Academic Business Incubators as an institutional form of academic entrepreneurship development in Poland

Siemieniuk, Lukasz Working Paper Academic Business Incubators as an institutional form of academic entrepreneurship development in Poland Institute of Economic Research Working Papers, No. 97/2015 Provided in Cooperation with: Institute of Economic Research (IER), Toruń (Poland) Suggested Citation: Siemieniuk, Lukasz (2015) : Academic Business Incubators as an institutional form of academic entrepreneurship development in Poland, Institute of Economic Research Working Papers, No. 97/2015, Institute of Economic Research (IER), Toruń This Version is available at: https://hdl.handle.net/10419/219713 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by/3.0/ Institute of Economic Research Working Papers No. 97/2015 Academic Business Incubators as an institutional form of academic entrepreneurship development in Poland Łukasz Siemieniuk The paper submitted to VIII th INTERNATIONAL CONFERENCE ON APPLIED ECONOMICS CONTEMPORARY ISSUES IN ECONOMY under the title MARKET OR GOVERNMENT? Institute of Economic Research and Polish Economic Society Branch in Toruń 18-19 June 18-19, 2015, Toruń, Poland Toruń, Poland 2015 © Copyright: Creative Commons Attribution 3.0 License Łukasz Siemieniuk l.siemieniu[email protected] Uniwersytet w Białymstoku, ul. M. Skłodowskiej-Curie 14, 15-097 Białystok Academic Business Incubators as an institutional form of academic entrepreneurship development in Poland JEL Classification: D01 Keywords: Academic Business Incubators; academic entrepreneurship; Poland Abstract: The Academic Business Incubators are a significant investment in the development of academic entrepreneurship in Poland. They put the emphasis especially on local development. They are the driving force and a source of motivation to take up new challenges for young people. They allow ambitious people to combine their theoretical knowledge acquired during their studies with practical knowledge. Thanks to the Academic Entrepreneurship Incubators young people become professionals in their actions. Their acquired skills, knowledge, physical, moral and mental characteristics are an excellent basis for the development of their business.The aim of the paper is to discuss the essence of academic entrepreneurship and present issues of the Academic Business Incubators functioning as an institutional form of academic entrepreneurship development in Poland. Introduction In Poland, academic entrepreneurship is relatively a new phenomenon and rarely used for the development of economic activity. The literature of the subject points to a number of barriers limiting, and often preventing economic activity of the scientific community. They are, in particular, the inadequacy of formal and legal arrangements, limited access to financial resources and the assistance of highly qualified executives. Another barrier is the risk associated with the specificity of the market for intellectual property, problems with the estimated value of a product, the formal description of the market, as well as the clarity of property rights. The development of academic entrepreneurship is conditioned by many factors. This applies in particular to problems of the science, research and education sector, which is the source of research and development, skilled workforce, training opportunities, as well as potential entrepreneurs among staff and students. The development of local environment for innovation and entrepreneurship also plays an important role, consisting of small and medium-sized enterprises, entities offering specialized business services, and potential customers of offered products and services. Particular importance in this respect gains a support system, including institutions, organizations and various assistance programs. These are science parks, technology transfer centers, technology parks and incubators of academic entrepreneurship. One of the entities which enables the connection of business with the functioning of universities are the Academic Business Incubators whose mission is to support economic activity of the academia - students, doctoral students, staff and graduates of universities and combating unemployment and commercialization of tangible and intellectual goods.The aim of the paper is to discuss the essence of academic entrepreneurship and present issues of the Academic Business Incubators functioning as an institutional form of academic entrepreneurship development in Poland. Methodology of the research. The research methodology is an analysis of the literature of the subject within the scope of academic entrepreneurship and analysis of documentation on the practical aspects of the Academic Business Incubators in Poland. The essence of academic entrepreneurship in Poland. Entrepreneurship of the academia is understood in two ways. A popular and the most common approach is the recognition of academic entrepreneurship as any kind of involvement of research institutions, academics, auxiliary staff and administration, doctoral students and students in business activity (Drucker, 1992). On the other hand, “academic entrepreneurship” is defined as business activity in the field of education and its practical support for people connected with the research. This concept has a career in the whole world. It is also known by other names such as “innovative entrepreneurship”, “technostarters”, “intellectual entrepreneurship” and “technological entrepreneurship”. Besides, for the companies established by universities there are terms used such as: a university spin-off, company off campus, professors’ companies and small technology business forms (Banerski et al, 2009, p. 6). According to L. Pasieczny and J. Więckowski “the essence of entrepreneurship is a set of specific characteristics of people and organizations, of which the most important are creativity, sensitivity to change, searching for and implementation of innovation, willingness to take risks and responsibility. At the same time, entrepreneurship is reflected in the actions of individuals and organizations, for which, however, favorable conditions in the organization and its environment are necessary” (Pasieczny&Więckowski, 1981, p. 136). J. Guliński emphasizes that academic entrepreneurship can be understood in three ways (Guliński, 2000, pp. 2-4): • as, on the one hand, any kind of involvement of the university, its students, doctoral students and staff in