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Business Incubation System (Mot masters research project report )


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Business Incubation System (Mot masters research project report )

  1. 1. Nile University MOT Masters Program Business Incubation Research Project Report This document represents a research project report submitted to Nile University, Management of Technology Masters Program. It presents a research project conducted on business incubation systems, their international best practices in design and management, and the role of science and technology policies to build the supporting ecosystem. Submitted To: Dr. Tarek Khalil Acting President and NU Provost Head of Management of Technology Graduate School Submitted by: Tarek Salah Kamel th Document Ver. 1, Wednesday, 24 of June 2009
  3. 3. MOT Research Project ReportEXECUTIVE SUMMARY This research project report presents a research work done at Nile University about business incubation systems. The research studied local entrepreneurship and incubation systems in Egypt, then international best practices of incubation systems design and management, then conducted a field research study at the University of Central Florida Business Incubation Program (UCFBIP). This was followed by a survey research on science and technology (S&T) policy development in many countries to build the supporting ecosystem for business incubation programs. A gap analysis is identified relating to best practices of incubation management systems and the surrounding supporting national innovation system in Egypt. These results are followed by an introduction to the Science and Technology (S&T) Policy to outline specific recommendations that are needed to effectively build best practice business incubation systems in Egypt. The main conclusions of that research are that:  Business incubation systems are effective tools for economic development, increasing employment, and technology commercialization; hence should be viewed within a whole Small and Medium Enterprises (SMEs) business support national strategy.  Business incubators cannot graduate sustainable high-growth firms without effective integration with other components of a mature National Innovation System (NIS), which needs to be built and improved as outlined in the research and as identified in the gap analysis. The national S&T policy is the formal tool to identify and build the national innovation system.  Specific societal model components must be studied and taken into consideration in order to forecast the expected outcome of a proposed incubation system and in order to set the right policies and procedures that enable it to effectively interact with its surrounding business, research, and governmental environment.3|P a g e
  4. 4. MOT Research Project ReportRESEARCH METHODOLOGYRESEARCH PROBLEM: Business incubation programs are attaining a growing interest in the Arab World and in Egypt, and are viewed mostly as economic development tools for job creation and technology development through the graduation of sustainable SMEs. In this regard, can these incubation programs be effective in their mission independently or they need to be immersed and interconnected to a whole National Innovation System (NIS), influenced by a National S&T Policy, that supports entrepreneurship, innovation and technology development and commercialization?RESEARCH APPROACH: The research intends to answer the following questions:  What is the role of business incubators in economic development? And what are the best practices such systems should adopt?  What supporting ecosystem environment should be in place for these systems?  How Science and Technology (S&T) Policy within developing countries should influence building that needed ecosystem? To answer these questions, the following research process was followed: 1. Conduct a survey research on incubation and entrepreneurship support systems in Egypt. 2. Conduct a desktop study research on international incubation systems. 3. Conduct a field study research at the University of Central Florida Business Incubation Program (UCFBIP) in the US for 1 month. 4. Specify a gap analysis on business incubation programs 5. Survey different national S&T policies and trends and challenges in S&T policy development. 6. Conclude with S&T policy recommendations for supporting incubation systems in Egypt. The outline of this process can viewed through the following graph.4|P a g e
  5. 5. MOT Research Project Report Figure 1: Research Approach5|P a g e
  6. 6. MOT Research Project ReportINTRODUCTION Business incubators are proven tools for creating jobs, encouraging technology transfer and starting new sustainable businesses. Set up to assist in the growth and development of new enterprises; there are currently about 4,000 business incubators worldwide, with around 1100 in North America alone [1]. The incubation model has been adapted to meet a variety of needs, from fostering commercialization of university technologies to increasing employment in economically distressed communities to serving as investment vehicles. Most business incubation programs are set up to produce companies that create jobs and wealth in their communities. Business incubators nurture the development of entrepreneurial companies, helping them survive and grow during the start-up period, when they are most vulnerable. According to the National Business Incubation Agency (NBIA) 2006 report on the state of business incubation industry; in 2005 alone, it‘s estimated that North American incubators assisted more than 27,000 startup companies that provided full-time employment for more than 100,000 workers and generated annual revenue of more than $17B [1] Business incubators are characterized by the following [1]:  Business incubation is a Business Support Process that accelerates the successful development of start-up and fledgling companies by providing entrepreneurs with an array of targeted resources and services.  These services are usually developed or orchestrated by incubator management and offered both in the business incubator and through its network of partners.  A business incubator‘s main goal is to produce successful firms that will leave the program financially viable and freestanding.  These incubator graduates have the potential to create jobs, revitalize neighborhoods, commercialize new technologies, and strengthen local and national economies.  Business incubators reduce the risk of small business failures.6|P a g e
