Health and life science business incubators – literature review and benchmarking
Health and life science business incubators –literature review and benchmarking
Peetu Virkkala, Heikki Ailinpieti, Martti Saarela
University of Oulu, Kerttu Saalasti Institute
Microentrepreneurship research group MicroENTRE
Oulun yliopiston Kerttu Saalasti Instituutin julkaisuja 2/2025
Business incubator
A type of entrepreneurial support organization that nurtures early-stage innovations and startups through a specific kind of incubation model.
Incubation
In a business context, incubation refers to the development activities that aim to turn ideas into tangible and intangible things.
Incubation model
Structured framework which describes how the incubation is done. It includes selection, business support, and meditation practices.
Incubatee
An individual or team that takes part in the incubator. The incubatee receives support and resources from the incubator.
Innovation ecosystem
Network of interconnected actors such as private and public organizations that foster innovation activities in the ecosystem.
This report has been produced as part of Europe co-funded (Council of Oulu region JTF funding) OYSTER Terveys- ja Life Science –hautomo project. The project is conducted between 1.1.2024 and 30.4.2026. The project is coordinated by Business Oulu (City of Oulu) and partnered with the University of Oulu and Oulu University of Applied Sciences.
Authors: Peetu Virkkala, Heikki Ailinpieti and Martti Saarela
Year: 2025
ISSN 2814-4406
ISBN 978-952-62-4372-6 Electronic
1. Introduction
Health and life science sector is full of business opportunities aa(and challenges)
Role of incubators in health and life science innovation aaactivities
Purpose of this report
2. Best practices for business incubators
Challenges in identifying best practices
Literature on best practices for incubators
3. Health & life science business incubators –literature
Health and life science business incubators
Incubators in health and life science ecosystems
Health and life science business incubators – a systematic aaliterature review
Overview of the results
4. International benchmarking
Overview of the results
Other remarks
5. Case study: Umeå Biotech Incubator
Umeå region and incubators in Umeå
Health and life science innovation ecosystem in Umeå and aaUBI’s role in it
UBI’s role in health and life science ecosystems in Sweden
UBI’s incubation model
UBI according to Bergek and Norrman’s incubation evaluation aamodel
UBI’s recommendations to other incubators
6. References
1 Introduction
Health and life science sector is full of business opportunities (and challenges)
The health and life science sector is one of the most rapidly evolving industries in the world. The industry has received a lot of investment in recent decades as global trends such as the aging population have provided demand for new types of businesses within the industry. (Garbuio & Wilden, 2018; Simunaniemi et al., 2022). In topics such as digital health, new innovative products and services are renewing healthcare delivery and providing record-high revenues to health and life science companies (Graph 1).
Many health and life science innovations are driven by nontraditional players, such as startups, which now have more opportunities than ever before (Garbuio & Wilden, 2018; Giglio & Micklus, 2021). In this fruitful environment, startups that are able to identify and meet unique market needs with value-adding innovations are well-positioned to grow and challenge established health and life science actors. However, the health and life science industry is ruthless for startups in many ways. The innovation process is complex, time-consuming, and highly regulated, requiring a lot of collaboration within complex health and life science innovation ecosystems, which can be difficult for startups to navigate. (Robinson, 2001; McMullen & Shepherd, 2006; Garbuio & Wilden, 2018).
Graph 1: Revenue forecast of Digital Health in Europe 2025-2029 (Statica.com)
Role of incubators in health and life science innovation activities
Entrepreneurial support organizations (ESOs) can help to alleviate health and life science startups’ innovation challenges. Various types of ESOs, such as incubators and accelerators, are utilized within health and life science innovation ecosystems to support startups. Many of these ESOs play key roles in health and life science innovation ecosystems as they help to ensure that the innovation ecosystems stay vibrant through their processes.
In the literature, the term incubation (nurturing something in a controlled environment), is often used to describe the processes that ESOs utilize to help startups. The term is often associated with incubators and accelerators that use specific approaches (incubation models) to nurture their incubates (entrepreneurs and startups) to specific stages. While the boundaries between incubators and accelerators are partly vague, incubators tend to focus on nurturing their incubates early-phase ideas and innovations to market while accelerators tend to focus on accelerating their incubates later-stage innovations to growth (Table 1).
Incubator
Duration
Cohort
Long duration, anywhere from one to five years. Flexible graduation dates. Founders tend to work at a sustainable pace to achieve benefits.
Cohort evolves through the process. Incubatees starting times may vary.
Business model Often publicly owned without own investment funding.
Table 1: Differences between incubators and accelerators (modified from Cohen, 2013)
As incubator's role in early-phase innovations and young startups is significant, they are often utilized to nurture early-stage innovations. While there are other types of incubators such as learning incubators, the majority of the incubators are business incubators that aim to commercialize innovations. The incubators can also be categorized further into general and sector-specific incubators (e.g. health and life science sector-specific incubator).
Purpose of this report
This report is part of the OYSTER Terveys- ja Life Science –hautomo project. The project began in 2024 and is set to last until the spring of 2026. The project aims to launch the OYSTER health and life science incubator in Oulu, Finland, and create a foundation for the post-project continuum of the incubator. More details about the project can be found from the OYSTER webpage.
