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S3. VIRTUAL INCUBATION COMPONENTS: COMPREHENSIVE BUSINESS ASSISTANCE

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

TOOL SUMMARY

This tool was created by the VIN for community college deans and key staff who will implement the virtual incubator on a day-to-day basis. It is specific to the fundamental NBIA element of “comprehensive business services” for incubator tenants. In a virtual incubator, some modifications need to be made to the traditional services of a brick-and-mortar facility for successful delivery of entrepreneur supports. Sample tools are provided from colleges who successfully offer these services.

ADAPTING INCUBATOR SERVICES TO A VIRTUAL SETTING

Business incubation generally uses a structured process to strengthen a young, struggling or second-stage business, helping it to be sustainable and profitable and grow in the community and beyond. While frequently completed in a physical, brick-and-mortar incubator or facility, business incubation can be accomplished virtually with a few minor adjustments.

The VIN has agreed that the services offered in virtual incubation at a community college is the same as those offered in a brick-and-mortar incubator without providing the business physical space. The general consensus of the VIN project team is that the detailed elements of incubation, extent of services, and their delivery methods will look different and be delivered differently by each community college. However, while the extent of the services may differ, the core of the incubation process will always be similar, whether colleges are working with brick-and-mortar or virtual/affiliate clients.

While each community college might use different terminology, the concepts are the same. The National Business Incubation Association (NBIA) proposes that business incubation programs, virtual or otherwise, have five key components:

UÊ Work with new companies.

UÊ Screen potential clients based on set selection criteria. UÊ Provide comprehensive business assistance services.

UÊ Maintain on-site management to coordinate the delivery of services. UÊ Graduate companies from the program.

WORKING WITH NEW COMPANIES

Using the virtual model being explored by the VIN project team, community colleges will be able to provide comprehensive business services to any entrepreneur that meets the criteria of needing and wanting

structured assistance. Such business owners may not yet be ready for a “traditional brick-and-mortar incubator,” may not need permanent office space (e.g., because the business is home-based) and/or may own second-stage businesses with their own office space.

SCREENING POTENTIAL CLIENTS BASED ON SET SELECTION CRITERIA

Not all entrepreneurs seeking business assistance are ready for incubation, which involves committing to a specific process/steps and focusing on business growth. Screening, or applying selection criteria, help to identify entrepreneurs who are truly ready for incubation.

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

PROVIDING COMPREHENSIVE BUSINESS ASSISTANCE

Of the five NBIA key components of incubation, in the collective experience of the VIN, comprehensive business assistance—offering the widest range of services that resources will allow—has the greatest impact on businesses and the community. The following table summarizes elements identified by the VIN as common comprehensive business assistance services that entrepreneurs request and community colleges provide.

ENTREPRENEURS FREQUENTLY REQUEST

UPON EXPLORATION, SERVICES AND SUPPORTS ENTREPRENEURS TRULY NEED

METHODS FOR SERVICE DELIVERY TO A VIRTUAL TENANT VERSUS A BRICK-AND-MORTAR TENANT Feasibility of a

Business Idea

UÊ Determining the feasibility of a business idea and the “fit” of that idea into a market

UÊ Assisting in creating a business plan

Virtual delivery can be done online or through phone calls, provided a document that has been drafted and reviewed by both parties can serve as a starting point for conversation-driven progress.

Access to Capital UÊ Identifying loans, grants and other financial resources

UÊ Supporting application and acquisition

UÊ Providing guidance in management and reporting

Virtual delivery can be done online or through phone calls, provided the entrepreneur has established a fundamental understanding of capital access. Applications for access to pre-seed funding can be submitted completely online. If the entrepreneur has no contacts, relationships with lenders or idea where to start, the guide needs to supportively discuss the range of options.