  7. 7. MOT Research Project ReportBENEFITS OF BUSINESS INCUBATORS The benefits of a well-managed incubation program can be many-fold for different stakeholders [4]:  For tenants, it enhances the chances of success, raises credibility, helps improve skills, creates synergy among client-firms and facilitates access to mentors, information and seed capital.  For governments, the incubator helps overcome market failures, promotes regional development, generates jobs, incomes and taxes, and becomes a demonstration of the political commitment to small businesses,  For research institutes and universities, the incubator helps strengthen interactions between university-research-industry, promotes research commercialization, and gives opportunities for faculty/graduate students to better utilize their capabilities,  For the business, the incubator can develop opportunities for acquiring innovations, supply chain management and spin-offs, and helps them meet their social responsibilities.  For the local community: it creates self-esteem and an entrepreneurial culture, together with local incomes as a majority of graduating businesses stay within the area.  For the international community: it generates opportunities for trade and technology transfer between client companies and their host incubators; leading to a better understanding of business culture, and facilitated exchanges of experience through associations and alliances. These are the desired outcomes, often not achieved due to poor management and other factors. Emerging evidence, nevertheless, suggests that in many situations the benefits indicated above are realizable and out-weigh the net public funding. National Business Incubation Agency (NBIA) has developed interesting statistics about business incubation programs in the US [13]:  Historically, NBIA member incubators have reported that 87% of all firms that have graduated from their incubators are still in business.  1,100 business incubation programs were operating in North America in early 20067|P a g e
  8. 8. MOT Research Project Report  NBIA estimates that in 2005 alone, North American incubators assisted more than 27,000 start-up companies that provided full-time employment for more than 100,000 workers and generated annual revenue of more than $17 billion.  NBIA estimates that North American incubator client and graduate companies have created about half a million jobs since 1980. That is enough jobs to employ every person living in Denver, Colorado.  Every 50 jobs created by an incubator client generate approximately 25 more jobs in the same community.  Research has shown that for every $1 of estimated public operating funding provided; the incubator clients and graduates of NBIA member incubators generate approximately $30 in local tax revenue alone.  NBIA members have reported that 84% of incubator graduates stay in their communities and continue to provide a return to their investors.  Publicly supported incubators create jobs at a cost of about $1,100 each, whereas other publicly supported job creation mechanisms cost more than $10,000 per job created.8|P a g e
  9. 9. MOT Research Project ReportCONCEPT EVOLUTION AND DEFINITIONS In its generic sense, the term business incubator is often used to describe a wide range of organizations that in one way or another help entrepreneurs develop their ideas from inception to commercialization, and the launching of a new enterprise. A broad definition of the term embraces technology centers and science park incubators, business and innovation centers, organizations which have no single physical location and concentrate instead on managing a network of enterprise support services (incubators without walls), so-called ‗new economy‘ incubators, and a variety of other models [3]. The evolution of the business incubator concept is summarized in Figure 2: Figure 2: Evolution of the Business Incubator Model The origins of business incubators can be traced back to Western industrialized countries in the late 1970s and early 1980s. Faced with a rapid rise in unemployment resulting from the collapse of traditional industries, it was recognized in both Europe and the USA that fresh strategies were needed to help regenerate crisis sectors, regions and communities. Strategies pursued in the 1980s were broadly characterized by a switch in emphasis from a top-down approach relying on exogenous factors and involving public intervention to transfer surplus mobile capital and jobs from developed to underdeveloped or declining regions, to a bottom-up approach focusing on maximizing the indigenous potential for economic development. At the same time, business incubators began to be9|P a g e
  10. 10. MOT Research Project Report used as instruments to support innovation and technology transfer [3]. Following are various definitions for such entities: 1998 Helsinki Workshop (Physical Aspects Emphasis) A place where newly created firms are concentrated in a limited space. Its aim is to improve the chance of growth and rate of survival of these firms by providing them with a modular building with common facilities (telefax, computing facilities, etc.) as well as with managerial support and back-up services. The main emphasis is on local development and job creation. NBIA (More than Physical Aspects) Business incubation is a dynamic process of business enterprise development. Incubators nurture young firms, helping them to survive and grow during the start-up period when they are most vulnerable. Incubators provide hands-on management assistance, access to financing and orchestrated exposure to critical business or technical support services. They also offer entrepreneurial firms shared office services, access to equipment, flexible leases and expandable space — all under one roof UK Business Incubation (UKBI) (3 additional Aspects) Business Incubation is a dynamic business development process. It is a term which covers a wide variety of processes which help to reduce the failure rate of early stage companies and speed the growth of companies which have the potential to become substantial generators of employment and wealth. A business incubator is usually a property with small work units which provide an instructive and supportive environment to entrepreneurs at start-up and during the early stages of businesses. Incubators provide three main ingredients for growing successful businesses - an entrepreneurial and learning environment, ready access to mentors and investors, visibility in the marketplace ELAN (No Emphasis on Physical Attributes) The European Community Business and Innovation Centers (EC BICs) – as they are officially known – are support organizations for innovative small and medium-sized businesses (SMEs) and entrepreneurs. Operating in the public interest, they are set up by the principal economic operators in an area or region, in order to offer a range of integrated guidance and support services for projects carried out by innovative SMEs, thereby contributing to regional and local development.10 | P a g e
  11. 11. MOT Research Project ReportBUSINESS INCUBATION SERVICES There are many services that modern technology incubator programs offer for their tenants, which can be extracted from the survey conducted in most international incubator services such as: University of Central Florida Technology Incubator (UCFTI), Technopolis Finland, The UK Business Incubator, European Business Incubators Benchmarks and NBIA Business Incubation Reports [3-7]. These services can be summarized as follows: These set of services can be grouped into three main growth phases for a startup, which are: 1. Pre-Incubation services, 2. Incubation services & 3. Post-Incubation services Exhibit 1 shows the results of a benchmarking study of business incubation services for the EU and US [8,9]. Other key elements of business incubation environments are shown for France & UK in Exhibit 2 [10,11]. Exhibit3 shows sample process for Technopolis Finland, which is considered one of the very successful incubation programs in Europe.11 | P a g e
