Government launches £10mn social Incubator Fund
I read about the Cabinet Office’s launch of a £10mn social incubator fund feeling that this was a remarkable bet on the future of an unproven horse. There are so far very few examples and no ongoing experience of running them.
A £10mn ‘investment readiness fund’ fund is launched in parallel, and the £10mn ‘incubator fund’ is designed to ‘provide start-ups with intensive support to enable them to take advantage of social investment opportunities so they better serve communities and people most in need’. The intention seems to be to start ten incubators – in three phases over the next three years.
Nesta’s work on Incubators made it clear that it is very difficult to evaluate their performance for two reasons: first they have a wide variety of different kinds of objectives – some are about developing products, some about local employment and some about financial returns; and second and linked to this, because they are very high risk and their outcomes may take many years to crystalise – you might achieve your objectives in a year or two – or ten, you might need to put yet more into the project, and the enterprise might never come to anything at all.
Incubators took off in the late 90s and there are now some 300 of them in the UK, many attached to universities. More recently, a new version of the incubator has arrived after showing rapid growth in the US. The key ingredients of the new ‘Accelerator’ are: pressure – the opportunity to launch your new enterprise is (in most cases) just 13 weeks from conception; and secondly: support – the fulsome provision of advice from people who have ‘done it before’, in the form of feed-back, guidance and contacts.
Accelerators house together a small number of teams, each developing their own idea, drawing ideas and inspiration from each other and from the intensive support and learning regime that is offered by the accelerator. There have been fewer than half a dozen so far in the UK, and only one specialising in social enterprise – the first cadre of Bethnal Green Ventures is just now about to complete its 13-week course. More importantly, there is at present no organisation with ongoing experience of running them, (and only one – just started – in the commercial sector).
Hopefully, the parent and the children will grow up rapidly and successfully together, but they will have to develop their own nursery as they grow!
There were three winners under this contract: Nesta + Bethnal Green Ventures, Telefonica’s wayra Lab + Unltd and HubLaunchpad, all of which I have written about on my website