725 - Benchmarking Study On Technology Based Incubators - 0

Benchmarking Study on
Technology-Based Incubators
Commissioned by
Gate2Growth Incubator Forum
Prepared by
Oxford Innovation Ltd.
December
2006

The Gate2Growth Initiative is supported by the European Commission - DG Enterprise - Innovation/SMEs
programme
www.gate2growth.com
Contents
1: Introduction .......................................................................................................................... 1
2: Benchmarking and its challenges...................................................................................... 2
3: Approach to questionnaire design .................................................................................... 6
4: Results of pilot benchmarking ......................................................................................... 14

5: Recommendations............................................................................................................. 17
6: References and useful links ............................................................................................. 18
Annex A: Draft questionnaire ............................................................................................... 20
Annex B: Final questionnaire ............................................................................................... 34
Contact: Mr. Luc Schmerber, inno AG Tel: +49 7219134535 email: l.schmerber@inno-group.com

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1: Introduction
This report from Oxford Innovation presents the development of a benchmarking

questionnaire for use by the Gate2Growth Incubator Forum a pan-European
network of professional managers of 129 technology incubators in 28 European
countries. As the main aim of the Forum is to share best practice, knowledge and
experiences amongst a wide and varied range of incubators across Europe, it is
imperative that comprehensive and coherent information is available on the
incubators-members of the Network. Benchmarking of these incubators can serve as
the best way of presenting an overview of the trends, challenges, practice and results
of the incubators.
Following the views of the Incubator Forum members, the brief called for a
benchmarking study to capture such areas as operations, incubator management
practices, services offered to incubatees, outcomes in terms of company and job
creation and other issues.
The rest of this report is structured as follows:
Section 2 presents the concept of incubator benchmarking and the challenges

it raises
Section 3 outlines our approach to the development of the benchmarking

questionnaire
Section 4 compares the results of the pilot benchmarking of the Gate2Growth

Incubator Forums members with the previous benchmarking of European
incubators
Section 5 suggested some recommendations for the further use of this

benchmarking tool
Section 6 lists references and useful links used in designing the questionnaire
and in preparing this report
Annex A shows a draft version of the questionnaire used for the pilot study
Annex B shows a final version of the questionnaire.
We thank the Gate2Growth Incubator Forum members for taking the time in
participating in this project.
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2: Benchmarking and its challenges
Benchmarking incubators
Benchmarking is the process of identifying best practices on selected performance
indicators and assisting the poor performers to enhance their standings (Costa-David
et al, 2002). It is a continuous dynamic and self-correcting process of identifying good
outcomes in incubators which could be attributable to their successful practices and
adapting these to another incubator.
Incubation practices are complicated by the wide variations in business models,

specifics of individual countries, local environments and services provided. It is of
course easier to start on a benchmarking of incubators with comparable approaches
within a single country. Although sometimes it is not achievable, it is still allows
benchmarking to be used to identify examples of best practice.
Benchmarking plays an important role in ensuring higher performance levels for

incubators. Higher performance helps move the industry towards the key
performance goals of high relevance, efficiency, effectiveness, utility and
sustainability (Lalkaka, 2002). From the perspective of incubator stakeholders and
shareholders, sustainability implies the capability to perform effectively even after the
external support has declined or ceased. Most incubators are supported during the
first 2-3 years of operation and all of them need to become self-sustainable in order
to continue operating.
Assessment of incubation practices in a range of countries (Brazil, China, Czech

Republic, Mexico, Nigeria, Poland and Turkey) highlighted that many incubation
programmes have been growing rapidly, but without the commensurate efforts to
enhance their effectiveness and impacts (Lalkaka and Bishop, 1996 in Lalkaka,
2002). Benchmarking is an invaluable tool to help incubation environments make the
transition from start-up and early development phases through to achieving a full-
service, mature, sustainable business model (Lalkaka, 2001).
Benchmarking produces useful comparative data for incubators rather than just about
incubators. NBIA research shows that there are two types of information that
incubator managers find valuable:
understanding how well they are doing performance-wise compared to peer

incubators elsewhere in the country (and possibly abroad); and
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understanding what they can do differently to improve their performance with
clients. Achieving these objectives can be helped by benchmarking.
According to NBIA, benchmarking allows tan incubator to:
(1) characterise the performance of a national sample of incubators
(2) use the data to identify both exemplary and low-performing incubators, as
well as to inform participating incubators of their standing relative to peers,
and
(3) expand an overall understanding of incubator best practice in a wide variety

of activity domains.
Poland pioneered an incubator benchmarking programme in 1994, with a group of 11

incubators. However, the most important work on benchmarking of incubators was
carried out in 2002 by the Centre for Strategy and Evaluation Services (CSES) in the
UK for the European Commission1. CSES developed a generic incubation model
which is based on:
inputs mainly made by stakeholders, management resources and projects

put forward by entrepreneurs
processes the various inputs that are brought together in the business
incubation process through the provision of incubator space and other
services to companies
outputs successful companies graduate with positive job and wealth

creation impacts on local economies.
This model was presented in a diagram (Figure 1) combining the incubator input-
output dimension together with key best practice issues.
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This and other useful documents and links reviewed in the preparation of this report are listed in
References.
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Figure 1: CSES model of incubation
Source: CSES, 2002
Benchmarking challenges
Benchmarking can have a number of challenges. The first challenge lies in the fact
that there is no single model or template for the running or structuring of an
incubation environment. Each one reflects a unique combination of factors, including
access to resources, aims and objectives, age, cultural factors, target client group,
economic and social conditions, stakeholders, links to and relationships with other
organisations, location, political context etc. This diversity and complexity creates a
challenge for the development of a one size fits all framework.
Another challenge lies in the fact that it is rather difficult to quantify benchmarks for
all aspects of incubator operations but very important. It is possible to identify a
number of key building blocks and principles that unite all incubation environments
and to select such indicators that will produce measurable outcomes, which will make
the benchmarking process easy. In a recent EU Innovation Paper in 2006 a list of
guidelines for the selection of indicators is suggested, which can be well applied in
the context of incubator benchmarking:
Relevant There should be a clear link between the indicator and the
objective that is to be achieved. By using relevant indicators, the stakeholders
will get a better picture of the incubators performance, as this will reflect the
output/impact rather then input.
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Comprehensive The set of selected indicators should cover all the main
aspects of programme performance.
Accepted Indicators should be discussed with various programme/incubator

