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New Incubation Business Models - Made in Taiwan

What are the main differences between incubators in Taiwan and in Europe? Technically? None, really! Similar incubation processes and services are delivered by enthusiastic practitioner in the EU as in Taiwan, to smart entrepreneurs, with smart ideas, which eventually (hopefully) will succeed in contributing to wealth generation and local development. No, not surprisingly the main differences do not lie in the technicalities which are very similar to the ones used in the EU. The main differences I saw while spending a full week visiting the Taiwanese incubation system can be identified with the high level of recognition and support provided by the public sector and in the business models adopted by the incubators.

Taiwan is a small island populated by 23 million people. One third of Italy, one fourth of Germany and of the UK, one twentieth of the overall European population. A country with a 4,33% unemployment rate, a level to which European Governments can hardly even dream of, a country which has made entrepreneurship the main ingredient of its growth. Beside the 4% unemployment rate which made me shiver when I heard about it, there is another number that gave me the goose bumps: Taiwanese entrepreneurs can rely on 130 incubators, as also described in the spotlight articel "Eastern Promise" in issue 1 of this magazine, to find support and all of these incubators receive some public support (up to more or less 30% of their business model depends on public funding).

When comparing these figures with the ones of the European Incubation industry as presented in the EBN BIC Observatory 2012, two considerations come to mind. The first one relates to the very high level of support the Taiwanese Government is providing to the incubation industry, a level of support which I have never experienced elsewhere. Local enterprise creation and innovation is definitely the way forward for the Government to  generate wealth and jobs and incubators are the identified tools to implement the strategy. I would be really hard pressed if asked to find a similar public sector acknowledgement anywhere in the EU.

The second consideration springs from the confrontation between the average 30% of public funding within the business model of Taiwanese incubators compared to the 67% of the EU ones. Is there a lessons to be learned? Yes! That the world around us has changed and that business models inside us must change accordingly! Joe Greaney says it clearly in his article “Money Matters” appeared in issue 1 of this magazine: “incubators are fundamentally business too; ones that need to survive, grow and pay their way”, and nowadays I have the feeling that a business model that relies for two thirds on the governments pockets and their willingness (or better possibility) to pay is just not up-to-date.  These are not the ‘80s and the ‘90s anymore! These are weird times, where basing incubation processes and strategies mainly on public funding is definitely to be considered as risk-taking! That is why I think looking at the Taiwanese experience, where incubators are viewed more as a business than in the EU, can help some of the EU incubators better focus on their survival issues and at generating those alternative, private-oriented and entrepreneurial revenue streams that in some cases are badly needed!
Published on 24-11-2012 16:34 by David Tee. 814 page views

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