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Initiative realized by Sviluppo Basilicata SpA within the framework of the FIDIBE Project (wp 3.2) SEE Programme 2007-2013 Raffaele Ricciuti - Sole Administrator Responsible of project local activities: Vittorio Simoncelli - Head of Sviluppo Basilicata SpA Project Area Sviluppo Basilicata SpA Project Team: Valentino Abbatantuono, Maria Giovanna Lecce, Assunta Lo Tito, Gaetano Torchia, Annamaria Verrastro Analysis and text elaboration: Maria Giovanna Lecce - Project Area Sviluppo Basilicata SpA Translation: Manuela Lapenta Editorial coordination: Annamaria Verrastro - Communication Service Sviluppo Basilicata SpA

Sviluppo Basilicata SpA Head Office Via Centomani, 11 85100 Potenza Tel. +39 0971 50661 Fax +39 0971 506664 Matera Office Rioni Sassi Recinto I° Fiorentini 75100 Matera Tel. +39 0971 50661 Fax +39 0971 506655 Business Incubators » Area Industriale Alta Val D’Agri di Viggiano 85050 Grumento Nova Tel. +39 0975 311343 Fax +39 0975 350174 » Rioni Sassi area Civita (under completion) Via San Nicola del Sole 75100 Matera info@sviluppobasilicata.it www.sviluppobasilicata.it We apologise in advance for any mistakes that might remain in the text Graphic project: BEAT di Giovanni Brienza - Potenza Final print December 2010


FIDIBE Project in Basilicata (Val d’Agri) The present publication has been accomplished by Sviluppo Basilicata within the framework of FIDIBE project - Development of Innovative Business Park- aimed at promoting innovation and entrepreneurship in SEE (South East Europe) transnational cooperation area, through the implementation of transnational partnerships and joint actions on strategic issues. Sviluppo Basilicata is developing the actions of FIDIBE Project in Basilicata in the Val D’Agri area. The company has already carried out: the present publication, consisting in the Study of the innovative potential of Basilicata and the Best Practice ‘Innovation Factory’; the start-up of High Val D’Agri Business Incubator, whose presence may allow to better interpret the needs of the whole area. Furthermore, an IBP (innovative business park) operational manual, to be used as a guide for both the creation of new parks and the enlargement of already existing parks, is expected to be drafted. The actions of FIDIBE project in Basilicata fall within the 2007-2013 Regional Strategy for Research and Innovation, conceived to ‘improve context conditions’ and promote innovative projects and activities carried out by enterprises and stakeholders working for the research (University, Research Bodies, Innovation Centres, Technology Transfer Centres), towards which Sviluppo Basilicata pays particular attention for the creation of partnerships aimed to set up an energy district of innovative enterprises. As foreseen by the project, during local action planning, a working group (the RNM Regional Network Meeting) has been created by involving the members of industry, science and research systems, institutions, local administrations, universities, associations/foundations, and enterprises of the area. Since its creation, the RNM has been conceived as a multi-voice instrument, so to have the possibility and availability of several contributions, able to orient the project proposals at a local level and to keep a constant attention on the issues of innovative enterprise in the Val d’Agri Area. We would like to thank all the stakeholders involved, and, in particular, Basilicata Innovazione, a project of Area Science Park - the first scientific and technological park in Italy- and the Basilicata Region. Basilicata Innovazione offers high value services and tools to local entrepreneurs and researchers, in order to support the competitiveness of the entrepreneurial system and the exploitation of the research and thanks to its ‘First Mile Incubator’ will continue to provide guidelines and ideas, useful to reach the objectives fixed within FIDIBE project. Raffaele Ricciuti Sole Administrator Sviluppo Basilicata SpA

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www.fidibe.eu Innovation Factory: from a business dream to a business plan


CONTENTS A) Executive summary

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B) History, analysis and success factors of the best practice

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C) Regional policy considerations for the best practice

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D) References

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3 Innovation Factory: from a business dream to a business plan


4 Innovation Factory: from a business dream to a business plan


A) Executive summary In absence of a business park operating in the Basilicata region, we were looking for a business support infrastructure that would have implied the majority of the criteria of the business Park or similar definition and that could serve as a real good example/best practice for our region. As a consequence, we have chosen the First Mile Incubator of Innovation Factory located in Friuli Venezia Giulia that, even though physically far from our region, can represent a practice to export on the local territory. Furthermore, on 24th April 2009, the Basilicata Region and Area Science Park – Innovation Factory signed a collaboration protocol for the fulfilment of a project called ‘Basilicata Innovation’ which foresees the birth of a new regional body that will provide services and tools to sustain SMEs’ competitiveness, improve the research on the regional territory, and establish an innovative incubator upon the model of the Innovation Factory’s structure. Fig. 1 - Geographical location of the Friuli Venezia Giulia region and of the province of Trieste

Innovation Factory as a first mile incubator is presented as a best practice due to its exceptional results in sustaining development and providing support to innovative SMEs in order to facilitate innovation and to increase the innovative potential and competitiveness of the area in which it is located. It provides assistance in each phase of the development from a business idea to a business plan to the market expansion reducing the potential risk by developing entrepreneurial competences and transforming the ‘potential entrepreneur’ in the entrepreneur whose idea will enter the market. Innovation Factory: from a business dream to a business plan

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A) Executive Summary

It is located, as previously mentioned, in the Friuli Venezia Giulia region, and more specifically in the Province of Trieste, inside Area Science Park’s property. Area Science is considered as the principal Italian scientific and technological Park divided into two Campuses: one in Padriciano and the other in Basovizza. Fig. 2 - Geographical position of Padriciano and Basovizza