  12. 12. MOT Research Project ReportBUSINESS INCUBATION PROGRAMS BEST PRACTICES Following are some best practices and guidelines that should be taken into consideration in designing a business incubation program [15]:  Comprehensive Business Assistance Programs A. Needs Assessment:  Develop and implement a systematic process for assessing client needs that has the flexibility to adapt to the changing environment surroundings.  Assess needs prior to accepting a business into the incubator and on a continual basis after it has entered the program. B. Coaching and Facilitation:  Dedicate sufficient staff time to meet with clients on a regular basis.  Allow Clients to make decisions and to complete tasks.  Provide oversight and support as clients use program resources. C. Monitoring Client Progress  Develop milestones for each client company designed to meet the specific goals of the client and the incubator  Develop and implement a systematic process for monitoring the clients progress in meeting milestones.  Utilize monitoring process to modify the service package offered to clients.  Utilize monitoring process to graduate clients form the program, once they‘ve reached the exit condition level outlined in your policy, whether it was based on amount of revenue, number of employees, or number of customers.12 | P a g e
  13. 13. MOT Research Project Report  Professional Infrastructure A. Know How Networks:  Develop a board-based pool of individual advisors from the private and academic sectors and ensure they have the technical and business skills needed to support clients businesses in various stages.  Establish a large enough pool of advisors to minimize the impact on a specific provider, especially if services are provided on a pro-bono (for the public good) basis.  Limit Exclusive arrangements with individual service providers to ensure that appropriate services are available to meet client needs on a quality basis.  Negotiate a fee structure to minimize the financial impact on the client (Example include pro-bono services, services in exchange for equity and services with deferred payment until equity capital is secured).  Facilitate the interaction between service provider and the client.  Screen Service providers and establish a feedback mechanism to assess client progress and satisfaction. B. Mentors:  Develop a pool of volunteers willing to serve as mentors for clients. Identify mentors who have been involved in actual business operations in the appropriate industries at various stages of the development process from proof-of-concept to initial public offering and/or acquisition.  Ensure that mentors meet with the clients according to a regular schedule.  Meet with mentors periodically to monitor client progress and identify additional needs.  Screen mentors and establish a feedback mechanism to assess client satisfaction. C. Advisory Boards:  Develop a pool of professionals, technologists, business owners and others willing to volunteer their services as advisory board members for clients. Seek individuals who have experience in the appropriate industries at various stages of the development process from proof-of-concept to initial public offerings and/or acquisition.  Ensure that advisory boards meet with clients according to a regular schedule.13 | P a g e
  14. 14. MOT Research Project Report  Meet with advisory boards periodically to monitor client progress and identify additional needs.  Screen advisory board members and establish a feedback mechanism to assess client satisfaction.  Client Capitalization and Financing A. Provide access to debt and equity capital to launch and sustain the growth of clients and train clients on requirements for obtaining financing. B. Establish linkages with ―angel investors,‖ venture capitals (VCs) and corporate equity investors through capital networks, brokers and personal contacts. C. Consider creating in-house equity and debt funds to seed a deal and to fill financing gaps. D. Create relationships with corporations that are willing to provide services (such as product development, manufacturing, sales & distribution for clients in the incubator in lieu of capital.  Client Networking A. Proactively encourage client networking to establish and sustain the incubators nurturing environment. B. Host brown-bag lunches, CEO roundtables and affiliates programs to bring business owners together to exchange ideas, share experiences & leverage resources. C. Hire incubator management that values client interaction and networking and is capable of facilitating these processes. D. Pay attention to how incubator facility design issues impact networking.  Technology Transfer and Commercialization A. Develop Partnerships with technologists and technology transfer offices with the principal objective of commercializing technology through new company formation. B. Manage conflicts between all parties; offer incentives for commercialization; and work to change potentially incompatible cultures to become more responsive C. Establish a seamless interface between the incubator and the technology generator to ensure fast and effective commercialization.14 | P a g e
  15. 15. MOT Research Project Report  University and Research Centers Laboratory Linkage A. Establish linkages with universities and research centers and labs to leverage the valuable assets, which their entities can provide to the incubated clients. B. Use these linkages to provide clients with faculty/technologists consulting services, students interns and employees, and access to technical facilities and equipments, databases, researchers and research and development financing. C. Ensure that partnerships and linkages provide value to all parties.  Facility Basics A. Ensure flexible space and the necessary amenities (such as high-speed communications, parking security, among others) to meet the needs of different clients at various stages of their development. B. Encourage client interaction through the use of common meeting areas (kitchens, mail rooms, copy rooms and other areas). C. Provide sufficient leasable space with flexible options for the incubators to reach financial sustainability.  Governance and Staffing A. Ensure that the incubator has an effective governing body including private-sector perspectives. B. Achieve consensus among staff and major stakeholders on the mission of the incubator C. Ensure that the incubators president/CEO has appropriate skills and is capable of helping companies grow. D. Ensure that staffing is sufficient, that certain staff members are designated to work primarily and directly with client services and that those people have highest qualifications. E. Hire entrepreneurial president/executive directors capable of identifying client needs and matching them with a wide range of resources, and ensure they do this without impeding the clients need to learn, and without diminishing the client‘s responsibility for growing a business. F. Offer competitive compensation and benefits packages that attract and retain quality staff.15 | P a g e
