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Research report on establishing a dedicated

Community Enterprise incubator in
Cambridgeshire

October 2003

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CONTENTS

3 Executive Summary

5 Introduction

7 Method

8 What is a Community Enterprise?

9 What is a Business Incubator?

How will an Incubator help
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Community Enterprises in Cambridgeshire

14 Summary of proposed Incubator Types

15 Case Studies

22 Results of Questionnaire

28 Possible locations for CE incubator facilities

40 Regional Support and Interest

43 Funding

43 Conclusion

45 Acknowledgements

46 Appendices

49 Bibliography

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EXECUTIVE SUMMARY

Introduction

Currently, there is no dedicated provision for Community Enterprises (CEs) in
Cambridgeshire in the way that there is for high-tech or graduate enterprises, such as St
John's Innovation Centre, located in Cambridge. However a variety of established, robust
social enterprises in the county are exploring ways to expand and diversify. Some are
developing incubation facilities as a way to develop additional commercial acitivities in order
to release them from any current dependency on grants.

In the dti’s recent Social Enterprise Unit (SEU) report called ’Social Enterprise: A strategy
for success’, Prime Minister Tony Blair stated that the government wants to ”create an
environment in which more people feel they are able to start and grow such
businesses [such as community enterprises].” The RT Hon Patricia Hewitt MP adds, ”I
want to ensure that we do more to encourage, grow and sustain social enterprises –
to ensure that social enterprise is not seen as a ‘side show’ to the ‘real’ economy but
rather an integral and dynamic part of it”.

It is felt, therefore, that to build or convert a building into a community based small business
incubator centre providing high quality accommodation with support services would reflect
those available to mainstream businesses and as it would be a local initiative it would
strengthen the sector further and encourage cluster growth in other areas. Our belief is the
centre would make a meaningful impact on communities, help regeneration policies,
encourage employment; increase much needed services and goods while supporting local
entrepreneurs.

This report details the findings of a study to determine what a business incubator is, how it
would benefit Cambridgeshire CEs and to ascertain if there is a need for such initiatives in
the county. The research for this report also looked at possible locations; the potential
funding for such a venture; and the commitment of other support agencies, local authorities
and other organisations to ensure the success of the initiative.

Objectives of the study

To establish what business incubation means, by looking at closely related community
led initiatives and evaluating best practice.
To establish whether or not a need for CEs incubators exists in Cambridgeshire.
To look at possible sites and funding opportunities.

Results of Study

All CEs that responded to the research would like to see an incubator for both start-up and
diversifying community enterprises. They felt that an incubator type of development would
provide a vibrant community for enterprises to share ideas, encourage sustainable growth
and to produce further community enterprises for local areas.

However the 25% response rate was mainly from entrepreneurs as opposed to those
already trading (the ‘movers and shakers‘). This would appear to back up anecdotal
evidence that many social and community enterprises struggle to identify themselves as
such. Research also found that other agencies, approached to help identify and target
community enterprises in the county, had similar problems in identifying CEs as such, and
had trouble in grasping the concept of what an incubator would offer this sector. This would

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indicate the need for more capacity building in the sector to enable enterprises and
entrepreneurs to see the ‘bigger picture’ and where they fit in, and also aiding other
agencies in identifying social and community enterprises more readily.

Many agencies, including regional and local authority organisations, are committed to
encouraging the growth of start-up and already established, small or medium sized
enterprises. There are developments taking place in many parts of the county to this end.
These are not aimed exclusively at community enterprises but it was felt that these
developments could cater for CEs working alongside mainstream start-ups.

Pursuing a ‘new build’ incubator was found to be costly and there are also issues
surrounding planning permission in some areas. However, a few well-established social
and community enterprises were keen to expand and develop their sites to become more
commercial. They are also looking at providing incubation facilities for other like-minded
businesses. These possibilities were studied closely as the setting up of smaller incubator
type models, within a existing development, has many advantages including lower capital
costs, good pre-established relationships and links within the local community, as well as
established partnerships with education establishments and relevant local business support
agencies. It is recommended that the Marwick Centre in March would be an ideal site to
develop an incubation facility in this way as it already contains a well established community
enterprise and has attracted lots of local interest in renting unused workspace. It also has
good business support, education links, and plenty of space to develop and extend the site.

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INTRODUCTION

“Regeneration means understanding people and their local context. It needs to help
to create an enabling environment, where people can use their abilities, fulfil their
potential and flourish” (Ruralnet 2003).

Cambridgeshire is a diverse county with vibrant cities and many rural areas. Strategic
partnerships with participation from all sectors including housing, economic development,
community development, mainstream business and voluntary sector are being developed to
regenerate both urban and rural areas; this is a continuous process.

In a world full of globalised companies the presumption that ‘big offers best value’ is slowly
being undermined by observations that small enterprises, especially community enterprises,
add more value than their international counterparts. They provide wealth to communities
and employment in areas that are generally seen as high risk - providing essential services,
idiosyncratic to the particular locality.

An initial feasibility study commissioned by East of England Development Agency (EEDA),
which looked at the possibility of setting up a regional flagship incubator in Cambridge for
Co-operative and Social Enterprises (CSEs), found that a high percentage of small and
medium-sized enterprises have a dramatically increased survival rate with business
incubation support. This type of development can provide affordable premises, hot desks,
business addresses, shared office facilities, training facilities, conference services, business
support and finance advice on site. All of these contribute to providing a vibrant business
community whose collaborative working and sharing of resources is seen to strengthen the
clusters of businesses encouraging growth and spin offs. The Small Business Services
(SBS) acknowledge this through a government white paper published in 2001 ‘Opportunity
for All in a World of Change’ that ”the lack of access to suitable premises, business
advice and other help, such as finance, can hinder the chances of survival for start-
up and early growth stage companies … 75% of businesses that start in such
incubation projects are still in business after 5 years compared with only 33% which
do not have such support.” The paper goes on to add that the development of such
business incubators “… is an important part of the SBS start-up policy”.

As suggested by the EEDA report, Cambridge’s CSEs would benefit from such a facility and
further research is continuing into the need and identification of suitable locations by Citylife
Ltd, the East of England Development Agency (EEDA) and other interested parties. Added
to the fact that 52% of all incubators in the UK are managed by social enterprises, could
other local community enterprises benefit from such a facility in such a diverse county as
Cambridgeshire? It is recognised from the outset that needs differ from cities to villages
and each have their particular difficulties and issues. However, the common factor in each
area is the necessity to establish and maintain viable businesses. This is aligned to the
”valuable role that the provision of good quality business support and advice can
play” acknowledged in the Bank of England report, ’Finance for Small Businesses in
Deprived Communities’. Also a large number of business advisers who were consulted in
this report commented that ”people from deprived areas are likely to require more
business support and advice than their other clients, in part due to the lack of local
role models and the need to build confidence”. Business incubation is one method of
providing such confidence on a dedicated site with the added benefit of tailoring business
advice and support to tenants within such a development.

Business Link, in line with it’s current policy to encourage and develop community
enterprises throughout Cambridgeshire, funded Cambridge Co-operative Development

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Agency (CCDA) to research the feasibility of an incubator type development exclusively for
these localised enterprises and services. CCDA was identified as the organisation best
able to accomplish this effectively as it provided continuity with the recent publication of its
feasibility study for a regional flagship incubator in Cambridge for Co-operative and Social
Enterprises. The CCDA appointed Sue Roberts to ‘head up’ this research.

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METHOD

There were five phases of the research:

Identification of potential Community Enterprise clusters in Cambridgeshire
(excluding Cambridge)

Information was taken from various mapping sources including publications from the
Guild, Business Link, CCDA, ACRE and other organisations. Requests were posted on
relevant internet chat sites for information including local, regional and national
websites.

Establishing level of interest in business development centres, including Incubator
models, with current identified Community Enterprises in Cambridgeshire.

Contact was made with existing Community Enterprises to ascertain their particular
needs at start-up. Questionnaires were sent and personal visits made to identify
clusters of Community Enterprises in Cambridgeshire. A selection of possible
development areas was chosen for in-depth research to be undertaken with visits made
to appropriate agencies involved in the regeneration of these areas.

Identifying potential support from a variety of business support agencies and other
organisations currently supporting, or involved with, Community Enterprises.

Telephone calls, email and meetings were made with appropriate agencies to discuss
the concept and ascertain the level of ‘in principle’ support for an incubator.

Identification of possible sites, in each area identified, that could be suitable for a
Community Enterprise incubator. Implications for trade, logistics and funding were
assessed.

Contact was made with local estate agents and developers, local authority planning
offices and economic development officers. Breakdowns of development costs were
ascertained from various organisations.

Identifying possible funding streams

Possible funders were researched via the internet, and visits were made to known
funding bodies including local, regional and national authorities

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WHAT IS A COMMUNITY ENTERPRISE?

“Community enterprises (or community-based regeneration organisations) seek to
make sustainable improvements in the economic, social, cultural and environmental
life of specific geographically defined communities”
Bank of England

Social Enterprise is a broad concept with no easily identifiable design. To understand the
concept is to distinguish their key characteristics as opposed to their organisational
structure. Social Enterprises share three objectives: they trade; have social purpose (such
as provision of employment for excluded members of the community or provision of a
community service) and finally, reinvest their surplus into achieving their social objectives.
The sector addresses a wide range of social and environmental issues and operates in all
parts of the economy. It is said that social enterprises are “value-led, market driven”
(‘The Role of the Voluntary and Community Sector in Service Delivery’, HM Treasury Sept
2002). A Community Enterprise, in the context of this study, is identified as a social
enterprise working within a specific geographical area and providing services or goods to
that area, although it could have a wider regional impact.

“Social businesses … have the ability to generate jobs and training for those outside
mainstream employment” and can “stimulate enterprise in areas of social
disadvantage which many businesses regard as uneconomic”
Anne Campbell MP

The defining characteristic of a community enterprise is that it aims to benefit a community,
perhaps but not necessarily geographically defined, through trading. In many cases such
enterprises aim to provide both training and employment opportunities for disadvantaged or
disabled people. They often find it more effective to achieve their aims through being
managed by the workers or community that are intended to benefit from the business
activities. They should also state, in business plans and in other documentation that their
objectives are primarily social. As a matter of principle all surpluses or profits (and assets if
the business were to be dissolved) should be reinvested in support of these objectives.

A community enterprise may be entirely self-sustainable or have some grant dependence.
Each will have its own social mission, individuality, aims and objectives. The peculiarity of
this sector is that many CEs are not aware that they are such. This has presented
difficulties in mapping them, however information has been taken from The Guild’s
research, (although it should be noted that this information was first complied 3 years ago),
and Business Link’s databases in addition to CCDA’s own directory. The following results
have enabled the identification of where Community Enterprises are most active and may
benefit from further resources in order to encourage growth in this area. Of note is that as
the research developed it became increasingly obvious that many charities could be
classified as emerging community enterprises.

In conclusion, for this research, a Community Enterprise has been identified as a social
enterprise that is ‘wedded’ to the community it serves. This report also recognises the
definition of the Social Economy “as sitting between the private sector and public
sector and includes organisations from the charitable voluntary and community
sector” (Social Coalition Report, ‘Social Enterprise in the English RDAs and in Wales,
Scotland and Northern Ireland’).

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WHAT IS A BUSINESS INCUBATOR?

“Start-up businesses face a number of practical challenges in their early months of
trading. Access to affordable premises can be a major factor in determining the
initial viability of a business.” Bank of England

Incubation is a process to help ‘start-up’ businesses survive and grow. They are usually
managed premises comprising of small office or light industry work units with meeting
rooms, parking and reception facilities. New start-up businesses are provided with an
informative and supportive environment. Peer group networking, business advice, business
mentoring; technology support services and assistance in obtaining finance for growth are
often found in such facilities to further support the new start-up businesses.

Each incubator has different aims pertaining to the economic development of its local area.
They can enable diversification of rural economies or, in urban areas, provide employment
and build local wealth. Incubators are sometimes used as a vehicle to transfer technology
from universities and major commercial businesses. Incubators can focus on a particular
market (for example, technology based businesses are nurtured in St John’s Innovation
Centre in Cambridge) or have a mixed use that targets a specific group of entrepreneurs,
like the Wandsworth Youth Enterprise Centre in Tooting (whose client group is 18 – 30 year
olds). Currently 82% of business incubators in UK operate a selection policy for entry to
their incubators and 48% of those select businesses of a type (UKBI). The role of an
incubator is to produce successful businesses that are financially viable and self-supporting
when they leave the premises.