In this report, we identified the best available knowledge and practices for health and life science business incubators to suggest how OYSTER health and life science incubator can be further developed to create a strong and sustainable foundation for its future. We set to achieve these goals through the following steps:
1. We define what incubators best practices are (chapter 2)
Incubators' best practices can be defined in many ways. We start by taking a closer look at incubator best practice literature to define our approach to the topic.
2. We identify what is academic literature’s current understanding of health and life science incubators from a business incubator perspective (chapter 3)
Incubator research is scattered across many different fields and no overview of health and life science incubators currently exists. We set out to fill this gap by conducting a systematic literature review (SLR) on health and life science incubators from a business incubator perspective to better understand the topic.
3. We benchmark health and life science business incubators (chapter 4 & 5)
We first identify a sample of health and life science business incubators from Europe to compare their approaches to incubation. Then we delve deep into a specialized health and life science incubator case study to identify what it takes to become a specialized health and life science incubator.
2 Best practices for business incubators
Challenges in identifying best practices
In recent decades, the number and the types of business incubators have increased rapidly. More than ever, business incubators have to justify their existence with strong performance and regional outcomes to prove their relevance to their funders (Baraldi & Ingemansson, 2016). Established and emerging incubators can flourish in this environment by optimizing their practices.
However, identifying so-called "best practices" for incubators based on academic literature is challenging for many reasons, such as:
• Most incubator literature can be described as atheoretical as there is no agreed-upon definition or unified theory for incubator research (Hackett & Dilts, 2004).
• Although a lot of research has been done, it is fragmented (various theoretical lenses are used) and anecdotal (focus is often on individual success stories and outcomes).
• It is difficult to compare incubators in a credible manner
o Incubators' success is relative to their environmental factors (Mian, 2014)
o Incubator comparisons use different measures and analyses of units (Hausberg & Korreck, 2020)
o Collecting reliable data from within and outside the incubator is complex (Hausberg & Korreck, 2020).
Literature on best practices for incubators
”Incubator best practice: A framework” by Bergek and Norrman (2008) is a central study in incubator literature from the viewpoint of best practices. It describes the best practices in business incubators and provides a framework to measure them.
Earlier, the incubation process was often treated like a “black box”: resources entered it, and it produced outcomes, but how it did so was not well understood. This "black box" needed to be opened to identify best practices. Bergek and Norman defined best practice as a process that is better at delivering a particular result than any other process. Furthermore, they noticed that identifying best practices in incubator models requires describing and distinguishing between incubator models and measuring their performance (specifically, how their outcomes relate to their goals) (Figure 1).
Bergek and Norrman show that understanding both the incubator goals and outcomes is critical to identifying the best practices for incubators. If we compare incubators’ outcomes without understanding their goals, we cannot tell if the differences in the outcomes are the result of differences in practices or merely differences in focus between incubators.
Incubator goal
Incubator outcome Incubator model Performance
Incubators’ goal descriptions differ from each other. They can be categorized in many ways and the comparison of the descriptions is often reasonable only on a higher level (e.g.: this incubator focuses on incubating health and life science companies). Incubator outcomes are measured with outcome indicators. It's important to understand which outcome indicators are used when outcome results are compared to be sure that the outcomes can be compared with each other.
Goals and outcome indicators for the OYSTER health and life science incubator
Goals and potential outcome indicators for the incubator have been defined during the development project. They will be used later in the benchmarking section to identify comparable incubators.
1. Goals for the incubator
Increase the utilization of the region’s strong technological expertise in the aaregion’s health and life science industry.
Activate healthcare professionals and researchers to explore entrepreneurship. Offer services that take into account the specific needs of the health and life aascience industry.
Act as an early-stage entrepreneurial actor in the OuluHealth ecosystem. Increase the region’s employment and vitality.
2. Potential outcome indicators for the incubator
Number of incubatees (applicants, graduates).
Number of commercialized research-based innovations.
Number of created jobs in the incubator-based companies (amount of national aaand international workforce).
Amount of funding which the incubator-based companies have received. Event statistics (how many events, how many participants, OuluHealth actor’s aainvolvement, feedback).
Number of incubator-based companies that operate in international markets.
Figure 1: Incubator evaluation model (modified from Bergek & Norrman, 2008)
When the incubator's goals and outcomes are understood, we can compare them between incubators. However, to know why one incubator has better outcomes (higher performance) than another, their incubator models have to be compared to identify the differences between them. To do this, Bergek and Norman created an incubator model framework that can be used to identify differences between incubator models (Figure 2). All incubators share three components in their incubator model: selection, business support, and mediation. These components can be described in each incubator and be used to compare incubators with each other.
Incubation model
Selection: Decisions concerning which ventures to accept to the incubator and which to reject.
Business support: Mentoring, coaching, or training activities undertaken to develop the incubates.
Mediation: How the incubator connects the incubatees to each other and to the outside world.
