Workshops for helping to develop innovations

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A number of examples of Accelerators have shown that short, sharp development workshops can be valuable not just for developing new businesses, but also for developing SMEs, for developing commercialisable IP, and for developing new products and new businesses for corporates. The TSB should encourage the Knowledge Transfer Networks to run Bootcamps.

While intensive development programmes have been focusing most prominently on IT start-ups (eg ‘Accelerators’), others have run bootcamps for people before they started new businesses, or for selecting them for incubators (see http://wp.me/p3beJt-y). Yet others have used them for identifying commercialisable IP (http://wp.me/p3beJt-y). And some have focused on helping SMEs – with strategy, with their business model, with new concepts, new products and new customers and marketing.

Corporates have used them for scouting for new technologies, processes and procedures; and for working with their suppliers to help them to develop new products for their own use fields (see http://wp.me/p3beJt-19). One major corporate set has a department (‘Emerging Technologies’) to work on major projects that presaged new ways of working in particular industries. One (new) organisation has brought SMEs together to help them to develop new products for big corporates in a local cluster (see http://wp.me/p3beJt-65).

One of the roles for the Knowledge Transfer Networks is that of bringing together organisations in their field that can bring something of value to one another. They should be scouting for opportunities to use development workshops.

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Extra funds for London Accelerators

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Professionalising the playgrounds; and thickening up the pot of post-Accelerator funding

For participants in sixteen London Accelerators, funding has been promised to pay for mentors and others supporters; and for co-investing in new businesses exiting these Accelerators. But this omits other possibilities.

Accelerators use ‘mentors’ for a variety of roles – from acting as supervisors, as contributors of their specialist knowledge or expertise, as advisers – about strategy, business model, proposals and plans, and as door-openers – especially to potential partners, customers and funders. And the art, and it is very much an art, lies in enabling them to make their contribution at the right moment – when the participants recognise the need and/or when the ‘mentor’ does so. There are also those who lecture, teach or coach, or just tell their own War Stories. Seedcamp boasts a thousand mentors; Springboard a hundred and fifty; and Bethnal Green Ventures some sixty.

So far, those who manage Accelerators have called on their friends and contacts, on those who support the world of entrepreneurship, and increasingly on their alumni to act as their ‘mentors’; and the latter have all responded to these calls. In Silicon Valley the network of such people is enormous and very responsive: everyone seems to know everyone and word is passed round quickly and effectively; but here in London, they are fewer and in less close contact with one another. EU funds have now been promised (via the GLA, Enterprise Capital and London Business Angels) to sixteen London Accelerators to pay for these people.

By comparison the folk of Silicon Valley are pleased and happy to pass the word around simply because they are interested in innovative businesses – a community for whom the fascination of working with and talking to and about start-ups is sufficient.

These funds will no doubt generate a host of ‘consultants’ big and small, who will offer their services because there is money to be made out of this burgeoning scene. But they will not be the first choice of aspiring entrepreneurs because the best supporters will be those who are not in it for the money; and the entrepreneurs will recognise this. Second rate Accelerators will attract second rate ‘mentors’; and it must be doubtful if this will promote the start-up scene to its best advantage.

Less controversially, the EU is also the source of funds promised for co-investing under arrangements with those who are putting money into new businesses that are exiting Accelerators (many of them angels and quite small funds – the most successful of which will have worked with the Accelerator over a period in getting to know their targets). This is designed to increase the size of such funding packages, which will lengthen the runway for these businesses and give them a better chance to establish themselves. Yet at this point, many are left without the support that they have enjoyed and with which they would very much like to be able to continue.

It is disappointing that funds have not found there way to spreading the Accelerator concept into new fields such as for high growth SMEs, for commercialising Intellectual Property, and for supporting innovation in local industries and in public services.

Level39, Canary Wharf – a throbbing new Innovation Centre

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This unique tailor-made innovation eco-system has been carefully designed to meet the varied needs of those who are looking for innovations and those who are seeking to develop them in this part of London; and to bring them together in successful collaborations. What it does and how it does it might have some useful lessons for all those involved in innovationism.

With a simple remit – the development of the area (Canary Wharf) – Level39, 1 Canada Square, opened by Boris Johnson in March of 2013 and headed up by Eric van der Kliej – formerly CEO of Tech City, has quickly become a lightning conductor for those looking for innovations and those with innovations to offer in the kinds of businesses in this area.

