Sustaining Design Entrepreneurship, Is It That Different? A Visual Analysis - Cumulius 2015 conference
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In recent years, the phenomenon of design-driven entrepreneurship began to take off, especially following the 2008 economic recession. In response to this phenomenon, many design schools launched design entrepreneurship support organizations, such as incubators and accelerators, to encourage and sustain entrepreneurial activities. However, it is not clear if these organizations are any different from existing entrepreneurship support formats and if they address specific needs of design entrepreneurs that other support organizations cannot satisfy. Although there is an abundant literature on support organizations and services for entrepreneurs, design-specific versions have not received much attention because their existence is quite recent and they are still very few in number. To establish if there were any differences in the offerings and characteristics of both sets of actors, twenty-one case studies of different support organizations were analyzed and the features of their offering were mapped graphically. Approximately half of the cases analyzed targeted design entrepreneurs specifically and half of them did not. The results show design specific actors have many common factors with standard entrepreneurship support organizations and very little differences. This issue may be a concern for those intending to open design specific support organizations, design entrepreneurs, design schools and creative-industries policy makers
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Sustaining Design Entrepreneurship, Is It That Different? A Visual Analysis - Cumulius 2015 conference
- 1. SUSTAINING DESIGN ENTREPRENEURSHIP, IS IT THAT DIFFERENT? A VISUAL ANALYSIS Laura Mata García. Design Department. Alumna Cumulus 2015 Milan, Italy The Virtuous Circle. June 4th, 2015
- 2. 2/18 DESIGNERS ARE EMBRACING ENTREPRENEURSHIP
- 3. 3/18 SUPPORT INSTITUTIONS SPECIFIC TO SUPPORT THEM ARE BEING CREATED
- 4. 4/18 RELEVANT IN A POST-RECESSION ECONOMY WITH HIGH YOUTH UNEMPLOYMENT Source: Thomson Reuters Datastream, Eurostat Reuters graphic/Scott Barber 4/2/2012 92 94 96 98 00 02 04 06 08 10 12 50 40 30 20 10 0 Euro Introduced Lehman Collapse Unemployment rate - under 25 year olds% Spain 50.5 Greece 50.4 Portugal 35.4 Italy 31.9 Ireland 31.6 UK 23.5 France 21.7 Germany 8.2
- 5. 5/18 ...IN WHICH NEW JOBS ARE CREATED MOSTLY BY NEW FIRMS AND EXISTING ONES DESTROY THEM Net Job Change - Start-ups Net Job Change - Existing Firms Source: Business Dynamics Statistics, Tim Kane 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 -1,000,000 -2,000,000 -3,000,000 -4,000,000 -5,000,000 0 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005
- 6. 6/18 HYPOTHESIS • Are design-specific support organizations different from their “generic” counterparts? • If so, how are they different? If design entrepreneurs are different and have different needs from entrepreneurs with other backgrounds, then, support systems that target them will consequently offer special services and features or even different formats to address their specific needs. RESEARCH QUESTIONS
- 7. 7/18 METHODOLOGY • Visual mapping of 21 case studies to visualize the features and services they offer and have an immediate glance of their format and offering. • 11 that cater specifically to design entrepreneurs and 10 that do not. • The visualization is made of 6 macro-sections of the common elements or “building blocks” of entrepreneurship support systems: Learn, Network, Invest, Time, People and Share.
- 8. 8/18 METHODOLOGY • Learn: Providing some kind of formal training in business- related subjects, technology and legal aspects • Network: Promoting networking between tenants. • Share: Sharing facilities and expensive professional equipment. • Invest: Connecting tenants with investors or investing directly in the ventures. • People: Targeting founders of specific professional backgrounds. • Time: Duration of the program with or without a graduation date. Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months•
- 9. 9/18 RESULTS: FORMATS OF SUPPORT ORGANIZATIONS • Almost none of the design-specific case studies fit exactly into a rigid model. • Design-oriented incubators are the most popular format, and a big part of their offering still is the rent of space, the sharing of expensive or specialized equipment. • Design accelerators tend to be a mix of hardware accelerators and business incubators. • Design-oriented co-working spaces, focus on the affordable sharing of facilities and expensive equipment and networking possibilities between the tenants.
