5. Case examples – Policies targeted directly at entrepreneurs

The mission of Converge Challenge is to leverage the intellectual assets and expertise emerging from Scotland’s Higher Education system into the creation of sustainable, high-growth businesses. It aims to provide students, graduates and staff of Scottish universities and research institutes with the practical and commercial skills they need to successfully develop their business ideas. The long-term goal of Converge Challenge is to enable students and staff to bring new products and services to market.

Young innovative businesses typically have the greatest economic impact, including job creation. The research and higher education sector develop knowledge and innovation that has the potential to be commercialised. It also trains talents that have the potential to be entrepreneurs. The Converge Challenge is designed to help stimulate the commercialisation of innovations in the Scottish Higher Education sector.

Converge Challenge is a business creation competition and entrepreneurship development programme for staff, students and recent graduates (i.e. having graduated within 24 months of application date) of all Scottish universities and research institutions. The competition aims to create a new generation of entrepreneurs in Scotland. The competition is organised in four categories:

The Converge Challenge category targets new businesses that demonstrate high commercial potential and scalability. The category is for the most advanced business ideas, and is open to both product- and service-based ideas. Applicants must be able to demonstrate validation of their idea, customer engagement and a route to market. Commercialisation must be realised within 12 months of the Award.

The Creative Challenge category is aimed at innovative business ideas in creative industries, including advertising, architecture, visual arts, crafts, design, fashion and textiles, film and video, photography, music, performing arts, writing and publishing, software and computer games. It is aimed at innovative ideas that demonstrate individual creativity, skill and craft. Businesses should have the ability to start trading with 12 months of the awards and have the potential to develop into sustainable businesses.

The Impact Challenge category is open to innovative projects with a social or environmental mission. Businesses must have the ability to start trading with 12 months of the awards and have the potential to develop into sustainable businesses.

The KickStart Challenge category targets early-stage, innovative projects that have the potential to become high-growth businesses. The KickStart category is open to both product and service-based ideas. Applicants must be able to demonstrate that their business idea is feasible, has unique selling points and that there is market demand.

Applicants are asked to attend a 2- or 3-day business course, depending on the category they enrol in, and submit a business plan (including financial forecasts and a 1-minute pitch video). Depending on the category, they may also attend a full-day business consultation, and be asked to pitch their idea at an “Elevator” event. Finalists of all categories are invited to participate in a promotional film and photoshoot and attend the awards ceremony. They may also get to attend an additional day of business training, and asked to pitch their idea to a judging panel, or to a live audience at the award ceremony (Table 5.1). Prizes vary by category (Table 5.2).

In 2016, the Converge Challenge received funding from eight Scottish universities (GBP 20 000 – EUR 22 500 – each) and the Scottish Funding Council (GBP 282 000 – EUR 321 000).

The initiative also receives significant in-kind support. Each university provides staff to sit on judging panels and resources to promote the Challenge. In 2016, the value of this in-kind support was estimated at GBP 77 400 (approximately EUR 88 100). In addition, it also receives support from business partners that specialise in providing training and advice related to product development, recruitment, intellectual property, finances, tax, accountancy, and more. Support is also received from third sector partners, such as Entrepreneurial Scotland and Firstport, Scotland’s social enterprise development agency. In 2016, it was estimated that the value of this in-kind support from the business and third sectors amounted to GBP 74 500 (about EUR 84 850).

One of the most important aspects of the Converge Challenge is the training programme. The first day of the training introduces participants to the fundamentals of business management, including business structure; how to pay yourself; employing other people; taxation; and accounting. The second day focuses on the basic corporate and commercial competencies, including quantifying commercial opportunities; estimating resources and timescales; cash flow; and building networks and teams. The third day focuses on identifying and targeting customers, market segmentation and competition.

Participants also have an opportunity to have their business plans reviewed by partners, and some participants are awarded 12 months of one-to-one mentoring.

There are linkages between the KickStart Challenge and the three other categories of challenges. The winner of the KickStart Challenge is automatically qualified to the semi-finals of one of the other challenges.

Converge Challenge forms a pipeline of potential applications for the Royal Society of Edinburgh Enterprise Fellowship and other support schemes such as Scottish EDGE (a start-up competition) and the Engage Invest Exploit programme (an event for start-ups seeking funding ran by Informatics Ventures, a programme which supports technology entrepreneurs from Scottish universities). In addition to direct applications from Scottish universities and research institutes, Converge Challenge receives referrals from the Scottish Institute for Enterprise (which offers entrepreneurship education to students in Scotland), and Enterprise Campus (an initiative that support postgraduate students from Scottish universities in setting up businesses).

