As technoparks, IT parks and business incubators spring up across Russia, observers, including the start-ups seeking residency with such organizations, are becoming increasingly interested to know if the return on these multimillion dollar projects is really worth their cost.
High-profile experts visiting KomTech 2014, a large innovation support event in Nizhny Novgorod, emphasized that even those technoparks already housing residents appeared lifeless, because they lacked an external partner ecosystem to nurture their growing ventures.
What innovators and their supporters want to know, is whether the mammoth facilities can indeed deliver on the promises of their champions. RVC, Russia’s leading innovation fund, partnered with EY to find definitive answers to these questions posed by the entrepreneurial community.
In their most recent study, the partners took a harder look at the achievements and deficiencies of Russia’s technoparks and business incubators. They attempted to provide their solution for what additional real estate investments may still be needed, to make the projects what they were intended to become from the outset—pillars of a new innovation ecosystems in the Russian regions.
To put together the comprehensive study, RVC and EY investigated the current progress and setbacks at 17 major technoparks and 53 business incubators, or approximately half of all such facilities in Russia. The organizations studied had an average age of between 4.5 and 5.7 years. Most of the entities studied are located in Central Russia and the vast Volga region. Half of the technoparks and incubators polled for the research focused on IT, with instrument production, biotechnology, nanotechnology and laser technology the focal area for 36% of the technoparks and 22% of the incubators.
75% survival rate
The survival rate of resident ventures is the most important KPI for these facilities. According to the study, several incubators demonstrated what would be considered an impressive survival rate even by international standards; in five of the facilities, successful residents accounted for more than 75% of the whole.
RVC and EY tried to determine the innovation support facility best practices that enabled the consistently high results of top entities in the U.S. and Western Europe. To ensure superior performance, an incubator or technopark is expected to make its screening process as rigorous as possible, only granting residency to companies that can deliver right out of the gate. The researchers therefore concluded that identifying teams with experience relevant to the purpose of their venture is a valuable selection criterion.
Experience notwithstanding, no young team of innovators will be able to improve a technopark or incubator’s statistics unless they are given sufficient and ongoing care in the form of mentorships, support for IP issues, prototyping, and other services. Unfortunately, guiding residents through the trials and tribulations of their first years in business is not par for the course across the entire incubator ecosystem in Russia.
A lack or entrepreneurs and qualified experts
Numerous discussions with technopark and incubator staff, gave the researchers an answer as to why services that are considered standard worldwide may be nonetheless overlooked in many Russian entities. One of the fundamental problems threatening the viability of a start-up launch ecosystem is technopark and incubator’s inability to retain the services of highly competent coaches and mentors. Unlike their counterparts in the US, for example, coaches in Russia don’t have a strong enough entrepreneurial background to understand all the subtleties and potential pitfalls awaiting their trainees.
Another deficiency is an acute lack of technical experts, a key hurdle in the way of residents seeking to hire skilled staff. Even if such experts are available, the cost of bringing them onboard is prohibitive for many fledgling ventures.
Another common problem plaguing the development of Russian technoparks, and especially the business incubators, is a noticeable lack of equipment and appropriately furnished rooms. In a few entities however, the reverse problem exists: equipment that has been purchased is underused.
