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10-1108_REPS-10-2019-0142
10-1108_REPS-10-2019-0142
https://www.emerald.com/insight/2631-3561.htm
University
University business incubators business
as a tool for accelerating incubators
entrepreneurship: theoretical
perspective
Noha Ahmed Hassan Received 3 November 2019
Revised 4 March 2020
Department of Public Administration, Cairo University, Giza, Egypt Accepted 27 March 2020
Abstract
Purpose – This paper aims to analyze the link between universities and business incubators (BIs) and to
determine how students, scientific researchers and entrepreneurs can benefit from this linkage. It creates an
environment in which everyone can help the other to put their new ideas, special skills and abilities into new
businesses. In other words, the traditional universities’ role has changed and entrepreneurial universities are
now needed to redirect new knowledge for economic development through BIs.
Design/methodology/approach – This paper adopts an analytical descriptive methodology approach to
describe the basic features of the data by using the descriptive research design. This research is based on
examining a model provided by the author concerning boosting the entrepreneurial aspects and outcomes through
university business incubators (UBIs) based on wide theoretical and empirical case studies. Also, the functional
structural approach is used to investigate the relationship between two variables as UBIs are considered a new unit
that has functions and structures to create an added value to universities and the society as a whole.
Findings – The educational system should create a favorable environment that enables young people to
develop their mindset from employees to employers, and to prepare them to improve skills and knowledge to
create jobs. UBI is the recent aspect of the BI evolution where the research outcomes are linked with the
industry and development. This relationship between these entities will provide success to its stakeholders.
Social implications – Many incubators around the world are supported by universities. Others are
making initiatives to link up with universities and higher education institutions to get the revenues and
returns from its academic nature. Lately, university incubators became a type of incubator evolution and
more supportive for entrepreneurs than other types of incubators.
Originality/value – The contribution of this study is to explain how UBIs succeeded to tie the results of
scientific research with economy and development through entrepreneurial activities to accelerate and realize
entrepreneurship strategies.
Keywords Entrepreneurship, Entrepreneurs, Business incubators, University business incubators,
Incubators, University–industry linkages, UBIs
Paper type Research paper
Introduction
The relationship between universities and business incubators (BIs) is necessary as
universities are the source of knowledge, research, resources and today’s innovation-driven
© Noha Ahmed Hassan. Published in Review of Economics and Political Science. Published by
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BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this Review of Economics and Political
Science
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p-ISSN: 2356-9980
licences/by/4.0/legalcode DOI 10.1108/REPS-10-2019-0142
REPS centers. The affiliation or management of a BI program inside a university represents a
great advantage for the entrepreneurs, as these institutions can provide links to the
industry, society and government entities.
Over the past two decades, universities have been urged to become more accountable to
the wider public and to contribute directly to the local, regional and national economic
development through taking on a range of “third mission” activities. Such activities include
the incubation of start-up firms, knowledge commercialization, the development of
knowledge transfer partnerships and providing entrepreneurship courses.
In the context of entrepreneurship, universities move one step ahead by structuring the
mechanisms to enhance entrepreneurial culture and create new businesses. Today’s
universities’ missions have witnessed a paradigm shift from teaching to a pre-focused
approach on economic growth in terms of research, innovation and entrepreneurship.
Scientific research has directed countries with emerging economies that suffer from a lot of
economic problems such as unemployment and low economic growth rates into becoming
knowledge-based economies by providing creativity, innovation, knowledge access,
information exchange and suitable infrastructure. As a result, most of them resort to BIs to
accelerate the economic growth wheel. Incubators act as an accelerator of commercialization
of the research outcomes of the universities. The value of linking universities with
researchers within can achieve the maximum efficiency of the BIs in the development of
companies.
Universities could also enhance their role through an effective and well-integrated
incubation system for promoting, creating and enhancing entrepreneurial society through
the universities’ new missions. University business incubators (UBIs) provide a better
context for generating revenues and supporting a financially, legally and technically win–
win interrelation between universities, business sponsors, government and society.
This study adds a new trend of knowledge accumulation to this relationship, which is the
role of UBIs in supporting different aspects of entrepreneurship from a theoretical
perspective based on the empirical case study results.
