Aalto Start-Up Center-Business Incubator from Finland

Case Arabus: business incubator activities focusing on creative businesses

Ms. Marika Paakkala, Project Director, Aalto University School of Economics, Small Business Center

29.9.2011

Aalto University

Under the Aalto University School of Economics

• SME business education programmes

• SME research, focused in entrepreneurship• Incubation services

–> Aalto Start-Up Center Arabus Business Incubator

Merging the three leading universities in Finland

Small Business Center

www.start-upcenter.fi www.pienyrityskeskus.aalto.fi

ACE Aalto Centre for Entrepreneurship

Start-up development process in AaltoPre-incubator Incubator Post-incubator

• Creation of new companies and jobs

• Business coaching• Development of tools and methods

• Increased internationality

• Facility solutions• Virtual incubator

• Aalto University –based business ideas

(incl. AES, Venture Cup etc.)

• Young Business Academy and Small Business Center

entrepreneurship training

• Advisory-clients from Tekes, Ely Center and others

• Company spinoffs

• Post-incubator companies as case studies for training

• Collaboration, networking, shared clients with present

incubator tenants

• Tailored business programs

• Internal quality studies of SBC and its network

• Success stories e.g. Footbalance Oy, Futurice Oy / one of Europe’s fastest growers (2800 %), GWEB (Microsoft award / Global Start Up of the Month), Sopima Oy (Microsoft award /

European most promising technology start-up); • VC investments in 50 companies

• Growth company cluster in Ruoholahti (Acceleration Center co-operation with Technopolis)

Co-operation and deal flow Aalto UniversityCentre of Economic developmentEntreprise HelsinkiInnovation Centre (Keksintösäätiö)Uusimaa region incubator networkDiges r,y (National association for developing the

creative industries in Finland) Employment and economic development officeTekes – the Finnish Funding Agency for Technology

and Innovation Serial entrepreneursOther actors in CI

7

Started during the years 1987-1988 mainly tentatively

– 3 waves of business incubation• 1987-1994 wave of experiments and establishment

• 1995-2001 wave of expanding

• 2002-2010 wave of specializing, networking,

internationalisation, privatisation and the wave of

polytechnics and universities

Business incubation in Finland

CREATIVE ENTREPRENEURSHIP - CASESStrategic planning is conducted in cooperation with

the Ministry of Education & Culture, as well as with the Ministry of Employment & the Economy and with the essential interest groups.

Business services and education:

• Arabus - Design, Media and Art Business Start-Up Center offers business development, training, facility and equipment services to SMEs and entrepreneurs in the creative sector.

• ”Luovien alojen yrittäjyys Etelä-Savon vahvuudeksi” -Entrepreneurship coaching in CI South Savo Regioni.

Regional development work strengthens regional competitiveness and attractiveness.

Public and private organizations engage with education and research projects

The network is the key success factor for the creative industry.

CIF is a coordinator for the national development programme for business growth and internationalization in the creative industries 2007-2013. It also coordinates and supports the realization of development projects funded from the national development project.

• TAIVEX -training program for art exports.

• ”Kestävät Palikat” -executive education for the architects.

• Managerial Programme for the Events in CI

• (in co-op. with Academy of Sibelius)

International research and development strengthens the knowledge:

• CreaEnt project is linking of knowledge and innovation to sustainable development and competition of Central Baltic Region (CBR) and development a best practice model of entrepreneurial education and networking for creative industry in Finnish, Estonian, Latvian and Swedish universities.

• CIF improves the framework conditions of the creative industries

in the Nordic countries and in the Baltic region through the KreaNord -project.

www.creativeindustries.fi

Arabus business incubatorEstablished in 1996Part of the University of Art and Design Helsinki until 2008. Now part of Aalto Uni. Part of the Uusimaa region incubator networkPortfolio: Almost 30 creative sector start-up companies with strong growth potential. ASUC total: Almost 80 start-up companies, approx. 170 employees.

The mission of the Arabus incubator is to promote entrepreneurship in the field of creative sector and industries, which have a growing importance in national economic growth

”The Business incubator for companies which are seeking for rapid growth and success!”

ARABUS Profile

Design - Concept and product design- UsabilityMedia - Internet, digital, AV and conventional mediaContent production- Culture production - Content production for internet, mobile and conventional mediaPerforming arts - Acting, choreography, dance

Defination by Ministry of Employment and the Economy, Creative industries in Finland:

“Animation production, architectural services, film and TV Production, Art and art galleries, crafts,

sports and adventure services, advertising and marketing, design services, music and program,

game

industry, radio and audio production, art and antiques trade, dance and theatre, media”

Aalto-university School of Economics Small Business Center

1. Management team (strategy work)2. Steering group ( financers, Aalto Uni specialists, group of external experts)3. Advisory board members: D.Sc. Jukka Ala-Mutka, CEO, Cone Advisor Oy, D.Sc. Erkko

Autio, professor, Imperial College, London, MA Helena Hyvönen, Executive Dean, Aalto University

School of Art and Design, D.Sc. Petri Parvinen, professor, Aalto University School of Economics,

D.Sc. Markku Virtanen, professor, Aalto University School of Economics

4. Aalto Start-Up Center team (total 6 members, selection process, development of service portfolio, marketing issues etc operative work)