stakeholders and interested parties
Credible Indicators should be easy to interpret and be credible for reporting

purposes. It is important to make sure that these indicators are unambiguous
to various stakeholders.
Easy The collected data should be easily and readily obtainable, i.e. it
should be easily measured without excessive effort. Ideally they should be
captured through monitoring during the life of the programme/incubator rather
than through the ex ante evaluations and be capable of independent
verification.
Reliable and robust The use of indicators should ensure that collected
information is accurate and reliable, i.e. the data have not been manipulated.
Consistent and comparable Indicators should be consistent from year to

year although they should also be refined and modified when necessary to
reflect important contextual changes.
Another challenge of benchmarking is that although no single model of business

incubation delivery can be said to be better than another, it is clear that certain
models are more successful in meeting their objectives than others. Benchmarking
can help in identifying such models.
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3: Approach to questionnaire design
Questionnaire design
Based on the brief for this project we suggested including seven topics that can
provide an important base for the successful comparison of the incubators. These
are presented in Table 1. A draft benchmarking questionnaire, which is presented
in Annex A, was designed around the topics based on the CSES questionnaire
created in 2002 for the benchmarking of the European incubators.
It was felt that it would be more useful for incubator managers to view their answers
in comparison with an average of all other previously submitted responses, rather
than having a range of responses with an indication of how many incubators chose
one or another range. The questions that asked for quantitative information were
designed to address this suggestion.
Table 1: Benchmarking areas

Initiation The degree to which the firm foundations are effectively established when
commencing incubator operations together with the benefits arising from virtual
incubation.
Provision of A link between the provision of incubator space and services in relation to the
premises advantages they offer to incubatees. Issues can include the role of facilities,
convenience, design and location in assisting incubatees development
Incubator Patterns of management in respect of incubator operation, e.g. owner operator, third
management party contracted management
Patterns of remuneration, e.g. agreed contract values or risk and reward type
contracts
Professional qualifications of incubator managers and the development of the skills
they require to effectively manage incubators
Other issues can include staffing levels, in-house or outsourced support
Services Services offered to incubates together with their potential impact upon tenant
companies
Delivery of these services (e.g. formal or informal )
Role of The role of incubators in encouraging and stimulating interactions with fellow tenants
incubators and HEIs, i.e. engagement with HEIs, interactions with key players (senior decision
makers and leading researchers), institutes and research groups both in relation to
support of the activities and tenant companies within Incubators
Outcomes Outcomes of the incubators operation in terms of a number of companies created, a

number of jobs created, a number of companies graduated, growth rates etc.
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Informal support Structures to support the development of Incubators in relation to local and regional
networks of incubators, approaches to communication and networking
Questionnaire review
The draft questionnaire was subsequently reviewed by the attendants of the

Gate2Growth Incubator Forums workshop in Cyprus on 6-8 December. The purpose
of this review was to assess the importance of suggested benchmarking questions
for individual incubators and to learn about their wish list for such a benchmarking
tool.
Their comments were then incorporated into the questionnaire. Two comments were
not included for a solid reason. First, it was suggested that a question about the
country location of the Incubator should be included. However, we believe that
knowing which country the Incubator is in is not really relevant in benchmarking a
particular incubator. Secondly, it was suggested that a question on quality of services
should be added. We felt it was inappropriate to add this question as the question will
be answered by the Incubator manager, i.e. a provider of these services, thus making
an answer subjective.
Some other comments were not relevant for the purposes of this study but might be
relevant for the online version of the questionnaire. These are mentioned in the
recommendations in Section 5.
A slightly modified questionnaire was then circulated to 20 Forum members present