Research problem
Universities have to face the changing and increasing demands with consideration of what
they are expected to achieve. Teaching and research issues are no longer enough. Today is
the so-called “third mission” where university–industry cooperation inventions and
innovations are systematically channeled from universities into the industrial applications
to develop an entrepreneurial economy. This method has been proven effective in many
developed and developing countries.
This paper examines how the governments help university incubators to enhance R&D
ability and to develop production efficiency and product quality. It also explores how
universities can be a strategic partner to BIs in supporting entrepreneurs to fill the gap by
using research results for economic development as university-based BIs can play a key role
in serving as the place where academic and entrepreneurial strengths merge.
Therefore, the main research question which the study proposes is: “How can
universities with BIs achieve entrepreneurship and support its strategies theoretically and
in the light of best practices implication results?
Research objectives
The aim of this research is to create an entrepreneurial ecosystem that is important for
sustainable growth and develop recommendations for improving the performance of the
UBI in the entrepreneurial context. To achieve this main aim there are some objectives:
to outline the changing role of universities and affected factors; University
to analyze the UBIs role, conception and importance; business
to identify the university’s new mission relationship with the BIs and incubators
entrepreneurship;
to examine and investigate the validity of the model provided by the author
concerning the relationship between UBIs and entrepreneurship;
to explain opportunities and challenges faced by UBIs in supporting
entrepreneurship; and
to provide the learned lessons concerning how to use UBIs as a tool to reinforce
entrepreneurship.
Research questions
This research developed the following questions to identify the link between UBIs and
entrepreneurial practices as reviewed in various empirical studies:
RQ1. What are the new role determinants of universities and their characteristics?
RQ2. What is the relationship context between universities, entrepreneurship and BIs in
different practices?
RQ3. What is the importance of UBIs for university, entrepreneurs and society?
RQ4. What are the recommendations for filling gaps concerning the correlation between
UBIs for university, entrepreneurs and society?
RQ5. How do UBIs help reinforcing different entrepreneurship strategies and elements?
RQ6. What are the opportunities and challenges that face UBIs’ role in supporting the
entrepreneurship strategies?
Research methodology
The adopted research methodology in this study will be a qualitative one. An extended
literature review is made to understand the main research objective that is derived from the
analysis of the correlation between the UBIs for university, entrepreneurs and society the
author will proceed with a deeper theoretical review to fulfill the objectives proposed above
and to answer the questions mentioned above.
The author also used the functional structural approach to investigate the relationship
between the study’s two variables as UBIs is considered a new unit that has functions and a
structure to create value added to universities and the society as a whole.
References are derived from several scientific articles, periodicals, reports, statistics and
online resources.
Material studied
Reinforcing entrepreneurship through UBIs in this study is reviewed through three sections
as follows: Section I introduces a comprehensive conceptual framework. Section II
highlights the link between BIs, universities and entrepreneurship. Section III discusses the
role of UBIs in supporting entrepreneurship. Section IV explains the challenges and
REPS opportunities that confront this role, and final, the conclusion section with results,
recommendations and a future agenda is presented.
In this study, the author provides a model for the relationship between UBIs and
entrepreneurship and tries during the study sections to prove the validity of this model as
follows (Figure 1).
Business incubator
BIs started in the 1950s and has evolved gradually along with the technological and social
changes. Most of them, as stated by Robles (2017), are managed as non-profit organizations
and as a part of the public efforts to increase the economic development through ventures
and job creations.
According to Sanyal and Hisam (2018), BIs firstly began in the US in the 1960s, and later
developed in the UK and Europe through various related forms such as innovation centers,
techno poles and science parks. They were recognized as a way of providing a variety of
economic and socio-economic policy needs which can include wealth creations, supporting
high potential small businesses growths, transferring technology, promoting innovation,
enhancing links between universities, research institutions and business communities.
Figure 1.
Relationship between
BIs and
entrepreneurship
Robles (2017) provided the evolution of the concept of BIs. Originally in 1985, BIs were University
defined as facilities that assist the early-stage growth of new start-ups through different business
services. Three years later in 1988, a new definition was added stating that the purpose of
BIs is to link technology, capital and knowledge to talent to accelerate the growth of new
incubators
companies, and to speed technology transferring.
