A tech incubator that’s incubating real growth and economic benefits
I have never believed in incubators.
The first wave of technology startup accelerators popped up in the mid-1980s, the second wave crested in 1999 and the third wave is washing up now. The first two waves were utter failures.
Andrew Clay Shafer, American tech blogger and co-founder of Puppet Labs, nailed it when he wrote that incubators are ghettos: “Most of them suck. Some suck so bad that the net value created by the program is probably negative. … An incubator has a class of companies, they give them a little cash, they have a weekly session with a mentor or whatever, time goes by, demo day, no one gets funding, fail, fail, FAIL.”
Many other pundits in the U.S., such as Sramana Mitra and Rich Swier, agree with Shafer’s blunt assessment.
I never bought the premise that startups could somehow be puffed up with real value in a shortened timeframe as if by magic. In my experience, having tracked thousands of ventures that pitched us over 25 years, it takes time and pure work to build solid companies. Just adding powder and lipstick to a startup that’s not ready for prime time doesn’t fool savvy investors – or anybody else.
However, there is a remarkably successful program operating here in Vancouver called Centre4Growth, an initiative launched by the BC Technology Industries Association just 18 months ago. Centre4Growth helps tech entrepreneurs increase revenue, expand into new markets, negotiate deals, assess opportunities and, yes, accelerate growth.
Perhaps because its motives are pure and simple – i.e. BCTIA isn’t looking to gouge a piece of the company or gain control or capture it for its network – Centre4Growth has attracted a huge resource pool, notably an army of great CEOs-in-residence (CIRs) as mentors for client companies. A Centre4Growth client company from Europe, Estonian financial risk management software-as-a-service company TreasuryView, signed up shortly after opening a sales office in Vancouver, soon after Centre4Growth was launched.
TreasuryView co-founder Margo Karp was impressed not only by the quality of the CIRs who worked with him, but also by the time they had for him and how accessible they were. In contrast, he told me that seeking advice from top tech leaders in Frankfurt, where he also has a sales office, was frustrating. Meetings would barely start, and they were already checking their watches.
More than 250 client companies have already signed up for the program from all across B.C.’s key tech sectors – ICT, digital media, clean tech, life sciences, hardware and gaming. They have achieved $35 million in new revenue and investment – 33% growth in revenue/investment from point of program entry to today and created 145 new full time employees (FTEs) – 10% growth in employment overall.
More than 800 companies engaged in the various programs and services offered.
Cindy Pearson, BCTIA’s COO and the likable bundle of energy behind Centre4Growth, told me that Centre4Growth provides coaching to entrepreneurs at Wavefront, Discovery Parks Vancouver and the Generator, the Vancouver Island Tech Park and the Kamloops Tech Park. It’s also receiving requests for services in Greater Vancouver. In addition, Centre4Growth’s e-library contains more than 800 documents and templates, including the Startup Toolkit.
Centre4Growth is open to all technology companies, regardless of size, sector and location, and they don’t have to be a BCTIA member.
Financial support comes from the government: $1.2 million over two years. Centre4Growth’s results in just 18 months have generated approximately $13 million in regional economic benefit, based solely on the net new employment generated. Pearson said that government feedback on Centre4Growth’s economic leverage from just $600,000 of annual funding has been very positive and could bode well for continuation of funding for the program.
Continuing the program? Given its proven success in adding real value to its client companies and the economy, how about cranking it up, putting some powerful government PR muscle behind it (jobs, jobs, jobs!) and “accelerating” the entire technology community in B.C.
Centre4Growth could be one of the best news stories coming out of the province’s technology sector in a long time – a real poster child for selfless community engagement for the betterment of the entire community. •