The initiative collects key metrics annually for each award category. Evaluations are not regular, but one was conducted in 2016 with the objective of estimating the economic impact of the initiative. The evaluation used data collected by Converge Challenge, as well as surveys of participants. Key performance indicators include the following:

The initiative was evaluated in 2017 to estimate its impact. The key findings were:

  • Between 2011 and 2016, the Converge Challenge category provided training to 180 people, of which 69 people incorporated a business.

  • Of the 69 businesses created over the period 2011-16, 60 continued to operate in 2016.

  • For each GBP 1 invested to date by the universities and SFC in the Converge Challenge has enabled participating businesses to leverage a further GBP 7.51 in funding.

  • In 2016, the businesses that have taken part in Converge Challenge created an estimated 180 jobs in Scotland. Of these, 100 can be directly attributed to Converge Challenge.

  • 97% of Converge Challenge participants reported that they were either “satisfied” or “very satisfied” with their experience.

  • Overall, GBP 29.7 million (EUR 33.5 million) of follow-on funding was secured by businesses based in Scotland. Of this, GBP 12.5 million (EUR 14.1 million) can be directly attributed to the support provided through Converge Challenge.

  • It is estimated that the businesses supported by the Converge Challenge generated GBP 5.2 million (EUR 5.9 million) Gross Value Added (GVA) for the Scottish economy in 2016. Of this, it was estimated that GBP 3.4 million (EUR 3.8 million) GVA can be directly attributed to the support provided by Converge Challenge.

  • For each GBP 1 invested in 2016 by the universities and SFC, the Converge Challenge generated GBP 2.07 GVA for the Scottish economy.

In addition, statistics from 2019 indicate that the programme attracted 1 100 applications over 2011-18. In this period, it trained 300 entrepreneurs and supported 150 early stage ideas and social enterprises. An estimated 40% of projects incorporate and the three year survival rate is estimated to be 88%. Converge Challenge alumni had secured around GBP 80 million of funding as of September 2019.

No major challenges have been encountered to date. The initiative has grown from one award category to four in seven years. Financial and in-kind contributions from universities have increased, and the number of business and third sector partners has grown.

The key success factor for the Converge Challenge is the strong partnerships between the universities, business community and third sector. The initiative relies heavily on the input provided by business support staff from the individual universities that support the project, who help to support the participating businesses before, during and after the competition process. Without this support, it is likely that the benefits associated with the project would be significantly lower.


BiGGAR Economics (2017), “Evaluation of the Converge Challenge”, BiGGAR Economics, www.convergechallenge.com/wp-content/uploads/2019/03/Evaluation-of-the-Converge-Challenge-Final-Report-17Mar17-.pdf

Converge Challenge (2019), Converge Challenge website, www.convergechallenge.com/ (accessed on 25 May 2019).

Growth Hubs aim to improve the coordination and delivery of business support to local companies based on local needs, with a focus on:

  • improving business support for administrative procedures (e.g.: taxes, legislation, regulation, access to finance and national funding streams),

  • facilitating access to specialised help by signposting businesses to appropriate existing support in the public and private sector, and

  • stimulating demand for business support among smaller businesses who may lack the resources to seek out business support.

The establishment of Growth Hubs followed the UK Government’s decision to adopt a localised approach to supporting business growth. This approach is based on the idea that locally-driven and owned Growth Hubs would be more efficient than centralised programmes in identifying and responding to local needs.

The creation of the Growth Hubs also responded to a need for simplification of the business support offer: by offering a single point of contact to firms, Growth Hubs would facilitate access to business support and encourage more firms to use it.

Each of the 38 English Local Enterprise Partnerships (LEP) has its own Growth Hub over which it has ownership and governance. LEPs are partnerships between local authorities and local private sector actors tasked with determining local economic priorities and undertaking activities to drive economic growth and job creation, improve infrastructure and raise workforce skills within the local area. LEPs operate independently and a network (the LEP Network) was created to facilitate knowledge sharing between LEPs and dialogue with the government and other stakeholders. Each LEP developed a Strategic Economic Plan, outlining its priorities, which served as a basis to develop Growth Deals, through which government funds are awarded to LEPs for projects that benefit the local area. Growth Hubs were set up as a key element of these Growth Deals.

There are 38 Growth Hubs across England. They aim to promote, co-ordinate and deliver business support based on local needs, working primarily in partnership with the Department for Business, Energy and Industrial Strategy (BEIS), but also engaging with other key Government Departments as necessary.

Growth Hubs act as one-stop-shops, offering an entry point for all business support and information (national and local) at different stages of business development (starting a business, scaling up and creating jobs). There is strong emphasis on co-operation and communication between the Growth Hubs right across the network to foster collaboration and best practice exchange and to share awareness of events and opportunities.

