Technology parks, incubators and enterprise centres.
Some of the world’s best high-tech R&D emanates from technology parks and Australia’s technology parks are world class. The concept is simple: gather an elite community of technology researchers and commercialisation experts in one location where they can work and network with like-minded professionals. More than glorified business parks the new breed of tech parks are about promoting a community and culture as well as supporting amenities and events. We explore the business of technology parks and enterprise centres and why a growing number of Australian businesses are choosing to park there. By Jodie O’Keeffe.
WITNESS THE POWER OF A CREATIVE, COLLABORATIVE CULTURE
A few years ago, a prominent multi-national corporation, riding high on the success of their decentralised business model, decided to investigate where, exactly, their most successful product ideas came from. Knowing this, perhaps they could develop a magic formula to generate more.
While big ideas came from all over the company, closer inspection revealed that, statistically, most ideas came from female employees. And, the women with creative minds also had creative fingers — as members of the lunchtime quilting club. Like brainstorming in slow-mo, the supportive, informal group environment encouraged innovative ideas, as well as tricky tapestry.
This is the theory behind technology parks and incubators. Plant a bunch of innovative people, working in different sectors, in a supportive environment, allow for cross-pollination and watch the ideas germinate. Tech parks and incubators come in many shapes and sizes, some are purpose built, some are ad hoc, but the underlying principle is the same. Bring talented people together so they can network, learn from each other, float ideas, think laterally, collaborate and innovate. Provide support in the form of workspace, technology, equipment, facilities, flexibility and mentors. Educate them on matters of business development, finance, intellectual property, marketing and management. Let them experience the thrills and spills of the fun park in the safety of the carousel. Then, instead of licensing out our greatest ideas to overseas companies, we have the skills to ride the roller coaster of our own successful, high growth businesses and the local economy reaps the reward.
More than the sum of its parts, a well-managed technology park can become a true hotbed of creativity and, with supporting infrastructure, can foster the development of potentially worldchanging commercial applications.
FIRING UP THE HOTBED
What makes a hotbed hot? Networking opportunities. Every conference, industry event, seminar and symposium has them. While some participants are more reluctant than others, the formal and informal networking opportunities offered in the environment of a technology park can be the catalyst for all kinds of new ventures.
At the recently opened Bio21 Institute, in Melbourne’s Parkville biomedical research precinct, networking opportunities abound. No longer hidden under the anthill, this award-winning building brings the business of research out into the light, with open plan labs, glass-walled offices and a large central atrium. Café-style communal areas are strategically placed between floors to encourage interaction between staff — and their ideas.
Bio21 Institute is expected to house 450 researchers by the year’s end, but it serves a further purpose, as focal point for the extended biotech research community. According to Dr Peter Goss, Head of Bio-Innovation, the Bio21 project is all about getting great minds to exchange ideas.
“Letting this place be somewhere the community can come together is key. Colocation is nice but, unless those people are actually bumping into each other and talking, then it’s not entirely clear what you get other than economies of scale,” says Goss. “There are over 2,000 biotech researchers within 15 minutes walk of here. At the moment, there isn’t a place they can regularly come together and where industry can join them. Hopefully we can provide that service.”
Postdoctoral Research Fellow Peter Walsh is studying evolutionary molecular biology at Bio21 Institute and regularly takes part in the seminars and mini-symposiums offered at the site.
“As a researcher, you can feel like you’re wasting time at these events instead of doing actual work. But then you walk away and realise that you’ve learnt a lot. There’s always crossfertilisation of concepts and ideas and techniques that come out of the seminars,” says Walsh.
Walsh has colleagues who, after attending each other’s seminars, found themselves waiting at the same corner when walking home through Parkville one night. They got talking, set up collaborations and have since had several joint publications. Who knows — the cure for cancer or the common cold might be discovered under similar circumstances.
Elane Zelcer, Executive Director of Monash University Science Technology Research and Innovation Precinct (STRIP), also makes the distinction between co-location and collaboration.
“There’s a requirement for our tenants, both corporate and university, to collaborate. If they’re not already collaborating, they intend to do so,” says Zelcer.
“Our purpose is to bring the university closer to business and business closer to the university. We identify ways to help businesses solve problems, and create innovations to give them a competitive advantage.”
TECH PARKS BURST THEIR BOUNDARIES
The rise of technology parks and precincts in Australia is producing a curious social phenomenon — the Geek Island. These are regions, outside the inner cities, where concentrated numbers of technology industry workers live. Cultural analyst and partner of KPMG Property Group, Bernard Salt, coined the term.
“Geek Islands need an anchor, something to seed the development of other industries that attract these jobs. It can be quite accidental, like a weapons research facility, or a CSIRO, or the research facility of a hospital — this tends to seed Geek Islands in Australia,” says Salt. “And you need a critical mass, like a city the size of Melbourne or Sydney, or something unique like Adelaide’s weapons research facility in Salisbury.”
So far, Salt has noted Geek Islands forming in the Sydney suburb of Ryde near a CSIRO facility, and in Melbourne around the Monash high tech precinct, future home of the Australian Synchrotron and incorporating the Monash STRIP. The north Adelaide suburb of Salisbury is an up and comer, strategically located between Technology Park Adelaide and Edinburgh Parks’s applied research and manufacturing technology park.
“I think this trend will increase,” says Salt. “There is a push towards technology parks, and it’s also something that suits the lifestyle of workers.”
So, what do a couple of Australian Geek Islanders do once they’ve met and hatched a plan to change life as we know it? They incubate.
AUSTRALIA INCUBATES
Australia has a solid research and development foundation, with government-financed expenditure at 0.33 percent of GDP in 2002-03, compared to an OECD average of 0.25 percent. Indeed, the federal government’s Backing Australia’s Ability initiative is encouraging science and innovation to the tune of $8.3 billion over ten years to 2011.