at the Cyprus workshop. Nine questionnaires were received back, some of which
were not fully completed due to the nature of the incubator (for example, early-stage
incubators were not able yet to comment on the number of graduated companies).
The results of this pilot survey are presented in Section 4. The survey was also used
to ascertain which questions were difficult to answer and which did not provide
sufficient information for cross-incubator comparison.
Questionnaire re-design
A final questionnaire was prepared following the analysis of the pilot benchmarking
and is presented in Annex B. We recommend using this questionnaire to create an
online benchmarking tool for the Gate2Growth Incubator Forum.
Some questions were modified and some were taken out all together. Benefits
generated by an incubator are not usually realised in the same financial year as in
which the investment is made. Thus evaluation can only be meaningful after a period
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of several years and, preferably after the incubator has reached a steady state (i.e.
roughly similar rates of incoming and graduating companies).Table 2 provides an
overview of made changes and the reasons behind them.
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Table 2: Reviewed questions
Question Description of a problem Outcome
1.1 When was your Incubator Answers to some of the further questions depend on the incubator age. For It is important to take this comment into account
established? example, there are no data on a number of graduated companies for an in the creation of an online benchmarking tool
incubator that was established only in 2004.
1.2 What is the type of your Suggested answer options for this question prove to be confusing. Instead of Suggested answer options were changed into
incubator? indicating whether an incubator is a general BIC or a Science/Technology specialist science (e.g. biotech) incubator,
Incubator, the respondents mentioned University incubator, private incubator general technology incubator and multi-purpose
or academic incubator. business incubator
1.3 Does your Incubator have a This question was partly overlapping with question 1.2. When question 1.2 was Delete the question
sector focus? reworded, question 1.3 became more or less exact repetition
1.4 Is your Incubator a member of Although it is an interesting question to have, it does not provide any useful Delete the question
any professional body? benchmarking information. The incubators are normally members of a national
association of science and technology parks (or incubators) and some
international bodies (like Gate2Growth Incubator Forum)
1.7 What location does the Greenfield option can be misunderstood in different countries. It might be Replace greenfield with rural
Incubator have? better replaced by rural Delete other option
1.8 Is your Incubator a part of a Some of the respondents indicated earlier that their incubator is part of a Rephrase the question into Is your Incubator
Science/Technology Park? university. part of:
- a Science/Technology park
- a university?
continued on next page
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continued from previous page
1.14 How are these costs covered? A list of answer options in this question is rather long Combine the first two options (EU subsidies and
subsidies from other international agencies)
Change banks into payments from private
sector organisations
1.15 After how many months will the It is difficult to answer this question for a newly-established incubator, but it is Keep the question unchanged
Incubator reach (or has already important to keep this question as it provide a valuable information
reached) a breakeven point?
1.17 What criteria are used to define This question is similar to question 1.22 Review and combine these questions
the Incubators target market?
1.18 What methods are used to Incubators use all or most of the suggested promotion methods, such as Delete the question
promote the Incubators advertising and media promotion, business events/conferences/exhibitions,
services? referrals from other business support agencies, direct approach to potential
tenants. It, therefore, does not make too much sense to benchmark incubator
in this area
1.21 Do you have entry criteria for This question can be combined with question 1.22, which lists these entry Combine with question 1.22
the Incubator tenants? criteria
1.22 What criteria are these? Given that questions 1.17 and 1.21 were suggested to be combined with Rephrase the question into What entry criteria
question 1.22, this question needs to be re-worded do you use in selecting your Incubator tenants?
Review the answer options
Add option No entry criteria to the answers list
2.2 What is the physical space of The number of units option does not mean much if the construction of the Delete number of units
the Incubator? building allows for the creation of units as request by the tenants
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2.3 What percentage of the It is useful to know the number of tenant companies in addition to the Rephrase the question into What is the current
Incubator space is currently percentage occupancy. This question makes more sense in the Outcomes occupancy of the Incubator in terms of:
occupied? section rather than Provision of premises - percentage of space occupied
- number of tenants?
Move the question before question 6.2
2.4 What type of premises are All incubators offer all or most of the suggested premises, i.e. office, workshop, Delete the question
available for tenants? laboratories, common facilities and mixed premises. Therefore, it does not
make too much sense to benchmark incubator in this area
2.5 What is the range of available This question asked about the size and monthly charge per sq m for the Delete monthly charge part of the question
Incubator units? smallest and the largest units in the incubator. The answers about the size of Add new question What is an average monthly
the units were received more or less from all respondents but the information charge per sq m in your Incubator?
about the rent was inconsistent.
2.6 Does the rent vary depending Similarly to the previous question, information on monthly charges is difficult to Rephrase the question into Does the monthly
on the length of stay? If yes, collect rent per sq m vary depending on:
please indicate the monthly rent. - the length of stay
- the unit size?
2.9 Do you allow a rent-free period? One of the answers was the whole stay is rent free Add an option the whole stay
2.10 Do your tenants receive any rent This question logically fits after question 2.6 Move the question after question 2.6
subsidies?
3.2 What are the main functions of The answers to this question make common sense. More or less all incubators Delete the question
the incubators management management staff are involved in management of incubator affairs, advising
team? and assisting tenant companies, networking with other incubators and business
support organisations. It, therefore, does not make too much sense to
benchmark incubator in this area

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3.5- What are professional These questions prove to be difficult to answer. First, qualifications differ from Delete these questions
3.7 qualifications of your Incubators country to country. Second, there are no set requirements for which
manager/business support qualifications the incubator staff have to have. Therefore, it does not make too
manager/facilities manager? much sense to benchmark incubator in this area
4.5 How do the charges for The answer to this question is rather predictable one of the roles of the Delete the question
incubator services generally incubators is to support the development of small businesses, therefore, the
compare with the cost of similar services incubators provide are cheaper compared to the similar service
types of services provided by providers. Therefore, it does not make too much sense to benchmark incubator
other business support in this area
organisations in the area?
4.6 Do you carry out census of Option Other is not needed Delete the option
tenants?
5.1 What are the main objectives of It is worth included an additional option that came out from the respondents Add a new option
the Incubator? answers promote entrepreneurial culture within the university/local
community
5.2 What are the main objectives of This question is similar to question 5.1 Combine with question 5.1
the Incubator?
6.1 Does the Incubator take an This question is similar to question 4.3 Combine with question 4.3
equity stake in the tenant
companies?

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6.3 How many tenants does the This question is unnecessary following rephrasing of question 2.3 Delete the question
Incubator have now?
6.4 What type of performance These questions asked to respond by ranking provided option on a scale from Delete the rankings
and criteria are used to monitor 1 to 5. This ranking did not prove to be working
6.6 Incubator performance?
What methods are used to

obtain feedback from
tenants/stakeholders on the
provided services?
6.5 What makes the Incubator an This question asked for responses by ranking on a scale from 1 to 5. This Change ranking to 1-3
attractive location for ranking, although difficult, proved to be useful
businesses?
6.9 What is the turnover growth rate Suggested options are not very helpful Change options to below 20% and over 20%
achieved by tenant companies Add option no turnover yet
in the last 3 years?
6.12 Where do the graduate One option is missing no graduates yet Add new option
companies move to?
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4: Results of pilot benchmarking
As mentioned previously, a pilot incubator benchmarking was performed by asking