Figure 2: Incubator model framework (modified from Bergek & Norrman, 2008)
In summary, to identify best practices for incubator models, we have to 1) identify incubators with similar types of goals and outcomes, and 2) compare their incubation models to identify differences in their selection,
support, and meditation components.
Table 2: Most commonly used KPIs in the incubator performance studies (Modified from Torun et al , 2018)
Torun et al. (2018) reviewed systematically the most commonly used key performance indicators (KPIs) in incubator performance studies. These KPIs describe well what is expected from the incubators as an outcome from the policy perspective The average of jobs created per their tenants (63,4%) and tenants' survival rate (58,5%) are the two most utilized KPIs. Clients Revenue, Funds/Capital Attracted, Sales Growth, and Size of Networks are also typical KPIs used in between 30-40% performance studies.
Health & life science business incubators – literature 3
Health and life science business incubators
Global healthcare challenges, such as increasing demand for services due to the aging population have brought more interest and investments for incubators in the health and life science sector. The health and life science sector is diverse, including different types of actors around living organisms such as human beings, animals, plants, and micro-organisms.
Many health and life science innovations are research-based innovations born in laboratory environments. A specialized research background is often needed to prove these innovations’ potential and address the industry’s strict regulations (Schwartz & Hornych, 2008). Innovation timelines are usually much longer than in other sectors due to the sector’s complexity and sale cycles (Flessa & Huebner, 2021). Developing innovations within the sector usually requires collaboration within health and life science ecosystems which are complex and hard to navigate for nascent entrepreneurs (Busch & Barkema, 2022).
Due to these and other sector-specific characteristics, health and life science incubators and their managers/coaches have to address many sector-specific innovation needs (Flessa & Huebner, 2021). The managers/coaches have to have extensive know-how from a variety of different types of topics to understand both the research and the commercialization realities, and expansive networks with research and industry actors to link up with the right actors throughout the innovation process.
Overall, the incubation process often demands a lot of resources to achieve the desired results (Flessa & Huebner, 2021). Most of the successful health and life science incubators have addressed these harsh realities by focusing solely on the health and life science sector (here on we call these incubators health and life science incubators). By focusing solely on the health and life science sector, they can address health and life science innovation realities better than non-sector-specific incubators.
Many of the successful health and life science incubators narrow their focus even further from this to focus on specific health and life science topics such as biotechnology or pharmacy (here on we call these incubators specialized health and life science incubators). Strict specialization can cause both benefits and disadvantages, but in many science-heavy topics, it can be critical to address the realities in the sector.
Incubators in health and life science ecosystems
Health and life science incubators are highly dependent on health and life science innovation ecosystems. Good relations with ecosystem stakeholders are critical so incubator management has to ensure that the incubator’s legitimacy can be maintained. This can be done by adapting the incubator structurally (e.g. by changing the incubation model) and by altering the incubator's position within its ecosystem (e.g. by redefining the incubator’s contribution to the ecosystem) (Friesl et al., 2019). When everything is in order, incubators can fulfill their role within their innovation ecosystems as creators and intermediates of knowledge networks and innovative startup companies.
Health and life science incubators role within their innovation ecosystems can be seen from different perspectives (Image 1). Regional set-up and interactions between academia, industry, and government ensure that regional innovation ecosystems differ significantly from each other. To ensure optimal value for both the incubator and the ecosystem, incubator management should ensure that they involve people from different parts of their innovation ecosystems in the management activities. (Hafer et al., 2021).
Image 1: The incubator’s role in the health life science ecosystem can be seen in different ways, e.g. as a cross-sectional actor [1, 2], as the ecosystem’s intermediary in the global ecosystem [3], or as a synthesis of the ecosystem’s expertise [4].
Health and life science business incubators – a systematic literature review
In the literature, health and life science incubators are approached differently from different perspectives. Any proper systematic literature review (SLR) about this topic doesn’t yet exist, so we set out to conduct one to obtain an overview of the literature and to understand how this knowledge could be utilized in the OYSTER health and life science incubator.
SLR was conducted using two scientific databases (Scopus & Web of Science), from which journal articles that focused on health and life science business incubators were selected using a systematic search method. After the multistage inclusion-exclusion process (see Table 3 for further details), the SLR led to the identification of 16 articles (Table 4). This small group of research articles shows that health and life science-focused business incubator research is still limited representing a minimal part of business incubator literature.
Overview of the results
The articles approached health and life science incubators from different perspectives. Three topics: “health and life science business incubators in academic medical centers”, “biotechnology specialized health and life science incubators”, and “differences between health and life science incubators and accelerators” were the most prominent in the articles. The articles were published between 1998 – 2024. A significant part of the articles was published between 2020-2024 which indicates growing research interest in the topic (Figure 3).
The literature shows that innovation in health and life science can be observed from many different perspectives. Research, clinical, and entrepreneurial innovation perspectives, not-forprofit and profit-based innovation approaches, and other types of user groups are highlighted as important topics to address in health and life science incubators. Differences between health and life science incubators and accelerators are partly vague and routinely challenged and re-shaped. The incubators tend to have a longer and less formal curriculum, and they tend to provide laboratory premises for their incubatees. Research-oriented and early-phase incubatees can benefit more from the incubators while technology-oriented health tech companies and later-stage incubatees can benefit more from the accelerators.