As part of the initiative, our innovation performance is measured using the biennial Australian Innovation Scorecard. The scorecard ranks Australia against a field of up to 30 OECD countries in the categories of knowledge creation, human resources, finance, knowledge diffusion, international collaboration and market outcomes.
While government-funded R&D thrives, our business sector R&D expenditure is sluggish, ranking 19 among OECD countries. We have a wealth of knowledge, coming in sixth for number of science graduates and ninth for technical and scientific articles published. However, we need to bring our entrepreneurial skills to the party, a deficit benchmarked by number of US patents registered per million in population. In 2003, Australia registered 53 patents, well below the OECD average of 152.
How do we ensure that our most creative, innovative talent is ready to leave the merry-go-round of product development and line up for the big prizes on offer in the open market? Australia’s tech parks are committed to breaking down the barriers to commercialisation by nurturing management, marketing and business development skills.
Sue Bell, president of Technology Parks and Incubators Australia, can feel the tide turning. As leader of an Australian delegation to European technology parks last year, Bell was proud to find her hosts seeking her assistance on how to develop a small business once the excitement of that Eureka moment subsides.
“We picture the European parks as being more advanced than us, and in many respects they are. But a lot of the parks in Europe have come out of a real estate model, so they’ve been industrial estates which, when tech parks became the rage in the 80s, were re-badged to meet the new market. The soft skills, which we automatically put into our tech parks and incubators, have been neglected.”
With the benefit of careful planning, purpose built technology parks often excel at the soft skills. Innovation centres and incubators feature prominently in tech parks all over the country. Technology Park Western Australia has its Entrepreneurs in Residence incubator as well as the WA Innovation Centre. Up on the Sunshine Coast, the Innovation Centre is the first stage in the development of a full-scale Knowledge Precinct around the University of the Sunshine Coast. Technology Park Adelaide has Innovation House and Australia Technology Park in Sydney has ATP Innovations (ATPi).
For Mark Jones, Technology Park WA manager, proactive park management and the fostering of start-ups are crucial ingredients for a successful tech park.
“It’s about growing companies and identifying the route to market for a start-up’s products and services. It’s about providing the necessary support for that company — it might be seed capital, partnering into Europe or it might just be business mentoring,” says Jones.
Dr Peter Goss sees Bio21’s Business Incubator as an opportunity to support small biotech businesses by sharing knowledge and equipment, mentoring and hosting business seminars and networking events.
“Most start-up companies have strong technical skills, but lack confidence commercially,” says Goss. “Combine our programs with the location, with the flexible and relatively affordable space and we believe it’s an attractive proposition. Ideally, we can help some of those companies grow and graduate and then maintain those relationships.”
FLEXIBILITY IS KEY
Not just a safe, nurturing, learning environment for small technology businesses, incubators provide one more crucial element — flexibility. Without the financial pressure of being locked into a fixed-term lease, start-up companies are free to expand (or contract), as circumstances require.
For Scott Gazzard, this flexibility proved vital. His online learning resources company, MCQ International, graduated from ATPi in June last year. Starting as an online assessment project at the University of Sydney, the MCQ International was named in Australia’s top 50 fastest growing technology companies in the 2004 Deloitte Tech50 Award.
“I don’t think we’d be around now if it wasn’t for ATPi. You really get a lot of value for a small up front cost. We wouldn’t have been able to afford to set up on our own, and ATPi gives you the flexibility, on a monthly basis, to expand or shrink if you need to,” says Gazzard.
Starting with just a single workstation in January 1999, Gazzard’s company grew to 12 employees over a period of five years in the incubator. Now located in the Sydney CBD and employing 15 people, MCQ International maintains strong links with ATPi through its bizNetClub — a community of entrepreneurs and interested parties supporting emerging technology businesses.
This supportive, collegial culture is encouraged among start-ups in the incubator. “We had no experience in starting a business,” says Gazzard, “but the good thing about ATPi was, if you didn’t know how to do something, another company there would be able to help.”
THE DIY INCUBATOR MODEL
Around the time Gazzard moved to ATPi, Phaedon Stough was also looking for some office space for his boutique recruitment company, MitchelLake. It was hard to find a decent office for three or four people, with the requisite facilities and amenities, at a reasonable price.
But Stough was not alone. He pooled resources with three other like-minded businesses to set up the business equivalent of a share-house. The group leased an entire warehouse floor and never looked back.
“It was fantastic,” says Stough. “Our building became an incubator of businesses. There was a media production company, a venture capital firm, a mobile technology marketing company and MitchelLake. As small companies, we faced a lot of the same issues.”
While the location has changed and businesses come and go depending on their accommodation needs, the original concept remains unchanged.
However, Stough admits that this type of working environment does not suit everyone.
“Some companies can be really concerned about intellectual property and sharing information but, even though we deal with a lot of extremely confidential information, it’s never been an issue. We share appropriate information to accelerate business growth,” he says.
“The common trait about people in this environment is that we’re all entrepreneurs and we take risks and that’s what makes it work here.”
Incubators come in all shapes and sizes — DIY, under the tech park umbrella or one of 79 government-funded Small Business Incubators across the country. Whatever the style, each performs a vital role in the birth and development of small businesses everywhere by providing a supportive, flexible, cost-effective safe-haven. In the incubator environment, small businesses can learn — from advisors, from their own mistakes and the mistakes of others — how to transform their ideas and knowledge into protected, high-value intellectual property.
And while there may not be a magic formula for generating winning ideas , we have the next best thing: a network of technology parks where Australia’s brightest can collaborate and question, encourage and inspire. Leading the way in business development, our tech parks have the attitude, culture and community to spark a million bright ideas — and capitalise on them.