the Gate2Growth Incubator Forum members to complete the draft benchmarking
questionnaire presented in Annex A. This pilot benchmarking was performed to
assess:
The relevance of individual questions to incubators of different stages of

development, and
Ease in answering the suggested questions.
Nine incubators that agreed to participate in the pilot benchmarking were:
BViT, the Netherlands

www.bvit.net
Diogenes Business Incubator, University of Cyprus, Cyprus
www.diogenes.com.cy
E2B Lab, Italy
www.e2blab.it
IBH (Innovation and Bildung Hohenheim GmBH), Germany
www.ibh-hohenheim.de
Smart Inkubator, Slovenia
www.smartstart.si
Science and Technology Park, Technical University of Koszalin, Poland
www.tu.koszalin.pl/eng/park.html
Science Park Graz, Austria
http://sciencepark.tugraz.at
STEP-C (Science and Technology Park of Crete), Greece
www.stepc.gr
St Peters Gate, University of Sunderland, UK
www.stpetersgate.co.uk
University incubator Ljubljana (UIL), Slovenia
http://www.lui.uni-lj.si/inkubator.asp
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We are grateful to the participants for their time in completing the benchmarking
questionnaires under a tight timeframe in mid-December 2006.
The quantifiable benchmarking results are presented in Table 3 and compared with
key averages, ranges and benchmarks from the analysis of the CSES survey data
from 2002.
Table 3: Quantifiable benchmarking results
CSES survey G2G survey

2002 2006
Average Range Benchmark Average Range
Average capital investment cost 3.7m 1.5-22m NA --- ---
Average setting up costs --- --- --- 1.03m 0.01m-

4.2m
Average operating costs 0.48m 0.05m- NA 0.38m 0.14m-

1.8m 1.0m
Breakdown of operating costs: --- --- --- ---

total payrolls/benefits 5%-80%
building maintenance 10%-64%
business services to tenants 5%-80%
other costs 0%-30%
% of revenue from public subsidies 37% 0%-100% 25% --- ---
Incubator space 3,000 m2 90m2 - 2,000 m2- 1,051 m2 280m2-

41,000m2 4,000m2 4,000m2
Size of individual unit: --- --- ---

smallest unit 11m2 8m2-15m2
largest unit 55m2 15m2-150m2
Number of enquiries per year --- --- --- 49 10-120
Number of enquiries turned into --- --- --- 5.5 2-13

tenants per year
Number of incubator tenants 27 1-120 20-30 12 3-23
Number of businesses assisted in --- --- --- 8 1-17

the last year
Number of businesses assisted in --- --- --- 22 4-50

the last 3 years
Incubator occupancy rates 85% 9%-100% 85% 75% 35%-100%
Length of tenancy (months) 35 6 no max 36 29 12-60
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Number of management staff 2.3 1-9 2 min --- ---
Ratio of incubator staff:tenants 1:14 1:2-1:64 1:10-1:20 --- ---
% of managers time advising clients 39% 5%-80% 50% 54% 12%-60%
Survival rates of tenant companies 85% 65%-100% 85% --- ---
Average jobs per tenant company 6.2 1-120 NA 3.7 1-4.4
Total number of employees in --- --- --- 57 8-120

tenant companies
Length of setting up an incubator --- --- --- 17 4-24

(months)
Several things were noted in the CSES survey, which are relevant to the preparation
of a benchmarking questionnaire:
Setting up and operating costs.

CSES in completing their benchmarking study for the European Commission
commented that it is inappropriate to set benchmarks for incubator capital
investment and operating costs because these will vary from country to
country and depending on the type of incubator. For example, a
biotechnology incubator requires a substantially higher investment in order to
set up dedicated laboratory space as well as office space.
Incubator space/number of tenants

CSES concluded that although their survey showed that the average
incubator space in the survey was 3,000m2 , a minimum of 2,000m2 space is
needed enough to accommodate 2-30 companies and to achieve economies
of scale. Therefore, they suggested a range of 2,000m2-4,000m2 as a
benchmark depending on the type of incubator.
Length of tenancy
CSES suggested a benchmark of 3 years for an average incubator. This
benchmark might not be appropriate for some specialist types of incubators,
e.g. biotechs incubators because of the longer product development time.
Proportion of management time advising clients

CSES survey indicated 39% as a management time spent advising clients.
Ideally, CSES concluded, more time should be spent advising clients and less
on administrative matters.
Survival rates
CSES survey results show 80-90% survival rate amongst tenant firms. CSES
benchmark was based on that figure. The survival rate of incubator tenants
operating in more high-risk sectors might be lower.
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5: Recommendations
Notes for electronic application
This benchmarking survey is best utilised through the online version as it will allow
any incubator-member of the Gate2Growth Incubator Forum perform a benchmarking
exercise at any convenient time. The results can be stored in one database and over
the years present an interesting source for analysis. A questionnaire developed
during this project can be used for the development of an online benchmarking tool.
A number of things need to be taken into account when preparing an online tool:
Data entry should be allowed to be stored before submission. This will mean
that an Incubator manager can come back to his/her questionnaire without
answering the same questions more than one time
Questions can be grouped separately for three different groups of incubators

newly established incubators (less than 1 year old), early-stage incubators
(between 1 and 3 years old or before the first tenant graduates, whichever
happens first), well-established incubators (more than 3 years old)
Virtual incubators should not be grouped separately as its only difference is

the lack of physical premises
As a result of the online questionnaire completion, incubator managers need

to be able to see their responses benchmarked against previously submitted
responses.
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6: References and useful links
Allen Consulting Group, 2003, BITS Incubator Program Pilot Evaluation, Australia,
http://www.dcita.gov.au/__data/assets/pdf_file/10365/BITS_Incubator_Program_-
_Pilot_Evaluation.pdf2
Benchmarking in Europe www.benchmarking-in-europe.com
British Embassy (Science & Technology Unit), Technology Centre of the Academy of
Sciences of the Czech Republic, 2005, Benchmarking Czech and UK Approach to
Innovation Centres, http://www.oti.globalwatchonline.com/online_pdfs/36320X.pdf
Centre for Strategy & Evaluation Services (CSES), 2002. Benchmarking of Business
Incubators Final Report, for the European Commission Enterprise and Industry DG,
http://ec.europa.eu/enterprise/entrepreneurship/support_measures/incubators/bench
marking_bi_part_two_2002.pdf
Costa-David J., J. Malan, R. Lalkaka, 2002, Improving Business Incubator

