul><ul><li>Investment </li></ul>
    11. 11. Startups status <ul><li>66% of new startups in the US still in existence 2 years after their birth </li></ul><ul><li>44% were still in existence 4 years after </li></ul>Source: Survival & Longevity in the Business Employment Dynamics Database&quot; Amy E. Knaup, Monthly Labor Review, (May05)
    12. 12. Why Innovation Incubation? <ul><li>Lack of experience </li></ul><ul><li>Lack of management skills </li></ul><ul><li>Lack of professional networking </li></ul><ul><li>Lack of focus on business </li></ul><ul><li>Lack of investment chances </li></ul><ul><li>Lack of lack of exposure to experts and support programs </li></ul><ul><li>Lack of proper work environment for innovation </li></ul><ul><li>Lack of proper technical infrastructure (labs, IT tools, etc.) </li></ul>
    13. 13.
    14. 14. Incubators different Roles
    15. 15. Innovators and Entrepreneurs <ul><li>Technology commercialization </li></ul><ul><li>Accelerate the development of new technologies </li></ul><ul><li>Access to investment opportunities </li></ul><ul><li>Maximize the probability of success of startups by </li></ul><ul><ul><li>reducing risks and </li></ul></ul><ul><ul><li>increasing knowledge </li></ul></ul><ul><ul><li>and investment opportunities </li></ul></ul>
    16. 16. Incubators Role in the Economy <ul><li>Creating jobs and wealth </li></ul><ul><li>Building or accelerating growth of local industry clusters </li></ul><ul><li>Business creation and retention </li></ul><ul><li>Foster innovation culture within the community </li></ul><ul><li>Enhance links between universities and businesses </li></ul>
    17. 17. Large companies <ul><li>Identifying potential spin-out business opportunities </li></ul><ul><li>Access to innvations </li></ul><ul><li>Foster innovation culture </li></ul><ul><li>Risk minimization of new technologies </li></ul><ul><li>Isolate highly innovative projects (Spin-out) </li></ul>
    18. 18. Investors and VCs <ul><li>Support small firms with high growth potential </li></ul><ul><li>Identify investment opportunities </li></ul><ul><li>Risk Minimization and Increase the return on investment opportunities through </li></ul><ul><ul><li>well screened and </li></ul></ul><ul><ul><li>assessed Technology Startups </li></ul></ul>
    19. 19.
    20. 20. Before we start <ul><li>Incubator objective must be clearly defined </li></ul><ul><li>The Incubator Model has to be selected </li></ul>
    21. 21. Incubators’ Models
    22. 23. Incubation Process and Services Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010
    23. 24.
    24. 25. Incubator Location <ul><li>Where Jobs creation is needed </li></ul><ul><li>Close to Universities & Research centers </li></ul><ul><li>Close to International Technology Companies concentration area </li></ul><ul><li>In Accessible area for most Cities </li></ul><ul><li>In good ICT Infrastructure area </li></ul>
    25. 26. The Physical Infrastructure Consists of Sample floor plan <ul><li>The Space Should </li></ul><ul><li>Be flexible & Modular </li></ul><ul><li>Be suitable for work day & night </li></ul><ul><li>Support ease of interaction </li></ul>Library Meeting Room Kitchen Adequate parking/ Transportation system ICT Lab <ul><ul><li>Management &Tenants Offices & Reception </li></ul></ul>
    26. 27.
    27. 28. Main Services Office Space & Infrastructure Networking / Experience Exchange Entrepreneurs Shared Internet & Facilities Access to Sources of Funds Mentoring / Training
    28. 29. Pre-Incubation Services Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010
    29. 30. Incubation Services Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010
    30. 31.
    31. 32. General Categories of Expenses Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010
    32. 33. Rental Model
    33. 34. Success Sharing Model
    34. 35. Other Income Sources Source: EBN : The Smart Guide to Innovation-Based Incubators (IBI) Feb 2010
    35. 36.