The National Business Incubation Association states that two core principles characterise
effective business incubation:
That an incubator is recognised as a dynamic model of sustainable efficient business
That the local economy becomes improved due to the successes of emerging
companies

Core activities:
Appropriate rental space and flexible leases
Shared basic office services and equipment
Business advice and support
Assistance in obtaining appropriate finance for growth
Other shared facilities including meeting rooms, parking, reception

Many successful managed workspace developments also offer some or all of these
facilities and activities. However, what makes an ‘incubator’ development different is the
provision of the following extra services and aims:
More intensive sources of relevant support for their tenant groups
The aim to tackle specific problems of economic development in urban and rural areas
including unemployment and availability of business support services
An increase in the success rate of early stage businesses

Incubators achieve this by:
Selection - evaluating new ideas and selecting those emerging businesses who will
gain the most from the services provided within an incubator. The selection process
tends to focus on particular areas of industry such as technical industries
Nurturing – tailoring business support and advice to tenants within an incubator

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Management – the management will tend to provide the relevant support and advice as
well as site-manage the complex
Graduation – encouraging growth of businesses within the incubator, then helping them
to take the next step as they outgrow the facility

The opportunities and benefits afforded by a successful incubator are manifold to
mainstream businesses and could be for community enterprises too. These include:
Higher likelihood that new businesses will be successful
Building of long-term partnerships and the capacity of a sector that is still not clearly
identified
Encouraging entrepreneurship in the sector by providing a tangible base and resource
centre to build upon individuals’ skills and visions
Helping to promote the experience of new ways of working throughout the region
through ‘leading by example’ and providing a central core of expertise supporting and
encouraging those most vulnerable to develop into more robust organisational clusters
and through replication
Access to integrated training programmes accredited through an appropriate Higher
Education establishment
Possible low cost / subsidised administrative office workspace, workshops and light
industrial units
Technical equipment and resources
Intellectual access to national and international networks
Supportive network for the exchange of information and advice
Adding to the quality of community life and local economies of the communities the
incubators are located in
Developing a greater level of awareness of community enterprise within the locality, the
mainstream sector and its own sector.

CCDA project staff visited a variety of community-led incubator type developments, seen as
innovative and successful within their own field, concentrating on rural and community
enterprise models. Through this, management structures, funding strategies, success and
issues to bear in mind to help best develop a new centre were researched. Though 52% of
incubators operate as social enterprises (UK Business Incubation (UKBI)), no incubator or
enterprise centre catered for CEs exclusively, although a few initiatives were identified that
were looking at this type of provision (see section on Case Studies). Most incubators had
provided managed workspace for a social firm (a CSE with at least 30% employees having
a support need of some kind and at least half of whose income is from commercial trading
activities) but not deliberately as part of their policy.

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HOW WILL AN INCUBATOR HELP COMMUNITY ENTERPRISE IN
CAMBRIDGESHIRE?

In a world full of globalised companies the theory that ‘big offers best value’ is slowly being
undermined by observation that small enterprises, especially social and community
enterprises, add more value. They provide wealth to communities and employment in areas
that are generally seen as high risk - providing essential services, idiosyncratic to the
locality.

The Government’s Strategic Vision
“is to create a dynamic and sustainable social enterprise sector,
as part of an inclusive and growing economy”
(‘Social Enterprise … a Strategy for Success’, dti July 2002)

Many community enterprises encounter the same difficulties as mainstream businesses
although to date social firms and co-operatives, (two of the many forms of social and
community enterprise), have a higher survival rate. Only one in five co-operatives fails
within its first five years as opposed to three in five mainstream businesses failing within the
same period (ICOM, ‘The Co-operative Advantage’). The Government has recognised the
value of such organisations and is actively seeking to encourage the growth of this sector,
partly through promoting methods and models such as business incubation, franchising and
replication. Globally, business developments that include incubation projects are having
significant impacts on the culture and the economic well being of local areas. The
Enterprise Centre in West Philadelphia is such a project; it was voted the National Incubator
Association’s ‘Incubator of the Year 2000’ with its provision of workshops and training
programmes. The Centre has become a key within the local economy recruiting and
developing entrepreneurial talent from as young as 12 years old and in the long term should
contribute significantly to the ongoing regeneration of an area that has widespread poverty,
property deterioration, high crime levels and a widely divergent community (Drivers to
Enterprise in Disadvantaged Areas, Leicester City Council).

The Bank of England in its document ‘Finance for Small Business in Deprived Communities’
(Nov 2000) concluded on the issue of finance for entrepreneurs in deprived communities
that “the promotion of enterprise in deprived areas has the potential to play an
important role in helping to address social exclusion, by providing jobs, increasing
the flow of money into local economies and increasing the availability of local
services” and Stephen Timms MP said in his foreword to the Enterprise and Social
Exclusion report that there is a “vital role that enterprise can play in helping to renew
our poorest and most marginal communities. It helps to create jobs and stimulate
activity in communities where crime and unemployment are high. It helps to meet the
basic needs of local people by providing vital services like shops. Perhaps most
fundamental it helps develop self-confidence and determination in local people and
communities – the real drivers of regeneration in the long run”

It could be said that there are three factors that help to determine the extent of business
start up activity in any locality; the interest of local entrepreneurs, the existence of an
entrepreneurial culture and the level and quality of advice support and guidance available to
would be entrepreneurs.

Although not the answer to all regeneration problems, community enterprises should be
seen as a key part of a holistic approach to addressing the needs of individual communities
and would add extra value to the three basic community needs: good health facilities, social
services and appropriate educational, including training, provision. As the New Economics

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Foundation noted in ‘Creating Enterprising Communities’ published by the Institute for
Public Policy and Research “supporting micro-enterprise in disadvantaged areas is
more than just about creating jobs and opportunities for individuals and business. It
is part of developing enterprising communities where people, resources and finance
are brought together in order to support and catalyse permanent change.”

Managed workspace has its place too, successfully providing space and helping new
businesses to grow. However, incubators with their in-house support and advice provide
businesses with a better chance of survival beyond five years as reported by the Small
Business Service: 75% of businesses that start in Incubators are still in business after 5
years compared with only 33% which do not have such support. As the paper ‘Managed
Workspace and Business Incubation – A Good Practice Guide for Local Authorities’ states,
incubators “are often seen as providing the seeds for area economic and social
regeneration” and there is national research looking at developing incubator models that
are not only operated by social enterprises (currently 52%, UKBI) but that also facilitate and
support the specific needs of this sector. This is illustrated by East of England Development
Agency’s recent report ‘Feasibility study for a regional flagship incubator in Cambridge for
Co-operative and Social Enterprises’ and the current study by South East of England
Development Agency mapping social enterprise and looking at the possibility of developing
enterprise hubs for this sector.

EEDA’s ‘Economy and Labour Market’ background paper (April 03), based on research
carried out by ‘Spacia’, has found that one in three small and medium sized enterprises
(SMEs) in the region struggle to find suitable accommodation for their business. This is a
three-fold increase on last year which confirms the major concern felt by social and
community enterprises in Cambridge as reported in the above feasibility study. EEDA have
successfully developed North and South E-Space incubator facilities for mainstream
businesses, with district partners to begin to address this issue. Although these enterprise
hubs are aimed at a specific industry they have also facilitated advice, support and even
occasionally offered their managed workspace to other industries. EEDA are also actively
looking, in partnership with local councils, at other opportunities to develop incubator
facilities within the region in the areas of Chatteris, Wisbech, Peterborough and Bury St
Edmunds.

Sustainable Communities
It is generally accepted that key requirements for sustainable communities include:
• a flourishing local economy to provide jobs and wealth
• effective engagement and participation by all local people
• an active voluntary and community sector
• buildings that can meet different needs over time, and that minimise the use of
resources
• good quality local public services, including education and training opportunities, health
care and community facilities
• a diverse and vibrant local culture
• effective links with the wider regional and national community

Specific for a rural community’s sustainability is the provision of work in the immediate area.
As Enterprising Rural Communities, the East Lancashire Partnership commented “in rural
areas employment tends to centre on larger settlements at the expense of smaller
more isolated rural communities, and opportunities to set up local enterprise in these
areas are limited” (elprural website).

All district councils within Cambridgeshire, in partnerships with local and regional
organisations, highlight the importance of encouraging a “varied and dynamic local

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economy which does not harm and seeks to improve the environment, offers quality
employment and training opportunities and secures the vitality and viability of our
towns and villages” (East Cambridgeshire District Council).

A localised community incubator whether a satellite from a ‘flagship’ incubator based
elsewhere or autonomous would provide:
• Job Creation – local jobs for local people
• Provision of core local services – the negative impacts of ‘out of town’ retail parks and
the centralisation of finance facilities such as banks and post offices must never be
underestimated.
• Creation of a positive image for communities generated by new businesses, especially
in previously empty and rundown commercial properties
• Revitalised local confidence creating real employment and training, providing needed
services and creating wealth.
• Localised enterprises which “owned by local people are better placed than larger
companies to promote regeneration and improve social capital” (Bank of England)
• Reduction in the feeling of social exclusion.

This type of development will also fit in with the challenges set by the Social Enterprise
Coalition in their recent report, referred to earlier in the study, that SEC should commit to
“help foster the creation of the necessary structures and instruments to build and
sustain a marketplace for the sector that will make it more businesslike as a whole
and … better market-oriented businesses.”

An Incubator type development for Community Enterprise will provide managed workspace
with facilities that match the needs of the community it is situated in. It will be able to select
businesses appropriate to these needs that provide added value and meet the objectives of
the incubator development. It will provide specific business support and funding advice
relevant to the enterprises and community needs. Partnerships with localised educational
establishments will provide referral routes and training programmes, while links with local
mainstream business will provide mentoring on both sides and facilitate a better
understanding of community enterprise as a whole.

Furthermore an incubator for CEs would develop infrastructure and encourage
entrepreneurship by providing a tangible base and resource centre to build upon their skills
helping to ‘attract new businesses and help existing businesses grow’. It will promote
the experience of new ways of working throughout the region leading by example providing
a central core of expertise supporting and encouraging those most vulnerable to develop
into more robust social enterprise clusters and through replication.

The two main problems encountered by those in community enterprise are funding issues
and the misunderstanding of the sector. An incubator or development centre for community
enterprises would therefore play an important role in the region by helping to deliver on
many of the Government’s key issues raised in the Social Enterprise Unit’s report. This
report also identifies the need to develop CSE networks: “Networks of social enterprises
and social entrepreneurs, ensure that the social enterprise voice is heard and can
play an important role in the sharing of best practice.” An incubator where CEs
converge will almost automatically generate such networks and facilitate a continuous
exchange of best practice. This will drive up the competitiveness of community enterprises
compared with mainstream business, creating spin offs and further productivity and
employment.

“The key is, to provide the right enabling environment”
Martin Clark, Citylife Ltd, Cambridge

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It must be remembered that all communities are different. Replication of facilities and
services does not always translate well to suit all areas. This may also be true of incubation
facilities. An in-depth examination into the cost, need and site issues will need to be
considered for each individual location where such initiatives are planned. Also issues
around the type of incubation facility and services offered will need to be explored in each
locality if the critical factors are to be addressed.

The needs of rural areas are significantly different from those of urban areas. Rural areas
generally have reduced infrastructure in terms of road and rail networks and this is often
also true of other opportunities available. There is a much reduced ‘immediate market’ for
trading between business-to-business and business-to-public. This limits the type of activity
that can take up the space afforded by an incubator. Activities, if not based around the
community (such as laundry service, child care and so on), are likely to be manufacturing
and distribution. It would therefore be likely that larger light-industrial units would be needed
in a rural incubator as opposed to a high-tech office complex for an urban one. Although
the intention of an incubator is to increase the profile of community enterprises, realistically
it will not achieve the high profile of a facility in a city centre in the short term. The issue of
visibility will have a knock on effect on how people view and support this type of
development and the sustainability issues surrounding it. Lastly, connectivity (Information
Communication Technologies, such as broadband access) needs to be taken into
consideration, although the proposed extension of broadband communication to rural areas
should reduce the impact of this issue. On a positive note though land and property, in the
rural areas, is more affordable and there is presently more funding available for the
regeneration of rural rather than urban areas. There may also be a larger base of potential
employees as there is less competition for workforces so a well-managed and effective
incubator could attract new businesses to areas that are potentially in decline. The only
constraint on size and growth of such a development, planning permission allowing, is
funding.

