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South African Business Incubation Conference (SABIC)

Challenges, realities and opportunities for incubation support programmesC Wyeth10 March 2016

Business Incubators in SASource: DTI, 2014

Presentation Outline3Whos challenges, realities and opportunities?OpportunitiesKnowing your target marketKey Questions to askChallenges

Whos challenges, realities and opportunities?Whos challenges realities and opportunities?Government?Private investors?Incubators?Incubatees?Service Providers?4

OpportunitiesConsiderable public and private sector support for enterprise and supplier developmentJob CreationEconomic transformation and empowermentSectoral transformationNeighbourhood re-development Technology development and transferTechnology commercialisation

(Read David Monkmans presentation to the US Congress, March, 17, 2010)5

Knowing the target marketMost important decisions

Knowing who to reach and why?GazellesTarget groupsUnemployedBright sparksSuppliersKnowing what you want to achieve and why?6

Key Questions?Defining your own realityClient target marketClient selection criteriaVirtual vs Physical Operating ModelWhat services to provide in-house or outsourcingHow to finance operationsLevel of donor supportCost recovery service fees, equity, royaltiesMulti-sectoral or single sector focusLevel of stakeholder involvementTo facilitate access to markets or not7

Key Questions (Continued)Defining your own realityIndependent entity vs Cost CentreSeconded management and staff vs full-timeClient focus start-ups vs existing businessesHow to measure successInputs eg. training hours, no. of consultations, etc.Outputs eg. increased turnover of incubatees, jobs createdOutcomes eg. no. of profitable and sustainable graduates

8

ChallengesOverdependence on grant fundingUnrealistic stakeholder expectationsGovernance?? Access to markets??Competent and experienced incubator staffClient selection criteria and processesService provisionLimited deal flowInadequate and ineffective operating systemsAdequate M&E and performance reporting9