6 Innovation Factory: from a business dream to a business plan


A) Executive Summary

Fig. 3 - Campus of Padriciano

Fig. 4 - Campus of Basovizza

Innovation Factory welcomes future entrepreneurs interested in creating their own business plan, and cooperates with them to transform an innovative idea into a successful business. Following an initial selection process, Innovation Factory offers space and services to support the initial, delicate phase of technological, commercial, Innovation Factory: from a business dream to a business plan

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A) Executive Summary

legal, and economic definition and verification of the business idea. The incubator’s activities are aimed at creating and developing the new business. Innovation Factory provides the opportunity to develop an innovative idea in an extremely fertile environment, i.e. AREA Science Park. AREA’s many links with the best international research groups, its network of contacts and skills deriving from its long experience in technology transfer to companies, exclusive business intelligence, patenting and documentation information services, high level economic-financial and managerial training available through collaborations with the best Business Schools worldwide, make Innovation Factory the ideal environment for transforming the dream of a lifetime into real business. Furthermore, a business coach accompanies future entrepreneurs along their personal development paths, sharing their challenges and helping them to reach the final goal: the creation of a company with a strong outlook for success. Collaboration with Innovation Factory takes place over 3 phases: Phase 1. Evaluation of the business idea: The proposer submits a description of his/her own business idea and a plan of activities in preparation for starting a new company to the scientific and technical committee of Innovation Factory. Phase 2. Pre-incubation: Once the proposal is accepted and an agreement is signed regarding the launch and management of the ‘Development Group’ of the future business, Innovation Factory makes adequately equipped space available and the various activities agreed upon are begun. Innovation Factory helps future entrepreneurs by providing the services and resources needed to successfully completing the path that leads to the creation of a new business. Phase 3. Company setup: At the moment in which the conditions for economic sustainability and operating autonomy exist, the proposer and Innovation Factory make arrangements for the creation of the new company. Innovation Factory’s share in the company will be a minority one and suitable way-out mechanisms will be agreed upon with the proposer. Pre-incubation and support to the new company last a maximum of 3 years.

8 Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice Innovation Factory is located in AREA Science Park, Trieste, Italy. Created in 1978, Area Science Park, is the first multi-sector science and technology park in Italy and one of the largest in Europe. The shareholders of Innovation Factory Scrl are: 1. the Consortium for the scientific and technological research AREA of Trieste; 2. Sincrotrone Trieste ScpA - a multidisciplinary Synchrotron Light Laboratory, open to researchers in diverse basic and applied fields (more information at http://www.elettra.trieste.it/info/it-index.html); 3. Bic Incubator Friuli Venezia Giulia Spa (more information at http://www.incubatori.fvg.it/). It is managed by the Consortium for the management of AREA Science Park, recognised by the Italian Ministry of Education, University and Research (MIUR) as a 1st level National Research Body. It operates on local and national level to foster territorial and business competitiveness by supporting the technology transfer and encouraging entrepreneurial training and internationalization. The park, which is comprised of two campuses (Padriciano and Basovizza), plays a fundamental role in the start-up and development of centres, companies and institutes operating in the fields of scientific research, technology transfer and provision of qualified services, in the following sectors: life sciences, biotechnologies for agriculture and food industry, diagnostics, biomedical technologies, physics, materials and nanotechnology, IT, electronics and telecommunications, Energy and Environment, marine ecology, etc. The campus in Padriciano hosts the head office of AREA Science Park and as well as Innovation Factory and other 62 tenants belonging to different business sectors, while the campus in Basovizza is home for 22 tenants and high-tech companies. During its 30 years of experience, AREA Science Park has developed a number of regional European and International projects following its mission to provide a national reference point for technology transfer and enhance competitiveness both regionally and nationally. It is one of the few International Science and Technology Parks focused on customized and ‘face-to-face’ services rather than the traditional real-estate approach. AREA’s innovation strategies have received acknowledgements on a national level such as being within first 100 cases of ‘Best Administration’ but also internationally by receiving recognition of ‘European best practice’ for two of its projects: 1. SISTER: as the first Italian project dedicated to optimize the competences of regional research systems on the market, and 2. Innovation Network: as a network of ‘Competence Centres’ specialized Innovation Factory: from a business dream to a business plan

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B) History, analysis and success factors of the best practice

in the most important economic sectors. It is the first Italian network for technology transfer aimed to monitor and assess companies’ innovation needs. During its growth, AREA has developed a wealth of distinctive competences (design and management of Science and Technology Park, creation of self sufficient knowledge based systems and creation of Education Programs targeting young people and students of all educational levels, R&D managers, existing and potential entrepreneurs) and initiated many regional and international projects such as the following ones: »» Sister - Liaison Office – dedicated to the enhancement of the research to boost local growth; »» Innovation Network – creation on the regional territory of a structure dedicated to SMEs in order to transfer know-how and technologies and to boost innovative projects; »» Innovation Campus – the school for professionals offering advanced training for innovation brokers; »» DOMOTIC FVG Project – whose aim is the use of technology to improve the quality of life, at home and at work; »» EURAXESS-Researchers in Motion – a project for the mobility of the European researchers; »» Enterprise Europe Network - the new European network for services provided to SMEs promoted by the DG Enterprise and Industry of the EC and financed by the Programme for Competitiveness and Innovation; »» IUSES – the project intends to promote among the students and teachers a new efficient way of energy consumption in every day life; »» MIT - Massachusetts Institute of Technology of Boston – a direct link with the MIT - Massachusetts Institute of Technology of Boston, USA aiming at promoting in a more efficient way the creation of research spin-offs and facilitate the development of innovation; »» Strategic Business Insights – Smes and research institutions ask for this kind of service in order to sustain new products or processes, new development trends, investments for new business opportunities. After receiving positive results from its projects directed towards University research and business innovation needs, AREA Science Park acknowledged the raising need for establishing a project dedicated to development of startups to serve as a bridge between university research potential (potential business ideas) and business needs (companies’ innovation needs).