The following table showing a selection of proposed incubator types and takes into
consideration a variety of needs but is recognised as not being comprehensive as individual
community requirements would have to be looked at in-depth. However, this table is still
valuable as a guide to issues to be considered in the planning and development of any
incubator development for CEs.

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SUMMARY TABLE OF PROPOSED INCUBATOR TYPES (Refurbished or New Build)
TYPE INFRASTRUCTURE FUNDING * BENEFICIARIES Possible Disadvantages MANAGEMENT ISSUES

Mixed CE/rural Transport issues Local authority CEs Possible loss of Exit strategy – high profile
Good connectivity (IT links) Private Sector Local residents through individual enterprise’s development, so reluctance of CEs
Links with learning providers RDA improved community identity to move on; also possible lack of
Scope for future expansion services Risk of not gaining suitable ‘move-on’ sites in rural
Trainees and employees ‘critical mass’ of CEs areas
Mainstream business &
financiers (better
understanding of CEs)

‘Hub and Spoke’ Main incubator supporting satellite As above As above As above As above
facilities More locations to support Fragmented identity? Would possible need additional
Good connectivity (IT links) target groups Loss of networking management costs for each satellite
Links with learning providers opportunities
Hybrid (mixed Dependent upon type of units (see May bring in specific As above Lack of clear identity for Possible conflicting values between
tenancy) above) funding streams not Voluntary organisations incubator objectives of different groups of
targeted exclusively at Mainstream/community Conflicts over internal enterprises
CEs, but may also limit led SMEs needs
funding opportunities
as now offering
support to mainstream
enterprises as well
Integrated Housing As above Creates more housing, As above As above Possible conflict of values and interest
and workspace Location sympathetic to needs of in line with govt Individuals disadvantaged Larger ‘ecological and expectations
housing tenants while still targets, therefore in the housing market i.e. footprint’ needed demand for housing may outweigh
beneficial to the trading enterprise money may be homeless, low income demand for workspace; site may
activity available from central evolve into housing estate
govt, the Housing Site security: always people around
Corporation and even to deter trouble-makers
housing association Housing tenant participation –
through partnerships conflict of expectations
Incubation issue – housing allocation
procedural issues particularly in tied
or supported housing
‘Piggy-back’ on As above As for other As above As above Uncertainty over who has
existing models responsibility for overall
developments (i.e. Others dependent management?
health centre) upon original
development

*All funders in Funding Section are relevant to all models unless otherwise stated. Environmental Issues: All structures have the capacity to incorporate positive environmental features.
Research will be needed into eco friendly housing and workspaces once a model and site have been identified

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CASE STUDIES

These case studies were researched in conjunction with the studies in the feasibility study
for a regional flagship incubator in Cambridge. Many groups were targeted for information
including CDAs from across the UK, the dti (SEU), and DEFRA. There are many varied
initiatives each appropriate to their own localities. These case studies incorporate
mainstream and social and community enterprise units in both rural and urban areas and
looks at new build and refurbished centres.

The Springboard Centre (Coalville) Limited, Coalville, Leicestershire

The Springboard Centre was set up in 1985, a semi-derelict building that was redeveloped
into basic workspace. It housed twenty-one office and industrial units designed for start-up
businesses. The Springboard Centre now has over seventy units due to the success of its
operation. The size of units available range from 150 sq ft to 2,000 sq ft and facilitates
commercial and community enterprises; there are currently 7 social enterprises that are
licensees but also many charitable organisations. The Centre works on a phased
workspace concept: the licensee starts in a small unit with the option to move into larger
units within the centre until it reaches the stage when it is ready to move out to it’s own
premises. On entry to the centre the start-up licensees benefit from reduced rents, stepped
over a nine month period to when they will pay the full licence fee. The Springboard Centre
was initially set up to provide self-employment opportunities as an option to the many coal
miners made redundant due to the decline of the mining industry in the area. There is
currently a waiting list of prospective new start-up businesses for the Centre and many
businesses have applied through using business and funding services provided by
companies within the centre.

There are five employees and volunteer Board Members who run the centre as a team. It
aims for 80% capacity although this year the Centre achieved 99% occupancy.

Funding/Partnerships
Partners offered the initial funding to set up the Centre – Urban Aid, Leicester County
Council, North West Leicestershire District Council and British Coal.
Current Funding – approximately 30% of income is received from council grants and
70% from rents received (Springboard Annual Report 2002).

Exit and Entry Strategy
Most business types are welcome although internal competition is not encouraged.
Businesses within the centre are encouraged to work together and where possible
complement each other.
Initial tenure is for 6 months, after which tenants may give one months notice period to
vacate premises
No time limit is imposed on occupancy

Facilities included in the rent
Workspace; access on site to administration; reception; communication facilities and office
equipment; conference and training suite; business and funding advice delivered by
Business Link and other appropriate agencies who come to the Centre; and car parking

Spin Offs
Mantle Community Arts that have their own small incubator within Springboard, developing
awareness and generating interest in art based activities within the Community working in

15
partnership with North West Leicestershire District Council and other organisations. There
is workspace available for diverse art type activities and workshops.

The Buffet Car provides hot and cold meals and a communal meeting place for Springboard
licensees. The Buffet Car is staffed by adults with learning disabilities, who over a two year
period train towards taking an NVQ Level 1 in basic food hygiene, which in turn may lead to
work opportunities outside of the Centre. This is a Leicestershire County Council Training
Scheme.

Future
The range of activity that exists with the Springboard Centre is vast, ranging from hot desks,
retail units, light industrial workshops, technical laboratories and office space. Although
most licensees are mainstream businesses the community enterprises have flourished due
to the affordability and centralised services provided by the Centre. The vision of the Board
members and employees is to strive for sustainability but also ensure that it’s services are
community-led. There are no plans for expansion on the site as all available space has now
been acquired. Even though the Centre was not set up as an incubator facility it has very
much grown organically to provide the type of facilities and external partnerships that are
expected within such a development. It must be mentioned though that as Health and
Safety legislation has been tightened up and European dictates are adhered to, it may not
be possible to allow the experimentation seen during the growth of this centre to be
replicated elsewhere - for example the use of partitioning to allow flexibility of the size of the
units as businesses grew.

The site is centrally placed within Coalville and therefore has few access issues. As the
Centre Manager commented, the success of the Springboard Centre is that it is “basic
(although I would suggest that it is far from basic), functional and friendly”. It’s proactive
Board members and employees continue to comply with and find funding as new European
legislation is approved - the Centre has recently refurbished communal areas within the
complex to comply with the Disability Discrimination Act. The success of both mainstream
businesses and community initiatives within the Springboard Centre provides positive
evidence that with careful management to maintain the balance between all organisations
within it, it has created an ideal environment for its occupants. It could be said that the
organisations within the Centre are autonomous sub-sections of a large company that
invests very much in the people within welcoming diversity and encouraging partnerships.

Luton and Dunstable Innovation Centre, Luton

This project was flagged up in 1995 from within Luton
University as the best way forward as part of the
regeneration strategy for Luton and was funded from
SRB. Traditional industry was in decline and it was felt
that an incubator type development would encourage the
growth of high-tech start-up businesses in the area. As
there was no building available to provide suitable
accommodation for the centre it was decided to opt for
new-build. A site was identified at Butterfield Green and
the vision is to build dedicated premises (40,000 sq ft)
that would provide business facilities for innovative
technical based start-up companies and associated
services. The development, funding, planning and other issues around the centre are still
ongoing, although work is expected to start in the near future. However, during the
intervening period, three university employees working from an industrial unit within the

16
University continued to provide the interface between local businesses and the learning
centre. In 1998 these employees moved site to the Spires (5,000 sq ft) which provided
dedicated office space and laboratory work units. With administration services, business
and funding support in place this ‘first’ incubator was set up to encourage spin offs from the
University, incubate technical based companies and offer space for second stage
companies to diversify. Further space was needed as the Trust expanded and it now
manages satellite facilities in other areas of Luton, providing incubation for multimedia, art
based start-up businesses and other enterprises. The satellite based in Bury Park has a
specific focus on providing community employment as it is a disadvantaged area with high
levels of ethnic minority residents and long term unemployed. Community enterprises are
encouraged to apply for support and space and at present 7 are licensees. The facilities are
available at commercial rates and all start-ups are provided with the same support and
opportunities within the Incubator. There are good access and transport facilities to all
satellites.

Funding
Initial funding from SRB – as the centre has expanded and projects developed, other
funding bodies that have provided funding include: Phoenix fund, Objective 2 funding,
Higher Educational Fund
Rent – these are set to reflect the total running costs of the buildings that SMEs occupy
Management Costs – from public funding and income generated through consultation
and business expertise.

Entry and Exit Strategy
SMEs are assessed on their initial Business Plan and application details. 50% of the
Board have to agree on suitability and then a licence agreement is offered.
One month’s notice is needed by tenants to vacate the premises
There is no exit strategy – the Innovation Centre has acquired more space as each unit
has become fully occupied

Facilities included in the rent
Work Space
Projects developed to enhance activities of the Innovation Centre including free access
to toolkits and support courses within Luton University.
Access on site to administration, reception, communication facilities and office
equipment
Business and funding advice, training programmes, seminars and workshops and
intellectual property advice. These facilities are provided through partnerships and
collaborative working with local educational establishments and external business
supported agencies such as Business Link, Chamber of Commerce and local Borough
Councils.

Spin Offs / Expansion
Butterworth Green, Bury Park
The Hat Factory – arts and multi-media incubator
Marsh Farm – acquisition of the redundant Coulter’s Factory – the intended use of which
is to provide workspace for co-operatives, social and community-led enterprises and to
provide self-employment opportunities to the residents of the community

Future
Luton and Dunstable Innovation Centre are still working with partners to develop the
purpose built centre in Butterfield Green and see their current role as vital in the provision of
good quality workspace and business support. It is anticipated that the nurturing of current
SMEs will provide a robust tenant base for the new Centre. DEVICE (Developing Effective
Virtual Interaction for Community Enterprise) has also been set up using Phoenix funding.

17
This project will look at how the latest and affordable technology can be used to enable
groups of people to live and work together as effective virtual communities and working
groups. With the experience and solid foundation of knowledge provided by Luton and
Dunstable Innovation Centre, DEVICES aims to help home based carers, dispersed
individuals and communities in rural areas, those who are disabled or have mobility
problems and those who have different cultural needs.

Bridport Centre for Local Food, Bridport

The Bridport Centre for Local Food is situated in Dorset; it is an initiative that aims to
develop the infrastructure of the local food sector, providing employment, training and
workspace to the food and farming sector, including local social entrepreneurs.

The leased premises (4,500sq ft) offer space for two food workshops, 1 large kitchen which
is leased by various organisations and businesses when required, two training rooms, office
space that will eventually be able to accommodate 15 desk spaces and storage and
distribution facilities.

The Centre has already supported the development of West Dorset Organic Foods, a
consortium of 12 local organic farmers in the area. However, plans for a meat processing
plant, which would open up trading opportunities with local retailers and caterers, proved too
costly and funding for it could not be secured. The Trust is currently developing two further
social enterprises: a local food distribution and catering company for schools and a training
company (a joint venture with Lyme Regis Development Trust and Bridport Community
Initiative). These will help to underpin the revenue costs of the Centre.

The Centre will provide managed work and office space for other social and community
enterprises not necessarily involved with the food chain, and support from CDA Dorset
business advisors and Business Link is available. It is hoped that this model will provide a
prototype for neighbouring areas and will become a hub for all forms of social enterprises in
West Dorset. The management is provided by West Dorset Food and Land Trust and there
are two core staff: a training and development manager and an administrator. CDA Dorset
is part of a network of agencies that support social enterprise in Dorset and are supporting
the development of ‘incubators’ for social enterprises across Bournemouth, Dorset and
Poole.