  16. 16. MOT Research Project Report  Client Screening and Graduation A. Utilize an extensive screening process to select clients that can benefit from the value– added services that the incubator provides. B. Ensure that screening processes determine the needs of the applicant, the ability of the incubator to provide value to the applicant and the willingness of the applicant to accept the value provided by the incubator. C. Establish appropriate graduation criteria.  Incubation Program Evaluation A. Utilize a range of quantitative and qualitative measures to evaluate performance relative to the incubators mission. B. Obtain client feedback on the value of the program while they are residents and following graduation. C. Ensure that the evaluation processes are both manageable and consistent and that outcomes are used to improve the incubator performance. D. Provide evidence of success to incubator management, stakeholders and investors. E. Allows incubator management to compare program effectiveness with other, like incubators. F. Provide evidence of incubation program and service quality. G. Provide information necessary to ensure that programs meet client need and evolve as necessary. H. Identify areas of improvement.16 | P a g e
  17. 17. MOT Research Project ReportINCUBATION AND ENTREPREENRSHIP IN EGYPT A survey research was conducted to list the national entrepreneurship and incubation programs in Egypt and to understand to what extent the ecosystem in Egypt is ready to support incubation programs. That survey was conducted in cooperation with Mr. Yasser Tawfik and went through many resources, which includes international studies, research reports, related conferences, as well as interviews with experts. Following is an overview of these resources:  Reviewing studies of international organizations like: UNDP, UNISCO, ESCWA …etc.  Reviewing studies of working organizations, like: SFD, GAFI, ExpoLink,, …etc.  Investigating business support web portals, such as: Afkar-Gadida, Kenana-Online, ...etc.  Studying:―IMC Market Research on Entrepreneurship Concept in Egypt‖ (April 2007),  Studying related conferences materials: o ―EIEP Entrepreneurship Certificate‖ Program launch event. o ―SMEPol - Mobilizing Entrepreneurship in Egypt‖ Event materials. o ―SMEPol - Financing Opportunities for SMEs in Egypt‖ Conference Report. o ―SMEPol - SME/Entrepreneurship Research Challenges in Egypt‖. (SMEPol). o ―SME Research Challenges in Egypt – Major Barriers‖. April 2007 The research generated a list that can be found in [ARW2, 3] of:  Techno Parks  Incubation Initiatives  Entrepreneurship Programs  Business Support Organizations  Business Support Portals  Business Plan Competitions  Business Training Centers  SME Funding Organizations/Programs There were some difficulties in conducting a research on Entrepreneurship in Egypt due to 2 main factors, which are:  Difficulty to find information because of lack of a central responsible entity and information national portal  Lack of ability to validate programs objectives and achievements due to unavailability of publicly published performance measures. Exhibit 4 shows the entrepreneurship ecosystem under study.17 | P a g e
  18. 18. MOT Research Project Report Following is an overview of the local research results: 4 Techno Parks  Mubarak City for Scientific Research and Technology Applications  Egypt Smart Village  Northern Coast Technology Valley  Sinai Technology Valley 6 Major Incubation Programs  Egyptian Incubators Association – 38 incubators (low tech)  Mubarak City for Scientific Research and Technology Applications - 2 incubators  Business Women Association – incubator project  MCIT Incubator in Smart Village  Nahdet El-Mahrosa Incubator 6 Entrepreneurship support programs  The Egyptian ICT Entrepreneurship Program (EIEP-USAID)  SMEPol Project – Ministry of Finance & CIDA.  ‫ – إفهم‬Youth & Entrepreneurship Civic Education Program  Intilaaqah Program by Shell  Sustainable Development Association  EYE- Egypt Business Support Organizations  Identified 44 entities giving business training and consultancy services for SMEs, which represent NGOs as well as private and governmental organizations: - Social Development Fund (SDF) - Small Enterprise Development Group (SEDO) - IT Industry development Agency (ITIDA) - SMEPol Project (Finance Ministry, CIDA, IDRC & GAFI) - Business Development Services Support Project (BDSSP) - SME Promotion Programme (GTZ) - Alexandria Business Association - Altadamun - Mansoura Business Association - Dakahlya Businessmen‘s Association for Community Development - National Council for Women - Egyptian Business Women Association (EBWA) - Egyptian Exporters Association - Egyptian Small Enterprise Development Foundation - Al-Mobadara - Future Generation Foundation18 | P a g e
  19. 19. MOT Research Project Report - Lead Foundation - Nahdet El-Mahsousa - Sanabel - Sharkiya Businessmen‘s Association for Community Development - + more. Business Support Portals  Social Development Gate:  Egyptian Investment Portal:  General Authority for Investment & Free Zones (GAFI):  Trade Point:  TegaraNet:  Women Business Development Center:  Afkar Gadida: Business Plan Competitions  Arab Business Challenge  Arab Technology Business Plan Competition (ASTF) progam wit Intel+UC Berkeley  Arab MIT Business Plan Competition  TDF competition  Industrial Business Plan (IMC-ASTF-EJB)  Business Idea Award (Alexandria)  Young Innovators Award. (Nahdet Al-Mahrousa) Funding Bodies for SMEs  12 NGOs (microfinance)  26 Banks. (Loans based)  3 Equity sharing bodies Regional Initiatives affecting the Egyptian Business environment  ESCWA: - Technology Center - Network of Technology Parks and Incubators  Investment Promotion Unit (UNIDO)  Medibtikar  Arab Business Angels Network (ABAN)  NBIA  InfoDev19 | P a g e
  20. 20. MOT Research Project ReportUCF BUSINESSS INCUBATION PROGRAM This part of the report shall cover the results of the field study research conducted at the University of Central Florida Business Incubation Program (UCFBIP) That field research was based on:  Attending some of the daily meetings at UCFBIP,  Visiting incubator sites and partners sites,  Visiting sites of the Technology Park at UCF  Investigating websites of related organizations,  Interviewing key responsible persons and presenting the work to all for validation. The persons interviewed were:  Dr. Tom O’Neal, UCFBIP Director & UCF VP for Research  Gordon Hogan, Business Development Executive & Manager of 2 sites (Photonics & Downtown Orlando)  Carol An Dykes, Technology Incubator Site Manager  Esther Vargas Davis, Seminole County Incubator Site Manager  Dr. Cameron Ford, Center of Entrepreneurship and Innovation (CEI) at College of Business Administration (COBA), UCF  Kirstie Chadwick, Venture Lab Director & Coach at UCF  Jerry Ross, Executive Director, Disney Entrepreneur Center (DEC)  Dr. Yasser Hosni, UCF Industrial Engineering and Management Systems. Orientation about UCF Technology Centers and facilities  Rene Ayala, Administrative Assistant at UCF Technology Incubator site.  Managers of some incubated companies and graduated ones from the UCFBIP.PROGRAM OVERVIEW The UCF business incubation program is sponsored and managed through a collaborative partnership between [16]:  University of Central Florida  Orange County  The City of Orlando  Florida High-Tech Corridor  City of Winter Spring  Seminole County www.seminolecountyfl.gov20 | P a g e