Creating the connections and providing a ‘connectious’ space is what its Ideaspace is about – providing space where ideas can be found, developed and connected – without being overwhelmed by the legacy of any corporate culture.

Among its early work was the hosting of the Accenture-backed Fintech Innovation Lab London, a 13-week Accelerator in which a dozen of Canary Wharf’s big banks participated. Seven SMEs – drawn from all over the world – with innovative technologies of potential value to the banks, were housed at Level 39 and provided with a ‘chaperone’ from each of the banks to help them find their way around the labyrinth of people with buying interests and requirements in the bank.

Level39 is now hosting a number of other innovation and acceleration programmes – created by ‘Pivotal Innovations’ which provides custom-designed programmes for corporations and governments looking to innovate and grow.

One of these is the Future Cities ‘Catapult’ Centre (supported by the Technology Strategy Board), which in partnership with Pivotal Innovations is convening cross-sector dialogues (starting with executive breakfasts) with key stakeholders and thought leaders – in finance, real estate, industry and government. The debates will explore viable solutions including critical issues in financing future cities.  They will explore models (eg Rio de Janeiro, Portland Oregon, Songdo in South Korea) and will ask what will interconnected, high-tech, smart cities be like. What new kinds of partnerships might be needed? What investment models might be called into existence? And what enabling policies might make it all happen?

Dassault Systemes, Europe’s second largest software company, has chosen to partner with Level39 and Pivotal Innovations as it expands its strategic focus on financial services in the UK. Its 3D FinTech Challenge 2013 (http://www.f6s.com/3dfintechchallenge2013/info) invites startups to develop solutions for the visualisation of client data in financial services, as a way to condense and simplify such data, such as capital exposure, risk and identity, of which it is often difficult to get a clear perspective, into “single views”, which can be readily understood and acted on. This collaboration too has involved a series of breakfasts with senior executives from London’s banking and insurance industries. Dassault is also showcasing some of its current technology at Level39, such as 3D visualisations of cities like London and Paris on giant touchscreen display units, as an innovative way of presenting information

Designed by Gensler, who also designed Google’s and Facebook’s offices, Level39 has a very wide variety of spaces. It has attracted early-stage businesses eg in retail and financial technology, to take small scale spaces – both entrepreneurs and intrapreneurs – because of its unique ‘connectious’environment. It has 77 drop-in desk spaces, in all sorts of configurations – either for individuals or for startups – most of those startups already post-revenue.

It also has spaces that are specially tailored for innovationism: there are four ‘Sandboxes’ – for Hackathons, for cafeteria-style meetings, for board meetings or discussions, and for presentations, as well as a superb conference room – all with great views over Canary Wharf. Facebook recently held a 48-hr Hackathon in one Sandbox; and the local banks recently held one whose aim was to test their security systems – by trying to hack into each other’s!

It has a cafeteria area with its unique iPad controlled coffee machine; and a Club Lounge will open shortly – for meals, where you can meet and entertain guests (and where you can get a discount if you also agree to commit a certain amount of time to mentoring.)

So what is its secret? In addition to the spaces, perhaps its most valuable asset is Pivotal Innovation’s capabilities in generating and curating provocative innovation events and programmes; and its ability to bring together people with common interests and purposes but who don’t yet know one another.

Its extraordinarily rapid growth (it will shortly open more drop-in spaces on Level 42) and its vibrancy suggest that it has some magic that might be of interest to other cities, like Bristol, Manchester or Liverpool; to other retail centres like Blue Water, Brent Cross or the Airports; to other clusters like the Thames Corridor, Science Parks or Dundee as a centre of the games industry; or even to the NHS or the MoD.

Angel investing taking rapid steps forward

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Now far from its origins as a side-line for rich single investors, angel investing is becoming a collaboration between different contributors and a major supporter of fast-growing young businesses

Since its re-launch last year, the UK Business Angels Association has increased its strength by opening its doors to related organisations working in its field, and has thus become more comprehensive and more influential.

Angel investing appears to be expanding – with more deals and more angels in the market – helping to fill the hole being left by the continuing decline in bank lending to SMEs, and as  the economy begins to pick up. The arrival of a new breed of Super Angel combined with the continued rise of syndicates plus leverage from co-investing funds (at least one VC has a panel of co-investing angels) are ‘pushing Angels up the value spectrum’ (according to Deloitte’s recent report.)