Funding
Initial Funding: No core, but funding from various agencies including: South West
Regional Development Agency, Leader Plus (European funding), NOF Seed Programme,
Dorset County Council, West Dorset District Council, Esmee Fairbairn Foundation
Current Funding: as above, and additional funding received through new projects. Rental
incomes also received. The centre is currently approx 80% grant funded and 20% from
rental incomes

Entry and Exit Strategy
Entry – enterprises need to be committed to the induction process and attend the
comprehensive training package
Exit – very flexible

Facilities included in the rent
Partnerships with CDA Dorset and Business Link provide relevant business and funding
support

18
Link up with Lymenet Training Centre has provided an IT suite that will also deliver
Learn Direct – Lymenet have also helped to refurbish other areas of the centre to enable
hot desk facilities to be provided.
Access to training facilities and kitchen area

Spin Offs
Networking benefits – not all business based in centre, but those incubated, continue to
support and add value by association and provision of advice and experience to new start-
ups.

Future
To expand the services to local social enterprises, especially those involved with the food
chain; to encourage further growth of the sector with the provision of the facility; and to
provide a successful prototype for replication.
The Centre for Local Food would not be sustainable as a pure managed workspace and
business incubator (West Dorset Food and Land Trust’s own research has indicated that
25,000 sq ft premises are the smallest areas that will provide the return needed to run a
managed workspace). However, the Trust is developing a series of programmes and social
enterprises based at the Centre, and these will help to maintain the viability of the
workspace and incubation elements; the Centre is therefore expected to achieve financial
sustainability after its third year.

The benefits and added value of this development will be the employment and training
provided to the local community, the growth of small businesses within the area and the
development of the infrastructure of the food sector as a whole in this region.

Other similar initiatives

Uniun Enterprise Trust, Pegswood, SE Northumberland

Uniun Enterprise Trust (UET) is a regeneration, community-based organisation in
Pegswood, SE Northumberland. The Trust was established in 1998 and operates a
community enterprise and resource centre with incubator units, offices, training rooms and a
café in a bid to provide on-going advice and support for businesses, community and
environmental initiatives together with training and employment opportunities for people in
the rural coalfield communities. UET enhances people’s skills, potential skills, self-help
initiatives and desire to enable personal development and community benefit. It achieves
this by providing motivation and inspiration for local people to become involved in activities
such as planning, dealing with statutory and professional agencies, fundraising and
developing entrepreneurial skills.

Enterprising Communities, Cumbria

Enterprising Communities supports the development of rural social and community
enterprises in Cumbria and is currently involved in a project developing a sustainable
succession for a rural primary school at Lowick - potentially the first British Co-operative
School. It is intended that the school will have charitable status and be a company limited
by Guarantee in order to manage the premises. It is envisioned that the school will be used
as a focus for a variety of small projects including start ups of both community enterprises
and mainstream businesses and it would like to be viewed as a model for "micro"
incubators, amongst other things. Links are currently being developed with existing training

19
providers and with Lancaster University Social Entrepreneur Unit Business School. Plans at
this stage include using one room in the school as a community office as well as opening up
the excellent computer facilities to the community.

Community Warehouse - Suffolk Connect

Community Warehouse aims to provide a hybrid workspace development combining
charitable, not for profit, and commercial enterprises and organisations under one roof. The
establishment of a retail outlet and a community café is seen as fundamental to the success
of this project to attract the public and encourage them to look around the warehouse. It is
hoped to provide subsidised rents to start-up community enterprises. However further
research into funding streams and management of this hybrid facility is still ongoing.

Primrose Centre, Huntingdon

The Primrose Centre in Huntingdon is managed by the Huntingdonshire Forum for
Voluntary Service. They took on the site several years ago when they were looking for
premises and developed it as a resource centre for the local voluntary sector. Facilities
include a resource library; meeting / training rooms; and shared admin / reception. They
offer rates which appear subsidised in comparison with mainstream market rates but are
largely self-sustaining beyond a few small grants. The centre currently hosts 7 groups with
a total site size of 2500 sq ft. They have no exit policies. The property is on leasehold from
the local health authority with support from the local authority until 2004 when they are
looking to relocate. The organisation is open to developing future hybridisation with social
and community enterprises and this model was used by the Cambridge Council for
Voluntary Service when they were planning a similar development on Cherry Hinton Road in
Cambridge.

Implications for Cambridgeshire

The studied ‘incubator’ type developments profiled in this section are very different from
each other and have been set up for a variety of reasons. However, the overriding objective
of each has been to encourage the growth of small businesses in their location and provide
a supportive environment to enable their success. As a result they are seen as models in
supporting regeneration of some of the most disadvantaged areas in UK, whether caused
purely by their location such as at Bridport or through economic decline through loss of
major industries as in Coalville and Luton. The result is the provision of local employment
and increased wealth in the areas they serve. However, the sustainability of these
dedicated premises is an issue that the organisations are continually trying to address. All
have grown or are growing as the need dictates and funding becomes accessible.

The development in Bridport is seen as the closest to a rural incubator for social and
community enterprises that has been identified and reviewed. There are several key issues
which it presents that will have implications for the development of an incubator for social
enterprises in Cambridgeshire. These include:

• Initial cost – this is an issue and needs to be thought out carefully. However the
flexibility of the social enterprise sector, that by its nature is entrepreneurial, as
shown by the Bridport development, has the ability to adjust and reassess visions.

20
• Central Theme - the Bridport Centre has a central theme for hosted enterprises: food
– this provides a means for people to more easily identify and relate to the site; given
that community enterprises cover such a diverse range of industries and sectors,
would an incubator in Cambridgeshire need a similar ‘theme’ in order to avoid
confusion on the part of the sector being targeted for support?

• Size – research has shown that a site needs to be in the region of 25,000 sq ft in
order to be able to resource the benefits and services it wishes to offer to tenant
enterprises. Given that land and property prices in Cambridgeshire are higher than
national averages, does this mean that a Cambridgeshire incubator will need a
larger site than has been researched (in order to recoup costs)?

• Funding – there is no single core funder for the development of the initiative, but
over 5 major funders and many smaller ones. Given that each of these will need to
have been approached separately and reported back to using different criteria and
methodologies, this represents significant administrative cost to the development
and maintaining of the site. If this were to happen in Cambridgeshire, who would
cover the cost of this additional administrative burden?

There is no doubt that this and other similar projects do add value to the communities they
serve. Partnerships looking to set up these type of developments would need to look at this
carefully when examining sustainability issues, taking into account the sector it is seeking to
develop.

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RESULTS OF QUESTIONNAIRE

An amended questionnaire compiled for the research into the ‘Feasibility study for a
regional flagship incubator in Cambridge for Co-operative and Social Enterprises’ (CCDA
March 2003) was sent to 20 known Community, Co-operative and Social Enterprises
(CSEs) currently trading in Cambridgeshire who had not been targeted in the previous
research. Eighteen known social entrepreneurs who are in the process of setting up a
social enterprise or who had previously expressed an interest in the sector have also been
targeted and there was a combined response rate of 24%. The same basic questionnaire
was used as for the previous feasibility study so as to provide consistency with ongoing
research into the need for incubation facilities for social and community enterprises.
Hopefully to enable comparisons to be drawn with reference to the findings of the first
report.

The minor amendments to the questionnaire included the introduction of multiple answers
which required respondents to grade the importance of their responses so as to identify in
priority the problems of initial set up and the benefits an ‘incubator’ facility could make to
eligible community enterprises. The enterprises targeted were identified through the
Business Link for Cambridgeshire’s ‘Social and Community Enterprises and sympathetic
organisations’ databases and Cambridge CDA’s ongoing mapping of this sector, in the area
it serves. This information was plotted on a map of the county and enabled identification of
community enterprise clusters currently trading in Map 1 and known social entrepreneurs as
previously referred to in Map 2. Map 3 presents the combined groups of social enterprise
and organisations sympathetic to social enterprises. This chart presents a different picture
highlighting the possibility that although there is not a lot of actual trading activity in some
areas they may be suitable locations to set up and encourage community enterprise
clusters to develop as they could benefit from a high level of support already available.

Map 1 shows that Cambridge has a robust cluster of successful CSEs which continue to
grow in this area. This could be related to many factors: pro-active support agencies
including the Cambridge Co-operative Development Agency, Cambridgeshire Council of
Voluntary Services; also the presence of excellent education facilities including Cambridge
University, Anglia Polytechnic University and Cambridge Regional College offering a
“breeding ground” for young entrepreneurs. Cambridge has many other facilities and
support services provided by local authorities, social services and local business as well as
having a good transport infrastructure – bus routes, etc for ease of access to places of work
by beneficiaries at disadvantage. The cumulative effect of this support in the city area,
although not the complete picture, may lend itself to the success of these enterprises. This
support is not available to such a large extent in the rural areas. However Map 1 shows that
there seems to be a ‘square’ of target CEs emerging with its corners being Cambridge,
Huntington, March and Littleport. Community and CSEs have been targeted within this
area, as an incubator facility is therefore most likely to be effective anywhere within it.
Peterborough was also targeted, as clusters of significant sympathetic organisations were
evident from Map 3, although it must be mentioned that these included all National
Westminster Bank outlets and Cambridge Building Societies. Cambridge was not targeted
because the initial research had been fairly exhaustive and well documented in this area in
the previous study. However 9 respondents from the previous study have been added to
the figures as they were identified as being based in outlying areas. Results from
Cambridge CSEs responding to the previous study were used for comparative data.

22
23
24
25
The enterprises targeted were sent an accompanying letter explaining the incubator vision
and asked to complete the questionnaire (see Appendix A). Housing Co-ops were not
included in this or the original research as the brief specified that office and light industry
were the managed workspaces to consider. Agricultural based Community Enterprises
were targeted in this survey though carefully excluded from the urban study as it is
appreciated that their businesses would probably need to be based near to, or on a farm.

Results of the questionnaire
The majority of respondents are currently in growth and needing new premises. However
nearly 1/5 are at start-up or pre-start up stages. Predominantly the respondents were
involved in training and education, and trading goods produced through this activity. This is
in-line with the majority of social enterprises and social firms throughout the UK, but there
was evidence of a good mix of other activities as well.

Main issues faced at Start-up
The most crucial problems identified as being encountered at start up were a lack of finance
and sourcing appropriate premises. The current vision for a CE incubator would therefore
meet these needs in offering a ‘customised’ site and subsidised or stepped rents.

The need for a low cost start-up property development for CEs
All respondents agreed that there is a need for low cost premises for start-up social and
community enterprises.

Over half of respondents felt that the best site for an incubator would be in Cambridge –
significant given that only 40% of the total respondents are currently based in Cambridge.
Other areas identified by respondents were March and Huntingdon, and to a much lesser
extent, Ely and St Neots. This could well be due to infrastructure issues, as Cambridge is
well serviced by public transport and has good road links. Cambridge also has a high
profile, and an incubator would benefit from association with that.

Benefits of a start-up business incubator type development
The main benefits as identified in order of importance were the sharing of facilities in order
to increase cost efficiencies, having a physical area in order to inter-trade, share ideas and
more easily access business advice and support. Again, all these are in-line with the vision
for what an incubator would offer tenant enterprises, and it is encouraging to see that the
‘target group’ of potential tenants share the vision for the services it could offer them.

Possible problems that could be encountered
The main areas where problems with an incubator are most likely to arise were identified as
being the relationships between tenant enterprises, between landlord and tenants but
perhaps most importantly around a possible loss of identity for individual enterprises,
particularly in relation to the community it was established to support.

Agencies already used by CEs
There were two advice and support agencies who were clearly identified as being the most
used and popular by the enterprises researched: Cambridge CDA and Business Links For
Cambridgeshire. It therefore seems that any incubator development would need to host a
business support body, and that in order to further attract target enterprises, that body be
one of the above in that they have the highest profile amongst social enterprises.

Given the high number of support agencies used and the evidence that, except for CCDA
and Business Link for Cambridgeshire, not one agency is used by the majority of CEs,
evidence would seem to indicate a lack of structured networking between both CEs and the

26
support agencies themselves. This may well be due to the diverse nature and geographical
spread of these enterprises in relation to each other. A solution to this would be the
development of an incubator which could act as a focus to enable stronger networking
between all.

Type of Property
The type of building respondents identified as being the most suitable was a mixture of light
industrial and office space. Interestingly several features were also identified by
respondents in this question that would increase the attractiveness of such a development
to them: the inclusion of childcare facilities, having a ‘shop front’ and residential
accommodation. These are also features of social enterprises that would not automatically
be part of an incubator development were it to use a mainstream model as a ‘template’.

Wish List
Many respondents identified features that have already been noted as being of need and
value. Others that now emerge include having a shared canteen, a common meeting place,
conference and training facilities, being fully IT networked (not automatically possible,
depending upon the location of a site) and even having access to shared vehicles – this last
point would seem to indicate the potential for an incubator to have ‘spin-offs’ in terms of
developing rural community transport services.