  21. 21. MOT Research Project Report Those collaborating entities are all members in the advisory board of the program, through which they provide insight and guidance to incubator management and help promote the incubation program in the local community. The goal of the UCF Business Incubation Program (UCFBIP) and its community partners is to facilitate smarter, faster startup and growth of emerging companies so those companies will become financially successful, high growth companies in the community: The sustainability of that program is secured through continuous funding from key stakeholders. The mission embraced is that funding is pumped in this program in Central Florida for economic development and diversification, technology commercialization, and generation of high-growth companies that create high-wage jobs and pay taxes to the government. The working policy is that the UCFBIP doesn‘t take equity in startups after graduation and depends mainly on public funding to sustain, however the rent paid by clients only covers half of the rent of the incubator actual facilities. Figure 3: UCFBIP Facilities21 | P a g e
  22. 22. MOT Research Project ReportPROGRAM PARTNER ORGANIZATIONS The UCFBIP network with a wide range of organizations to provide added value assistance to their client companies. Many of these organizations are listed on the incubator website ( under ―Incubation Program‖ then under ―Partners‖. Some of those partners are also members of the advisory board. The following shows the developed network: Figure 4: UCFBIP Partner Organizations AeA – Florida Council AeA ( is the nations largest high-tech trade association. Established in 1943, AeA has more than 3,500 member companies that span the high-technology spectrum, from software, semiconductors and computers to Internet technology, advanced electronics and telecommunications systems and services. The Florida Council of AeA is located in the University Tech Center facility. Through the partnership, Incubator clients are provided a one-year membership free-of-charge in AeA. The many benefits of membership include procurement opportunities alerting, education and training, high-tech lobbying, human resource programs (including group insurance programs), industry data and publications, small business resources and state advocacy programs. Disney Entrepreneur Center (DEC) The Entrepreneur Center ( is located in downtown Orlando at 315 East Robinson Street, in the Landmark 1 Building. It provides a ―one-stop shop‖ for entrepreneurs and small businesses for counseling services, training programs, and financing programs. The Center is the home of several entrepreneurial service22 | P a g e
  23. 23. MOT Research Project Report organizations such as the US Small Business Administration, UCF Small Business Development Center (SBDC), SCORE, the Hispanic Business Initiative Fund, The Alliance, Florida First Capital., the UCF Technology Incubator, and many others. A Business Information Center provides access to online and print resources for business information research. The following graph shows a list of the actual service providers offices at DEC one-stop-shop for entreprenrus followed by another one for detailed services : Figure 5: Disney Entrepreneur Center Service Provider Offices and Their Services23 | P a g e
  24. 24. MOT Research Project Report Inflexion LLC Inflexion Fund, L.P. ( managed by Inflexion Partners, is a seed and early-stage venture capital fund organized with an emphasis on company building and harnessing regional, national, and international resources of the fund‘s managers and strategic partners. Inflexion is the first and only Florida-focused fund leveraging a network venture capital model involving some of the largest institutional investors in the country. Inflexion‘s corporate headquarters is located in the UCFTIP in the University Tech Center facility. Orlando-based partner, James Boyle, and the other Inflexion partners work with Incubator clients offering business plan reviews, advice and capital-raising strategies. UCF College of Business Administration (COBA) UCF COBA ( works closely with the Incubator to offer a number of programs throughout the year. The ―Excellence in Entrepreneurship Certificate‖ Course is a seven-session interactive course developed specifically for entrepreneurs in todays market. Offered 3-4 times a year, the course is open to any entrepreneur or aspiring entrepreneur in the community. All applicants to the Incubator are required to complete the course as part of the application process. The course is a tool to establish a certain level of business knowledge among potential Incubator clients. It provides the entrepreneurs an opportunity for additional due diligence on their business concept. It also offers the Incubator better insight into the potential of the businesses and their business development needs. Members of the UCF College of Business faculty and practicing professionals from the local business community teach the sessions. The course concludes with each participant presenting their business before a panel of experienced entrepreneurs and business advisors. The Center for Entrepreneurship & Innovation (CEI) in the COBA serves as the focal point for academic entrepreneurship programs as UCF. CEI also assists in identifying and placing business students as interns and part-time employees in Incubator companies. Some courses in the College require the students to work in teams with a local company and Incubator clients may have the opportunity to benefit from assistance provided by those student teams. The annual UCF business plan competition, UCF chapter of Collegiate Entrepreneurs Organization (CEO) and other activities are also managed by CEI. UCF Office of Research and Commercialization (ORC) The Office of Research and Commercialization ( manages all of the contracted research activities for the University. For Incubator clients, the Office of Research is a source of assistance for identifying UCF faculty and facilities for partnerships in applied research, product development and testing. Particular emphasis is given to the Small Business Innovation Research program, the Small Business24 | P a g e
  25. 25. MOT Research Project Report Technology Transfer program, and the Florida High Tech Corridor Matching Grant programs to support University partnerships with industry. The Office of Research is located in the University Towers in the Central Florida Research Park. The Office of Technology Transfer (OTT), located in the Office of Research, manages the intellectual property acquired to protect the University‘s rights to innovations resulting from the research at UCF. Those technologies are then made available for licensing to companies or other organizations for commercialization through the creation of products, processes or services. A number of Incubator companies have licensed patents, copyrights, trademarks or trade secrets as the technology platform for their company. The following graph shows the different entities under management of the UCF ORC, in which the incubation program fully interacts with all of them: Figure 6: UCF Office of Research and Commercialization Affiliated Programs UCF Orange County Venture Lab The UCF Orange County Venture Lab (, housed in the College of Business Administration (COBA), is a partnership between Orange County, the COBA and the Office of Research and Commercialization (ORC). The Venture Lab assists UCF faculty and students in exploring commercialization of their research results. The Lab also provides advisory services to technology companies in the community and25 | P a g e