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In 2006, AREA Science Park established Innovation Factory, a first mile incubator for future entrepreneurs interested in the realization of their own project: ‘creating a company from an innovative idea’. Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

Hereafter, it is presented a scheme which resumes the competences and the four pillars of AREA Science Park: Innovation network, Innovation Factory, Innovation Campus and Sister. Fig. 5 - Competences and four pillars of AREA Science Park

The Economic Impact of the Area Science Park Consortium is represented with the following figures which highlight a very positive impact on the territory of Friuli Venezia Giulia (data updated until 2009): Technology Transfer and academic research exploitation: »» »» »» »» »» »» »»

2,700 companies supported; 1,630 innovation actions implemented; 93 patents filed from companies; 7.72% increase in sales attributed to Area’s intervention; 5.47% increase in personnel attributed to Area’s intervention; 427 exploitation interventions; 46 patents filed from academic research;

Innovation Factory: from a business dream to a business plan

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B) History, analysis and success factors of the best practice

»» 11,000 training hours; »» 1,500 participants. STP management: »» 2,430 staff resources; »» 72% of personnel with a university degree; »» 10% yearly increase of employment; »» 7% yearly increase of sales; »» 94% success rate of start ups born in Area Science Park; »» Better tenants’ ROI, ROE, compared to Italian companies. The idea of creating Innovation Factory was born from the conviction that in Italy, and especially in the Region of Friuli Venezia Giulia, venture capital and business angels do exist. There are also many regional, national and international programs that provide financial support for the development of ‘innovative ideas’ but activities of professional assistance to future entrepreneurs are missing either in the phase of creation of an entrepreneurial idea or during the actual creation of a company and its market entry. This lack of assistance and support results in a relatively significant percentage of failure of ‘new ideas’ either in the starting phase or even in the developing phase, also due to a lack of specific professional competences that are necessary for a new entrepreneur to succeed in the market. In that respect, Innovation Factory intervenes exactly at the most crucial phase in the development, the phase of pre-incubation (pre-seed phase) and continues until the ultimate phase of the company development (start-up) i.e. market penetration and market share realization. Table 1 describes the main milestones of establishment of Area Science Park and Innovation Factory in a chronological order. Tab. 1 - Milestones of establishment of AREA and Innovation Factory Date

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Description

1976

After the earthquake in 1976, the Region of Friuli and the Italian government allocated funds for its reconstruction. During this period arose the idea of creating a structure, that was to become Area Science Park, where research and industry were to be strictly linked in order to enhance the existing scientific institutions of the territory, such as the International Centre of Theoretical Physics (Ictp) of Miramare

1978

Consortium for the management of the Park was established thanks to the close collaboration with CNR (the Italian National Council for Research), Friuli Venezia Giulia Region, the Province of Trieste, the Municipality of Trieste and Universities of Trieste and Udine. The headquarter of Area Science Park is located 10 kilometres (6.21 miles) away from the city Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

1981

After the purchase of the land on behalf of the Ministry of Interior in 1981, followed restructuring of the area and attraction of enterprises as possible tenants

1985

Area Science Park welcomed its first tenant

1999

The Consortium was recognized as a National Research Body and was allowed to open new offices not only in Trieste but also regionally

2002

Opened delocalized centre in Pordenone

2004

Opened delocalized centre in Gorizia

2006

Established Innovation Factory, the first mile incubator in the Area Science Park

Innovation Factory is targeted at: »» researchers and research groups intending to implement their own startup project; »» entrepreneurs interested in taking part in the creation of new companies in the light of research carried out in collaboration with research institutions in the area; »» young professionals interested in developing an innovative business idea. Innovation Factory offers business incubator services with specially equipped units, help in assessing the enterprise concept from technological, commercial, legal and economic standpoint, plus financial support with the possibility of funding in the form of seed capital. In order to foster the business initiatives, Innovation Factory together with AREA Science Park, also makes available specialized offices to potential entrepreneurs carrying out analysis on: »» patents and document retrieval; »» technical analysis for the validation of the innovation focus of the business idea; »» market and desk analysis. Such analysis aim at underlining strengths and weaknesses of the business proposal useful for its evaluation and deciding on crucial activities in the preincubation phase related to the success of the future company. The main activity of the incubator is the creation and development of new companies through continuous assistance (capital, professional technical, managerial and financial support and office utilities) that carries an innovative idea (a ‘business dream’) to defining an appropriate business model (a ‘business plan’) and matching it with potential market needs (‘potential customers’). Unlike other incubators, the incubator run by Innovation Factory manages not only the aspect of providing financial assistance but it assists the entrepreneur in all the phases of company’s development by providing technical assistance already in the pre-seed phase, professioInnovation Factory: from a business dream to a business plan

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B) History, analysis and success factors of the best practice

nal assistance in running the funds and necessary office utilities in the seed-phase, professional internal and external tutors through the whole process of development until the company’s expansion phase (market penetration and market share realization) and exits once the company’s incubation life cycle is completed and the company is in the market (see figure 6). Fig. 6 - Life cycle of a start-up