Three factors for operating a successful enterprise
Factors for the successful realisation of an incubator for CEs identified by respondents did
not show that finding the ‘ideal site’ was as important as other issues. The most important
factors in the successful development of an incubator were seen to be that all parties
involved in its development and running were committed to a shared ‘vision’ for it, it was
able to secure appropriate finances for its setting up and ongoing revenue costs and that
appropriately skilled managed could be found to manage it. The location was identified as
the fourth most important factor (only 13%) with having strong evidence of need for it even
further behind (only 8%).

CEs interested in renting space if a development was made available now
Finally, despite interest shown for an incubator by all respondents, only 40% would be
interested in taking a tenancy within it if it could be appropriately situated for them, with a
further 20% unsure. This is not as immediately bad as it may seem, as the incubator is
being targeted at start-up enterprises, and only 17% of respondents were at start-up or pre-
start-up stages, many other established enterprises view this development as being
beneficial for them in other ways – perhaps to house new diversified business activities.

Conclusion
The 24% response rate was mainly from entrepreneurs as opposed to traders and ‘movers
and shakers‘. This would appear to back up the identity issue faced by community
enterprises themselves. A follow up by telephone to ascertain the reasons for targeted
enterprises not responding to the questionnaire included not seeing an incubator as relevant
to their enterprise and also not having time to participate in surveys. Research also found
that other agencies, approached to help identify and target community enterprises in the
county, had problems identifying community enterprises as such, and had trouble in
grasping the concept of what incubator would offer. This would indicate the need for more
capacity building in the sector to enable enterprises and entrepreneurs to see the ‘bigger
picture’ and where they fit in, also aiding the other agencies in identifying social and
community enterprises more readily.

For a full breakdown of results please see Appendix B.

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POSSIBLE LOCATIONS FOR COMMUNITY ENTERPRISE
INCUBATORS

This section takes a closer look at areas that may benefit from incubator facilities for
community enterprise within Cambridgeshire. These areas were ‘flagged up’ from the
mapping exercise, which identified possible clusters of social enterprise and organisations
sympathetic to social enterprise (see Questionnaire section). Further research identified
several existing and emerging incubator type developments. A decision was taken to look
at these in more detail to see how they could be best developed, as previous research had
indicated that new build sites would have had no guarantee of any tangible benefit to this
study. This decision was further supported by CCDA’s involvement as the lead partner in a
separate feasibility study involving the purchase of a large barn to house a ‘co-operative
consortium’ of local producers to be based in Cambridgeshire. Although an appropriate site
was identified, planning permission was refused. Time issues and restricted resources
would not have enabled effective research into new build facilities as a guide comparison
and it was felt that possible ‘link ups’ with existing developments would be more appropriate
at this stage. However, indications of costs for new builds have been included as a
‘benchmark’.

PETERBOROUGH
Although Peterborough (a unitary authority) has a strong cluster of voluntary organisations,
businesses and agencies sympathetic to social enterprise, the research did not identify a
definitive group of community enterprises currently trading in the city. However, the
regeneration of the city, which includes the recent vast land purchase by EEDA, in
partnership with Peterborough City Council, could possibly support such an initiative for
nurturing such businesses in the future. The proposal for this 20-hectare site is to create a
mixed-use scheme that could include business space, housing and other facilities (EEDA
Update Spring/Summer 2003). The expansion of Compass, a charity that provides training
and support for disadvantaged people in various areas in Peterborough using its recycling
and reuse projects to provide a service, is a good illustration of this. It currently has ten
projects around the city. The growth of it’s computer hardware recycling project has proven
so successful that Compass is currently negotiating the purchase of a large warehouse,
(10,000 sq ft), in partnership with Peterborough City Council. This project is being
supported with DEFRA and Urban 2 funding. Relocating will enable them to extend their
facilities and to develop a new recycling plant for electronic and electrical equipment. It was
ascertained that there is unlikely to be surplus space for other organisations, even ones in
sympathy with their objectives, as it is anticipated that all space will be fully utilised from the
outset by the proposed activities.

It is felt, for this study, that as Peterborough is currently being targeted by EEDA to develop
mixed-use schemes across a range of sectors and that major recycling developments are
already currently expanding that any additional development around supporting CEs using
incubation would easily be ‘lost’ amongst all the new development. Business Link for
Cambridgeshire is also planning to encourage sustainable work from home for ethnic and
female minorities in the city. It would be useful to revisit Peterborough in the future once the
current projects are bedded down in order to assess the need.

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HUNTINGDON

Huntingdon is a market town that has many well-established social and community
enterprises and robust networks that cover the voluntary sector including the social firms,
Branching Out and Spectrum. Research has shown that there is no specific reason for them
to move site at present and no opportunity for expansion within their enterprises, however
they would welcome and support any initiative that would encourage the growth and
participation in this sector and have proven track records to support new social enterprises.

The Oxmoor estate in Huntingdon is a ward in its own right and has been identified as one
of the most disadvantaged areas in the town with more than double the average
unemployment in the area (Huntingdonshire in Perspective, Hunts District Council). It has
attracted SRB status and funding as it is recognised as one of most the deprived wards in
the UK and therefore there is much work going on to regenerate the area. Partners involved
in the regeneration process involve local government and health authorities - a state of the
art health centre is currently being developed on the estate – and local voluntary
organisations including the Huntingdonshire Forum. Research has indicated that
community enterprise is growing in this area seeking to provide childcare and a community
café. There is also interest in setting up a woodwork community enterprise and the district
council is keen to see rural craft enterprises set up to encourage local employment and
training. Corrine Garbett, Economic Development Manager, Huntingdon District Council
(HDC), commented that a recent household survey in the area evidenced that accessing
learning is a major problem, despite Huntingdon Regional College being based in this area.
To try and remedy this HDC is currently working with local colleges and businesses to find
ways of developing access to non-academic qualifications in order to encourage youngsters
to get involved in appropriate training and employment and try to bridge the generation gap.
Community Enterprise is seen as one way of facilitating this process. Business for People,
an established emerging social enterprise is also working within Oxmoor as providers of
Learn Direct and other IT training. Overall it appears that some type of facility to encourage
self-employment offering business advice and training in order to support fledgling
community enterprises would be appropriate for this area and would be welcomed in
principal by those working in the area including Diane Lane, Oxmoor Opportunities
Neighbourhood Manager, Cambridgeshire County Council.

It is hoped that the new health centre due for completion in 2006 will centralise the activity
on the estate and that a new shopping centre with retail and possibly light industrial
workspace and office space will open up possibilities for the residents. The voluntary sector
network, Huntingdonshire Forum, has developed a resource centre elsewhere in
Huntingdon that offers subsidised rates exclusively to the sector. Its model shows much
success and will doubtless continue in the area, subject to securing a suitable site at the
end of its current lease. One such site could be based on the Oxmoor estate where there
the County Council is leading the large programme of community renewal and regeneration,
with particular emphasis on building a culture conducive to social enterprise. Other options
would include the development of a purpose-built site on a plot of land, large enough to
house a greater number of organisations reflecting a greater mix and cross-section of social
and community enterprise alongside the voluntary sector, especially significant as many
new fledgling social enterprises are emerging from this sector as traditional grants ‘dry up’.
However, the cost of such an undertaking would be significant and so support would be
better directed in securing and refurbishing existing sites. There are also good bus links
and public transport links to this area.

At this stage though it is felt that the new health centre and other new re-developments
were unlikely to offer space exclusively for an incubator type of development for CEs

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although add-ons to existing planed developments were not thought to be out of the
question. It does appear that these plans will include flexible work space environments and
office space and so could be a possibility for further investigation through further
consultation with key players involved in the regeneration of this area.

Other possibilities include Business Link for Cambridgeshire who currently sublet office
space to commercial business - there could be a possibility of extending this to include
social and community enterprises with onsite services already structured with the recent
appointment of a Social Enterprise Adviser.

The following table summarises possible areas of Huntingdon that may offer facilities to
house an incubator for community enterprises including costing of a new build in the area.

New Build/Land £250,000 per acre for light industrial estate area based on/near ring
road to ensure best access
£35/sq ft for industrial £100/sq ft for basic office (no partitioning), so
assuming 50/50 split of usage = £877,500. Therefore starting cost for
new build = £1,127,500
Leasehold In the region of £15 Per sq ft (depending on facilities, but definitely to
include offices) = £225,000 per year, BUT doesn’t include any
refurbishment worked that may be needed
Health Centre Not sure if there will be appropriate space but there may be
workshop/retail/office space in the adjoining development where
current retails and office outlets are now
Restricted planning permission, but will probably allow light industrial
activity and office space
Cost at market price (see above figures for new build/leasehold)
Trinity Free Possible site for meeting rooms – 3 rooms available on time-share
Church basis, but no storage facilities and site currently extensively used, so
would prove difficult to integrate enterprises.
Primrose Managed by Hunts Forum for Voluntary Service providing
Centre meeting/training rooms, resource library, shared admin/reception, etc.
Currently hosts 7 groups with a total site size of 2500 sq ft
Property is on leasehold from local health authority with support from
local authority, until next year when they are looking to relocate. Open
to developing future hybridisation with social enterprises
Business Link Currently sub-let some of spare office capacity to other enterprises
Tenants would benefit from having business advisers ‘on tap’ and
close associations with this mainstream business support agency
Limited space available and parking in crucially short supply
Would act to further mainstream social enterprises

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FENLAND DISTRICT

The mapping exercise and subsequent information received from agencies such as
Enterprise Fenland has shown that Community Enterprise is flourishing, although dispersed,
throughout the Fenland District. The Fenland District Council (FDC) is currently
restructuring and undertaking a number of reviews and although there is significant interest
in seeing community enterprises develop and agreement that this sector is worthy of
support, it is presently felt that due to budget and political commitments there is no scope
for them to be treated more favourably than commercial small and medium sized
enterprises (SMEs) and no budget to offer anything other than almost commercial rents to
occupiers of workspace (Mike Carter, former Head of Economic Development, FDC). FDC
is currently looking at a possible scheme to provide workspace in the Chatteris area but this
is at the very early stages of planning and would be made available to mainstream
businesses that could include community enterprises. Although finding revenue funding
streams to keep the project viable is at this stage presenting difficulties it is projected that
this new build will begin in June 2004.

As an indication of the costs of establishing an incubator facility in Chatteris is detailed
below:
New Build/Land £60,000 per acre for light industrial estate area
£35/sq ft for industrial £100/sq ft for basic office (no partitioning), so assuming
50/50 split of usage = £877,500. Therefore starting cost for new build =
£937,500

Leasehold In the region of £10 Per sq ft for comparable properties for offices, £5 sq ft for
industrial (depending on facilities, but definitely to include offices), so in the
region of £112,500 per year, BUT doesn’t include any refurbishment worked
that may be needed

Further, there is currently a high level of interest by statutory and funding bodies in how
social and community enterprises can deliver environmental benefits. There are resultantly
several pilot projects being delivered throughout the Fens, which may in time see the
generation of new, larger, community enterprises.

MARCH
March is a busy market town in the Fenlands and there is a successful Social Training
Enterprise and Social Firm, Fenland Area Community Enterprise Trust (FACET) currently
based in this area. FACET was established to develop new community enterprises that will
offer training, work experience and integration into community life to all people in the
Fenland area who have learning and/or physical difficulties. It is based in the Marwick
Centre on the outskirts of March near to the railway station and its current trading activities
include FACET Horticulture – FACET was awarded the contract to provide all the hanging
baskets within the town; and FACET woodwork which produces garden furniture, pet
homes, storage solutions and other items. FACET also provides The Mencap Essential
Skills Programme and accredited Computer Training through its partnership with Isle
College. It is anticipated that as new trading activities are developed these will overtime be
‘floated off’ as independent community enterprises.