  26. 26. MOT Research Project Report assists with specific needs Incubator client companies may have. Assistance is provided with market research, business planning, investor presentations and company formation. Education programs are offered as well. UCF Small Business Development Center The UCF Small Business Development Center (SBDC) ( is located at the Disney/SBA National Entrepreneur Center and maintains an office in University Tech Center. Services of the SBDC include individual assistance and regularly scheduled training events on a wide range of business topics such as starting a business, how to find financing, taxes, writing a business plan, international trade, contracting with government agencies, patents and trademarks, and e-commerce issues. Incubator clients are encouraged to sign up as a client of the SBDC. This enables SBDC Certified Business Analysts to assist Incubator clients. They are available for consultation on a wide variety of issues including: business plan writing, market research, advertising, sources of financing, record-keeping, taxes, and selling to the government. The SBDC also offers an Advisory Board Council program ( providing advisory boards for small businesses seeking guidance in growing the company. Incubator companies that have been in business for 1 year and who are generating revenue are qualified to apply to the program for advisory services to complement those offered by the Incubator. The following graph shows the interaction of all these collaborating partners, more detailed scenarios of service providing to entrepreneurs from the community and from UCF can be found in [ARW8] Figure 7: Entrepreneurship Ecosystem Relations at UCF26 | P a g e
  27. 27. MOT Research Project ReportUCF BUSINESS INCUBATION PROGRAM SERVICES The UCF Business Incubation Program provides client companies with the experience and insight needed to create successful companies through relationships it has created with partners such as, professional service providers, business assistance organizations, local/regional/state government as well as their dedicated staff. The Incubator provides a variety of services such as [7]:27 | P a g e
  28. 28. MOT Research Project Report28 | P a g e
  29. 29. MOT Research Project Report The model of support of business services partners is based on the following process at UCFBIP:  A representative of a certain service provider visits the incubator and clients reserve with him/her if they need the support. This is on a voluntary basis to service the incubation program.  Service providers understand that this is not a sales/marketing pitch and that main incubator concern is to educate the clients.  If clients want to go further with a certain service provider, this will be managed by themselves on a contract basis between them and the service provider directly.  There are many service providers to rotate on a voluntary basis, so that they are not exhausted – maybe a certain service provider comes only twice a year.  Feedback from both parties is collected by incubator management after such meetings to assess effectiveness and quality perceived about a certain service provider. The following graph shows the number of service providers grouped per each set of services offered in the UCF business incubation program. Figure 8: Service Providers at UCFBIP29 | P a g e
  30. 30. MOT Research Project ReportINCUBATION PROGRAM PROCESSANDKEY PERFORMANCE INDICATORS Figure 9: Incubation Program KPIs30 | P a g e
  31. 31. MOT Research Project ReportUCFBIP MANAGEMENT STRUCTURE The following graph represents the management structure of the program and the next one details the structure for the technology incubator facility located in the UCF Research Park with some clarified responsibilities. Figure 10: Organizational Structure at the UCFBIP Figure 11: Detailed Organizational Structure of the Technology Incubator Facility31 | P a g e
  32. 32. MOT Research Project Report Managing an incubator facility requires a set of competencies that can be grouped into the following ones:  Comfortable with technology.  Networking capability – Ability to see how different people could benefit from each other.  Very good at meeting people – social intelligence – people experience.  Worked before with young startups or had his/her own startup – Entrepreneurship Skills.  Balancing different stakeholders.  Effective management/leadership skills.  Ability to coach startups in what they don‘t know - keep them focused.UCFBIP BEST DESIGN PRACTICES The design of the UCFBIP illustrates one of the best practices that should be taken into consideration when designing such programs elsewhere. Following are some of these best practices design considerations: Figure 12: UCFBIP Best Practice of Incubators Design32 | P a g e
  33. 33. MOT Research Project ReportGAP ANALYSIS OF THE NIS IN EGYPT According to the local survey research and the international study on best practices including the UCFBIP field research study; the following conclusions were reached as gap analysis results of the national innovation system in Egypt in the viewpoint of business incubation programs: Figure 13: Gap Analysis of the NIS from Incubation Systems viewpoint33 | P a g e
  34. 34. MOT Research Project ReportTHE ROLE OF SCIENCE AND TECHNOLOGY POLICYINTRODUCTION TO SCIENCE AND TECHNOLOGY POLICY From the study of different national S&T policies and recent research on S&T policy development [21- 44], we conclude that S&T policies are critical governmental tools for allocating governmental budgetary resources into S&T development initiatives that support specific technology development areas and cultural change programs towards embracing creativity, technology entrepreneurship and innovation. As in [21], there exist two ideal types of policy approaches that tend to appear together, although one predominates over the other. Figure 14: What is S&T Policy?  The first is the ―Academic Approach‖, which is geared towards fostering academic research and mainly towards universities and public research centers.  The second is the ―Business Approach‖, which attaches greater emphasis to applied research and technological innovation processes in business. Both approaches seek to increase and foster the production of new knowledge and skills, yet while one aims to finance academic activities, without direct connection to short-term results, the other aims to foster private investment and raise companies‘ level of technology, and to tie public research to the transfer of results to the private sector. Therefore, some have argued that the best policies for fostering economic growth and competitiveness are more closely tied to the ‗business approach’. The business-oriented model should be applied to public S&T policies to put considerable pressure on public research systems to address economic and social needs. The following graph outlines four major research priority areas that should be the focus of public research systems [43], which are:  Better Health: Society places high priority on health and the treatment of disease, and R&D budgets for health research have increased in many OECD countries.34 | P a g e