Performance through Benchmarking and Evaluation: Lessons Learned from Europe,
NBIA Conference, Toronto,
http://www.cetraonline.it/file_doc/165/Business%20incubator.pdf
Department of Trade and Industry (DTI), UK Innovation Self Assessment,

http://www.innovation.gov.uk/self_assessment/home.asp?p=assessment
European Commission, 2004, Innovation Management and the Knowledge-Driven

Economy, Innovation Papers No 38, the European Commission Enterprise and
Industry DG
Goddard, J.G. and H. Chouk, 2006, First Findings from the Survey of European
Business Incubators, http://www.dauphine.fr/imri/Valorisation/WP2006/WP04.pdf
Lalkaka, Rustam, 2001, Best practices in Business Incubation: Lessons (yet to be)
Learned, paper presented at the International Conference on Business Centres:
Actors for Economic and Social Development, Brussels, 14-15 November
http://www.bii.ge/eng/studies_&_Papers/LALKAKA_UK.pdf
2
All online available documents were accessed on 6 November 2006
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Lalkaka, Rustam, 2002, Technology business incubators to help build an innovation-
based economy, Journal of Change Management, 3(2):167-176
Louis Lengrand & Associs, PREST, ANRT, and Reidev Ltd, 2006, Smart Innovation:
A Practical Guide to Evaluating Innovation Programmes, Innovation Papers No 44,
the European Commission Enterprise and Industry DG
National Agency for Enterprise and Construction, 2004, Benchmarking Incubators:

Background Report for the Entrepreneurship Index 2004, Denmark,
http://www.ebst.dk/file/3057/Entrepreneurship_2004.pdf
National Business Incubation Association (NBIA), 2002, A National Benchmarking

Analysis of Technology Business Incubator Performance and Practices, USA,
http://www.technology.gov/reports/TechPolicy/NBIA/2003Report.pdf
Science Alliance, Best Practice in Science Based Incubators,

http://www.science-alliance.nl/english/meetings.htm
UK Business Incubation, 2004, The National Business Incubation Framework, UK
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Annex A: Draft questionnaire
Following the views of the Gate2Growth Incubator Forum members, the project was
called to prepare a benchmarking study of the whole membership of the Network to
capture topics such areas as operations, incubator management practices, services
offered to incubates, outcomes in terms of company and job creation and other. A
draft benchmarking questionnaire has been designed, which is presented below.
We would like to invite you to take part in the assessment stage of this questionnaire.
Your views on the relevance, importance and easiness-to-assess of the proposed
questions will help to shape the benchmarking framework.
Thank you very much for your assistance!
1. Initiation
1.1 When was your Incubator established? Year
1.2 What is the type of your Incubator?

Business & Innovation Centre (BIC)
Science/Technology incubator
Other (please specify in 4-10 words)
1.3 Does your Incubator have a sector focus?

No
Yes, please specify in 1-2 words
1.4 Is your Incubator a member of any professional body?

No
Yes (please list)
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1.5 What is the legal status of your Incubator?
Public
Private
Other (please specify)
1.6 Is the Incubator for profit? not for profit?
1.7 What location does the Incubator have?

Urban
Greenfield
Virtual
1.8 Is your Incubator a part of a Science/Technology Park? Yes No
1.9 Who are the stakeholders and shareholders of your Incubator?

Stakeholders Shareholders
Yes/No %
National authorities & public agencies

Regional authorities
Local authorities
University
Other R&D organisation
Banks
EU and other international agencies
Private company (please specify its sector)
Total N/A 100%
1.10 How long did it take to set up your Incubator? months
1.11 What was the cost of setting up the Incubator? million
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1.12 What is the annual operating cost of your Incubator? million
1.13 What is the breakdown of these costs?

Total payroll/benefits
Building costs (maintenance, mortgage costs)
Business services to tenants
Other costs
Total 100%
1.14 How are these costs covered?

Set up Running
costs costs
EU subsidies
Subsidies from other international agencies
Subsidies from national authorities and public agencies
Banks
Payments from universities and other R&D organisations
Rental income and other incubator charges ----------
Other revenues ----------
Investment income ----------
Other
Total 100% 100%
1.15 After how many months will the Incubator reach (or has already reached)
a breakeven point?
months
1.16 If the Incubator receives subsidies to operate and these were stopped, what would
be the effect on the Incubator operations?
Activities can be maintained at current level
Activities will have to be reduced
Activities will have to be stopped
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1.17 What criteria are used to define the Incubators target market?
Firms must be start-ups
Firms can be already trading but must be below a certain size
Firms must be involved in certain types of activities
No particular criteria
1.18 What methods are used to promote the Incubators services?

Advertising and media promotions
Business events/conferences/exhibitions
Referrals from other business support agencies
Direct approach to potential tenants
1.19 How many enquiries for premises does the Incubator receive per year?
1.20 How many of these enquiring companies became tenants?
1.21 Do you have entry criteria for the Incubator tenants? Yes No
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1.22 What criteria are these?
Prepared business plan
Size of the company
Sector profile of the company
Sorted financing
Business must have an innovative project
Business must demonstrate high growth potential
2. Provision of premises
2.1 Which type of premises were used for setting up your Incubator?
Purpose-built
Converted
2.2 What is the physical space of the Incubator?