The Marwick Centre was originally a purpose built building for Social Services to provide
training activities for people with physical and learning disabilities and still has many unique
features when first designed including a spa bath. FACET currently utilises 30% of the
building and land and has been offered the opportunity to purchase the building and land

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outright. Working with Enterprise
Fenland, FACET are currently in the
process of tendering a bid for funding
from the Community Fund to purchase
the property and refurbish it to better
enable them to support new and
emerging community enterprises. The
vision is that the available office space
will be leased to mainstream business
to strengthen the financial position of
the organisation as a whole and that the
workshops/light industrial units will be
licensed to start up and emerging
community enterprises including the
The original Marwick Centre buildings
new venture, Fenland Community
Laundry Services. It is anticipated that
4 workshops will be made available to
new enterprises and that the two-storey
office complex will initially be leased to
a mainstream concern to provide
funding to underpin the development of
the centre. Business and funding
advice and support will be developed
from within the Centre to meet the
needs of tenant enterprises but this will
also be enhanced with the support from
Enterprise Fenland, which will also act
as a referral agency to the Marwick
Centre for new community
New buildings recently added to the Marwick Centre site
enterprises. Further, they have
indicated that they would consider relocating their premises to within the Marwick Centre.

FACET also has strong partnership with ISLE College to provide accredited training and is
currently looking how it can best develop this.

FACET was also identified as a key enterprise in the Fens acting as a focus for social and
community enterprise development based upon its initial successes and relationships with
regional statutory bodies. Other CEs looking for premises in the immediate area include a
play scheme and an advice centre. Many funding bodies have identified the Fenland area
as a priority area because it has relatively high unemployment, low skills base, high
agricultural dependency, low wages and a lack of access to community services. Several
funding opportunities are currently available and are being accessed by Community
Enterprises in the Fens. The Rural Renaissance fund (formerly Rural Development
Programme) is available from EEDA for projects that create jobs, provide skills and
qualifications and enhance access to services. The funding relies on applicant
organisations being able to generate 50% for their match funding. This area also has
access to European Objective 2 funding and Countryside Agency funds and the Community
Fund.

Evidence shows that The Marwick Centre site is well situated and has the capacity to
deliver an incubator type facility. The support from nearby Enterprise Fenland and the
credibility of the current organisation has become a magnet for other like-minded
enterprises. The site is available at well under current commercial rates and a Business
Plan is currently underway to enable a strong bid to be made to the Community Fund for
funding to further develop the site.

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Critical Factors for Community Enterprises within the proposed Marwick Centre Incubator

Factor Issue Comments
Partnerships Client Referral Already established Papworth Trust, QEST, Pelcombe Trust, Speaking Up,
Private and State Health
Enterprise Fenland (Business Link)
Development of Economic – would offer cash-flow benefits to tenant enterprises through lower overheads and more
Incubator and income for FACET to further develop new community enterprises
facilities Regional - could act as model for further incubator-type facilities to be replicated from
District Council – unclear until restructuring and reviews completed
Learning Establishment – Isle College: already access to accredited training opportunities for tenant
enterprises
Business Link for Cambridgeshire – would realise a key part of their vision
Cambridgeshire ACRE (Action with Communities in Rural England)
Funding Funding streams available for Incubation projects, training and learning projects for disadvantaged, rural
areas, start-ups via ESF, EEDA, dti
Attract and Quality and type Accommodation available for hybrid activity – office space, light industrial units, training workshops, land
Retention of of to develop horticultural activities
Community Accommodation Near to railway station so good infrastructure link to other parts of the county
Enterprises Transport for client group established – Fenland Area Community Transport – scope to develop social
enterprise transport facility
Range of Onsite business and funding support – possibly from Business Link for Cambridgeshire’s Social
Services Enterprise Adviser, Enterprise Fenland
Shared office equipment/resources
Administration Support
Capacity to develop community café and childcare facilities
Possibilities of sharing staffing resource during times of peak demand on differing enterprise activities
Positive Community Vital support during first years of growth from peers and specialist advisers
Benefits Enterprise Capacity to create spin offs – FACET projects develop into independent enterprises
success Shared values and support
Growth and Easy entrance and exit lease agreement – underpinned by commercial arm (office facilities)
development Affordable stepped rents
As enterprises grow and move on may be able to purchase further property on current industrial estate
or at other locations within Fenland – could realistically see new clusters developing

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Summary of development of physical business incubator for Community Enterprises in the Marwick Centre

Factor Issue Comments

Demand Community Robust emerging social firm providing training and employment to disabled individuals within community
Enterprises Already providing relevant business advice and support to other community enterprises within local area
including the South Fen Farm
Referral routes established through Enterprise Fenland, Fenland QEST, Business Link for Cambridgeshire
Plans already underway to create further managed workspace for community enterprises with incubation
facilities as part of larger economic development strategy
Local Strategy No specific local government strategy for Community Enterprise Incubation – Fenland District Council
Partnership with Business Link for Cambridgeshire’s Social Enterprise Adviser and Enterprise Fenland
advisers looking at encouragement and growth in this area.
Regional strategy – (EEDA corporate plan 2003-06) ‘Improving productivity in the priority rural areas will be
addressed through specific rural renaissance activities and broader actions to promote cluster and sectoral
growth, such as incubation centres, increasing access to broadband, building an entrepreneurial culture and
workforce development.’
Land Availability Current site – Marwick Centre covering 2 acres with workshops and office facilities
Planning Already has planning agreement as previously used as workshops and office space for training and
Permission employment of clients with learning and physical disabilities
Cost £80,000 for the site and £220,000 to refurbish and refit the Centre
Funding Available funding Community Fund (bid currently underway)
Other funds including Rural Renaissance Fund, Objective 2, ESF and Countryside Agency, EEDA
Possibility of commercial mortgage as FACET’s enterprises become more successful
Given that CEs are rarely “nine to five” jobs “work-life balance” funding should also be available
Revenue Rental Income – Independent office unit for mainstream or community enterprise – Estimated £10,000 pa
Rental Income – Light industrial units x 4 for social/community enterprises
Other possible sources of revenue - grants including Cambridgeshire Learning Disability Partnership, The
Papworth Trust, Fenland District Council and Speaking Up!
Learning & Skills Council - if FACET becomes an approved direct contractor

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East Cambridgeshire

East Cambridgeshire has three robust social firms: Branching Out; Burwell Community Print
and Prospects Trust which are quietly expanding and looking at ways to diversify as
opportunity and needs dictate. In the mainstream sector, East Cambridgeshire District
Council (ECDC) are looking to address the issues of lack of start-up businesses in this
geographical area as the district has one of the lowest business formation rates in the
region. ECDC provide an economic development service which helps to develop business
in the district ensuring that specialist agencies provide support, helping to attract grants
from UK or European services and developing initiatives to enable people to start their own
businesses. ECDC is also currently looking to ‘roll out a district wide wireless broadband
network’ in partnership with EEDA. This network aims to provide ‘an affordable, high speed,
high capacity’ continuous Internet access that will benefit all members of the district
including all businesses and the voluntary sector. If developed, this Broadband access
would also aid community enterprises. The advantages are numerous especially for those
communities in the rural areas and would include: increased business competitiveness,
ability to attract Rural Investment, creation of business networks, and opportunities for
increased business marketing.

This report looks at two areas in East Cambridgeshire that could possibly benefit from an
incubator type development for community enterprises, Littleport and Burwell.

LITTLEPORT

Littleport has recently undergone a health check by ECDC and an action plan to regenerate
the town is currently being developed in consultation with the Littleport Partnership Group.
This will address the issues highlighted in the report. Littleport has access to ERDF and
Objective 2 funding for regeneration and future funding will possibly be available from EEDA
and the Countryside Agency with match funding from the district council.

It was initially thought that the proposed regeneration of the area might be assisted by an
incubator type development to enhance the growth of the current community enterprises.
Further research emphasised how vital the community services provided by Branching Out,
Littleport Business Group and Cambridgeshire ACRE (Action with Communities in Rural
England), whose headquarters are based in Littleport, were to the town. This included the
Community Café initiated by Branching Out and ACRE that is currently expanding its
services to provide Internet and IT training facilities for the young people in the area.

The health check identified that 52% of Littleport’s residents commute out of the town and
that there is a need to provide local employment. However the report also recognised that
there is a lack of industrial units available for start-up businesses although many retail units
were vacant. Community issues identified included the current rapid population growth, a
common effect of out-commuting, and although Littleport provides basic amenities there is a
shortfall in specialised services. It is felt that this could be remedied with the provision of
more vocational type courses for those in the area including skills such as motor mechanic,
plumbing etc.

Littleport is also the home of E-Space North developed by EEDA and ECDC and provides
office space and incubator type facilities originally intended for hi-tech businesses.
However the entry policy now encourages other types of business that could benefit from
the facility and the site is currently at 60% capacity.

35
Although at this stage there is no scope for community enterprises to be treated more
favourably than commercial SMEs it appears that workspace is extremely limited and a
possible solution could be a centre to encourage growth for community led enterprise. The
disused Burberry Factory may provide an ideal site to this end. Half of the redundant
factory has planning for residential use whilst it is anticipated that the other half will be used
for workspace and community initiatives. East Cambs are keen to extend the provision of
business and community advice within the town and although do not at this stage envisage
an exclusive community enterprise development, would welcome the extension of facilities
already provided by Littleport Business Group for local entrepreneurs. An example of this is
the plan to develop a recycling centre in partnership with the social firm Branching Out, near
to Littleport’s industrial area. Terry Brook is an active member of the Littleport Partnership
as well as the Manager of Branching Out and feels that this Health Check will enable
Littleport to find its niche and then it may be possible to start looking at an incubator type of
development perhaps centred around the river to act as a tourist attraction, base for
boating holidays etc.

Littleport could have potential but the need would have to be further investigated in the
wake of the production of the action plan following the town’s Health Check. The Burberry
area may offer an ideal site however other parties are still exploring the use of this site. The
vacant office space at E-Space North could be utilised although not central to the other
initiatives in the town and is available at current market rates. It is felt that this area could
be explored further in consultation with the agencies mentioned above.

BURWELL

Burwell has been identified as a possible location because of the strong community
enterprise currently trading in the village and its plan to develop this area further with the
provision of leased workspace. Burwell Community Print (BCP) is primarily a training
enterprise using the context of a printing press to deliver work base training for adults with
learning difficulties. It facilitates the national Learn Direct initiative on site, and trades from a
site on Burwell Community College, the local comprehensive school. BCP is looking to
develop more commercial activities, as it is aware that its current dependency on grants is
exposing it to increasing risks and limiting its freedom to expand and diversify. One avenue
it is currently exploring is the development of an adjacent piece of land it owns to offer
workspace to local community enterprises. This could include spin offs from the extension
of their work, providing employment in catering and cleaning services to the businesses that
rent the workspaces. In support of this development, there is some evidence of an
increasing Community Enterprise sector in that area, but further research is to be
undertaken by BCP which will include a surveyor’s report on the land and confirmation of
levels of interest in this project. The tables below summarise the critical factors for success
for both the development of a possible incubator type facility and community enterprises
themselves. These assumptions are based on current evidence at a very early stage of
strategic planning.

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Summary of possible development of physical business incubator for Community Enterprises in BURWELL

Factor Issue Comments
Demand Community Robust social firm that wants to expand its current training and trading and encourage other community
Enterprises enterprises to develop
Could act as a magnet as plans are developed – as with FACET
Strong referral routes for clients and business / funding support (CCDA / Business Link for Cambridgeshire /
SFER / Phoenix Employ
Local East Cambs DC keen to encourage growth of SMEs (any type) especially hybrid
Government Dedicated Social Enterprise Adviser based at Business Link for Cambridgeshire
Strategy EEDA Regional strategy – (EEDA corporate plan 2003-06) ‘Improving productivity in the priority rural areas
will be addressed through specific rural renaissance activities and broader actions to promote cluster and
sectoral growth, such as incubation centres, increasing access to broadband, building an entrepreneurial
culture and workforce development.’
Land Availability Land already owned by CE
Planning Planning already in place for main building – need to investigate planning issues surrounding use of
Permission proposed units
Cost No cost as already owned
New Build in the region of £80 per sq ft, so a 15,000 sq ft development = £1,200,000
Funding Initial Purchase CAPITAL
New Build
REVENUE
Management and maintenance of complex including full-time manager and associated costs estimated at
£50,000 pa
Available funding EEDA, ECDC, Phoenix Trust, Countryside Agency, Private Venture Capital
Continual donors sympathetic to enterprise
Revenue Rental Income
Innovative ideas to create income i.e. training for other organisations, community catering, other facets of
development
Other grants (charitable status)

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Critical Factors for Community Enterprises within the proposed site at Burwell

Factor Issue Comments

Partnerships Client Referral Already established: Papworth, QEST, Pelcombe Trust, Speaking Up,
Private and State Health
Word of Mouth
Development of Economic – would offer cash-flow benefits to tenant enterprises through lower overheads and more
Incubator and income for BCP to further develop new community enterprises
facilities Regional - could act as model for replication
District Council – ECDC interested in seeing the growth of SMEs
Learning Establishment – Cambridge Regional College (CRC) and current access to accredited training
opportunities for tenant enterprises (Learn Direct)
Business Link for Cambridgeshire – would realise a key part of their vision
Funding Funding streams available for Incubation projects, training and learning projects for disadvantaged, rural
areas, start-ups via ESF, EEDA, dti
Attract and Quality and type Land already owned
Retention of of New-build – so tailored to specific needs
CEs Accommodation Transport for client group established –– scope to develop social enterprise transport facility
Range of Shared office equipment/resources
Services Administrative support
Capacity to develop community catering enterprise and childcare facilities
Learn Direct already established to deliver training
Business and funding support not anticipated although BCP has excellent partnerships with CCDA,
Phoenix Employ, SFER and other supportive networks
Positive Community Vital support during first years of growth from peers and specialist advisers
Benefits Enterprise Capacity to create spin offs – BCP projects develop into independent enterprises
success Shared values and support
Growth and No room for expansion
development Be a more robust social enterprise that will be positioned competitively and will encourage the growth of
community enterprise in the area

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CAMBRIDGE

Cambridge city was not actively researched for this study although it is felt that the
hub and spoke incubator could be a possibility and Cambridge might be able to
provide the central support for this model. Updated information of the progress of
identified other interested parties from the previous feasibility study was thought to be
useful. They are at different stages of development and it is important to learn from
the experience in the county and regionally to prevent overlap and to improve the
sustainability of the initiatives instead of competing with them.