Source: PolyTechnos Venture Partners

The incubation process is divided into 3 phases: »» Phase 1. Evaluation of a business idea Applicant submits a description of a business idea and a business plan to the technical-scientific Committee of Innovation Factory. »» Phase 2. Pre-incubation After passing selection, the applicant signs a convention and enters into the ‘development Group’. From this point on, Innovation Factory assists the future entrepreneur in the accomplishment of its business idea. »» Phase 3. Establishment of a start up company Once all the conditions are met allowing the future entrepreneur to be able to operate in autonomy and to sell its product to first customers, Innovation Factory together with the future entrepreneur agrees on establishment of a new company. 14

Once the company is set, Innovation Factory becomes a minority shareholder. Parties mutually agree on establishing mechanisms that will allow to the Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

entrepreneur to gain a full ownership of its company (the most adequate ‘way out’ of Innovation Factory). Here are the three incubation phases explained in detail: Phase 1. Evaluation of the business idea Innovation Factory initiates activities through a very vigorous selection of entrepreneurial ideas that go through initial feasibility analysis and technical evaluation of the Technical Committee after which the business idea and initial budget proposed by the potential entrepreneur are accepted or refused (See figure 7). The selection is intended to ensure, at the best of the available knowledge, that only innovative and potentially valuable ideas from a technical, economic and commercial viewpoint are accepted. In accordance with its mission, Innovation Factory does not tend to support projects that would represent a one-man show business, but instead it tends to give priority to future companies with a scale up possibly. In the first years of activity, 50 new innovative business ideas have been submitted to be hosted in the incubator, but only 8 have been approved by the Technical Committee.

15 Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

Fig. 7 - Selection process of entrepreneurial ideas in Innovation Factory

16 Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

Phase 2. Pre-incubation Once the idea is accepted and an initial agreement is signed, Innovation Factory provides the technical, managerial and financial assistance necessary for the development of a business idea. As regards capital it is not managed directly by the entrepreneur, instead Innovation Factory sustains all or part of the expenditures necessary within the whole period of development. Expenses are previously determined in the initial budget, agreed between the potential entrepreneur and Innovation Factory and approved by the Incubator’s managing body. (See figure 8). Fig. 8 - The Process: from a Business Dream to a Business Plan

In that respect, after the phase of scouting and analysis of the innovative idea (‘business dream’), chosen potential entrepreneurs (referred to as the ‘Development Groups’) enter into the ‘coaching’ phase, the most important phase in which new potential entrepreneurs develop the competences necessary to do business. This is the most delicate phase of the development and, in that respect, the activities of the incubator are aimed at minimizing the risk of failure of future entrepreneurs by developing their entrepreneurial competences through external consultancy and internal coaching. In this stage, Innovation Factory also provides more specialized competences such as exploring the possibility of patentability of a ‘business idea’ (i.e. a new product) and thanks to its established business network it starts creating a bridge between the new entrepreneur and its potential customers. Once economic and financial indicators of the business idea are formalized, professional competences and possible new business networks are acquired, the potential new entrepreneur enters a start-up phase. As indicated on figure 6, Innovation Factory and the future entrepreneur will establish the company Innovation Factory: from a business dream to a business plan

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B) History, analysis and success factors of the best practice

only when previously indicated potential customers, provided they are not only ‘early buyers’, are asking to buy the product/service of the company. This way, the incubator assists the future entrepreneur by making available instruments, competences, resources and networks necessary to verify technologic, economic, legal and commercial feasibility of an entrepreneurial idea on the market. The process ensures its support in: a. Assistance for the implementation of the projects: the future entrepreneurs receive technical assistance from the well-skilled staff of Innovation Factory during each phase of the project implementation, including the evaluation of the results and the following re-planning activity (i.e. about product development, protection of the intellectual property, market analysis, feedbacks from the first business contacts, etc.). Moreover, the incubator encourages the exchange of information and experiences among the entrepreneurs and the potential entrepreneurs who tackle similar problems during all phases of company’s development. Innovation Factory helps future entrepreneurs by providing the services and resources needed to successfully complete the path that leads to the creation of the new business. b. Financial assistance: the entrepreneurial initiatives are introduced to the financial operators such as venture capitalist specialized in seed capital, business angels, and business banks during events and meetings. c. Incubator services: the Development Groups and start-up companies can use the services provided by Innovation Factory and AREA: the basic ones (ICT networks, canteen, conference rooms, etc.) as well as important promotional opportunities: introduction to the main local institutions, press tours, involvement in technology transfer initiatives carried out by AREA, participation to business plan competitions at national and international level (i.e. TechGarage at SMAU in Milano, HIT Competition in Barcelona). During the pre-incubation period, Innovation Factory periodically controls the process of establishment of the new company: if any of the milestones set for the development group in not achieved, the process is stopped and the development group is dismissed at no charge for the entrepreneur. If all the milestones are achieved, Innovation Factory confirms the program and the budget of the development group and continues towards the Phase 3. Phase 3. Establishment of the start up company

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As previously stated, only when previously identified potential customers are ready to buy the new product or service (this way becoming ‘real customers’), the entrepreneur and Innovation Factory move to establish the Start up company. Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

