Assessment of Incubator Program - City of San Jose

More documents

Recommendations

Info

• This highlights the question: How does this program achieve the Agency’s priority goals,such as, facilitating supplier relationships (purchasing from San Jose companies) andestablishing production facilities in the U.S. (which appears not to be the primary purpose fortenants of the US MAC)? It appears the US MAC is more closely aligned with the Office ofEconomic Development’s international program which includes a focus on strengthening theCity’s visibility and ties with foreign governments and companies.• All of the incubators should use the same annual review reporting format, includingconsistent metrics.• An Agency staff person should be assigned as an account manager for each US MACcompany to monitor its growth and expansion and assist the firm with finding space in theCity when the opportunity arises.San Jose Incubator Impact Assessment – June 2009 Page 22 of 62
NBIA Best Practice 3: Structure for financial sustainability by developingand implementing a realistic business plan.Key Findings: As noted, there were no formal business plans for the incubators (althoughspecified in Sublease and Co-Sponsorship Operating Agreement between SJSURF and the Agency).The BioCenter is in the process of preparing plans. Another missing component is an exit plan thataddresses the question: when has an incubator reached the end of its lifecycle?The following summarizes the key elements of the financial structure of the incubators:• An Annual Master Lease is paid by the Agency to landlords for five facilities (four incubators(SBC & EBC collocated), SDForum and eCenter), at an estimated cost of $1.5 million per year.Given the length of time the incubators have been in existence and the investment made in leasepayments, owning the facility versus leasing may be a better option if the Agency continues tosupport these programs. SDForum is a 501(c)(3) entity and has a separate sub-lease agreementwith the Agency.• The San Jose State University Research Foundation (SJSURF), as a 501(c)(3), holds the Subleaseand Co-Sponsorship Operating Agreement and is responsible for managing the incubators (SBC,EBC, US MAC and BioCenter) and providing fiscal and management oversight.Fiscal Structure:oooStaffing:ooSJSURF collects an administrative fee of eight to ten percent to offset the cost of staffingand other incubator operations. Affiliate companies pay a separate fee for services;SJSURF solicits sponsorships and grants to support incubator programs and operation;andSJSURF charges ten percent administrative fee on expenses.SJSURF employees and staff for SBC and the US MAC; andSJSURF contracts with Prescience International, a consulting firm, to manage theBioCenter and the EBC.• The established fee to incubator tenants is to cover their service costs and any facility,maintenance; supply costs (note: the total amount for these expenses is almost double the cost ofspace paid by Agency). The value to the tenant is the month-to-month lease, hands-on technicalassistance and, in the case of the BioCenter, access to lab facilities.oException: Last year’s eleven winners of the California Clean Tech Open (CCTO)received a $500/month allowance for one year’s rent or services in the EBC or an affiliatemembership in the BioCenter. The Office of Economic Development (OED) agreed topay the EBC the cost of the $500/month allowance for each winner’s rent or services forone year. Note: An agreement between OED and the SJSURF referencing thesearrangements was not provided.San Jose Incubator Impact Assessment – June 2009 Page 23 of 62
Page 10 and 11: 3.0 Summary of Current Tenants and
Page 13: 32 percent of “unidentified” bu
Page 18 and 19: Table 3 - AnnualEconomic Impact &Re
Page 20 and 21: 4.0 Incubator Program Key Findings
Page 22 and 23: Core Principle 2: The incubator its
Page 26 and 27: • To support operating expenditur
Page 28 and 29: almost double. There are no notes o
Page 30 and 31: Recommendations:• The financial q
Page 32 and 33: NBIA Best Practice 5: Build an effe
Page 34 and 35: NBIA Best Practice 6: Prioritize ma
Page 36 and 37: • Internet is so slow - we need a
Page 38 and 39: Areas for Improvement:• Need an o
Page 40 and 41: NBIA Best Practice 8: Seek to integ
Page 42 and 43: 5.0 Measuring Economic & Revenue Im
Page 44 and 45: B. Revenue ImpactsRevenue impacts m
Page 46 and 47: 6.0 Business Services Programs Key
Page 48 and 49: • The value is the visibility for
Page 50 and 51: Redevelopment Agency and City of Sa
Page 52 and 53: 7.0 Summary of Key Findings & Recom
Page 54 and 55: 2) Tenant Criteria & Mix• There s
Page 56 and 57: 4) ReportingAnother major weakness
Page 58 and 59: Not enough oversight and service fo
Page 60 and 61: 8.0 Alternative Innovative, Emergin
Page 62 and 63: The Churchill Club is Silicon Valle
Page 64: About the Consulting TeamChabin Con

Assessment of Incubator Program - City of San Jose

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?