Cambridge City Council – The economic and development policy is currently being
updated and the first local plan draft is currently out on deposit. The ‘working in
Cambridge’ section contains the employment policies, including a guide to
development and change of use proposals. Andrew Poulton, Senior Economic
Policy Officer, has encouraged social entrepreneurs to respond to the draft, as it is
perceived that it may be difficult for community and social enterprises to fit into the
categories set out in the current proposal.

CityLife Ltd – CityLife Ltd is currently assessing the demand of small business
starter units for people from a relatively disadvantaged background and seeking
suitable sites. Ideally both the small business incubator and social enterprise cluster
could be co-located for economic reasons , flexibility of overall operations and the
profile in the community. If the demand and solution were clear, Citylife would hope
to raise a local Bond to provide the core funding for development.

Momentumarts (formerly Eastern Touring Agency) – Momentumarts have recently
completed the first part of their feasibility study looking to set up an Arts Incubator
primarily to cater for artistes from diverse ethnic groups and cultures in the region.
The second stage of this research will investigate further the best site for this
development and also look at the type of incubator development best suited to their
client group needs, for example the ‘hub and spoke’ model. Momentumarts is still
very keen to establish links with other agencies dedicated to community regeneration
and economic development.

SOUTH CAMBRIDGESHIRE

Although there are a number of identified Community and Social Enterprises in South
Cambridgeshire, they are spread disparately around the district. Further, South
Cambridgeshire District Council (SCDC) have only recently reviewed their economic
development strategies for the area. These new strategies show SCDC to be in
favour of developing land to create employment and economic benefits especially for
those groups who are disadvantaged in the labour market. However, they have also
tightened up much of their planning policy guidance in order to protect green land
and brown land sites from new industrial developments. In relation to this study it
was felt it was unrealistic to ‘scope out’ this area until the new strategy was
published, and as it was not released until the end of this study, there are no
recommendations arising from it as such. It should be noted that there are a number
of expansions taking place within robust community and social enterprises such as
Darwin Nurseries and Opportunities Without Limits, these are in early embryonic
stage and are currently having problems with planning permissions.

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REGIONAL SUPPORT AND INTEREST

Views were sought from various local and regional agencies with regard support for
an incubator type development for community enterprises. In principle, most local
bodies were very interested in the idea and expressed interested in receiving copies
of this completed report. The research also found support from like-minded
organisations expressing an interest to link up ideas if the concept was developed
further.

Cambridgeshire County Council, Simon Smith (Head of Economic
Development)
In partnership with other authorities the County Council are developing a series of
workspace units in the Fenland area. At this stage they had not considered any
specific CE specific incubator development for Cambridgeshire, anticipating that the
Fenland developments will adequately cater for the needs of start-up CEs.
Cambridge CC is also working with Huntingdon District Council on the regeneration
programme in the Oxmoor estate.

DEVELOPMENT AGENCIES
Cambridgeshire ACRE
Cambs ACRE is supportive of the concept of a hybrid-type incubator development in
the county, as it could be a focus for the development of a new partnership of social
and community enterprise support agencies, which could, in turn, draw down funds
for the sector. Such government funds include Future Builders, a one-off funding
opportunity to cover some capital costs to encourage voluntary groups to begin to
trade.

Cambridge Co-operative Development Agency (CCDA)
CCDA, which is undertaking this research study, is keen to support this type of
development and is already working with Business Link for Cambridgeshire to further
support CEs through the development and delivery appropriate business training and
workshops.

Cambridgeshire Recycling Network – (CCORN)
CCORN aims to develop a vibrant and productive community-led network open to all
the community and affiliated organisations and individuals working to expand waste
reduction, reuse, recycling and reprocessing initiatives. It gives specific priority to
assisting organisations to effectively apply for and win funding available for such
projects. CCORN uses sound financial planning to help create viable social
enterprises and self-supporting initiatives. They welcome the opportunity to work in
partnerships which encourage the growth of social enterprises, charities and local
community recycling groups, and to maximise appropriate fundraising opportunities.

East of England Development Agency (EEDA)
EEDA’s Corporate Plan 2003 – 2006 states that “EEDA, with its partners, will identify
and agree intervention to accelerate the growth of clusters and increase productivity
and competitiveness of companies within clusters.” and will “continue to support
projects that contribute to the physical renewal of urban areas. This may take the
form of support through area-based initiatives, direct developing or funding for one-
off capital projects on regeneration, physical renewal and urban renaissance.” Also
“Improving productivity in the priority rural areas will be addressed through specific
rural renaissance activities and broader actions to promote cluster and sectoral
growth, such as incubation centres, increasing access to broadband, building an
40
entrepreneurial culture and workforce development.” In relation to rural areas, in the
region, EEDA are keen to support “entrepreneurship through high-quality and
accessible business support, such as county hubs for integrated rural business
support; rural innovation centres and networks.”

East of England Mutual and Co-operative Council (EEMCC)
Interest in incubator developments was shown by the EEMCC who, in principle,
could possibly link up with this type of development - especially with the recent
recruitment of a Regional Strategy Manager who aims to raise the profile of the co-
operative and mutual sector.

BUSINESS SUPPORT AGENCIES
Business Link for Cambridgeshire
Business Link for Cambridgeshire initiated this research in view of the new
responsibility the Business Link network has been given to support community and
social enterprise. They are keen to support developments that provide support to
start-up and developing community and social enterprises in order to strengthen the
sector, encourage sustainability and provide robust clusters that will provide real
employment, goods and services needed in community areas that reflect their
individual needs. They would consider placing a Business Link Officer in situ,
probably their newly appointed Social Enterprise Adviser, and would recommend that
advice and support be made available within the incubator from social enterprise
agency advisors such as the CCDA.

Enterprise Fenland
Enterprise Fenland is a sub-contractor of Business Link for Cambridgeshire
delivering a range of programmes including Support to Community Enterprises. It
would welcome further initiatives in the rural areas to encourage the growth of
community-led enterprises to provide local employment and services seeing these as
a way to keep the generated wealth within the localised economy.

EDUCATION AND TRAINING
Anglia Polytechnic University
Anglia Polytechnic University is currently piloting the ESF funded ‘WISE’ programme
- an accredited course on ‘Understanding Social Enterprise’ that provides practical
business advice for and promotes the understanding of Social Enterprise. Lewis
Herbert, Manager of the WasteWISE part of this course, commented that a link up
may be possible as he is currently hoping to set up Re-use centres in the region,
encouraging social enterprises to look at waste and recycling initiatives.

Local Regional Colleges (Cambridgeshire and Huntingdon)
Local Regional Colleges which were approached expressed interest in the
development of incubator facilities for CEs and the wider social enterprise movement.
This is based on such developments proving to be a resource whereby students
would be able to more easily progress through different training placements at
different enterprises which would be more closely situated to each other. Owing to
time constraints it was not possible to contact the other Regional Colleges in the
county.

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FUNDING

A critical factor is funding and sustainability of an incubator type development for
Community Enterprises (CEs) including initial funding and ongoing revenue costs. A
key factor in identifying sources of funding is knowing that an incubator would need
to offer below market rent to CEs within it. This has implications with regard to state
aid legislation - public monies (grants) cannot be used to create unfair competition in
the market place. It is likely to be thought by many that start-up CEs would be
gaining an unfair advantage through having rents subsidised by public monies. One
solution to this would be that the entry level rents would be calculated at a cost value
to be stepped up over a level of time to generate surplus towards the running costs of
the incubator and to ensure that CEs become more ‘mainstreamed’.

SRB funding – although this is now ending its lifecycle there are still some SRB
funded projects that have several years to run. An incubator facility could fit into
some of these projects including the one developing the Oxmoor Estate in
Huntingdon
Investing in Communities - the successor programme to SRB
Objective 2 / European Union – it should be noted though that European funds
for the UK as a whole are due to be revaluated as a whole in 2006.
Community Fund – is dependant on Charitable Status but is being accessed
through an incubator type initiative in the Fens
EEDA – have a commitment to supporting incubation facilities as reported in their
2003 – 2006 Corporate Plan, “Improving productivity in the priority rural
areas will be addressed through specific rural renaissance activities and
broader actions to promote cluster and sectoral growth, such as incubation
centres, increasing access to broadband, building an entrepreneurial
culture and workforce development.”
Countryside Agency
Rural Renaissance Fund

There are also smaller amounts of funding appropriate for tenant CEs including:
Scarman Trust; Awards for All; Global Grants; Adventure Capital Fund; SEED; CRED
and UnLtd.

Additionally there are also a number of more commercial sources of finance that
could be accessed to help develop an incubator. It is felt that financing the incubator
entirely using grants when it is seeking to be self-sustainable from the outset is
unrealistic. There is also the danger of enterprises losing their autonomy, as
securing grants will often tie to activities and targets which may not necessarily be
the most appropriate for them. Commercial finance therefore has the additional
benefits of giving the incubator more freedom to act as it feels fit while the sector
changes so quickly. These sources include:

SBS Incubation Fund
ICOF
Charity Bank
Citylife Ltd Bonds
Unity Trust Bank – which has recently launched a rent to buy funding scheme for
the voluntary and community sector to purchase premises providing up to 100%
finance

42
CONCLUSION

A key issue affecting this research has been mapping the community enterprises.
This is due to this sector being in a constant state of flux arising from different
definitions being used by different agencies and issues of self-identification. It is felt
that there needs to be specific dedicated research undertaken to further definitively
‘scope out’ this sector. Following this, the findings and recommendations of this
report should be revisited in the light of the information found.

CEs have shown little interest in the subject of the opportunity of dedicated / purpose
built business incubation facilities outside of Cambridge City. This could be due to a
genuine lack of need in the wider geography of Cambridgeshire or it could be due to
difficulties in identifying appropriate enterprises. As already stated, once there is a
more coherent picture of the community enterprise sector this subject should be
revisited. There is evidence, however, of market led incubation type initiatives
successfully developing (such as at FACET and Burwell Community Print) to which
start-ups are attracted by word of mouth. It is therefore recommended that any
resources becoming available to develop CE incubators be targeted towards these
current initiatives

There was not enough evidenced need from any of the individual districts for a new
build incubator. There is evidence however of a growing CE sector that could benefit
and market forces that are moving towards meeting these needs in a sustainable
way. Incubator type facilities are emerging from CEs that already have a core
business activity and are looking to diversify while providing the widest possible
benefits.

Research indicates that any incubation initiative targeting CEs cannot be entirely self-
sustaining. It would therefore be prudent for incubators to develop ‘hybrid’ tenant
policies: offering mainstream businesses space within the facility would generate
increased opportunities for CEs to become more ‘mainstreamed’, as well as
strengthening the overall financial position of the incubator.