Academic institution's expertise and their researchers are addressed as significant contributors to the success of health and life science incubators. Health and life science incubators should ensure that these actors are involved and committed to the incubator strongly. Academic institutions should understand how the incubators can help them reach their educational, innovation, and care delivery goals, and researchers should understand how the incubators can help them turn their ideas into products and services alongside their clinical and research activities.
• Journal articles were first identified from the databases by using a strict search argument.
• Articles that didn’t approach incubation from the entrepreneurial perspective (e g articles that approached incubation as a biological process) were then excluded.
• Finally, only the articles that focused on health and life science business incubators were included This led to the final group of 16 articles
Table 3: SLR’s multi-stage inclusion-exclusion process
Figure 3: Publication trend
Publications
Manent et al. (2024). Helping start-ups and public organisations to align: Coproducing the co-creation context in a public hospital
Clayton (2024). Different outcomes for different founders? Local organizational sponsorship and entrepreneurial finance
Mulyasasmita et al. (2023). From garages to ecosystems: the coevolution of life science incubators and accelerators
Silva et al. (2022). Is there a fit between incubators and ventures producing responsible innovations in health?
Jiang et al. (2022). Innovation elements, incubation capacity, and incubation performance in biomedical incubation platforms: moderating role of customized services
Gardner (2021). California tool works: assessing the impact of life science incubators and accelerators
Hafer et al. (2021). A multi-institutional partnership catalyzing the commercialization of medical devices and biotechnology products
Donegan & Lowe (2020). Going local: Placing entrepreneurial microgeographies in a larger regional context
Friesl et al. (2019). Managing technological uncertainty in science incubation: A prospective sensemaking perspective
Huang & Huarng (2015). Evaluating the performance of biotechnology companies by causal recipes
Ostrovsky & Barnett (2014). Accelerating change: fostering innovation in healthcare delivery at academic medical centers
Sorte (2013). Challenges and opportunities for biotechnology SMEs in Brazil
Table 4: 16 publications
Summary of relevant findings from the health and life science perspective
Describes how the mutual alignment process occurs between the incubator (public hospital) and the incubate. Highlights how the mutual alignment process enables co-creation activities.
Describe how certain types of founders benefit from different kinds of Entrepreneurship Support Organizations (ESOs). Highlights the benefits of the incubator model.
Gives an overview of health and life science incubators and accelerators’ history and highlights the benefits of the health and life science incubator model.
Identifies that not-for-profit and for-profit health incubatees get support in different ways. Highlight that not-for-profit incubates and Responsible Innovation in Health (RIH) require more attention.
Describes innovation elements of biomedical incubation platforms that positively contribute to their incubates survival rate and growth of status.
Gives an overview of health and life science incubators and accelerators in California. Highlights their practices and differences between health and life science incubator and accelerator models.
Describes a case study of a health and life science incubator that is produced by two universities through a multiinstitutional partnership.
Describes how deepening university support for entrepreneurial development influenced university-affiliated entrepreneurial decision-making in micro geographies such as health and life science incubators.
Describes how prospective sensemaking between the ecosystem and incubator’s management affects the incubator’s internal structure and alters its position within the ecosystem.
Shows that the number of biotechnology incubators and incubates in them have increased the revenues in Taiwan’s biotechnology industry.
Describes how Academical Medical Centers (AMCs) can grow their culture of entrepreneurial innovation through a health and life science incubator and clinician-innovator career track.
Describe how biotechnology incubators help to address the main constraints of biotechnology entrepreneurs.
(1-12)
Publications
Chakma et al. (2008). Can incubators work in Africa? Acorn Technologies and the entrepreneur-centric model
Tonukari (2008). Africa needs biotechnology incubators
Cooke et al. (2006).The biosciences knowledge value chain and comparative incubation models
Tsang & Lo (1998). Biotechnology development in Hong Kong: Infrastructural support for the biotechnology and related industries
Summary of relevant findings from the health and life science perspective
Describes a case study of a health and life science incubator in South Africa highlighting reasons behind its discontinuity.
Describes how biotechnology incubators can help to improve Africa’s biotechnology industry.
Evaluate knowledge value chains between private, mixed, and public bioscience incubators.
Describes the funding of biotechnology and diagnostic-based incubator facilities in Hong Kong between 1994-1997.
Table 4: 16 publications identified in the SLR (13-16)
Based on the SLR, we offer the following concluding remarks for the development of the OYSTER health and life science incubator:
1. Stakeholders from the health and life science ecosystem should be involved in the incubator management board
The health and life science ecosystem offers access to a diverse pool of experts from various fields, benefiting both the incubator and its incubates. To leverage this expertise effectively, the incubator should involve different stakeholders from the ecosystem to the incubator’s management board. This fosters stakeholders’ commitment and motivates them to share their resources and expertise.