The entrepreneur, as a majority owner, has the control of the company, while Innovation Factory, as minority shareholder, remains in the company for the first 3 years in order to continue to support the company in its start up phase. After the 3 year period the shareholders together decade on a most appropriate ‘way out’ mechanism for Innovation Factory. Innovation Factory: the role of the incubator on the way to business realization Below are the most crucial variables which contribute to the realization of a business dream1: 1. resources; 2. competences; 3. definition of a business idea; 4. formation of entrepreneurial skills. 1) Innovation Factory and resources According to performed studies, success of a company is conditioned by availability of various resources: financial, technical, and managerial ones. More unique, inimitable and irreplaceable resources company owns higher is its competitive advantage on the market. Innovation Factory’s approach to providing a support to potential entrepreneurs is initially focused on determining jointly which direction potential entrepreneur should follow and which activity should he/she start first and only than which type of resources would be the most appropriate at the given moment. Innovation Factory has the objective to finance the project differently than Venture Capitalist would finance. It does not provide financial resources on free disposal to the potential entrepreneur but it covers the services that are necessary, such as computer, office, collaborators. Experience of modeFinance, i.e. Mr. Ciprian: ‘In the phase of creating a business dream, researcher does not need financial resources but effective comprehension on what he is about to do. If I have received the financial support without knowing the market that I was about to face, stages of development of my company, competitors, I would have probably thrown away the money and time without reaching the result (…).Financial resources have served me in a later stage especially for sustaining the utility costs (computers, salary for our collaborators, marketing and communication expenses etc.). If we have not received the support of Innovation Factory once we have determined which way to follow we would not have been able to sustain our further activities’. 1

Source: “Evidence from Innovation Factory experience of AREA Science Park in Trieste”, Francesco Castellaneta

Innovation Factory: from a business dream to a business plan

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B) History, analysis and success factors of the best practice

There also are more intangible services that start-up benefits such as being located in the technology transfer and research centre. It allows a direct exchange of ideas and opinions in any given moment, directing the company in one direction or other. Once determined the weakness in the business idea, Innovation Factory finds an appropriate consultant to guide a way. Among many different opportunities offered by being located within AREA Science Park, there is also a possibility for future entrepreneurs to participate on public and internal events organized by the Park. For example supported by AREA and Innovation Factory, Amped in its pre-incubation phase has participated at the event ‘Techgarage Day’ organized by SMAU, Milano where it won a premium as the most innovative start up. 2) Potential entrepreneur, pre-incubation phase and Innovation Factory: ‘defining a business idea’ Pre-incubation phase finds potential entrepreneurs with a business dream that is still in its embryonic phase and it needs additional information and valuation before it becomes technically and economically realizable. In this phase the future entrepreneurs are faced with increased level of insecurity where they need to find solutions to problems that are not perfectly defined and search for an application of a new technology that is still not developed but also to choose which business opportunities to embrace among a vast sea of possibilities. In this phase, Innovation Factory puts on the disposal various consulting competences that support very important step for development of entrepreneurial project which future entrepreneur otherwise would abandon. Possibility to count on external support greatly conditions a direction that future entrepreneur will follow, especially regarding realization of opportunities thanks to competences and support Innovation Factory makes available. ModeFinance’s co owner declares in its interview that: ‘If there was not for the support of Innovation Factory we would probably do something but would not choose to do this. Innovation Factory has provided us not only with economical support but also with a possibility to develop our product. On our own we would not be able in such a short period to develop this product’. Definition of a business idea is also influenced by availability of specific competences. Innovation Factory supports potential entrepreneurs in a phase of research and valuation of patentability of a product or idea, by providing information, thanks to its entrepreneurial contacts, also on a very important segment such as competition. 3) Access to internal and external competences within Innovation Factory 20

Potential entrepreneurs rarely have all the necessary skills to guarantee launching and success of a new company, and for this they have to search for Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

external skills and competences like commercial, industrial partners, consultant and research centres. In this respect, Innovation Factory is directly involved by supporting potential entrepreneur with competences using its own network of established business relations providing an open door for the potential entrepreneur to already experienced external stakeholders. It is also important to mention that Developing Groups located within Innovation Factory also have on their disposal the competences available within AREA Science Park (i.e. either internal consultants or existing business/entrepreneurial network). Access to external competences arises from the fact that future entrepreneurs localized within the incubator are perceived with more credibility when evaluated by external stakeholders: ‘It is also necessary to mention that the fact to work with University and being located in Innovation Factory provides significant credentials. I would not ever thought before that it would be so important. Instead the fact of being located in AREA and Innovation Factory gives you more guarantees. This comes from the point that the screening process that we had to pass in order to be a part of the Incubator is very well acknowledged and appreciated by external stakeholders’ - ModeFinance. 4) Innovation Factory and formation of entrepreneurial skills Formation of entrepreneurial skills is of fundamental importance especially when a potential entrepreneur comes from the world of research or is starting entrepreneurial activity without previously having acquired relevant managerial or entrepreneurial skills. Support provided by Innovation Factory is particularly focused on gradual acquisition of necessary entrepreneurial and managerial skills avoiding in this way that premature failure discourage potential entrepreneur to continue to develop its business dream.

