London Business School alumni tend to go a long way after they leave the Regent’s Park Campus in London. All over the world our graduates have risen to the top in some of the biggest and most successful companies in the world, from global financial institutions to Silicon Valley tech companies, Fortune 500 conglomerates to Asian Tiger manufacturers.
But for the past four years, away from the spotlight of big business in a sheltered corner of the campus, a quiet revolution has been taking place in the form of an incubator, not so much to populate the boardrooms of big companies, but to nurture the small startups that could become the next generation of global companies.
The London Business School Incubator Programme, with 13 student teams, moved into refurbished dedicated space on campus in the autumn of 2013. In the last four years, nearly 90 per cent of the students who have been supported in the Incubator are still in business (see page 34 onwards) – rather better than the 20 per cent survival rate for UK startups estimated by the UK Business Incubator Association.
Tech startups have been grabbing the headlines for many years now, but what distinguishes us from the other incubators is the range of businesses supported. We’ve helped to launch ventures from a wide variety of sectors, many of which are already winning business and awards. And some regularly top rankings for UK startups. FlatClub, an online flat broking service that started in London, has already expanded internationally. Elizabetta Camilleri, founder of SalesGossip, which alerts subscribers to last-minute high-street sales, was voted Female Entrepreneur of the Year in the Smarta 100 Awards.
The School’s Incubator Programme is open to recent alumni on a competitive basis and the ‘founders’ benefit from an impressive package of funding and support. Each startup receives free office space, support from a number of professional service firms as well as strategic support and coaching from supporters, Deloitte. In addition, our global partner Landor provides branding consultancy services. Occupants also have access to the knowledge and expertise of our faculty and alumni. One, now successful founder estimated the in-kind value of this support at £200,000 over the course of the year he spent in the Incubator.
Komal Joshi is the founder of Planned Departure, a secure electronic vault where users can store their digital assets, assign beneficiaries and plan a digital afterlife. She believes that what distinguishes the School’s Incubator from other schemes is the sense of community. “The fact that six other critical friends found the idea and opportunity interesting is a good social proof and validation of the idea,” she says. “The dedicated space is really good for discipline. The support we get from Landor, Deloitte and the School sets us apart from anyone setting up on their own.”
I was lucky when I set up my first business in the late 90s when it was easier to get started. In contrast, today’s entrepreneurs are operating in a much more cluttered environment and must compete for the same network of support, mentors and coaches. As part of the Incubator Programme we use our networks to provide this support for the first critical year – while at the same time being careful to challenge and incubate rather than give ‘life support’.
But students don’t just get left out in the cold at the end of their tenure. We strive to ensure that they are rehoused at competitive rates. From the day they move in we encourage them to be on the hunt for more permanent space in the right business community. Some transfer to accelerators. But so strong are the bonds formed in that first year that all continue to maintain a relationship with those who helped them in that first, formative year.
Part of the excitement for our students is not just the thrill of the ride but the creative excitement they get by working with a wide range of people – both youthful digital natives and grey-haired corporate warriors. That’s what makes our Incubator so successful. The entrepreneurs gain wisdom from their mentors but the mentors can also learn how to navigate the new economy from the digital natives. It’s a win/win for both generations.
The world of work that our students are entering is a very different place to even five years ago. We live in increasingly volatile, uncertain, ambiguous and complex times. Product development cycles used to be measured in years. Now a new product can be superseded by a better version within a matter of weeks.
Not so long ago, many students aspired to become bankers, consultants or industrialists. The generations of entrepreneurs we are now nurturing at the School are inventing their own jobs and creating new businesses that will disrupt the old. I predict in a few years time many of these embryonic startups will become the new mainstream businesses. Our graduates, in their modest office spaces, are reinventing the future.
Banneya uses 3D printing technology to allow people to design and make their own jewellery. Our Mobile Health is an mHealth app aggregator to improve clinical care. Some businesses are new takes on established business models. Pizza Rossa, was voted Best Start Up of the Year at the 2013 Crowdcube Awards. Its founder, Corrado Accardi, wants to do for takeaway pizza what Pret has done for sandwiches, with a new chain of healthy, quality takeaway pizzerias serving by-the-slice in London.
London is an amazing place in which to live and work. There is nowhere like it for fostering entrepreneurship. Students from all over the world come to set up their businesses at the School. I have no doubt that many of those that started in our Incubator will thrive and grow to become global businesses of the future.