2. The incubator management’s role as a mediator between the incubator and the ecosystem should be addressed
The incubator management takes part in prospective sensemaking within the ecosystem. Regular discussions with other ecosystem actors are essential to understanding their perspectives on the future and their role in the health and life sciences sector. This insight should be used to realign the incubator's strategy, enabling it to adapt and evolve its role within the ecosystem. Such an approach enhances the incubator's legitimacy and helps mitigate potential conflicts of interest within the ecosystem.
3. Dual-career nature of academic entrepreneurs should be addressed to attract researchers to the incubator
The incubator should address the dual-career nature of academic entrepreneurs who often have both academic and entrepreneurial goals. It should be clear for academics from the start how valuable their research findings can be from the entrepreneurial perspective and how the incubator can help them to coalign their academic and entrepreneurial goals to help them commercialize their research findings.
4. The incubator should ensure that it has appropriate incubator manager/coach resources to achieve desired outcomes
Incubation managers/coaches within the health and life sciences sector are expected to possess specific capabilities. Sector-specific expertise in research and commercialization is essential throughout the incubation process. To provide comprehensive support, multiple incubation managers/coaches with diverse skill sets are required, and they are expected to collaborate with the incubatees for a longer duration compared to other sectors. The incubator must ensure that these management resources are provided to achieve sufficient and desired outcomes. Inadequate management resources will result in suboptimal outcomes and negatively impact the incubator's performance.
5. Incubator models’ fit to the health and life science sector should be ensured
The majority of research articles highlight the unique characteristics of the health and life sciences sector that are not present in other industries. Health and life science incubators are better equipped to address these specific traits comprehensively compared to general incubators. It is crucial to ensure that the incubation model effectively addresses these sector-specific needs. Without a robust, tailored incubation model, the incubator will struggle to meet the expectations of the health and life science sector.
6. The incubator should make a strategic decision between general and specialized health and life science incubation model
Health and life science is a diverse and complex sector. Its topics often require specialized expertise, especially in topics such as biotechnology and pharmacy. The incubator management should acknowledge the benefits and disadvantages of general and specialized health and life science incubation models. The general approach can provide freedom of choice and decrease resource use but at the same time be too general to lead to desired outcomes. On the other hand, the specialized approach delves deep into a specific topic but narrows the focus and requires special resources which increases the costs. The incubator can also start by focusing on a particular field and then gradually expand to other fields as the incubator evolves. To make the best decision between these approaches, the management should make their differences clear to ecosystem stakeholders and together decide the appropriate approach to the incubator.
4 International benchmarking
International benchmarking was conducted to identify the types of health and life science incubators that exist in Europe. Through an online search, we identified a sample of 19 health and life science incubators (table 5). The websites of these incubators were then analyzed to identify similarities and differences in the incubator’s approaches to health and life science incubation
Overview of the results
Most of the incubators were public health and life science incubators (19). Only two of the incubators, Lundbeck Biotech Incubator in Denmark and JLABS @ BE in Belgium were run by private organizations. The public health and life science incubators were often co-owned by public actors such as universities, cities, regions, and hospitals which mostly funded the incubators through public funding instruments (e.g. national and European funding instruments), and in some cases through private funding instruments (e.g. foundations and associations).
We categorized 6 of the 19 incubators as specialized health and life science incubators. These incubators specialized either in biotechnology (5) or cancer research (1). All of the specialized incubators provided wet labs (laboratory premises for biological analysis) which were less common in the general health and life science incubators.
• SPARK Finland
• Health Incubator Helsinki
• Aleap
• Oslo Cancer Cluster Incubator
• ShareLab
• Medeon
• Umeå Biotech Incubator
• SmiLe incubator
• DRIVE incubator
• Lundbeck Biotech Incubator
• Brussels Life Science Incubator
• JLABS @ BE
• Tartu Biotechnology Park
• Genopole
• iPEPS Incubator
• Eurasanté Bio-Incubator
• TLS incubator
• Bio4Dreams
• BioEscalator
Table 5: 19 health and life science incubators identified in the benchmarking
The incubators’ programs were long, often lasting multiple years, and were frequently tailored according multiple years according to their incubatees' needs. The most common selection criteria used in the incubators were ideas’ scalability to international markets and fit to the health and life science sector. More research-oriented incubators (e.g. specialized incubators) often highlighted research-based expertise and evaluation in their selection processes. Some of the incubators accepted incubatees broadly for their programs while the most established incubators tended to be highly selective and conducted long evaluation processes, especially in the specialized incubators. The starting time of incubatees varied. In some incubators, the incubates joined as patches while in others the incubates joined flexibly throughout the year.
incubatees joined flexibly throughout the year. Most of the incubators promised their incubates tailored coaching, health and life science expertise, and networking opportunities. Specialized incubators often also highlighted their unique laboratory premises. Many of the incubators emphasized the role of their community and shared feedback and success stories from their current and graduated incubates in their social media.
Most of the incubators had operated for over a decade in the sector. Their incubation models differed from each other through their common goals often included the commercialization, internationalization, and scaling of health and life science-based ideas. Incubator managers/coaches and management board members were often selected from health and life science industry, finance, and research backgrounds. Some of the incubators highlighted also lab managers for their lab premises. Coaching was often used over mentoring to highlight the incubator managers’/coaches’ personal and long-term roles with their incubatees.