For new build incubation facilities a key consideration when determining a location
has to be that of transport infrastructure - namely that of local public transport
allowing beneficiaries and work placements to get to the site easily. For those
incubation type initiatives already in existence this is less of a concern as they will
already have established transport solutions.

Given that a key benefit to CEs from the incubator will be the opportunities for
subsidised (or less than market rate) rent there are significant issues concerning
securing grant funding, particularly in relation to state aid legislation. An incubator
would therefore need to aim to be primarily financed through commercial means –
loan finance, venture capital and bonds. However for incubation type facilities that
are already in existence and have already been able to secure grant incomes it is
proposed that their relationships with current funders be strengthened wherever
possible, while at the same time they also try to develop more sustainable funding
streams.

On a larger scale, an incubator could be used to support the national Social
Enterprise Coalition in influencing policy makers to better support the developments
of such initiatives around the country.

43
This report recommends supporting the proposed development in March at the
Marwick Centre. It is ideally situated with a credible existing social firm and a list of
possible tenants. It is affordable and has a well-established business support advice
agency situated in the same town that may consider moving into the centre in the
future. There is already an established link with Isle College in Peterborough and the
potential to create link-ups with other colleges in the county. Although not sited
centrally in March, the current CEs interested in setting up in this location do not rely
on ‘passing trade’ and perhaps more importantly it is very close to rail links.

44
ACKNOWLEDGEMENTS

Ginnie Abubakar, Manager Burwell Community Print
Beren Aldridge, Enterprise Manager, Voluntary Action Cumbria
Mike Anstey, Luton and Dunstable Innovation Centre, Luton
Sergio Aschettino, Community Enterprise Adviser, Enterprise Fenland
Leslie Axle, Office Manager, West Dorset Food and Land Trust
Adrian Ashton, Development Officer, Cambridge CDA
Kirstin Bennett, Cambridgeshire ACRE
Martin Biss, Project Manager, West Dorset Food and Land Trust
Susan Bradburn, Manager, The Springboard Centre, Coalville
Terry Brook, Manager Branching Out, Littleport and Huntingdon
Rose Bugler, Enterprising Communities, Cumbria
Martin Clark, Director of Employment Initiatives, Citylife Ltd
Gavin Clayton, Cross Border Art, Bourn
Tim Crabtree, Training and Development Manager, West Dorset Food and Land Trust
Tom Davies, Accounts clerk and Admin support, Cambridge CDA
Corrine Garbett, Economic Development Manager, Huntingdon DC
Martin Garrett, Director, Greater Cambridge Partnership
Lewis Herbert, Wastewatch, Anglia Polytechnic University
Darren Hill, East Cambs District Council
Sandra Hooper, Community Development Officer, Enterprise Fenland
Linda Ingram, Project Manager, FACET
Stella Keir, Projects Manager, Compass (Peterborough Ltd)
Chris Kubicki, Social Enterprise Adviser, Business Link for Cambridgeshire
Diane Lane, Community Development Officer, Cambridgeshire County Council
David Lloyd, Business for People, Huntingdon
Dave Hollings, Co-op and Mutual Solutions, Cumbria
Helen Maltby, Uniun Enterprise Trust, Morpeth
David Nicholls, Business Development Manager, Cambridge Business Link
Daxa Pancholi, Head of Services, Economic & Development Group, Leicester City Council
Andrew Poulton, Senior Economic Policy Officer, Cambridge City Council
Simon Smith, Head of Economic Development, Cambridge County Council
Will Spinner, Economic and Development Officer, Fenland District Council
Martin Strube, Renaisi, London
Sally Tubberdy, Hunts Forum
Steve Wallace, Social Enterprise Unit, Dti
Lynette Warren, Luton and Dunstable Innovation Centre, Luton
John Wilkinson, Social Policy Inclusion Adviser, EEDA
John Wroe, Managing Director, Momentumarts formerly Eastern Touring Agency

45
Appendix A
QUESTIONNAIRE – COMMUNITY ENTERPRISES,
CAMBRIDGESHIRE
Name/Address of
Organisation
Contact/Tel details

How long has your Pre – start up 1 – 2 yrs 5yrs +
organisation been 0 – 1 yr 2 – 5yrs Date of start -up
trading? Please circle?
At what stage of Start-up Expansion/Growth
development is your Diversifying New premises needed
organisation? Please None of the above/other
circle
Which best defines Agriculture, Arts, Catering, Childcare, Other care, Environment,
your trading activity? Finance, Gardening/Horticulture, Housing, Manufacture, Recycling,
Please circle Retail, Training, Transport, Other (please specify)

Start-up. What were Finance/funding 1 2 3 4
the problems your Suitable premises/location 1 2 3 4
organisation Business Advice/Support 1 2 3 4
encountered at start Legal Advice/Support 1 2 3 4
up? Administration/Office facilities 1 2 3 4
Please indicate in order Marketing/Visibility 1 2 3 4
of significance (1 not Other: 1 2 3 4
significant – 4 critical)
Do you think that there Yes / No
is a need for a low cost
start up property Where do you think this ‘incubator’ should be set up, and why?
development set-up for
Community Enterprises?

What benefits do you Business Support 1 2 3 4
think such a Networking with other CSEs 1 2 3 4
development could offer Physical market to trade 1 2 3 4
to you and other ideas/goods/services
enterprises in it? Sharing of facilities/cost effective 1 2 3 4
Please indicate in order Funding advice and support 1 2 3 4
of significance (1 not Visibility in the market place 1 2 3 4
significant – 4 critical) Shared marketing 1 2 3 4
Shared policies H&S/Eq Opps etc 1 2 3 4
Other 1 2 3 4
1 2 3 4
1 2 3 4

46
What problems do you feel could
be encountered?

What agencies do you currently
use for advice and support ie
Business Link, ACRE,
Development Agencies, Local
Authorities?

What type of buildings would be Office space
most suitable for your
organisation and what size? Light Industrial Units (what access issues?)

Mixture of office space and Light Industrial Units

Other:

WISH LIST – If you have not
already been able to list them,
what things would you like to see
made available to organisations
being based in such a
development?

What three factors do you 1.
believe are necessary to ensure
success and longevity of your
organisation? 2.

3.

At this stage of initial research, Yes / No
would you be interested in being
based in an appropriately located
incubator?
Thank you for your help. Please return this form to:

Sue Roberts, Project Officer,
CCDA, Alex Wood Hall, Norfolk Street,
Cambridge CB1 2LD

Any queries please contact me on 0797XXXXXXX or 01223 360977

47
APPENDIX B
RESULTS OF QUESTIONNAIRE

Stage of development Trading activity
Expansion 31% Education/Training 34%
Needing new premises 27% Retail 21%
Diversification 18% Recycling 17%
Start-up 13% Catering 8%
Other 7% Printing 8%
Pre-start up 4% Agriculture 4%
Horticulture 4%
Laundry services 4%

Is there a need for a low cost community enterprise incubator? Problems encountered at start-up (4 = most critical, 1 = least)
Finance/Funding 4.0
Yes 100% Suitable premises/location 3.6
Other 3.5
Business advice/support 3.1
Marketing/visibility 2.6
Admin/office facilities 2.1

Where should it be set up? What benefits would an incubator offer?
(4 = most critical, 1 = least)
Cambridge 54% Sharing of facilities/cost effective 3.7
March 16% Physical market to trade ideas/goods/services 3.6
Huntingdon 16% Business Support 3.4
Ely / Littleport 7% Funding advice and support 3.4
St Neots 7% Visibility in the market place 3.3
Shared policies 3.3
Networking with other community enterprises 2.9
Shared marketing 2.9

Agencies used for advice and support Wish list:
Cambridge CDA 29% Advice/support 26%
Business Links for Cambridgeshire 18% Central shared admin resource 22%
All development agencies 7% Subsidised rents 11%
Cambridge CVS 7% Canteen 7%
Camb Enterprise Agency 7% Common meeting place 7%
COVER 7% IT networked 7%
Regional Authorities 7% Conference facilities 4%
EEDA 6% Meeting rooms 4%
Cambs ACRE 2% Shared vehicles 4%
Emmaus UK 2% Shop front 4%
Enterprise Fenland 2% Training facilities 4%
GET group 2%
ICOF 2%
Richmond Fellowship 2%

Interest in being based in an appropriately located incubator: What type of buildings would be most suitable?
Yes 40% Mixed industrial and office 37%
No 40% Light industrial only 28%
Unsure 20% Other (includes accommodation, childcare & shop front) 25%
Office only 10%

Factors for success: What problems would be encountered?
Commitment to vision by everyone involved 30% Internal relationships with other enterprises 25%
Securing funding 24% Loss of identity (also in terms of relation to community) 21%
Securing appropriately skilled management 22% Tensions with tenant/landlord relationships 21%
Finding the ‘right site’ 13% Lack of funding for ongoing revenue needs 13%
Having strong evidence of need 8% Developing a suitable ‘exit policy’ 8%
Luck 3% Gaining appropriate planning permissions 8%

48
BIBLIOGRAPHY

Bank of England, Finance for Small Businesses in Deprived Communities
Bank of England, The Financing of Social Enterprises May 2003
Business Link – Inside UK Enterprise – Social Enterprise 2003
East Cambridgeshire District Council Website
East Cambs District Council – Littleport Healthcheck –November 2002
EEDA Corporate Plan 2003 – 2006
EEDA – East of England 2010 – The Regional Economic Strategy
EEDA – Feasibility study for a regional flagship incubator in Cambridge for co-operative
and Social Enterprises – March 2003
EEDA Economy and Labour Market background paper (Apr 03)
Fenland Area Community Enterprise Trust Leaflet/Business Plan + others and those in
the original FS
Fenland District Council – Fenland Performance Plan 2003/2004
Greater Cambridgeshire Partnership July 2002 – Investing in Success
HM Treasury - The Role of the Voluntary and Community Sector in Service Delivery – A
Cross Cutting Review September 2002
Huntingdonshire District Council – Huntingdonshire in Perspective: An Audit of the Local
Economy 2003
Leicester City Council – drivers to Enterprise in Disadvantaged Areas – Case Studies
Report Jan 02
Managed Workspace and Business Incubation – A Good Practice Guide for Local
Authorities November 2000
Social Enterprise Coalition – Social Enterprise in the English RDAs and in Wales,
Scotland and Northern Ireland 2003
South Cambridgeshire District Council – Economic Development Strategy June 2003
The Judge Institute of Management, Cambridge University - Making a Difference: A
Community Enterprise Research Agenda for the Future
The Springboard Centre – Annual Report 2003

www.cambsacres.org.uk Our Communities – Our Future
www.burwellprint.co.uk Burwell Community Print
www.businesslink.org Business Link
www.cambridge.gov.uk Cambridge City Council
www.cambs.businesslink.co.uk Business Link Cambridgeshire
www.camcnty.gov.uk Cambridgeshire County Council
www.citylifeltd.org Citylife Ltd
www.cms.coop Co-operative and Mutual Solutions
www.co-op.co.uk Co-operative Movement
www.dti.gov.uk Department of Trade and Industry
www.eastcambs.gov.uk East Cambridgeshire District Council
www.elplural.org.uk - Enterprising Communities Initiative, Lancashire
www.ely.org.uk/branchingout Branching Out
www.ermis.co.uk Social Firms UK
www.fenbet.co.uk Enterprise Fenland
www.gcp.uk.net Greater Cambridge Partnership
www.huntsdc.gov.uk Huntingdonshire District Council
www.innovationcentre.co.uk Luton and Dunstable Innovation Centre
www.momentumarts.org.uk Momentumarts formerly ETA
www.nbia.org National Business Incubation Association
www.peterborough.gov.uk Peterborough City Council
www.sbs.gov.uk Small Business Services
www.scambs.gov.uk South Cambridgeshire District Council
www.social-enterpirises.org.uk Social Enterprise Unit
www.socialenterprise-east.org.uk SSEER
www.ukbi.co.uk UK Business Incubation Ltd
www.wastewise.net Waste Wise, Anglia Polytechnic University

49
Compiled by: Cambridge CDA
Alex Wood Hall, Norfolk Street, Cambridge CB1 2LD
www.colc.co.uk/cambridge/ccda

For: Business Link for Cambridgeshire
Centenary House, St Mary’s Street, Huntingdon PE29 3PE
www.cambsbusinesslink.co.uk

Printed by: Burwell Community Print (a local social enterprise)
Burwell Village College, The Causeway, Burwell CB5 0DX 50