In practice, a key element of the Growth Hubs’ offering is the provision of face-to-face professional advice to businesses and signposting to appropriate local and national resources. At any initial meeting with each company or start-up, a Growth Hub adviser evaluates the business’s growth plans and establishes a diagnostic assessing in which areas further support will be needed. Depending on the kind of assistance required (e.g. HR, marketing, sales, e-commerce, funding and finance, export, etc.), support is delivered by the Growth Hub itself or through external organisations identified by the advisor, including local and national public and private sector partners (e.g. local universities if the priorities correspond to innovation, the Department for International Trade if export support is required).

Growth Hubs have been set up independently to respond to local needs and do not follow a rigid structure. As such, they can vary in terms of capacity and support services offered. They are however required to adhere to five Principles of Funding set out by BEIS: (i) Management, governance and coordination; (ii) Data monitoring, reporting, evaluation and value for money; (iii) Strategic partnerships and business support simplification; (iv) Triage, diagnostics and signposting and (v) Supporting ambitious and high-growth businesses (scale-ups).

As noted above Growth Hubs work in collaboration with a wide range of local and national, public and private sector partners - such as Local Authorities, Chambers of Commerce, the Federation of Small Businesses, Universities, Enterprise Zones, Business Angel Networks, Enterprise Agencies, banks and accountants – co-ordinating local business support and connecting businesses to the appropriate assistance.

With LEPs owning and governing Growth Hubs, a key vertical link at national level is the LEP Network, which was established to connect the 38 LEPs across England. The network is a not-for-profit company governed by three volunteer LEP Chairs. They are responsible for the finances and operational actions of the overall LEP Network on a day to day basis. In addition, a National LEP Network Steering Group meets throughout the year and sets the overall policy direction and strategy for LEPs. The group is open to all 38 LEP Chairs. Each LEP board is led by a business Chair and board members are local leaders of industry (including SMEs), educational institutions and the public sector.

BEIS designed a specific monitoring and evaluation framework for Growth Hubs. The framework ensures the collection of data and information that could contribute to understanding which type of business services are helpful for local companies, how their performance can be improved to provide a higher impact in the local and national economies and wider society. The framework constitutes a “minimum set of data to collect”. In addition, Growth Hubs are encouraged to collect any additional data they believe will help their operations. Metrics were designed in accordance with EU requirements and with the goal to reduce burden.

Growth Hubs were asked to report aggregated data (Table 5.3Table 5.3. Aggregated data to be reported by Growth Hubs ).

Growth Hubs are expected to record data when they provide face-to-face support or have referred a user to a business support scheme. LEPs are expected to provide “non-aggregated” data for their Growth Hub in an accessible format (e.g. a spreadsheet with metrics as the columns and interactions as rows) at 6-monthly intervals or if specifically requested by BEIS.

As each Growth Hub operates independently, BEIS has encouraged LEPs to develop a robust evidence base for their growth hubs to ensure that they can demonstrate impact with the aim of supporting any future bids for public sector funding. This can include a LEP’s own internally agreed KPIs. LEPs are therefore responsible for both day-to-day monitoring of performance and wider strategic, process and impact evaluations of their activities – including value for money at a local intervention level.

BEIS has produced a template to help LEPs produce their individual Growth Hub Annual Reports. The Annual Reports are designed to help BEIS assess how individual Growth Hubs are performing against the five agreed principles of funding, to showcase their success stories and aid the identification of best practice and local innovations that could aid the development of the wider Network.

The key metrics reported on in an Annual Report include:

An independent evaluation with a control group conducted in 2017 found that businesses that have been in contact with a Growth Hub are growing faster than other businesses. This was true both in terms of turnover (9.0% for Growth Hub users, 2.5% on average for other companies) and employment (8.0% for Growth Hub users vs. 0.1% for the comparison group).

Figures from October 2017 also show that overall, 582 815 businesses had engaged with Growth Hubs and/or been supported by them as well as 31 834 individuals, including entrepreneurs, pre-start-ups and start-ups. Out of these, 105 356 users received referrals to additional public/private support. Growth Hubs also helped 11 459 individuals start a business. A customer satisfaction survey of Growth Hubs support found an average satisfaction of 86.6%.

Growth Hubs are perceived as a very successful initiative in the UK as a support to local economies and the competitiveness and productivity of local business.

One of the main challenges in operating the Growth Hubs is to efficiently divide resources between different categories of businesses and the services provided, in particular, supporting very small scale ventures as well as scale-ups. This is done through specialisation at the level of the Hub by offering support focused on problems faced by small businesses, such as access to premises, skilled workers, good infrastructure and finance, while addressing the needs of scale-ups by signposting national support and enabling local networking and collaboration.