Health and life science innovation ecosystems had a significant role in the incubators. Many of the incubators were located physically in technology or science parks near universities and university hospitals to utilize their innovation ecosystem’s resources. We identified two approaches to incubation management and branding. Some incubators had their own management and distinctive brands while others were managed from higher up in the park and had similar brands as their host parks.
Other remarks
During the online search, we also identified some general incubators that highlighted health and life science as one of their focuses (Table 6). As most of these incubators had a more general incubation model we wouldn’t categorize them as health and life-science business incubators.
We also identified other types of ESOs that had similar activities as health and life science incubators such as innovation hubs, and launchpads (Table 7). These findings highlight diverse approaches to health and life science incubation and vague boundaries between different types of health and life science incubation models.
• STING incubate
• UIC Build
• Tehnopol Startup Incubator
• Lefkippos Incubator
• UtrechtInc
Table 6: Examples of general business incubators with health and life science focuses
• Health Tech Hub Copenhagen
• Pioner Launch Programme
• Start Codon
• Bayer Co.Lab
Table 7: Examples of ESOs with similar activities as health and life science incubators
Highlights
for the OYSTER health and life science incubator
International benchmarking helps to highlight the multitude of approaches to health and life science incubation. Long incubation periods, diverse incubator managerial resources, and strong ties to health and life science innovation ecosystems are common for many established health and life science incubators. General and specialized health and life science incubators seem to differ from each other in many ways. The OYSTER health and life science incubator should ensure that these common characteristics are addressed in the incubation model and decide if it wants to a adopt specialized incubation model. The management should also be aware of other types of health and life science incubation models that could be utilized in the OuluHealth innovation ecosystem in the future.
Based on the benchmarking, we offer the following concluding remarks for the development of the OYSTER health and life science incubator:
1. The Incubator model should be designed to address the SWOT of the regional health and life science innovation ecosystem
Health and life science incubators’ incubation models are diverse. Their goals often include commercialization, internationalization, and scaling of health and life science-based ideas. However, how they do it through their incubation models is highly influenced by their regional health and life science innovation ecosystems. With this in mind, it seems that the health and life science incubator should foremost ensure that its incubator model addresses strengths, weaknesses, opportunities, and threats of its’ regional health and life science innovation ecosystem.
2. The incubator should prove its legitimacy by constructing credible strategic partnerships with research and industry actors
Most of the incubators have been operating for a decade and achieved regional legitimacy for their operations. Most recognized health and life science incubators tend to have a significant role in their regional health and life science innovation ecosystem. They tend to have strategic partnerships with both research and industry actors which make them legitimate actors as sources of ideas and funding opportunities. The incubator should strive to build strategic partnerships with research and industry actors to prove its legitimacy on regional and national levels which in time can lead to interest at the international level.
3. The incubator should involve stakeholders in its management from different parts of the regional innovation ecosystems
Most of the incubators involve advisers to their management boards from different parts of the health and life science innovation ecosystem. As mentioned in the SLR, this fosters the stakeholders’ commitment and motivates
mentioned in the SLR, this fosters the stakeholders’ commitment and motivates them to share their resources and expertise so the incubator should ensure that it addresses this topic.
4. The long development time of health and life science innovations should be addressed in the incubator’s base financing and the selection of investors for incubatees
Commercialization and scaling of health and life science innovations take a long and require a lot of resources. This means that health and life science investor has to wait long to get benefits out of their investments. To secure its postdevelopment project future, the incubator should aim to secure base funding from public actors who can commit to long-term investment. The same applies also to obtaining funding for incubatees from investors.
5. The incubator should strive to maximize both formal and informal learning and networking through its incubation model
The role of a physically localized community is highlighted in many of the incubators. The incubators organize a variety of events that connect incubatees and other health and life science actors together to learn and network. As many of the most successful health and life science incubators put a lot of effort into these activities, the incubator should address face-to-face networking and colearning strongly in its incubation model.
6. The potential for pre-incubator programs should be considered
Many health and life science incubator providers offer pre-incubator programs such as health and life science pre-incubators and thematic boot camps either as separate programs to prepare potential incubatees for the incubator or as the first parts of their incubator programs. Pre-incubator programs can help to attract incubatees from different fields and ensure their capability to the incubator. Post-incubator programs such as health and life science accelerators are less common and provided mainly by leading health and life science incubators. They should be provided only when the incubator has established its position.
7. The incubator should select strategic benchmark targets according to its current status and future aims
We identified a variety of different types of health and life science incubators with different types of incubation models. As achieving high quality and comprehensiveness in health and life science incubation takes time, it doesn’t make sense to adopt practices of the most advanced health and life science incubators that have built capabilities for them over the years. Instead, the incubator should benchmark its practices to similar health and life science incubators which practices could be achieved realistically and as quickly as possible.
Case study: Umeå Biotech Incubator 5
We visited the Umeå Biotech Incubator (UBI) in fall 2024 to identify what kind of capabilities are needed to run a specialized health and life science incubator in Nordics.