    36. 37. Incubators’ Staff <ul><li>Incubators have very small staffs </li></ul><ul><li>Role of key people provide: </li></ul><ul><ul><li>Guidance </li></ul></ul><ul><ul><li>Monitoring </li></ul></ul><ul><ul><li>Evaluation </li></ul></ul><ul><ul><li>Suggestions and transform </li></ul></ul><ul><ul><li>ideas into successful businesses </li></ul></ul>Source : EBN observatory report Incubator size (No. of employees)
    37. 38. Incubator Manager <ul><li>Dynamic manager </li></ul><ul><li>Must be entrepreneurs in their own incubator </li></ul><ul><li>Business expertise </li></ul><ul><li>Shared Resources utilization </li></ul><ul><li>Management consulting services experience </li></ul><ul><li>Role </li></ul><ul><ul><li>attracting the right tenants </li></ul></ul><ul><ul><li>enforcing an appropriate set of operational rules </li></ul></ul><ul><ul><li>assisting the tenants as their businesses develop, </li></ul></ul><ul><ul><li>understand problems facing a tenant, </li></ul></ul><ul><ul><li>Business plan…… Locating sources of Capital </li></ul></ul><ul><ul><li>Encourages networking (Internally and Externally) </li></ul></ul>Source: A Business Incubator: Operating Environment and Measurement of Economic and Fiscal Impacts, Deborah M. Markley and Kevin T. McNamara
    38. 39.
    39. 40. Measures <ul><li>The success of any incubator must be evaluated in relation to its objective </li></ul><ul><li>General measures can be: </li></ul><ul><ul><li>Jobs created (Quantity & Quality) </li></ul></ul><ul><ul><li>No. of tenants and graduates </li></ul></ul><ul><ul><li>No. of product innovation </li></ul></ul><ul><ul><li>No. of new business starts </li></ul></ul><ul><ul><li>Success rates of incubator firms, </li></ul></ul><ul><ul><li>Impact on local development (benefit/cost analysis) </li></ul></ul>
    40. 41. Quality System <ul><li>European Business Innovation Centres Network (EBN) </li></ul><ul><ul><li>Mission </li></ul></ul><ul><ul><li>Organisation </li></ul></ul><ul><ul><li>Services </li></ul></ul><ul><ul><li>Performance </li></ul></ul><ul><ul><li>Quality </li></ul></ul>
    41. 42.
    42. 43. Imperial Innovations Group Sunday 15 August 2010 Project Pipeline Project Development Investment Build Relationships Invention Disclosure & Commercial assessment Validation of Market Need Spin-out Pre-Seed Seed and Incubation Post Seed and Exit <ul><li>Visit universities and other R&D centres </li></ul><ul><li>Engage with inventors </li></ul><ul><li>IP Strategy </li></ul><ul><li>Technology readiness </li></ul><ul><li>Market need </li></ul><ul><li>Product development needs </li></ul><ul><li>Engage with commercial partners </li></ul><ul><li>Proof of Concept </li></ul><ul><li>Market intelligence </li></ul><ul><li>EiR </li></ul><ul><li>Develop business plan </li></ul><ul><li>Seed investment Review </li></ul><ul><li>Company formation </li></ul><ul><li>Management team </li></ul><ul><li>Premises and services </li></ul><ul><li>Series A+ investment assessment </li></ul><ul><li>Management team development </li></ul><ul><li>Valuation and deal structure </li></ul><ul><li>Exit? </li></ul>Licence Marketing Negotiation Licence Management <ul><li>Identify and engage with potential licensees </li></ul><ul><li>Structure deal terms </li></ul><ul><li>Close the deal </li></ul><ul><li>Monitor licensee obligations </li></ul><ul><li>Distribute revenue share commitments </li></ul>
    43. 44. <ul><ul><li>Over 3.000 operational business incubators, of which 30% in Europe </li></ul></ul><ul><ul><li>EBN is now the leading non-governmental pan-European BIC network </li></ul></ul><ul><ul><li>Over 240 members in EBN including 155 BICs full members and 75 associate members in the 27 E.U. Member states and in 11 other countries (Central and Eastern Europe, Turkey, Canada, USA, Egypt, China…). </li></ul></ul><ul><ul><li>The EBN Quality System agreed as part of the trademark licencing contract with DG Enterprise and DG Region protects the integrity of the EC-BIC trademark </li></ul></ul>
    44. 45. Incubators Networks <ul><li>UKBI </li></ul><ul><li>EBN </li></ul><ul><li>NBIA </li></ul><ul><li>InfoDev </li></ul>
    45. 46. Thank you for your attention <ul><li>Jamil Alkhatib </li></ul><ul><li>[email_address] </li></ul>