Financial/Fiscal Supports

UÊ Access to an accountant UÊ Budgeting assistance UÊ Financial projecting

UÊ Creating/acquiring and managing realistic financial statements

Colleges may provide access to a network of financially based mentors, coaches or advisors who have agreed to be a part of a collaborative program via web-based or other published means. Services provided by these persons may be free of charge, available by subscription (often set up by a network of college-vetted, preferred providers who donate time/services on a pro bono basis) or offered through a fee for service arrangement. SBDCs, SCORE, the local Chamber of Commerce or the college’s internal program may provide or refer

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

ENTREPRENEURS FREQUENTLY REQUEST

UPON EXPLORATION, SERVICES AND SUPPORTS ENTREPRENEURS TRULY NEED

METHODS FOR SERVICE DELIVERY TO A VIRTUAL TENANT VERSUS A BRICK-AND-MORTAR TENANT Identifying and

Marketing to a

Customer/Client Base

UÊ Identifying and building a customer/client base

UÊ Creating a sales and marketing plan for the client’s products/ services

UÊ Providing guidance on using traditional and modern media (e.g., newspaper, direct mail, social media, Google Places) for marketing

Colleges may offer marketing-based courses online or at regional learning centers or other on-campus or off-campus locations. They also may provide access to a network of financially based mentors, coaches or advisors who have agreed to be a part of a collaborative program via web-based or other published means. Services provided by these persons may be free of charge, available by subscription or offered through a fee for service arrangement. SBDCs, SCORE, the local Chamber of Commerce or the college’s internal program may provide or refer clients to this resource.

Launch Guidance UÊ Providing practical knowledge on initiating a new venture

UÊ Offering a friendly but realistic team of mentors who can

“kindly kill” less sustainable and profitable ideas while building out the profitable elements. Often termed a “whack pack” these folks use reality and experience to guide entrepreneurs one-on-one

Colleges may enlist local business advisers/counselors to provide face-to-face assessments and suggestions. These services may be free of charge, available by subscription or offered through a fee for service arrangement. SBDCs, SCORE, the local Chamber of Commerce or the college’s internal personnel may provide or refer clients to this resource.

Strategic Problem Solving

UÊ Providing practical knowledge to help entrepreneurs move through challenges once a venture has begun

UÊ Offering supportive and attentive one-on-one guidance from someone with experience

Colleges may use enlist local business advisers/counselors to provide face-to-face assessments and suggestions. These services may be free of charge, available by subscription or offered through a fee for service arrangement. SBDCs, SCORE, the local Chamber of Commerce or the college’s internal personnel may provide or refer clients to this resource.

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

ENTREPRENEURS FREQUENTLY REQUEST

UPON EXPLORATION, SERVICES AND SUPPORTS ENTREPRENEURS TRULY NEED

METHODS FOR SERVICE DELIVERY TO A VIRTUAL TENANT VERSUS A BRICK-AND-MORTAR TENANT

Peer Networking and Support Service Identification

UÊ Helping entrepreneurs network with peers in the same or similar situations

UÊ Providing contacts in supportive businesses and subject matter experts (e.g., IP attorneys, project management experts)

Colleges may use online business, workforce and economic development social network blogs; mentor meetings; career fairs; and seminars, conferences and programs sponsored by business organizations, the Chamber of Commerce and education institutions.

Sustainability and Growth Planning

UÊ Providing guidance on how to sustain as well as how to modify and grow a business

Colleges may offer marketing-based courses online or at regional learning centers or other on- or- off campus locations. They also may provide access to a network of financially based mentors, coaches or advisors who have agreed to be a part of a collaborative program via web-based or other published means. Colleges may enlist local business advisers/counselors to provide face-to-face assessments and suggestions. These services may be free of charge, available by subscription or offered through a fee for service arrangement. SBDCs, SCORE, the local Chamber of Commerce or the college’s internal personnel may provide or refer clients to this resource.

Technology Exposure

UÊ Exposing entrepreneurs to state-of-the-art services and technology, such as VoIP,

Microsoft 365 Cloud and mobile credit card services, that can help their businesses be more efficient and professional

Colleges may offer technology-based courses online or at regional learning centers or other on-campus or off-campus locations. They also may provide access to a network of financially based mentors, coaches or advisors who have agreed to be a part of a collaborative program via web-based or other published means. These services may be free of charge, available by subscription or offered through a fee for service arrangement. SBDCs, SCORE, the local Chamber of Commerce or the college’s internal personnel may provide or refer clients to this resource.

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

MAINTAINING ON-SITE MANAGEMENT TO COORDINATE THE DELIVERY OF SERVICES

Once their businesses are incubated, business owners will rely on the services provided by the college to help them achieve their goals. The range of services will vary based on the area, region, business specialty and/ or capabilities of the college. Incubation requires management, coordination and oversight of the services provided to a participating business. This is often done by a team or a designated/dedicated staff person that delivers the services, works with the businesses being incubated, holds the businesses accountable for meeting goals and is also responsible for recruiting new clients and being a cheerleader for all of the successful businesses that pass through the program.

