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Hi Tech Magazine - October 2000
CDC’s hi-tech incubator programme gets the thumbs up
by Shelley Grell
We’ve all read the misery articles about how the lack
of co-operation between government and business is hindering New Zealand’s
hopes for a big high-tech future. And how the establishment of incubator and
venture capital funds has been crucial to rapid development of other countries
similar in size to New Zealand.
Clearly, if we don’t get our heads out of the sand and
dramatically raise our standards in the fast changing pace of the knowledge
economy, we’ll continue to be written off as just a small backwater nation of
sheep farmers. And quite frankly we deserve it. For if we are to grow and
develop, we have to compete with the best in the world.
Grabbing the bull by the horns is what New Zealand’s
technology industry has long been crying out for, and this is exactly what the
Canterbury Development Corporation has done.
Government funded for an initial three programmes, the
CDC is leading by example with the introduction of a sophisticated Biz hi-tech
seminar programme. Many of the entrepreneurial technology companies who have
benefited from this specialist and free incubator programme are beginning to
buck a backward trend and poke fingers into the eyes of the “woe are we”.
Over the years, while introducing 6,500 companies to
the CDC’s Business Grow programme, John Hamilton came across a number of small to
medium companies with strong technology skills, innovative solutions and heaps
of potential. What they didn’t have was the necessary business management
skills to take them to the next level.
“I met graduates and other individuals with enormous
promise who had never been in business before,” said John. Some were operating
from their living room and selling their hi-tech solutions over the Internet.
These are young entrepreneurial businesses that are working in a fast moving
business environment with narrow windows of opportunity requiring technically
demanding solutions. Many are also isolated, have limited industry networks and
lack access to working capital from normal channels. Even the basics about how
to manage a business, gaining finance and hiring employees can be a challenge.”
Their business potential was clear. But because of the
unique nature of the technology industry, John felt that what these companies
needed most of all was specialist support, business training, market contacts
and to learn from and integrate with others in the industry.
“The technology industry is potentially worth millions
of dollars to our economy,” he explained. “If we look after our hi-tech
entrepreneurs, we will all reap benefits from their success as they create more
jobs, more wealth and attract more business interest in the region.”
So in August last year, John related this idea to
Chris Pickrill, CEO of the Canterbury Development Corporation who agreed that
something needed to be done. Together with Toni Herby, Business Services
Manager, Chris proposed an assistance programme for the hi-technology sector to
the Ministry of Economic Development. It was accepted with funding provided for
an initial three rounds of the incubator programme carrying a maximum of 10 entrants
each.
The aim of the programme is to strengthen the
management capabilities of the businesses and prepare them for investment
readiness within 12 months. The first two rounds of programme have already
proved immeasurable successful in ways far beyond initial expectations.
The programme offers a solid 14-week training schedule
of three-hour evening courses on business management skills. Entrants also
benefit from the largest BITC business mentor scheme in New Zealand, the
biggest locally run Company Rebuilders service to help those who are struggling
– the Company Rebuilders Charitable Trust, BIZ training courses and Business
Grow.
Seminar topics include strategic business planning,
business & technology planning, market research, relationship development,
marketing hi-tech products to the global market place, legal issues, IP
protection, raising capital, distributor management and success stories from
local entrepreneurs.
The first round of the incubator programme started in
March 2000 and was completed in July. Fifty percent of these companies have
since secured investment funding. The second round followed straight on and is
to finish this month.
Not only have the 20 entrepreneurial companies so far
learnt business skills, how to create a strategic plan and been given a
valuable pool of resources to tap into, they have also been introduced to the
big guns, business networks and venture capitalists.
Because of the regular meetings, these once tucked
away hi-tech experts are now networking with others in their field, sharing
ideas, learning the pitfalls and the accomplishments, forming partnerships,
alliances and distribution channels.
What has come as a surprise to everyone are the
spin-offs from the incubator programme. A new high tech community has formed,
where like-minded entrepreneurs meeting weekly to socialise, support and
encourage each other. The Friday night social barbecues organised jointly by
CDC and Boulevard Websystems (one of the first ten incubator companies) are
attended by up to 50 hi-tech business people.
“The programme has been highly successful,” says John,
“because the people involved wanted it to be. We’ve provided the glue and a
neutral meeting place. These young technology entrepreneurs are now meeting others
which allows them to benchmark their progress, show them the way forward and
assist in getting them to the next level.”
Early next year will see the start of the third and
final round of the incubator programme. The CDC is encouraging applications
from top graduates, promising individuals and small innovative businesses for
the ten places available. Entrepreneurs from outside the region are also
welcome to apply. The success of all three rounds will be a determining factor
as to whether or not the programme will continue.
Places are limited and because of demand, entry
criteria tough. Only those with the highest skill level, technical competence,
passion, sales acumen and global business potential are selected. The five
judges on the panel are experts in their own right, in the technology field and
well known in the industry.
“We were initially concerned that the pool of entrants
or the level of standard might reduce, but that has not been the case,” said
John. “If anything the quality is stepping up. We are getting new blood
applying each round and have had to upskill the programme each time to maintain
the standards. Furthermore, we are achieving all this locally.”
Successful companies from the CDC programme include:
Applied Research Associates – specialists in 3D modeling, 3D surface measurement
and design and production of a 3D hand held laser scanner.
Boulevard Websystems Ltd. – Software and network development specialising in
e-caf software support and management systems.
Agrimm Technologies Ltd. – Develops trials and manufactures biological plant
protection products for horticulture.
Keyghost Ltd. – Develops and markets a range of computer security
products via the Internet. (See Hi Tech article in September issue Pg. 26-27.)
Wirecat Solutions – Internet based consultancy firm specialising in
mathematical problem solving, optimisation techniques and programming.
Da Vinci Communications Ltd. – Develops software for testing state-of-the-art
communication networks, systems, services and communication interfaces.
Niche
Software Ltd. – Develops
software for RSI prevention, education and rehabilitation.
For more details about the programme contact: John
Hamilton, Canterbury Development Corporation, Tel: 03 379 5575, email john.hamilton@cdc.org.nz or visit the website at www.cdc.org.nz.