Total area (gross) sq m
Total lettable sq m
Number of units
2.3 What percentage of the Incubator space is currently occupied? %
2.4 What type of premises are available for tenants?

Office
Workshop
Laboratories
Common facilities
Mixed
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2.5 What is the range of available Incubator units?
Size Charge
(per month
per sq m)
Smallest unit sq m
Largest unit sq m
2.6 Does the rent vary depending on the length of stay?

If yes, please indicate the monthly rent in per sq m.
No
Initial rent
Final rent
Not applicable
2.7 Which charges are included in the rent?

Utilities
Services
Use of common equipment
2.8 How does the rent compare to the market rate for similar types of premises?
Lower
Higher
About the same (i.e. market rate)
2.9 Do you allow a rent-free period?

No, tenants pay from day 1
Yes, 1 month
Yes, 1-3 months
Yes, 6 months
Yes, 1 year
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2.10 Do your tenants receive any rent subsidies?
No
Yes
Pease specify the source of subsidy
Pease specify the level of subsidy per month
2.11 What is the length of time tenants stay in your Incubator?

Maximum length of stay months
Average length of stay months
3. Incubator management
3.1 How many staff does the Incubator have?

Full-time Part-time
Incubator manager
Business support manager
Administrator
Receptionist
Secretary
Other personnel
3.2 What are the main functions of the Incubators management team?
Management of Incubator affairs
Provision of advice and assistance to tenant companies
Networking with other incubators and business support organisations
3.3 Approximately what proportion of the management time (in %) is devoted to

business support services?
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3.4 What sort of experience and skills does the Incubator personnel have?
Set up and run their own business
Previously worked for the university
Previously worked for public authorities
Previously advised start up and small firms (i.e. consulting)
Previously trained start up and small firms
Participated in training relevant to business incubation
3.5 What are professional qualifications of your Incubators manager?

Degree Professional Other
qualification
Accounting/banking
Real estate
Personnel management
Legal
Sales/trade/marketing
Other
3.6 What are professional qualifications of your Incubators business support manager?
qualification
Accounting/banking
Real estate
Legal
Other
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3.7 What are professional qualifications of your Incubators facilities managers?
qualification
Accounting/banking
Real estate
Legal
Other
3.8 What type of training do you offer to the incubator staff?

4. Services
4.1 What type of professional services does your Incubator offer?

In-house External
Pre-incubation
Business planning
Forming a company
Administrative/secretarial
Training
Accounting
Legal
Assistant with Intellectual Property rights
Market research/sales/marketing
Export
New product development
Fund-raising
Recruitment
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Networking
Translation
4.2 What other facilities and services are available to your tenants?
In-house External
Shared secretarial/office services

Office equipment
Broadband
Cleaning
Maintenance
Meeting rooms
Conference facilities
Bar/Restaurant/Refreshment room
4.3 Does the Incubator take an equity stake in tenant firms?

Always
Sometimes
Never
4.4 What is the pricing strategy for these services?

In-house External
Services are free

Tenant charges partly cover the cost of services
Tenant charges cover the entire cost of services
4.5 How do the charges for Incubator services generally compare with the cost of similar
types of services provided by other business support organisations in the area?
Lower
Higher
About the same
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4.6 Do you carry out census of tenants?
Yes, tenants are monitored on a monthly basis
Yes, tenants are monitored on a quarterly basis
Yes, tenants are monitored on annual basis
No particular tenant management/census arrangement
4.7 What is the top service identified through the tenants census?
Please specify in 1-4 words
4.8 What are the tenants exit criteria?

Companies can rent units for a fixed period of time
Companies leave when they need more space to expand
Companies leave when they achieve agreed business objectives
Companies leave when they require support the incubator cannot offer
No particular exit criteria
5. Role of incubators
5.1 What are the main objectives of the Incubator?

To create new companies
To create new jobs
To help universities and R&D centres commercialise know-how
To strengthen one particular sector (please specify which)
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Helping to create new high quality businesses
Helping to improve the competitiveness of existing businesses
Contributing to job and wealth creation
Contributing to the development of new products and services
Contributing to the internalisation of businesses in the area
6. Outcomes
6.1 How many business has the Incubator assisted

in the last year?
6.2 How many tenants does the Incubator have now?
6.3 Does the Incubator take equity stake in the tenant companies?
Never
Yes, on average in 1-3 companies per year
Equity stake is under 3% in each company
Equity stake is between 3%-10% in each company
6.4 What type of performance criteria are used to monitor Incubator performance?
(Please rank on scale 1-5, where 1=least important; 5=most important)
Occupancy rates
Number of graduated companies
Jobs created by tenant/graduate companies
Turnover of tenant/graduate companies
Incubator financial performance
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6.5 What makes the Incubator an attractive location for businesses?
Good location and image
Quality of premises
Price
Flexible terms for incubator units
Availability of professional business support services
Clustering and opportunity to network with similar businesses
6.6 What methods are used to obtain feedback from tenants/stakeholders on the provided
services? (Please rank on scale 1-5, where 1=least important; 5=most important)
Feedback via informal contact
periodic meetings with tenants and stakeholders
periodic surveys of tenants and stakeholders
no particular methods
Other methods (please specify)
6.7 Employment by tenant companies

What is the total number of people employed by your tenants?
What is the average number of employees per tenant company?
How many companies employ
1-3 people?
3-10 people?
10-20 people?
20-50 people?
more than 50 people?
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6.8 Turnover of tenant companies
What is the total turnover of the tenant companies in the last year?
In the last year, how many companies had a turnover
below 1 million ?
1-5 million ?
5-10 million ?
over 10 million ?
6.9 What is the turnover growth rates achieved by tenant companies in the last 3 years?
Below 10%
Between 10 and 20%
Over 20%
Not possible to identify
6.10 Investment raised by tenant companies (in million )

What is the total investment raised by your tenants in the last year?
What is the total investment raised by your tenants in the last 3 years?
What is the average investment raised per tenant company in the last year?
What is the average investment raised per tenant company in the last 3 years?
6.11 Apart from business failures, why do companies leave the Incubator?
Companies take on new staff and need more room to expand
Incubator units can only be rented for a fixed period of time
Companies find better/cheaper/more suitable premises
6.12 Where do the graduate companies move to?

