The Conversation

The editor at The Conversation writes to me thus:

“Ian, I thought you might know if there was any research on this area.

I’m not sure if it’s becoming more of a thing or I’m just noticing it but after the announcement today from Vodafone about their ‘start-up incubators’ in London, Singapore and Comm Bank’s ‘innovation lab’ in the same sorts of places, it got me to thinking what is the purpose of these places? They are couched as places to inspire innovation (and probably to capitalise on talent in these tech hubs) but I wonder whether it’s mostly a marketing thing.

Do you know if there is any research on the use ‘hubs’ or ‘labs’ like these? Either internationally or here in Aus?

Thanks,
Jenni”

I reply:

“Jenni

I am not aware of any research on the subject, however my casual observations would suggest that these corporate incubators have three functions:

1. Marketing to customers, as you suggested. I put this in the bucket of ‘profile’ marketing – where a company is trying to create a positive impression with the public. This is usually a sign that a company is in an oligarchical environment and thus it has the money and the inclination to attempt to create the impression otherwise.

2. Marketing to staff. This is an attempt to convince staff that the organisation is groovy and funky, so as to help with staff retention

3. Keeping up the corporate Joneses. Down at the club the CEOs now must have an incubator to discuss, whereas once it might have been a corporate jet. These things come and go, like fashions

You will note that usually the actual cost to the company of operating the incubators and investing in the companies is way less than the marketing budget associated with the incubator.

Also you will note that the people that run these incubators are usually wonderfully unqualified to make any sort of success out of the things.

A genuine ‘unicorn style’ success would be embarrassing in as much as there would recriminations as to how much the corporate made out of the deal; no matter what, it would be too much or too little, or something. The party with the deep pockets always seems to get sued!

Which brings me to my last point; I have checked a few of the Australian corporate incubators and not one insists that its incubator companies sign a Covenant Not To Sue – which shows an incredible level of ineptitude.

All of that is opinion, unfortunately.
regards
Ian”