Management

Creative Industry & Information and Communication Technology

FOCUS AREAS

• Existing company under 3 years

• Innovative, scalable business idea with a growth potential

• Existing business plan incl. finance plan for the first year

INNOVATION & GROWTH

TECHNOLOGY BUSINESSART

DREAM TEAM

• Application through Aalto Start-Up Center’s web pages www.start-upcenter.fi/en

• Face to face meeting with Business Advisor

• Team meeting once a week, decisions made within 1-2 weeks

APPLICATION PROCESS

Business advisor services Business advisor

services

Business advisor services

Business modeling

-Modeling of company’s business-Strategic alternatives, policies and focus points- Definition of customer value, competition field and supply- Ensuring funding

Sales action plan

- Cornerstones of sales- Defining purchasing criteria- Tailored sales action plan - Practical sales training

Ensuring continuation of growth

- Managing growth stage- Defining genuine competitive advantage- Securing necessary resources- Planning of growth-driven financing

APPLICATION

SELECTION

To apply for the incubator:

- Business idea with growth potential- Existing company and business plan- Application through Aalto Start-Up Center’s web pages- Decision within 1-2 weeks after all necessary material has been sent

Development program

Sales program

Growth program

Enter incubator

O yrs. 3 yrs.

Information and training- Training and information events form various areas of business

Facilities

- Furnished premises, Office Suite, conference rooms, private Intranet and broadband

Networking and development- Events with other entrepreneurs and stakeholders- Development- and coaching programs

Mentoringservices

- A broad and experienced network of business professionals

Aalto Start-Up Center and Arabus services

Softlanding services

• Technopol and ESA (Estonia)• Northtown technology center

(Lithuenia) • Kristal business incubator (Russia)• Northtown Technology Center

(Latvia)• Several partnership agreements in

process (Sweden, England…).

Funding in 2010

49.7

31.7

7.810.8

ESFCity of HelsinkiHelsinki School of EconomicsEntrepreneurs

Costs4.20%

38.60%

45.20%

3.20% 8.80%

Materials and accessories

Staff costs

Purhasing costs, services

Travel costs

Other costs

COMPANIES

• Aalto Start-Up Center has 80 companies. Companies are from creative industry (30), or developing: mobile- (10), internet- (20) or software services (20).

• ~25% of all applicants are selected ( ~ 200 appl. year 2010)

• The entrepreneurs are 36 years old by averige and 80% of them has a academic education(2/3 has Aalto background)

• The top funders for our companies are: ELY, Centres for economic development, transport and the environment, Finnvera, Tekes– the Finnish Funding Agency for Technology and Innovation, Ministry of Education and Culture and business angels

According to Aalto Start-Up Center survey 2009-2010

Figures and results• Results in Arabus company and job figures (1.5.2008-

30.4.2011)

- 56 selected companies ~20% of all applicants are selected - 35 new established companies, of which 15 have been set up by women> new companies- 117 employees, of whom 36 are women- Team size ~ 2 entrepreneurs- The entrepreneurs was 36 years old by averige.

112 persons belonged to the age group: 25-44 years old- Since 1996 about 200 companies have been selected to Arabus

Aalto-university and Arabus do regular study on its customer base 86 % survival rate after ten years 32% of postincubator companies are considered fast-growing

Incubated companies 2008-2011 Fields: Examples:• Communication services www.communicea.fi • Faschion designers www.kaksitva.com• Usability Designers www.scope.fi• Industrial Designers www.saunasavu.com• Digital and social media www.omakirja.fi• Arcitecture services www.penandhammer.com• Game industry www.tribestudios.com• Arts trade, art management www.artchortcut.com• Sports and experience services www.boxy.fi• Video and animation services www.brinkHelsinki.fi • Living lab www.digitalliving.fi

Challenges

A) Companies and entrepreneurs

• Difficulties in the business consept modeling

• Lack of business skills (management, marketing etc.)

• Problems with the Entrepreneurial team building

• Lack of understanding the importance of self-leadership

• Funding issues

B) Incubator activities:

• How to educate creative people in entrepreneurship?

• How to find new and interesting entrepreneurial teams?

• Consulting Process Development• How to find suitable mentors?• Interaction with markets (partnerships,

co-operation)• Interaction within the incubator• Customer base is fragmented (due to

broad definition of the creative industry) • Funding issues

Aalto Start-Up CenterHiilikatu 3

00180 HelsinkiFinland

Further information aboutAalto Start-Up Center:

Ms.Marika PaakkalaProject Director

Mobile: +358 40 829 2286Email: marika.paakkala@aalto.fi

More information about creative sector:

Mr. Bengt ForsströmProject manager +358 407034984

Email: bengt.forsstrom@aalto.fi

Contact information

More info and application form:

www.start-upcenter.fi

Activities in St. PetersburgMs. Elena Mochnikova

+358504385737Email:elena.mochnikova@aalto.fi

Information about Baltic sea co-operation and partnerships:

Ms. Natalia Narits+358 40 5638 453

Email: natalia.nartis@aalto.fi

Softlanding services (Estonia)Eeva Riistama

+358 40 550 4805Email: eeva.riistama@aalto.fi

Thank you for your attention

andWelcome to

Aalto Start-Up Center!