- 10. 10/18 RESULTS: APPROACH TO DESIGN BUSINESS OFFERING DESIGN BUSINESS STRATEGY BUSINESS IDEA Most design-oriented organizations approach design putting it at the core of the business offering, it is embedded either: • In the objects they sell (furniture, jewelry, clothing, fashion accessories) or, • In the services they provide (professional design services). • Some of them encourage designers to embrace tech entrepreneurship and start an ICT-based venture.
- 11. 11/18 RESULTS: TACKLING DIFFERENT PHASES OF THE ENTREPRENEURIAL PROCESS Most organizations (both design-oriented or not) tackle different phases of the entrepreneurial process .However, none of them tackles its earliest phase: the opportunity identification phase.
- 12. 12/18 RESULTS: MAIN CRITICAL POINT OF THE DESIGN-SPECIFIC SUPPORT ORGANIZATIONS • The largest gap in the system is in the INVEST area. Most design-oriented incubators, coworking spaces and the like do not grant any seed capital or financial support. • Overall, there are almost no differences between non-design specific organizations and those that do target designers specifically. • The differences they present are actually negative; they offer fewer services, such as less access to networks of investors and seed funding. • The main added value they offer to design entrepreneurs is the access to expensive shared equipment (3D printers, laser cutters, sewing machines), etc. and business mentoring from industry experts to bridge the cognitive gap design entrepreneurs have in business and management topics.
- 13. 13/18 COMPARISON OF THE TWO SETS OF CASE STUDIES: GENERAL ENTREPRENEURSHIP SUPPORT ORGANIZATIONS Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• AALTO ENTREPRENEURSHIP SOCIETY Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• BOLT Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• GENERAL ASSEMBLY Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• LA COCINA Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• HAXLR8R Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• HIGH TECH (NETHERLANDS) Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• TECHSTARS Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• Y-COMBINATOR Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• LEMMOS LABS Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• DREAM IT VENTURES Design Specific Networking MentoringEarlySeedCapital Ve ntureCapital Long/ShortTerm Founders’Backgr ound OfficeSpaceSpecializedEquipment Busi ness Admin. Related N ETW ORKINVEST TIME PEOPLE SHARE LEARN Electronic Protyping Systems • IndefinteTimeframe• 1-3months• 3-6months• 6+months• IMPACT HUB
- 14. 14/18 COMPARISON OF THE TWO SETS OF CASE STUDIES: DESIGN-SPECIFIC SUPPORT ORGANIZATIONS
- 15. 15/18 CONCLUSIONS In general all design-oriented actors share most of these objectives: • To reduce the risk of business failure for designers by mentoring, screening and giving constructive feedback. • To enable collaboration and networking among the different actors involved in the creation of the new venture. • To reduce start-up costs by giving access to shared facilities like office space, shop equipment, etc. • To bridge the cognitive gaps of founders in the various areas of knowledge necessary to start up and run a business (e.g. providing business training to designers)
- 16. 16/18 CONCLUSIONS Areas of opportunity for enriching the design entrepreneurship support system are: • Encouraging the use of design at a more strategic level. • Tackling the opportunity identification phase (a fundamental phase of the entrepreneurial process that is often overlooked). • Facilitating (or providing) access to funding for design-driven startups • Helping designers scale their business models.
- 17. 17/18 • How to overcome the heavy dependence of the venture on the designer founders’ personal and professional skills in order to avoid the problems this poses for the scalability and long-term life of the venture. • How design could be used at a more strategic level when creating new ventures shifting away the emphasis on the tangible products that has characterized the discourse on design entrepreneurship until now AREAS OF FUTURE RESEARCH