business, on the other hand, as the creation of companies by employees, students and doctoral students; • as a channel of knowledge and innovation transformation, through the establishment of businesses by representatives of the academic community (on a campus or nearby), or the transfer of knowledge and innovation for a fee or free of charge; • as the transfer of technology and innovation, which can occur via licensing (implementation) agreements, patent sales, services and expertise to the world of the economy, sharing of databases and library resources, services of the staff and research contracts ordered by the economy. The evolution of the traditional functions of higher education, the creation of second and third generation university, which is described by J.G. Wissema in his work, the emergence of hard budget constraints and the need to make the best use of structural funds have caused the appearance and then increased academic entrepreneurship. Accordingly, J.G. Wissema concludes that in the search for different solutions, designed to enhance innovation of enterprises and bring scientific communities closer to the realities of the economy, academic entrepreneurship seems to be an attractive field for experimentation and testing. A university is assigned to a new role. Today, in the knowledge-based society it serves not only the role of a teaching and research center, but it is also seen as an institution with abundant source of new ideas, thoughts, research, which can often be used to start a new business. Not using these possibilities would be a waste of the country's economic development potential (Wissema, 2005, pp. 11-18). The use of knowledge, scientific achievements, skills and ideas emerging at universities in their own business is characterized by a certain degree of risk. Young entrepreneurs have to bear the costs associated with establishing and running a business from the very beginning. What is needed is considerable knowledge of procedures and legal issues related to starting and running a business. Additional barriers that may arise are issues concerning property rights, or difficulties with evaluation of results of scientific achievements. Therefore, in connection with the abovementioned difficulties in the initial phase of operation of the business, academic entrepreneurship should undergo some protection, called incubation. Business incubators are able to provide such a protection. The necessity results not only due to the reasons mentioned above, but also as the research indicates that the inventor, innovator and entrepreneur are often different people, and only in exceptional cases they have all the features together, as it was, for example, in the case of Edison, Bell, Eastman, and Dell. Students and researchers of non-economic faculties are focused mainly on the use of technology to create new products and services and not on the rules related to financial or market issues (Wissema, 2005, pp. 11-12). Hood and Young developed theoretical principles within which competencies for success-oriented entrepreneurs need to be developed, namely: the content, skills and behaviour, mentality and personality (Hood J.&Yong J., 1993, pp. 115-135). Matusiak indicates that another important matter related to defining entrepreneurship in the scientific community, there are issues: whether entrepreneurship is to be primarily “incubation” of entrepreneurs and businesses, or “incubation” of know-how having a potential market value, and incubation of projects, business concepts, supporting enterprises such as a start-up (Matusiak, 2009). These approaches are inspired by a radically different philosophy and completely different bases. The former is based on the hypothesis that it is possible, with a minimal support, to increase the number of stable in a market and competitive knowledge-based firms. The latter assumes that it is only possible to support a process of conceptualization of business projects in an organizational and financial way, while they are forced to find external financing themselves. The authors in this case have three solutions (Skweres-Kuchta, 2007, p. 159): • the sale of certain projects to institutional investors; • bringing them as their contribution in the company-funded by “business angels”; • the creation of venture capital funds which are minority shareholders in these companies. According to K.B. Matusiak, academic entrepreneurship is programmed “creative destruction” and its implementation requires a “specific bastion” created by (Matusiak, 2006, pp. 110-111): • the sector of science, research and education which supplies the market with results of market research, skilled workers, and flexible training opportunities of potential entrepreneurs from the students and faculty members; • the support system which consists of programs and institutions that support the transfer of technology and the development of the initial phases of the company; • the local environment of innovation and entrepreneurship, which consists of small and medium-sized enterprises, specializing in business-related services, and risk financing institutions (venture capital). The abovementioned elements as a consequence of interdependence and merging (i.e. a synergy effect) create conditions for the development of economic activity. Through networking based on the infrastructure and institutions soft actions are developed, causing considerable interest in finding ideas for new products and technologies. J.G. Wissema rightly points out that recently there is an increasing importance of “knowledge” as a production factor, activating the development of new forms of cooperation between science and the economy. Hitherto existing model of scientific institutions, especially of higher education, based on education and scientific is extended by preparations for entrepreneurship (Wissema, 2005, pp. 21-39), understood as the development of creative activities that will enable independent operation in the market. Thus, the challenge for the scientific and educational institutions become, according to him, the following (Wissema, 2005, p. 21-39): • shaping attitudes open to entrepreneurship and self-employment among staff and students; • development of knowledge and technological and organizational solutions for the needs of the market and small and medium-sized enterprises; • management of intellectual property; • entrepreneurial management of higher education; • initiating partnerships and networking