Premises close by
Elsewhere in the local area
Elsewhere in the region
Elsewhere in the country

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Annex B: Final questionnaire
Following the views of the Gate2Growth Incubator Forum members, the project was
called to prepare a benchmarking study of the whole membership of the Network to
capture topics such areas as operations, incubator management practices, services
offered to incubates, outcomes in terms of company and job creation and other. A draft
benchmarking questionnaire has been designed, which is presented below.
We would like to invite you to take part in the assessment stage of this questionnaire.
Your views on the relevance, importance and easiness-to-assess of the proposed
questions will help to shape the benchmarking framework.
Thank you very much for your assistance!
1. Initiation
1.1 When was your Incubator established? Year
1.2 What is the type of your Incubator?

Specialist science (e.g. biotech) incubator
General technology incubator (supporting projects in a number of different fields)
Multi-purpose business incubator (no particular specialisation)
1.3 What is the legal status of your Incubator?

Public
Private
1.4 Is the Incubator for profit? not for profit?
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1.5 What location does the Incubator have?
Urban
Rural
Virtual
1.6 Is you Incubator part of

Yes No
a Science/Technology park?
a university?
1.7 Who are the stakeholders and shareholders of your Incubator?

Stakeholders Shareholders
Yes/No %
National authorities & public agencies

Regional authorities
Local authorities
University
Other R&D organisation
Banks
EU and other international agencies
Private company (please specify its sector)
Total N/A 100%
1.8 How long did it take to set up your Incubator? months
1.9 What was the cost of setting up the Incubator? million
1.10 What is the annual operating cost of your Incubator? million
35
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1.11 What is the breakdown of these costs?
Total payroll/benefits
Building costs (maintenance, mortgage costs)
Business services to tenants
Other costs
Total 100%
1.12 How are these costs covered?

Set up Running
costs costs
Subsidies from the EU institutions
Subsidies from national authorities and public agencies
Payments from private sector organisations
Payments from universities and other R&D organisations
Rental income and other incubator charges ----------
Other revenues ----------
Investment income ----------
1.13 After how many months will the Incubator reach (or has already reached)
a breakeven point? months
Other
Total 100% 100%
1.14 If the Incubator receives subsidies to operate and these were stopped, what would
be the effect on the Incubator operations?
Activities can be maintained at current level
Activities will have to be reduced
Activities will have to be stopped
1.15 How many enquiries for premises does the Incubator receive per year?
1.16 How many of these enquiring companies became tenants?
36
www.gate2growth.com
1.17 What entry criteria do you use in selecting your Incubator tenants?
Prepared business plan
Sector profile
Sorted financing
Business must have an innovative project
Business must demonstrate high growth potential
Business must be start-ups
Business can be already trading but below a certain size
No entry criteria
2. Provision of premises
2.1 Which type of premises were used for setting up your Incubator?
Purpose-built
Converted
2.2 What is the physical space of the Incubator?

Total area (gross) sq m
Total lettable sq m
Number of units
2.3 What is an average monthly charge per sq m in your Incubator?
2.4 What is the current occupancy of the Incubator in terms of

percentage of space occupied?
number of tenants?
2.5 What is the range of available Incubator units?

Smallest unit sq m
Largest unit sq m
37
www.gate2growth.com
2.6 Does the monthly rent per sq m vary depending on
Yes No
the length of stay?

the unit size?
2.7 Do your tenants receive any rent subsidies?

No
Yes
Pease specify the source of subsidy
Pease specify the level of subsidy per month
2.8 Which charges are included in the rent?

Utilities
Services
Use of common equipment
2.9 How does the rent compare to the market rate for similar types of premises?
Lower
Higher
About the same (i.e. market rate)
2.10 Do you allow a rent-free period?

No, tenants pay from day 1
Yes, 1 month
Yes, 1-3 months
Yes, 6 months
Yes, 1 year
The whole stay
38
www.gate2growth.com
2.11 What is the length of time tenants stay in your Incubator?
Maximum length of stay months
Average length of stay months
3. Incubator management
3.1 How many staff does the Incubator have?

Full-time Part-time
Incubator manager
Business support manager
Administrator
Receptionist
Secretary
Other personnel
3.2 Approximately what proportion of the management time (in %) is devoted to

business support services?
3.3 What sort of experience and skills does the Incubator personnel have?
Set up and run their own business
Previously worked for the university
Previously worked for public authorities
Previously advised start up and small firms (i.e. consulting)
Previously trained start up and small firms
Participated in training relevant to business incubation
3.4 What type of training do you offer to the incubator staff?

39
www.gate2growth.com
4. Services
4.1 What type of professional services does your Incubator offer?

In-house External
Pre-incubation
Business planning
Forming a company
Administrative/secretarial
Training
Accounting
Legal
Assistant with Intellectual Property rights
Market research/sales/marketing
Export
New product development
Fund-raising
Recruitment
Networking
Translation
4.2 What other facilities and services are available to your tenants?
In-house External
Shared secretarial/office services

Office equipment
Broadband
Cleaning
Maintenance
Meeting rooms
Conference facilities
Bar/Restaurant/Refreshment room
40
www.gate2growth.com
4.3 Does the Incubator take an equity stake in tenant companies?
Always
Never
Equity stake is under 3% in each tenant
Equity stake is between 3%-10% in each tenant
4.4 What is the pricing strategy for these services?

