Charles Wyeth - Incubation presentation 100316

1. South African Business Incubation
Conference (SABIC)
Challenges, realities and opportunities for
incubation support programmes
C Wyeth
10 March 2016

2. Business Incubators in SA
Source: DTI, 2014

3. Presentation Outline
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• Who’s challenges, realities and opportunities?
• Opportunities
• Knowing your target market
• Key Questions to ask
• Challenges

4. Who’s challenges, realities and opportunities?
• Who’s challenges realities and opportunities?
o Government?
o Private investors?
o Incubators?
o Incubatees?
o Service Providers?
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5. Opportunities
• Considerable public and private sector support
for enterprise and supplier development
• Job Creation
• Economic transformation and empowerment
• Sectoral transformation
• Neighbourhood re-development
• Technology development and transfer
• Technology commercialisation
(Read David Monkman’s presentation to the US Congress, March, 17, 2010)
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6. Knowing the target market
• Most important decisions
o Knowing who to reach and why?
− Gazelles
− Target groups
− Unemployed
− Bright sparks
− Suppliers
o Knowing what you want to achieve
and why?
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7. Key Questions?
Defining your own reality
• Client target market
• Client selection criteria
• Virtual vs Physical Operating Model
• What services to provide – in-house or outsourcing
• How to finance operations
o Level of donor support
o Cost recovery – service fees, equity, royalties
• Multi-sectoral or single sector focus
• Level of stakeholder involvement
• To facilitate ‘access to markets’ or not
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8. Key Questions (Continued…)
Defining your own reality
• Independent entity vs ‘Cost Centre’
• Seconded management and staff vs full-time
• Client focus – start-ups vs existing businesses
• How to measure success
o Inputs – eg. training hours, no. of consultations, etc.
o Outputs – eg. increased turnover of incubatees, jobs
created
o Outcomes – eg. no. of profitable and sustainable
graduates
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9. Challenges
• Overdependence on grant funding
• Unrealistic stakeholder expectations
• Governance
• ?? Access to markets??
• Competent and experienced incubator staff
• Client selection criteria and processes
• Service provision
• Limited deal flow
• Inadequate and ineffective operating systems
• Adequate M&E and performance reporting
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