UBI is a good example of a successful health and life science incubator. UBI is located in Umeå, Västerbotten county in Sweden. It was created in 2003 by a local professor who noticed that the general business incubator process didn’t suit the commercialization of biotechnology innovations well. Nowadays UBI is nominated as one of Europe’s top 15 biotech incubators.
Umeå region and incubators in Umeå
Umeå region has a significant impact on the Swedish health and life science ecosystem. Despite its northern location and mid-sized population, around 10% of Sweden’s health and life science companies are in Umeå. The region’s main university Umeå University has world-class expertise in biotechnology, especially in fields such as molecular biology and biochemistry in infectious diseases, nervous systemconnected diseases, metabolic diseases, cancer, and clinical research.
There are three incubators in Umeå which all have specific focus areas: eXpression Umeå (design), Uminova Innovation (technology), and Umeå Biotech Incubator (biotechnology). The incubators are owned by Umeå University Holding, Umeå municipality, and Västerbotten region. Incubators are funded by their owners, VINNOVA, and Swedish foundations (soft fund). The incubators also utilize project-based funding from the EU.
Health and life science innovation ecosystem in Umeå and UBI's role in it
Umeå’s health and life science innovation ecosystem is centralized around Umeå University. Most of the ideas and innovations go first to the university’s innovation center from which discussions are then started with potential incubators. Umeå’s health and life science ecosystem is vibrant. The largest life science companies include Cytiva (≈600), APL (≈120), and Sartorius (≈100).
Key differences between Finland and Sweden. In Sweden:
• Researchers own their research IPs, not the university.
• Incubators don’t invest in the startups. There are separate national-level investment instruments for incubators (VINNOVA).
Image 2: Umeå region
UBI’s role in health and life science ecosystems in Sweden
UBI works at all levels in the ecosystem. It supports research ideas, provides offices and labs, networks to venture capital, and expands the health and life science network within the region. It is an active actor who challenges existing practices, ties entities in the system together, and connects the ecosystem to national and international organizations.
Key numbers (UBI)
• UBI has 18 active incubate teams. Around half are ”projects” and half companies
• UBI has 8 employees of which 5 act as coaches
UBI is also active in two national-level innovation ecosystems: Swedish Incubators & Science Parks (SISP) and the Association of Life Science Incubators in Sweden (ALIS).
SISP is the industry association for Sweden's incubators and science parks which aims to transform Sweden into the world’s most effective innovation ecosystem. It has over 60 members that share a rich toolbox of resources and shared practices.
ALIS is Sweden’s national platform for health and life science incubators. It brings together Sweden’s nine regional health and life science incubators (GU Ventures, KI Innovations, Lead, Medeon, Sahlgrenska Science Park, Smile Incubator, STING, Umeå Biotech) and arranges digital matchmaking events for Swedish start-ups and national and international investors.
UBI’s incubation model
UBI’s incubation model is divided into 6 stages:
Evaluate (3-5 weeks): The quality of the scientific data and the IPR situation are evaluated.
Pre-incubate (6-12 months): Market need and team is evaluated.
Verify (2-4 years): Science, product development, IP, need, market, regulatory, health economy, and sustainability impact are verified.
Finance (6-18 months): The company is formed and external investors are taken onboard.
Grow (1-2 years): Startup transforms to a scaleup company.
Alumni (Ongoing): Networking and PR support is offered.
Figure 4: UBI’s incubation process (modified from ubi.se)
UBI according to Bergek and Norrman’s incubation evaluation model
Incubator’s goal: UBI utilizes local resources to transform biotechnology research into growing companies. Together with other actors in the Umeå innovation ecosystem, UBI wants to increase the attractiveness of the region and motivate local graduates to stay in the region after their studies. In practice, UBI provides researchers with resources and expertise to minimize challenges in biotechnology research commercialization.
Incubation model – selection: New incubatees are selected as ”projects” to the incubator. They register as a company only further in the process (Figure 5). This approach provides multiple benefits:
• Incubatees often work full-time as researchers at the university. This approach lowers their threshold to join the incubator
• Project status gives incubatees benefits that they could not get if they joined as a company. For example, company status may narrow early funding opportunities and access to the university’s research facilities.
• Changing ownership and responsibilities within the project is straightforward.
The selection process is demanding. The initial evaluation is done by 2 external technology experts and 2 external business expert. The final select
external business experts. The final selection for the incubator is done by the decision board. This way, the time and effort needed for preincubation and incubation are made clear from the start. It's important to ensure that potential incubatees have enough time and commitment.
Only 2-4 projects are selected by year and the incubator commits to them strongly. There are many reasons for this:
• Biotechnology innovations require versatile tech evidence before and during the incubator process. This bounds a lot of resources.
• Projects stay in the incubator long, even up to 8 years. While yearly acceptance is low, the overall number of active projects cumulate.
• Incubating deep-tech companies is expensive. By focusing on a small group of projects the incubator is able to limit financial risks.