21 Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

Success factors of the best practice Innovation Factory can be considered as a best practice for a range of success factors both external and internal to the company. External factors that have contributed to its success can be retraced to the following: »» strong interaction with the major shareholder, i.e. AREA Science Park, National Body of Research and the leading Science Park in Italy; »» industrial /science park environment (Innovation Factory is hosted in Area Science Park); »» strong support of the local government (both regional and municipal); »» good international connections; »» close relations with the businesses; »» attitude towards networking. Internal factors are described as follows: »» a strong management with a sense of vocation; »» thinking in a project approach; »» thinking and planning ahead; »» successful research for the funding; »» understanding that there was the need for assistance and support to business creation; »» Kind of serviced provided. The advantages for Smes are: »» access to the market of technologies; »» development of new technologies, products, and processes; »» acquisition of managerial and technological innovation; »» development of new company’s assets (patents) supporting competitiveness on global markets; »» economic development and business creation. Advantages for researchers: »» protection of the intellectual property; »» valorisation of the research results; »» realisation of start-ups starting from innovative ideas; »» new collaboration opportunities with businesses for the development of research projects. Advantages for the territory: »» creation of new enterprises; »» creation of new jobs; 22

»» development of the regional economy. Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

Best practices within a best practice Potential business dreams and realized business ideas, Results From its creation in 2006, Innovation Factory has performed analyses of 50 business dreams. Within the 2008-2009 Innovation Factory received 23 proposals of potential business dreams (4 proposals in final semester of 2008 and 19 during 2009) from various sectors out of which: biomedicine, software, energy, environment, etc. At the moment, Innovation Factory is home to 3 entrepreneurial initiatives, others are located in premises within AREA Science Park for technical reasons (necessity of having premises adopted for the use of laboratory). Following are accepted potential entrepreneurial ideas out of which 3 are in incubation phase (already existing companies), 3 are in pre-incubation phase and 1 with pre-incubation phase that terminated negative. Name Phase Starting and ending date of preincubation Sector Product/Service Main activities performer during the preincubation period Name Phase Starting and ending date of preincubation Sector Product/Service Main activities performer during the preincubation period Name Phase Starting and ending date of preincubation Sector Product/service Main activities performer during the preincubation period

Preincubation terminated negative 16/01/2008 – 30/06/2009 ICT High immersive-impact, virtual simulation systems Development and validation of software

Pre-incubation 24/06/2009 – 23/06/2010 Engineering Measurement and engineering-support systems for enterprises, provided through the tuning-up of innovative analysis systems and technologies. In particular, a technology for the measurement of noise-intensity produced by rotating organs (OTOMA). Development and validation of software

Preincubation 30/10/2009 – 30/10/2010 Diagnostics Device for the measurement of the rate of total and free bilirubin respectively in newborn blood-serum. Support and convalidation of a prototype

Innovation Factory: from a business dream to a business plan

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B) History, analysis and success factors of the best practice

Name Name Phase Starting and ending date of preincubation Sector Product/service Main activities performer during the preincubation period Name Phase Date of establishing of the company Sector Product/service Main activities performer during the preincubation period

Preincubation 04/08/2009 – 03/10/2010 Energy High Temperature Heat Pumps Support and convalidation of a prototype

G&LIFE srl Incubation 06/10/2009 Nutrients Applicative development, realization and commercialization of personalized diets based on genetic profiles and perception of taste Development and validation of software Promotion Development of commercial and financial partnerships

Name

AMPED S.R.L.

Phase

Incubation

Date of establishing of the company

10/04/2008

Sector

ICT

Product/service

Development of application software for elaboration of images and videos

Main activities performer during the preincubation period

Development of commercial version of software Market analysis Development of commercial contacts

Name Phase Date of establishing of the company Sector Product/service Main activities performer during the preincubation period

MODEFINANCE S.R.L. Incubation 14/09/2009 Financial Software and services for analysis of company credit ratings Development and validation of software Development of commercial contacts

Milestones of the incubated businesses: ĂŹ AMPED: creates software for the analysis and enhancement of images and videos in the forensic and public security field. 24

2006: admission to the Innovation Factory support program (AREA Science Park). Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

2006: Project won 2nd prize at the BP competition StartCup. 2008: Amped SRL officially established. 2008: first sale to the Swedish Police. 2008: awarded as the best Italian startup at the SMAU ICT trade fair. 2009: became a partner of world leader of video surveillance management software. Currently: starting worldwide commercial partnerships with several distributors. ĂŹ ModeFinance: credit risk profile evaluation (rating and default probability). 2007: admission to the Innovation Factory support program (AREA Science Park). 2008: entered world market through a partnership with Bureau van Dijk. 2009: Mode Finance officially established as a company. ĂŹ G-Diet: provides complete nutritional program and genetic profile based on DNA. 2008: admission to the Innovation Factory support program (Area Science Park). 2009: European patent deposited. 2009: G-diet finalist @HiT Competition (Barcelona, Spain): one of the best 25 start-ups worldwide. 2009: G-diet company born.

25 Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

‘When Innovation Factory supports a Business dream to become a Business’: examples Amped 2

Product Amped is a company developing software for the analysis and the enhancement of images and videos in forensic and public security field. Application of the product is primarily attended to police, defence and private investigators. The product elaborates images and videos from the crime scene that are usually of low quality (images coming from surveillance cameras or telephones) whereby the software program elaborates distorted images by increasing its quality.

Origin of a business dream The product was born as a University project by its founder, Mr. Martino Jerian, within the Department of electronics and information technology (DEEI) with the group of Image processing laboratories at the University of Trieste. Thesis was later realized with the help of police investigation unit (RISScientific Investigations Unit - of Parma, Italy) with the aim to serve as more advanced tool for investigators and video processing tool acceptable by the courts. In 2006, Amped was accepted to be Innovation Factory’s first potential entrepreneurial business dream and as a result of its support a research project 26

2

Source: Company presentation Amped SRL, Trieste, Italy

Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

idea became a product, software was tested by users on real cases, and several scientific, commercial and institutional partners were identified. In 2008, Amped SRL was officially established. From a business dream to a business plan as declared by Mr. Jerian in the interview: ‘I wanted to start something on my own (…). I liked the idea of realizing software especially after receiving positive response during the realization of the thesis. During the thesis I participated at the Start Cup, as a national business plan competition (…). At the same time a new initiative Innovation Factory was available within AREA Science Park (…). I applied even without knowing exactly what it was about. I was the first one accepted by the Innovation Factory (as the first company incubated) and also the first company successfully established’.