  35. 35. MOT Research Project Report  Sustainable development: Society also demands greater public research efforts to achieve sustainable development. The private sector lacks sufficient resources to invest in R&D such that new emerging technologies radically improve the way human needs are met. Sustainable development is a now a global concern that requires international science and technology cooperation, notable with less-developed countries and innovative approaches to the organization and funding of research.  Enhanced Security and Safety: New technologies can respond to the increasing social concerns about safety and security, such as the risks of transponder diffusion of epidemics, the dissemination of biological chemical or nuclear weapons, or the spread of computer viruses and the vulnerability of communications networks.  Cleaner environment: With the major trend of environmental decline due to economic growth, social pressure is exerted to find new ways of manipulating nature without harming the environment, represented by renewable energy sources and green technologies. Figure 15: Economic and Social Needs of Needed Focus of Public Research Systems Politics and Public Policy The study of Politics is the attempt to explain the various ways in which power is exercised in the everyday world and how that power is used to give resources and benefits to some people and groups, while sometimes imposing costs and burdens on other people and groups. The study of Public Policy is the examination of the creation, by the government, of the rules, laws, goals, and standards that determine what government does or does not do to create resources, benefits, costs, and burdens [20]. S&T policy is a form of public policy, and today‘s S&T policies are called upon to respond to new challenges that play a major role in the competitiveness of nations. These are [43]:35 | P a g e
  36. 36. MOT Research Project Report  Foster science industry linkages, notably through more appropriate forms of governance of public research,  Ensure that IPR Regimes encourage investment in innovation  Promote the development and mobility of human resources in science and technology (HRST),  Enhance international co-operation in S&T and facilitate the dissemination and access to publicly funded research results. Figure 16: Current S&T Policy Challenges These various challenges lie at the heart of current debates about science, technology and innovation policy. Governments continue to wrestle with questions of how best to restructure and reform public research organizations to improve their contributions to social and economic problems without sacrificing the objectivity and independence of their advice and their ability to pursue curiosity-based research. Governments are also working with industry and civil society to improve the attractiveness of scientific and technological careers to students and to improve prospects for mobility. In bilateral and multilateral settings, they increasingly work with other governments and non-governmental organizations (NGOs) to foster international co-operation on issues of global concern [43].36 | P a g e
  37. 37. MOT Research Project ReportMAJOR TRENDS IN SCIENCE, TECHNOLOGY AND INNOVATION POLICIES The global patterns of science, technology and innovation are quickly changing. What are the implications for science and innovation policy? What steps are countries taking to boost their capabilities in science, technology and innovation? What is the contribution of science and innovation to growth and social goals? All these questions were studied in the latest OECD report ―OECD Science, Technology and Industry Outlook 2008‖, which reviewed key trends in science, technology and innovation in OECD countries and other non member economies and published in November 2008. That OECD report has identified the following emerging S&T policy trends, which are [42]: Figure 17: Major Trends in Science, Technology and Innovation Policies37 | P a g e
  38. 38. MOT Research Project ReportSCIENCE AND TECHNOLOGY POLICY AND NATIONAL INNOVATION SYSTEMS S&T policies are concerned with the buildup of National Innovation Systems (NIS). An NIS emphasizes the interaction of national capabilities for research with national capabilities for economic development. Therefore science, technology and innovation policies (STIP) are focusing on Technological Innovation & Economic Development. Where, the technological innovation is both the invention of new technology and the introduction into the market place of new products, processes, or services based upon new technologies [42]. A national innovation system should have:  A strong research capabilities both in its industrial and research sectors  Complete government structure for S&T administration.  Strong decision support system in S&T  Research funding programs  Entrepreneurship support and SME technological development programs  Property rights/protection laws  Technology VC/angel investors players  An educational policy that Unleashes creativity, critical thinking, collaborative learning, and stimulates high-quality of performance. In this regard, S&T policy must balance research for technology improvement in current industries and research to establish new internationally competitive industries in new technologies. Below is a graph of the proposed major components of a normal National Innovation System: Figure 18: Proposed Major Components of National Innovation System38 | P a g e
  39. 39. MOT Research Project Report However, a needed component in the society that plays an important role as catalyst in the national innovation system is the existence of strong non-governmental organizations with missions to support innovation and nurture entrepreneurship and technology development within the community. This forth component is often not taken into consideration in different literature materials [45] that focus only on a triple-helix representation for national innovation systems. Figure 19: Role of Specialized NGOs as NIS Catalysts In order to effectively build such a National Innovation System, the following graph outlines the priority areas that need to be detailed within the scope of the S&T policy. Figure 20: Scope of the S&T Policy Priority Areas39 | P a g e
  40. 40. MOT Research Project Report Such priority areas need political commitment, legislative and regulatory framework, capital funding, government support, public awareness, trained scientific personnel, and cooperation with local and international partners. So for these priority areas the following, the S&T policy should detail:  Strategic objectives  SWOT analysis for each strategic objective  Proposed policy measure  Entity responsible for implementation Such a comprehensive identification should allow policy makers to effectively identify critical technology to support, the form of that support, and the mechanism by which to evaluate that support, making a reasonable justification of the public funding put in these programs.40 | P a g e
