The Royal College of Art’s Incubator wrestles with its own development

InnovationRCA, the RCA’s incubator, has ploughed a leading furrow among higher education establishments; and is contending with the issues that are raised by an incubator programme that runs in parallel to its academic programme, (which is a post-graduate programme), and that is also a part of the educational process.

The RCA’s incubator now takes in four or five new business teams each year – its sixth cohort (it started with just two per annum in 2008); and it is a two-year programme. While many start-ups involve little more than taking a recently created way of doing something and simply applying it to a new field, often with a tweak or two, the kinds of businesses that are brought to this incubator entail substantial design or engineering/IT development (the essence of the RCA) as well of course as market and business model testing. (There are other groups whose products seem to lend themselves more readily to licencing; and these are also housed alongside, but under a different regime.)

Evaluation of early-stage development processes is notoriously difficult, partly because they are all so different from one another, and partly because, as one expert observed, you cannot do so until years after (but how many?!) The statistics are that about 40% of the teams in the incubator have received ongoing funding; and just under half have developed products and are trading.

There is a bootcamp in the summer and networking events to help candidates to understand their own personal aims and objectives and to match up with appropriate team members; and the deal is that those selected for the incubator receive loans of £30-£70k, partly convertible into equity, plus compulsory support. The RCA has established a fund in order to support these businesses (it was originally supported by a substantial grant from Nesta), but needs to be able to recycle the proceeds of sales of or repayments from its businesses in order to sustain the incubator.

The incubator is housed in the recently completed Dyson Building in Battersea which can house around fifteen businesses, with flexible accommodation and meeting spaces, and excellent kitchen/eating space.

The learning programme seems to be very sophisticated, and comprehensive; and each team is assigned a pair of coaches, whom the participants meet every two weeks. Every six weeks they have a review with a larger group of mentors; and they are required to pitch their business every three months to another group of mentors. The RCA has a group of eight ‘coaches’ (mentors), plus half as many more ‘occasionals’; and would like to have a larger and more diverse range of mentors available

Teams sometimes find that one or more of their members are less wholeheartedly committed to their project than others, that other

career interests attract them more than entrepreneurialism, or that their interests in the future of the business do not co-incide with those of  potential investors. And any of these circumstances impede the progress of the business and necessitate the reforming of the team and their re-energising and redirection – often a difficult management task.

Demo Day takes place once a year with around half-a-dozen investors, mainly angels, and InnovationRCA would like to have more such potential investors; but the two-year term of the incubator and the potentially divergent interests of the participants make investing in their businesses more uncertain than some other start-ups. Moreover, the RCA needs to hold its investments under some kind of fund that would handle all the legal and contractual arrangements – which are not within its normal capabilities.

There is evidently a number of issues associated with incubators that run in parallel with academic programmes, not least when they are part of the educational process; and as a leading incubator in higher education, InnovationRCA is wrestling with these.

For descriptions of other aspects of DesignLondon’s work – especially the development of its pedagogical programme, see: http://goo.gl/Yr12c

Copyright 2013

John Whatmore                                                                   February, 2013

The Centre for Leadership in Creativity

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