27 Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

modeFinance 3

Product modeFinance is a rating provider company performing credit market analysis to companies from all over the world. The product provides the existing market with innovation: a new methodology for the allocation of rating based on integration of the most innovative theories for engineering design with financial theory used for credit reports, statistical analysis and market research (companies searching for the best suppliers, costumers, partnerships etc.).

Origin of a business dream The Entrepreneurial initiative, supported by Innovation Factory, was born as a spin off in the University of Trieste on the initiative of Mr. Valentino Pediroda, researcher within the University of Trieste and Mr. Mattia Ciprian engineer and consultant for some Italian rating companies. Founders of modeFinance began working in financial environment in 2003 inside an Italian research project MIUR ‘Complex Systems in Economics’ in which AREA Science Park participated as technical coordinator. Thanks to the acquired knowledge, the charter members of modeFinance executed consulting activities for Italian rating agencies, mainly developing numerical models for the enterprise default prediction.

28

3

Source: modeFinance, company presentation

Innovation Factory: from a business dream to a business plan


B) History, analysis and success factors of the best practice

After having had enough experience in the development of numerical methods for financial risk, in 2007, the charter members became a part of Innovation Factory with an intention to develop a new branch of research and attempt to founding a company based on new competencies. As a result of new competences acquired with the support of Innovation Factory, AREA and innovative ideas of the researchers, in 2009 they established a new company: modeFinance.

Source: modeFinance, company presentation

From a business dream to a business plan as declared by Mr. Ciprian in an interview: ‘Business dream was born one day after three or four years of developing numerical methodologies to be applied in modern finance and especially in credit market analysis. With the support of IF we have managed to develop our business dream, build partnership with BvDEP and with acquired competences we currently provide ratings globally. It was a joint work that resulted in establishment of our company in October 2009’.

29 Innovation Factory: from a business dream to a business plan


C) Regional policy considerations for the best practice ‘We need to inject innovation and research in the productive system of our region and in order to fulfil this objective we have chosen AREA Science Park, which is in our opinion the best partner in our Country and abroad’. These are the words of the President of the Basilicata Region, Mr Vito de Filippo, which has highlighted the sense and meaning of the agreement signed with the Science Park of Trieste. On 24th April 2009, The Basilicata Region and Area Science Park signed a collaboration protocol for the realisation of a project called ‘Basilicata Innovation’ which foresees the birth of a new regional body that will provide services and tools to sustain SMEs’ competitiveness and the improvement of the research on the regional territory. Regional businesses will find a direct access point to the state of the art of the international applied research, to find competences, partners, financing, and assistance to accomplish innovative projects. In Basilicata, a great deal of research centres, excellent centres and dynamic productive businesses are present and they are deeply engaged in sectors like agro-industry, hearth observation, environment, and energy. ‘Basilicata Innovation’ addressees these subjects, with the goal of offering a stable structure highly rooted on the territory in order to provide services and tools for local enterprises. This initiative wants to start an economic development process centred on technology transfer. By giving value to the research results and enhancing the quantity and quality of the competences transferred to SMEs, it is possible to promote the creation and the growth of highly knowledge based enterprises. Thus, the migration of the best practice taken into consideration, even though belonging to a territory very faraway from Basilicata, is supported by a strong political consensus. The Region signed the protocol with Area Science Park (and Innovation Factory as well, representing a part of the Park) because it has verified that the expertise and the know-how generated in Friuli Venezia Giulia can have positive spin-offs for the Basilicata region. Basilicata needs big improvements in the fields of the research and scientific system and technological innovation; as a result, it is really urgent to have a structure that can give value to the pre-competitive development and the technology transfer, and the entrepreneurial training. In the last ten years, Area Science Park and Innovation Factory have achieved competences, tools, and methodologies that will be transferred to the Basilicata region, especially in the four strategic sectors/poles chosen by the regional government: sustainable mobility, energy, agro-bio technologies and hearth observation (extensively described in the Study of the Innovative Potential of Basilicata, WP3.1). 30 Innovation Factory: from a business dream to a business plan


C) Regional policy considerations for the best practice

In particular, for each of the previous sector indicated, it will be promoted the realisation of industrial research projects coherent with the strategic development guidelines of the reference sector and that will be analysed in the respective technological road maps. Furthermore, the interventions foreseen will be focused on the advanced research, the development of new methodologies and productive systems, to the increase of value of the research through the transfer of the methodologies to the wide world of local Smes, so to offer them new useful solutions with a wide systemic impact in order to enhance the competitiveness of the reference economic sectors. The achievable results of the local SMEs could be as follows: »» »» »» »» »»

development of new technologies, products, processes; acquisition of technological innovation; managerial innovation; creation of new innovative businesses; development of new company’s assets as patents supporting competitiveness on global markets.