  41. 41. MOT Research Project ReportCONCLUSION AND S&T POLICY RECOMMENDATIONS Business incubators are used as tools for economic development; therefore should be viewed within a whole SME business support national strategy. Business incubators cannot graduate sustainable high- growth companies without effective integration with other components of a mature national innovation system, which needs to be built and improved as outlined before. In this regard, in order to build an incubation system, specific societal model components must be studied and taken into consideration in order to forecast the expected outcome of that incubator and in order to set the right policies and procedures that enable it to effectively interact with its surrounding business, research, and governmental environment. Such a societal model with its details is outlined in t h e f o l l o w i n g g r a p h : Figure 21: Parameters to Consider When Building Incubation Programs41 | P a g e
  42. 42. MOT Research Project Report Taking the societal model of Egypt into consideration, the concluding S&T policy recommendations for EGYPT out of this research are: Figure 22: S&T Policy Recommendations42 | P a g e
  43. 43. MOT Research Project ReportREFERENCES [1] Linda Knop, ―2006 State of the Business Incubation Industry‖, NBIA Research Series, NBIA Publications, 2007 [2] Anna Bergek, Charlotte Norrman, ―Incubator best practice: A framework‖, Technovation, Elsevier, 2008. [3] European Commission Enterprise Directorate General, ―Benchmarking of Business Incubators‖, Final Report, Feb. 2002. Center for Strategy and Evaluation Services (CSES). [4] Rustam LALKAKA, ―‗Best Practices‘ in Business Incubation: Lessons (yet to be) Learned‖, President of Business & Technology Development Strategies, Brussels, 14 November 2001. [5] [6] Pretti Vuorela, ―Teve & Incubation Excellence: Bridging Innovation and Business‖, technopolos Ventures Ltd, October 2006. [7] [8] NBIA, ―A National Benchmarking Analysis of Technology Business Incubator Performance and Practices‖. US Department of Commerce, Technology Administration, April 2003. [9] Kris Aertsa, Paul Matthyssensb and Koen Vandenbemptb, ―Critical role and screening practices of European business incubators‖, Technovation, 2006. [10] Benchmarking Summary Report, National Business Incubation Framework, UKBI, 2004. [11] Ronagh Witthames, ―Assessing the potential of the French Business Employment Co-operative model within the UK context‖, A Research Study by Suffolk ACRE, © Suffolk ACRE Ltd. June 2005. [12] [13] [14] idisc - infoDev Incubator Support Center: [15] Dinah Adkins, Chuck Wolfe and Hugh Sherman, ―Best Practices in Action: Guidelines for Implementing First-Class Business Incubation Programs‖, NBIA Research Series, NBIA Publications, 2004 [16] ―University of Central Florida Business Incubation Program: Client Handbook‖, UCF Technology Incubator, 2008. [17] ―UNDP Human Development Report 2007/2008‖, UNDP, 2007 [18] ―UNESCO Science Report 2005‖, UNESCO [19] ―Market Research on Entrepreneurship Concept in Egypt‖, Industry Modernization Center, 2007. [20] Thomas A. Birkland, ―An Introduction to the Policy Process: Theories, Concepts, and Models of Public Policy Making‖, M.E. Sharpe, Inc. 2005 [21] Luis S. Menedez and Laura C. Castro, ―Explaining the Science and Technology Policies of Regional Governments‖, Regional Studies, Vol. 39.7, pp.939-954, October 2005. [22] ―Science and Technology Policy of the Republic of Croatia‖, 2006-2010, Ministry of Science, Education, and Sports.43 | P a g e
  44. 44. MOT Research Project Report [23] ―Science and Technology in Ireland‖, Ireland 2004 Presidency of the European Union. [24] ―Science and Technology Policy in Iceland‖, Prime Minister‘s Office, the Science and Technology Policy Council, 2004. [25] ―Science and Technology Policy 2006-2009‖, Iceland Prime Minister‘s Office, the Science and Technology Policy Council. [26] ―Mobilizing Science and Technology to Canada‘s Advantage‖, Publishing and Depository Services, 2007 [27] ―A Proposal for Finland National Innovation Strategy‖, Ministry of Employment Draft, 2008. [28] ―Report on Science Technology Indicators for Norway‖, the Research Council of Norway, 2006. [29] ―Science and Technology Master Plan of Mongolia 2007-2020‖, Ministry of Education, Culture and Science. [30] ―Technology Strategy‖, UK Technology Strategy Board, Annual Report 2006. [31] ―High-Tech Strategy for Germany‖, Federal Ministry for Education and Research, 2006 [32] ―American Competitiveness Initiative: Leading the World in Innovation‖, Domestic Policy Council, Office of Science and Technology, Feb 2006. [33] ―Compete. New Challenges, New Answers‖, US Council on Competitiveness, 2008 [34] ―Competitiveness Index: Where America Stands?‖, US Council on Competitiveness, 2007. [35] Philip Shapira, ―US National Innovation System: Science, Technology and Innovation Policy Developments‖, Georgia Institute of Technology, Atlanta, USA, 2007. [36] Andrew Jamison, ―Science, Technology and the Quest for Sustainable Development‖, Technology Analysis and Strategic Management, Vol. 13, No. 1, 2001 [37] Carlota Perez, ―Change of Paradigm in Science and Technology‖, Number One, 2000 [38] ―Canada‘s Future in Science and Technology: Making it Work‖, Association of Canadian Community Colleges (ACCC), 2008. st [39] Joseph Coates, ―A 21 Century Agenda for Science and Technology‖, Research Technology Management, Sep. Oct. 2001 [40] Joseph Coates, ―Where Science is headed – Sixteen Trends‖, Journal of Washington Academy of Sciences, Fall-Winter 2003 [41] Joseph Coates, ―Fourteen Technology Trends‖, Research Technology Management, Sep. Oct. 2005 [42] ―OECD Science, Technology and Industry Outlook‖, OECD, 2008 [43] ―Science and Innovation Policy, Key Challenges and Opportunities‖, OECD, 2004 [44] ―The Science of Science Policy: A Federal Research Roadmap‖, Subcommittee on Social, Behavioral, and Economic Sciences, National Science and Technology Council, Office oif Science and Technology Policy, November 2008. [45] Azley Abd Razak, Mohammed Saad, ―The role of universities in the evolution of the Triple Helix culture of innovation network: The case of Malaysia‖, International Journal of Technology Management and Sustainable Development, Vol 6., No. 3, 2007.44 | P a g e
  45. 45. MOT Research Project ReportACOMPANIYING RESEARCH WORK This research project is submitted on a CD alongside other research documents that should be considered as supplement research details: [ARW1] Introduction to Business Incubation.ppt [ARW2] Entrepreneurship and Incubators in Egypt.ppt [ARW3] Entrepreneurship and Incubation Activities in Egypt_Report.doc [ARW4] 1. UCF Research Commercialization Office - Top View_TS.pptx [ARW5] 2. Disney Entrepreneur Center_Overview_TS.pptx [ARW6] 3. UCF Incubation Program_TS.pptx [ARW7] 4. Nile University Incubation Program Action Plans_TS.pptx [ARW8] IAMOT2009_UCFBIP- Entrepreneurship Ecosystem Case Study_ED01.pptx [ARW9] Paper Slides-BUSINESS INCUBATION A STRATEGIC PERSPECTIVE_TS.ppt [ARW10] SRO_Paper_Business Incubation - A Strategic Perspective_TS.pdf45 | P a g e
  46. 46. MOT Research Project Report EXHIBIT 1: BENCHMARKING ANALYSIS OF TECHNOLOGY BUSINESS INCUBATORS 2006 Benchmarking Study of European Business Incubators NBIA 2003: A National Benchmarking Analysis of TBI Performance and Practices.46 | P a g e
  48. 48. MOT Research Project Report EXHIBIT 3: TECHNOPOLIS FINLAND SAMPLE SERVICES & PROCESS Technopolis Finland Packaged Services Technopolis Finland Process48 | P a g e
  49. 49. MOT Research Project Report EXHIBIT 4: ENTREPRENEURSHIP ECOSYSTEM49 | P a g e