Business incubators and intangible assets

Speaking of economic development (see previous posting), last week, the House Small Business Committee held a hearing on Business Incubators and Their Role in Job Creation (see Chairwoman's statement, witness statements, and video highlights).

I have long been a supporter of incubators. During one of the many meetings this winter over possible new innovation policies, I argued for an expansion of funding for incubators -- and that some of that new funding should go to support programming, not just facilities (see previous posting).

Well, it looks like the President of the National Business Incubation Association, David Monkman, agrees. In his testimony, he stated:

Currently, federal funding for incubation programs focuses almost exclusively on bricks and mortar - the facilities themselves. But successful incubators provide much more than shared space. I urge you to consider ways to also provide operational funding for incubators committed to developing innovative programming and following industry best practices, which will allow them to provide continued and expanded services to high-growth companies.

That argument was echoed by Lou Cooperhouse, Director of the Rutgers University Food Innovation Center. As he noted:

The heart of a true business incubation program is the ongoing, personalized and comprehensive services that are provided to clients.

Timothy Early, President of the Hampton Roads Technology Council, also pointed out that:

The U.S. Small Business Administration, which provides funding for SCORE and SBDC programs, offers many important programs to help small businesses. However, SBA has no business incubator funding program, and it does not offer intensive, sustained services to the start-up and fledgling companies that are creating our nation's new jobs and commercializing new technologies.

That is a great point - and SBA programs should be modified accordingly. Specifically, those services should include helping companies identify, develop, and better utilize their intangible assets and intellectual capital. Other nations are already doing this -- for example, Glasgow's Intellectual Assets Centre and Hong Kong's Intellectual Capital Management Consultancy Programme (see also the press release). We should as well.