The integrated system of activities and services established in Friuli Venezia Giulia will be appropriately adapted to the characteristics and peculiarities of the territorial, economic and social context of the Basilicata region and it will be articulated following the subsequent principal intervention lines (as stated in the Protocol Agreement signed between the Basilicata Region and Area Science Park): »» establishment of a system of Competence Centres strategically placed on the Territory and connected to a network (according to the ‘Innovation network’ model) dedicated to the promotion of the innovation culture. The Competence Centres will provide services and assistance to SMEs concerning strategic issues in the sustainable mobility, energy, agro-bio technologies and hearth observation sectors; »» establishment of a service devoted to the increase in value of the research developed by the Research Centres and the University of Basilicata with the overall aim to extend the relationships between the research world and the Smes and to favour the connection of the research with the market; »» establishment of a Study centre supporting technological transfer and innovation activities for the entire regional productive and scientific system; »» organisation and management of training activities specifically planned both for regional SMEs and for technology brokers; »» establishment of a first mile incubator (following the Innovation Factory model) sustaining the creation of new enterprises both from researchers and young people who intend to implement projects regarding innovative Smes with a high - knowledge content. Innovation Factory: from a business dream to a business plan

31


C) Regional policy considerations for the best practice

The agreement signed between Area and the Basilicata Region has a validity of 6 years and it is renewable for other 6 years; therefore the Region wishes to adopt a medium - long term strategy above all because Basilicata needs big inputs and improvement in order to support and enhance innovation on the territory. Even though there is a good demand for innovation and there are plenty of research centres and university’s faculty, Basilicata could be still considered as a virgin territory as far as innovation is concerned. The path started from the Region will also followed by Sviluppo Basilicata which intends to promote this strategy to all the local stakeholders participating to the Regional Network Meetings with whom it has already started to discuss upon innovation and how to implement it on the territory. The stakeholders identified belong to a wide range of relevant structures and bodies (Universities, Research centres, Chamber of Commerce, and so forth) and they can give a very important contribution to the identification of problems connected to the implementation of innovation in Basilicata and of the suitable solutions to go over these difficulties.

32 Innovation Factory: from a business dream to a business plan


D) References Francesco Castellaneta, Ph.D. in ‘Business Administration and Management, ‘Evidence from Innovation Factory experience of AREA Science Park in Trieste, Scientific’, (2009). Francesco Castellaneta, Ph.D. in ‘Business Administration and Management, ‘From the business dream to the business plan: the role of first-mile incubators’ Economia e Management, (January 2010). Interview with the expert Mr. Andrea Trevisi Person in charge for the Technological Transfer of Innovation Factory Scrl (02 February, 2010). Interview with the expert Mr. Giovanni Cafarelli Person in charge for the Business Incubators of Basilicata Innovazione (02 February, 2010).

33 Innovation Factory: from a business dream to a business plan


Website of FIDIBE Project www.fidibe.eu Visit the partners’ websites and the sub-pages of FIDIBE project • Mid-Pannon Regional Development Company http://www.kprf.hu/ • Sviluppo Basilicata S.p.A. http://www.sviluppobasilicata.it/ • Venice Gateway for Science and Technology http://www.vegapark.ve.it/ • Centre for Research and Technology Hellas http://www.certh.gr/ • Alexander Dubček University of Trenčin http://www.tnuni.sk/ • West-Pannon Regional Development Company http://www.nyupan.hu/ • Technology Park Ljubljana Ltd. http://www.tp-lj.si/ • Business Innovation Centre of Croatia http://www.bicro.hr/ • Harghita County Council http://www.hargitamegye.ro/ • INOVA NOVA, n.o. http://www.inovanova.sk/

34 Innovation Factory: from a business dream to a business plan


Background of FIDIBE project Development of Innovative Business Parks to Foster Innovation and Entrepreneurship The SEE area has a low performance with respect to R&D. The majority of the countries of the area are facing low levels of innovative activity and thus of competitiveness. The main objectives are to increase the innovative potential and competitiveness of the SEE area with the development and support of competitive and innovative small and medium-sized enterprises operating in the Area, to facilitate innovation, promote entrepreneurship and the development of knowledge economy in the SEE area and to decrease the big disparity in economic development in the SEE area. Objectives would be achieved through developing and improving support networks and services for innovative SMEs in the area. Main outputs: » the Manual of Business Innovation Park, which can be used as a guide to establish new and further develop existing parks, » regional analyses and feasibility studies of the foundation of new parks or of the enhancement of old parks coupled with the in-depth analysis of needs of SMEs, » forums for exchange of best practice, knowledge and experience in the framework of training, study tour, international seminar and final conference. Project duration: 01/04/2009 - 31/08/2011 Partnership 9 Partners from 7 different countries joined the project representing Science Parks and Business Incubators, Research Centres and Universities, Development Agencies and Local Authorities • Mid-Pannon Regional Development Company (Hungary) Lead Partner • Sviluppo Basilicata SpA (Italy) • VEGA Venice Gateway for Science and Technology (Italy) • Centre for Research and Technology Hellas (Greece) • Alexander Dubcek University of Trencin (Slovakia - till 15 April 2010) • Harghita County Council (Romania) • West-Pannon Regional Development Company (Hungary) • Technology Park Ljubljana Ltd. (Slovenia) • Business Innovation Centre of Croatia BICRO Ltd (Croatia) • INOVA NOVA, n.o., (Slovakia - as of 15 April 2010).

www.fidibe.eu


FIDIBE project was selected within the European programme SEE-South East Europe co-financed by EUROPEAN UNION. It is a transnational cooperation programme that aims to improve the territorial, economic and social integration process in the participating Countries by contributing to the area competitiveness through the development of transnational partnerships and joint actions on strategic issues.

www.fidibe.eu

The company, italian partner of FIDIBE project, in house of the Basilicata Region, works as a regional agency by fostering development, research and competitiveness in Basilicata.


Innovation Factory from a business dream to a business plan