relationships with local business. In such an environment a trend is created known as “academic entrepreneurship” or in other words economic activity of academia. The interest in the economic activity of the academic community has a number of sources. According to K. Matusiak and K. Zasiadły, they are included in: (Matusiak&Zasiadły, 2005, pp. 145-148): • activities related to the commercial transfer of new ideas from science to the economy; here a model “inventor-entrepreneur” turns out to be particularly effective, allowing to adapt systematically to new solutions for the market and consumers' expectations; • increasing innovative pressure, resulting in shortening the time of transition from the idea to the market application (a first-mover advantage), which is the cause of the spatial approximation of a business and a scientific institution or a university, a scientist and an entrepreneur; innovation increasingly becomes a product of the environment in which an entrepreneur operates (the innovation environment); • an increase in the search for new forms of revenue raising of universities and research institutions by streamlining the channels of communication and cooperation with business, resulting in the sale of technology and research services; • a stronger need for enhancing the attractiveness of educational offer by preparations for the practical use of acquired knowledge in own company; • an increasingly demanding market, creating a difficult obstacle to overcome for ambitious graduates; self-employment is a relatively simple way to break the deadlock in this regard. The main element of academic entrepreneurship are (as already mentioned) people with certain rare competence. M. Skweres-Kuchta emphasizes that such entrepreneurs are characterized or should be characterized by (Skweres-Kuchta, 2007, p. 160): • inventiveness and perseverance in finding and solving problems; • openness to cooperation and self-improvement of managed organization; • the ability to see contact points between knowledge, technology, and often hidden market needs; • the ambition to run one’s own life, passion, vision and dreams. Donckels recognizes the increasing awareness of entrepreneurship as a career option as a major determinant of development activities in the field of academic entrepreneurship (Donckels, 1991, p. 35-42). Next S. Kwiatkowski indicates the following desirable characteristics of entrepreneurial behaviour (Kwiatkowski, 2000, pp. 24-26): • diversity of knowledge, contacts and opportunities – an intellectual entrepreneur is able to associate simultaneously in multiple environments, spheres and worlds, which brings a unique opportunity to develop and deepen the knowledge and expand relationships that constitute a potential base for expansion; • the ability to integrate the process of collecting, selecting and processing information and the ability to make decisions, the ability to synchronize the work simultaneously in different phases of the decision-making process, which makes it possible to avoid the deposition of certain information, assumptions, hypotheses and evaluations; • possibilities for global action, containing extensive contacts and frequent movements, which increase the ability to identify and seize the opportunities; • the ability to find oneself in the right place and time, and to identify changes in the environment, which makes it possible to determine the actions that bring the expected results; • identification of the role in business as an intellectual challenge and adventure, making it possible to maintain a certain distance to the role, which is a lasting source of inspiration; • attachment to ethical and employee development issues. Since, as it was assumed, academic entrepreneurs are those associated with universities and other organizations active in the field of the science and research and development sector, that is, academics, students, doctoral students and everyone interested in the commercialization of acquired knowledge, it is obvious that these people shall undertake the following types of activities within the business activity (Grudzewski & Hejduk, 1997): • development of new products, technology, organization and management systems or their improvement; • adaptation of the results of research necessary to implement the license; • introduction to business practice of patents, utility models and improvement schemes, as well as the design and implementation of innovation. D. Trump claims that entrepreneurship starts with a vision, without it nothing significant is developed. What is important, however, entrepreneurship is not a genetic characteristic, and this means that it can be learnt. According to D. Trump, by one’s own will, skills, knowledge, and own strength people themselves influence the course of events in their •ABI Seed Capital – an innovative seed fund investing in the best Polish start-ups. The Fund offers the easiest and most effective system of investing in Polish start-ups. In addition to the funds, the ABI Seed Capital also provides mentoring guru of start-ups, access to the second round of investment, including the participation of investors from the Silicon Valley. The ABI Seed Capital has made so far 49 capital entries in innovative companies each time in the amount of not less than 100,000 PLN for 15% of the shares. Further 84 investments will be made by the end of 2015. •ABI Business Link – the network (ultimately in 2015 – 10) of the world's top business development centers for start-ups. As part of a preferential package comprehensive services are available to customers, allowing to conduct a business in a simple and effective way from anywhere in the world. In addition, the offer includes comfortable workplaces, modern conference rooms, meeting rooms with multimedia facilities and networking spaces. A showcase of the ABI Business Link are Laboratories which are a unique place, conducive to creative work. Currently, about 200 start-ups per month use the services of Business Link. References Banerski G., et al. (2009), Przedsiębiorczość akademicka. Raport z badania, Polska Agencja Rozwoju Przedsiębiorczości, Warszawa. Berkhout E. et. al. (2010) , Bridging the gap-International data base on employment and adaptable labor, SEO Socioeconomic Research, Amsterdam. Ciborowski R. (2014), Innovation Process Adjusting in Peripheral Regions. The Case of Podlaskie Voivodship, “Equilibrium. 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