GRADUATING

Graduation is where the line is drawn between brick-and-mortar incubators and virtual/affiliate incubators. Under the “traditional model”, once the business has achieved its goals or has successfully completed the incubation process, it must graduate and become a self-sustaining business that contributes to its community’s economic base. Community colleges tend to continue to engage with the entrepreneur

providing on-going supports, personal (and local community) connections, as well as entry-points into further education and training. Virtual tenants tend to have high-touch relationships with the virtual incubation college staff, and so these markers of “graduation” are implemented differently. In some cases, colleges support the entrepreneur in transitioning to a new space, in others, those businesses become primary service providers (e.g. design company) for the incoming businesses to the brick-and-mortar incubator. Graduation is rarely an end-point for the community college relationship.

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

SAMPLE COMPREHENSIVE BUSINESS ASSISTANCE TOOLS

Common Questions Used by Community Colleges to Assess Entrepreneurs and Their Needs Information about the business:

1. When was the business established?

2. What are the business’s applicable NAICS codes? 3. What products or services does the business offer?

4. How many full-time, part-time, contractor (1099) and other workers does the business employ? 5. What is the business’ estimated annual gross revenue?

6. Is there a written business plan?

7. Is business involved in the importing or exporting of goods or doing other business internationally?

Information about customers and competitors:

1. Does any single customer or contract represent 50 percent or more of annual business revenues? 2. What is the average length of the business’ customer relationships and the annual customer turnover rate? 3. Who are the business’ key competitors? Describe the competitive environment in the industry.

4. How does the business differentiate itself from competitors?

Information about operations:

1. What are the business’ marketing plan, market analysis, pricing, positioning and costs?

2. What are the details of the business’ financials, such as its accounting system, AP, AR, debt and financial statements?

3. Does the business have a website and social media platforms? How are they used?

Getting to know the entrepreneur:

1. What was your inspiration for starting or buying your company? 2. What do you like most about running your business?

3. What customers or markets represent the greatest opportunity for your business?

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

COMMON QUESTIONS USED BY COMMUNITY COLLEGES TO ASSESS BUSINESS IDEA POTENTIAL FOR SUCCESS

Success Screen

Is there a need or desire for the product/service? Can the customer buy it?

Is the size of the potential market adequate to sustain the business?

Will the customer buy the product/service? Is there a clear concept?

Can the product/service be made/delivered? Will the final product/service satisfy the market? Does the product/service have a competitive advantage?

Can the advantage be sustained? How will competitors respond?

Does the company have superior resources? Does the company have appropriate

management?

Can the management understand and respond to the market?

Are forecasted returns greater than costs? Are the risks acceptable?

Does the product/service fit the company’s overall growth strategy?

Will management support it? Is it real?

Can we win?

Is it worth doing?

Is the market real?

Is the product/service real?

Can the product/service be competitive?

Can the company be competitive?

Will the product/service be profitable at acceptable risk?

Does launching the product/service make strategic sense?

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S3. VIRTUAL INCUBATION COMPONENTS:

COMPREHENSIVE BUSINESS ASSISTANCE

SAMPLE TERMS OF A CONTRACT BETWEEN A COLLEGE AND A VIRTUAL INCUBATION BUSINESS OWNER Virtual Incubation: Incubation Without Walls

UÊ Designed for businesses that either cannot or do not want to operate in the Entrepreneurship Center. UÊ Target Businesses: home-based businesses, manufacturing, retail and service businesses that require a

specific location UÊ Fee: $35/month UÊ Features

o Business coaching and assistance via:

Q Phone Q Skype Q Email Q Text

Q Any other reasonable accommodation

o Access to resources (legal, accounting, taxes) o 2 – 3 year agreement

o Physical address for mailing (if needed) o Mailbox (if needed)

o Conference room access

o A shared office space during center operating hours for meeting clients (if needed) o Attendance to free educational workshops provided by E-ship Center staff via:

Q Skype

Q Distance fiber optics Q Conference call

o Workshop discounts

o Copy service when center is open o Secretarial service for a fee UÊ Requirements

o Monthly coaching

o Presentation of an elevator pitch as part of the application process o Attendance at incubator networking functions

o Participation in educational programs

References

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