Incubation model – Business support: Incubator’s managers act as coaches in the incubator instead of as mentors. A coach provides guidance to projects and
Figure 5: Transition from project in Verify stage to company in Finance stage
Market research and experiments
Internal funding from the incubator
Acquiring external financing
External funding from investors
Project Transition
helps projects to achieve incubator goals. Coache’s responsibilities are narrowed to specific parts of the incubator process so no individual coach is responsible for the whole process. This coaching method is more active and personal method compared to mentoring and it provides specific benefits for the incubator:
• Through coaching, managers are more committed to their projects. Managers want to see their projects succeed.
• Each coach can focus on specific domains where they are expert. This increases the quality of the coaching. Coaches’ domains include both practical and academic expertise areas.
• Coaching requires local presence. Locality means a lot for incubatees and for the incubator’s brand.
On the other hand, there are also some disadvantages to this approach, such as:
• Narrowing responsibilities for specific parts of the incubation process may cause siloed thinking. The business environment transforms fast so coaches’ knowledge about topics outside of their core competence may become outdated.
The incubator is a specialized incubator (biotechnology) so it's able to:
• Address large set of biotechnology-related risks such as product, clinical, regulation, reimbursement, and commercial risks in its program.
• Offer laboratory premises that fit well with biotechnology companies.
Over the years, key management practices have evolved in UBI:
• Management sets high importance on market evaluation. Incubatees are often soft-forced to evaluate their projects through discussions with their customers and stakeholders.
• Management utilizes KTH Innovations's readiness level method (www.kthinnovationreadinesslevel.com/) to measure progress of incubatees
• Management keeps administration minimum. This saves both incubatees and coaches time. At the same time throughout the incubation process the importance of documentation is emphasized.
• Project teams are built through a tailored team development program for startups (STEP). The management evaluates regularly if the project teams have the necessary competencies and ability to develop their innovations.
For each project specific project manager is selected early.
• If the project team doesn’t have a good person for this role, a suitable candidate can be recruited externally with soft money.
• The project manager takes part in the training board where they learn corporate governance practices and formal documentation. A consultant with experience as a CEO or COB in a health and life science company is hired to train/educate the project team with board issues, documentation, reporting,
etc. This increases their embeddedness and motivation toward the project.
• Through these actions, the management ensures that the projects have a relevant financial situation and a long-term plan to attract additional funding.
Incubation model – Meditation:
UBI aims to build external relationships with universities, industry, and investors. The management team is active in different regional and national events in the health and life science industry such as in the LSX World Congress and BIOEUROPE. Coaches’ relationships and connections to industry and academia are utilized comprehensively.
UBI organizes and takes part regularly in different types of activities:
• Ongoing newsletter.
• Events including webinars, seminars, breakfast events, pub events, CEO events and company presentations.
• Collaboration in Umeå’s industry council (Branschrådet).
• Sweden Life Science Incubator Knowledge Network (Kunskapsportalen).
• UBI Investment Day with preparation material for companies.
Incubator’s outcomes: UBI aims to produce companies that grow and create growth in Sweden. With an active incubate portfolio, over 20 alumni, and ongoing funding from both Vinnova and the EU, UBI is fulfilling its goal to transform biotechnology research into growing companies.
UBI’s recommendations to other incubators
UBI’s management recommends the following practices to other biotechnology business incubators:
Keep good relationship with the university and its researchers
• Researchers are driven by academic goals. Make sure that they understand all the good things that commercialization of research can bring to them and how it can be aligned with their research activities.
• Be present at different types of events at the university.
• When the researcher succeeds, send a small gift so that you are remembered.
Employ experienced managers with diverse backgrounds
• Employ experienced people both from industry and academia.
• Share responsibilities between managers. Organize regular status checks.
• Be present as much as possible. Mentoring is not enough in this field.
Offer sufficient lab environments
• Biotechnology ideas develop in the laboratory. Access to the laboratory is mandatory for these companies.
• When possible, take also the advantage of other laboratory environments such as university laboratories.
Be clear for incubatees about what it takes
• Explain the time and effort needed to be successful.
• Teach the importance of documentation.
And foremost, when you design a health and life science incubator
Write down how many resources you can realistically acquire.
• Think about what you wish to achieve (e.g. how many successful startups). Then think in reverse order how much resources it would demand in each phase (time, money, and expertise) to clarify if you have enough resources.
• If you notice that your resources are insufficient, narrow your goals or begin discussions with your ecosystem stakeholders to identify how you can have more resources.
Key takeaways for the OYSTER health and life science incubator
UBI shows what it takes to become a specialized health and life science incubator. If we to transform the incubator into a specialized health life science incubator, we should:
• Understand the significant resources and capabilities it takes to run a specialized health and life science incubator.
• Identify the specialization topic that plays on Oulu’s health and life science strengths.
• Build the incubator so that it utilizes and provides benefits for both the regional and the national health and life science innovation ecosystems.
• Collaborate strongly with the University and the University of Applied Sciences to ensure that there are enough potential research-based ideas and innovative researchers.
Acknowledgment
This case study is based on both face-to-face and e-mail discussions with the management of UBI. We want to thank UBI’s Operations Manager Peter Jacobsson and UBI’s business coaches Lisandro Bernardo, Pia Keyser, and Andreas Lindberg for their valuable time and expertise and for their invitation to visit UBI.
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