An earlier definition by Mian (1996) defined IBs as “a strategy understood in relation to
innovation centers and as a function of business and research development” whereas Greene
and Butler (1996) viewed BIs as a mechanism to promote the technology-based firms’
development and to give the right resources to grow business to a level of maturity.
The National Business Incubators Association (NBIA, 2014) discussed that BI is a
dynamic process of business enterprise development and a business support process that
accelerates the successful development of start-up companies by providing entrepreneurs
with specific resources these resources are usually developed by the BI management and
offered through its network of contacts.
Al-Mubaraki and Busler (2013) conducted a qualitative study that included ten multi-
case studies in different countries. Its findings indicated that countries with incubators can
play a vital role in economic development according to their growth, the number of clients
served and the number of graduated firms.
From the author’s perspective, an incubator can, therefore, be identified as a physical
location that provides a specific set of services to individuals, entrepreneurs or small
companies. They are entities that help in sustaining innovation rates of start-up enterprises
and enhancing the entrepreneurial activities.
Entrepreneurship
Entrepreneurship is defined by Ahmad and Seymour (2008) as a dynamic process of
identifying economic opportunities and acting upon them by producing and selling
products, but the OECD (2011) defined it as the phenomena associated with an
entrepreneurial activity, where the entrepreneurial activity is defined as the enterprising
human action in value generation through the creation of economic activity by identifying
new products or markets that highlight the importance of the value added by
entrepreneurial activities and the changes in the resources needed by the entrepreneurs.
Further, OECD (2001) defined the term “self-employment” as “an entrepreneur who
works not for someone else but for him.” In another publication, in the same year,
entrepreneurship was referred to as the enterprising individuals who display the ability to
take risks with innovative ideas to generate new products.
Hattab (2013) explained that the global entrepreneurship monitor (GEM), for example,
adopts entrepreneurship as “any attempt at new business creation, such as self-employment,
a new business organization or the expansion of an existing business by an individual, a
group of individuals or an established business that implies considering those who have just
entered a market as entrepreneurs, as well as those who have been in the market for several
years, but are still growing.
But Kuratko (2004) showed that the performance of entrepreneurs is based on starting a
new business and using a window of opportunity to develop a business idea into a workable
format, but entrepreneurship itself is more than just starting a business. Others such as
Groenewald et al. (2006) and Lose (2016) see entrepreneurs as risk-takers in terms of offering
products, identifying and developing new business ideas. They defined an entrepreneur as a
person with the ability to identify business opportunities and utilize these opportunities for
success as well as having the ability to manage these business opportunities to generate
revenue.
REPS Ravesteijn and Sjoer (2010) state that innovating, recognizing opportunities and
contributing to the economic growth are common factors to all entrepreneurial activities.
Therefore, one can say BIs should promote entrepreneurial activities and skills exercising to
enable incubated small and medium sized enterprises (SMEs) to be developed and more
sustainable.
To perform effectively, according to Michelacci (2003), an entrepreneurial background
and skills are required for BIs. The level of the BIs’ entrepreneurial ability and skills affect
the degree of the success of the new BI process. Hence, entrepreneurship involves coming up
with new pathways of managing resources while pursuing opportunities.
To sum up, BIs are relevant to solving economic problems, generating income and
creating job opportunities. In addition, entrepreneurship has the ability to generate
significant benefits of growth, employment, development and innovation. Hence, the gate for
UBIs is education and universities that will be discussed in the following section.
Recommendations
To develop recommendations and improve the performance of UBIs and entrepreneurship;
the author provided some recommendations to policymakers and entrepreneurs as follows:
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Further reading
Ahmad, N. and and Richard, G. (2008), “Defining entrepreneurial activity: definitions supporting
frameworks for data collection”, OECD Working Paper.
Hofer, N. and Andrea, R. (2009), “Universities, Innovation and Entrepreneurship Criteria and Examples
of Good Practice”, OECD LEED Program.
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Higher Education, OECD, Paris.
Corresponding author
Noha Hassan can be contacted at: noha_hassan2015@feps.edu.eg
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