The Association is attracting widespread support – for example now from most of the big five ‘accounting’ firms (and soon all?), and from funders big and small; and it is generating new initiatives.

By their involvement, and by virtue of their related experience, Angels are increasingly themselves generators of added value; and are becoming increasingly sophisticated investors in young businesses.

The Association has set up a “walled garden” website for its members in order to help in the completion of funding deals. It enables them to share information about part-funded deals – to help close those deals and reduce the number of deals that fail to complete.

The Association is forming The Business Angels Institute – an organisation designed to help people understand and learn about Angel investing – with several meetings already planned this month. It is working with PWC to support a programme of increasing access to identified Angel-backed businesses for corporates seeking acquisitions, and is running workshop on trade sales. And it is setting up local meetings for Angel investors to meet sources of deal-flow and key players such as the Angel Co-fund, the Business Growth Fund and HMRC.

A cluster-based ‘Accesserator’

A cluster-based Accelerator…here helping to enable SMEs with innovative products to market to the big companies of this sector – all located close to one another; the process energised both by collaboration and competition

This novel application of the Accelerator in a cluster suggests how SMEs with innovative products can be promoted by a period of intensive support to help disseminate their innovations into organisations in the cluster, where the latter are working both collaboratively and competitively.

While most commonly Accelerators have been about helping aspiring entrepreneurs to develop their ideas into commercial ventures, some, like this one, have been about helping SMEs to grow. They have done so by focusing on the development of strategy (see Qi3 at http://goo.gl/Od6F1), business model (see The Young Foundation at http://goo.gl/ET1zQ), new concepts (see Watershed http://goo.gl/XCTxK), new products (see Plato, Belgium at http://goo.gl/hzBJ5), and new customer segments and marketing (Fintech below).

The FinTech Innovation Lab London is a three-month long collaborative Accelerator, in its third week as I write, in which seven young businesses in IT have been brought together, all of them carefully selected by the senior IT officers in the thirteen big companies in this project (twelve of them large banks) because their ‘products’ might be valuable to them.

The FinTech Innovation Lab, provides its seven companies with office space in the heart of Canary Wharf for these three months, and provides mentors to help them through the process. And a ‘chaperone’ was appointed by the senior IT officer in each company, whose job it is to help them talk to people in their bank (The cultures of the banking industry and the IT industry are quite different, and selling by the one into the other is recognised as a complicated and arduous process.)

A similar ‘Accelerator’ has been run for the last two years with a number of banks in New York – with evident success – enabling them to make use of products or services from other fields which have no necessary relationship to the banking industry.

The role of these ‘chaperones’ is to identify which of these young businesses might have something that would be of value to their company, and to help their staff to get in front of the right people in their company, people who could help them to make use of their products. One person who has experienced this process is said to have commented that his company was able to achieve in the three months what would otherwise have taken two years.

The process is energised by the fact that having committed to the project, each company’s senior IT officer and its ‘chaperone’ are simultaneously collaborating and competing with those of the other companies to get the most out of the process and out of the IT companies and what they have to offer. Every week, one of the big companies makes a presentation in the co-working space, for example about security problems, about their purchasing hoops, about their current challenges etc.

The programme finishes with ‘Demo Day’on 20th March; and hopes will focus on whether it has stimulated growth in the SMEs, whether it has brought innovative ideas into the banking industry, whether it has identified interesting investment opportunities to present to investors; and whether in the longer term it seems likely to inspire entrepreneurs to see potential in the financial services industry.

In addition to the thirteen big companies and the carefully selected companies in the IT industry (several of which are from other countries – reflecting the international nature of the banking industry), the parties to this exercise, all of whom can hope to gain from it and therefore have an interest in its success, are the major consultancy organisation that is managing the process (which has clients in the banking industry) and the predominant landlord in the area, which has provided space for new business nurseries in the hope that among them might be some future tenants. The TSB is making contributions to the programme. And it is formally supported by the Mayor of London.

 

If you are interested to learn more and meet the consultant who is running the process, email me john.whatmore@btinternet.com.

 

John WhatmoreThe Centre for Leadership in Creativity

Copyright 2013