In-house External
Services are free

Tenant charges partly cover the cost of services
Tenant charges cover the entire cost of services
4.5 Do you carry out census of tenants?

Yes, tenants are monitored on a monthly basis
Yes, tenants are monitored on a quarterly basis
Yes, tenants are monitored on annual basis
No particular tenant management/census arrangement
4.6 What is the top service identified through the tenants census?
Please specify in 1-4 words
4.7 What are the tenants exit criteria?

Companies can rent units for a fixed period of time
Companies leave when they need more space to expand
Companies leave when they achieve agreed business objectives
Companies leave when they require support the incubator cannot offer
No particular exit criteria
41
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www.gate2growth.com
5. Role of incubators

To create new high quality companies
To help improve the competitiveness of existing businesses
To create new jobs
To help universities and R&D centres commercialise know-how
To strengthen one particular sector (please specify which)
To promote entrepreneurial culture within the university/local community
6. Outcomes
6.1 How many business has the Incubator assisted

in the last year?
6.2 What type of performance criteria are used to monitor Incubator performance?
Occupancy rates
Number of graduated companies
Jobs created by tenant/graduate companies
Turnover of tenant/graduate companies
Incubator financial performance
6.3 What makes the Incubator an attractive location for businesses?

Good location and image
Quality of premises
Price
Flexible terms for incubator units
Availability of professional business support services
Clustering and opportunity to network with similar businesses
42
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www.gate2growth.com
6.4 What methods are used to obtain feedback from tenants/stakeholders on the provided
services?
Feedback via informal contact
periodic meetings with tenants and stakeholders
periodic surveys of tenants and stakeholders
no particular methods
Other methods (please specify)
6.5 Employment by tenant companies

What is the total number of people employed by your tenants?
What is the average number of employees per tenant company?
How many companies employ
1-3 people?
3-10 people?
10-20 people?
20-50 people?
more than 50 people?
6.6 Turnover of tenant companies

What is the total turnover of the tenant companies in the last year?
In the last year, how many companies had a turnover
below 1 million ?
1-5 million ?
5-10 million ?
over 10 million ?
6.7 What is the turnover growth rates achieved by tenant companies in the last 3 years?
Below 20%
Over 20%
No turnover yet
Not possible to identify

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6.8 Investment raised by tenant companies (in million )
What is the total investment raised by your tenants in the last year?
What is the total investment raised by your tenants in the last 3 years?
What is the average investment raised per tenant company in the last year?
What is the average investment raised per tenant company in the last 3 years?
6.9 Apart from business failures, why do companies leave the Incubator?
Companies take on new staff and need more room to expand
Incubator units can only be rented for a fixed period of time
Companies find better/cheaper/more suitable premises
6.10 Where do the graduate companies move to?

Premises close by
Elsewhere in the local area
Elsewhere in the region
Elsewhere in the country
No graduates yet
Thank you for your answers.
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www.gate2growth.com

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Benchmarking Study on

Gate2Growth Incubator Forum

Oxford Innovation Ltd.

Gate2Growth Incubator Forum

3: Approach to questionnaire design .................................................................................... 6

4: Results of pilot benchmarking ......................................................................................... 14

6: References and useful links ............................................................................................. 18

Annex A: Draft questionnaire ............................................................................................... 20

Annex B: Final questionnaire ............................................................................................... 34

Gate2Growth Incubator Forum

This report from Oxford Innovation presents the development of a benchmarking

The rest of this report is structured as follows:

Section 2 presents the concept of incubator benchmarking and the challenges

Section 3 outlines our approach to the development of the benchmarking

Section 4 compares the results of the pilot benchmarking of the Gate2Growth

Section 5 suggested some recommendations for the further use of this

Annex B shows a final version of the questionnaire.

Incubation practices are complicated by the wide variations in business models,

Benchmarking plays an important role in ensuring higher performance levels for

Assessment of incubation practices in a range of countries (Brazil, China, Czech

understanding how well they are doing performance-wise compared to peer

According to NBIA, benchmarking allows tan incubator to:

(1) characterise the performance of a national sample of incubators

(3) expand an overall understanding of incubator best practice in a wide variety

Poland pioneered an incubator benchmarking programme in 1994, with a group of 11

inputs mainly made by stakeholders, management resources and projects

outputs successful companies graduate with positive job and wealth

Source: CSES, 2002

Accepted Indicators should be discussed with various programme/incubator

Credible Indicators should be easy to interpret and be credible for reporting

Consistent and comparable Indicators should be consistent from year to

Another challenge of benchmarking is that although no single model of business

Table 1: Benchmarking areas

Outcomes Outcomes of the incubators operation in terms of a number of companies created, a

The draft questionnaire was subsequently reviewed by the attendants of the

A slightly modified questionnaire was then circulated to 20 Forum members present

Question Description of a problem Outcome

continued on next page

continued on next page

continued on next page

continued on next page

continued from previous page

What methods are used to

As mentioned previously, a pilot incubator benchmarking was performed by asking

The relevance of individual questions to incubators of different stages of

Ease in answering the suggested questions.

Nine incubators that agreed to participate in the pilot benchmarking were:

BViT, the Netherlands

Table 3: Quantifiable benchmarking results

CSES survey G2G survey

Average capital investment cost 3.7m 1.5-22m NA --- ---

Average setting up costs --- --- --- 1.03m 0.01m-

Average operating costs 0.48m 0.05m- NA 0.38m 0.14m-

Breakdown of operating costs: --- --- --- ---

% of revenue from public subsidies 37% 0%-100% 25% --- ---

Incubator space 3,000 m2 90m2 - 2,000 m2- 1,051 m2 280m2-

Size of individual unit: --- --- ---

Number of enquiries per year --- --- --- 49 10-120