Another challenge in providing specialised services to different types of firms and business support to specific sectors of the economy is that it can lead to a complex advisory services landscape. A challenge for Growth Hubs going forward will be to address complexity and collaboration in the commercial business support market in order to better connect with it and facilitate access by smaller firms.

The Growth Hubs are perceived as a success, as they play a key role in strengthening local small firms and start-ups, promoting job creation and helping companies to grow and in some cases go global. The wide range of services offered contributes to reinforce the performance, efficiency and competitiveness of local businesses, while aiming to retain and create jobs.

Success factors for the Growth Hubs that may be relevant for similar policies and initiatives include:

  • Offer political support to the centres at national level. The creation of LEPs and Growth Hubs was flagged as a national political priority by the government, under the support of the Business, Energy and Industrial Strategy Committee of the House of Commons. The strong political support was thought to contribute to better engagement among stakeholders. Defining a national strategy was an important tool to signal this commitment.

  • Develop strategic plans at the local level. Implementation at the regional and local level requires bottom up contributions to inform the national authorities and define and achieve the most appropriate goals for the local context.

  • Involve a variety of stakeholders. The combination of a top down with a bottom up approach, where local stakeholders are strongly involved and play a key role, allowed for a wider participation and leveraging local capacity.

  • Create of a network linking the Growth Hubs. The development of a national network contributes to consistency between the services offered across hubs, but also gives the opportunity for organisations to learn from each other.

  • Establish a monitoring and reporting system. After having been created, Growth Hubs require a high level of monitoring and reporting to national authorities, in order to understand if their services are corresponding to the national and regional plans or ambitions, but also to understand their impact and outcomes, as well as to allow for benchmarking opportunities.

  • Embed the Growth Hubs in new national strategies. Involving Growth Hubs as partners in the definition and implementation of new strategies ensures the Hubs’ relevance and allows for leveraging their capabilities. For example, the National Industrial Strategy uses the Growth Hubs to reach out to local stakeholders and businesses.

  • Direct sufficient and continuous funding should be provided for the structures. Financial support is needed on a regular basis to ensure continuity of service.


British Business Bank (n.d.), “What are Growth Hubs? And what can they do for me and my business?”, The Business Finance Guide, British Business Bank.

Business, Energy and Industrial Strategy Committee (2017), “Industrial Strategy: Review”, Business, Energy and Industrial Strategy Committee, House of Commons.

Department for Business Innovation and Skills (2018), “Monitoring and Evaluation Framework for Growth Hubs – 2016 to 2018”, Department for Business Innovation and Skills, UK Government.

Department for Business Innovation and Skills (2018), “Growth Hub Funding to Local Enterprise Partnerships (LEPs), Schedule 3 – Principles of Funding (2018-2019)”, Department for Business Innovation & Skills, UK Government.

Enterprise M3 Growth Hub (2018), “Driving prosperity in the M3 corridor”, Enterprise M3 Growth Hub.

GFirst (2020), Gloucestershire Growth Hub website, www.thegrowthhub.biz/.

GFirst (2016), “Growth Hub Phase 2 Business Plan 2016-2021”, The Gloucestershire (GFirst) Growth Hub.

GFirst (2014), “Strategic Economic Plan for Gloucestershire”, March 2014.

LEP Network (2020), LEP Network website, www.lepnetwork.net/growth-hubs/.

Ministry of Housing, Communities & Local Government (2018), “New proposals for Local Enterprise Partnerships (LEPs)”, Ministry of Housing, Communities & Local Government, UK Government.

Ministry of Housing, Communities & Local Government (2018), “Strengthened Local Enterprise Partnerships”, Ministry of Housing, Communities & Local Government, UK Government.

UK Government (n.d.), “Growth Hubs: A New Opportunity for Regulatory Services”, Better Business for All Office for Product Safety and Standards, UK Government.

UK Government (n.d.), Better Business for All, Guidance, Office for Product Safety and Standards, UK Government.

UK Government (2017), “Building a Britain fit for the future”, Industrial Strategy White Paper, UK Government.

The Regional Business Development Centres aimed to encourage growth among Danish entrepreneurs and small businesses by increasing their awareness of their growth potential and helping them identify and exploit growth opportunities. To do so, Regional Business Development Centres provided a range of business support services in collaboration with private and public sector providers to address identified weaknesses in the capabilities of start-ups and SMEs and facilitate future growth.

The Regional Business Development Centres were created within the context of wider efforts to spur economic growth, research and innovation. The creation of the Regional Business Development Centres was part of a reorganisation of local governance which included a move towards a regionalised system to support business development and economic growth. They aimed to address the regional dimension of growth by responding to local and regional business needs while contributing to national growth targets. In 2007, five regions were formed. Each region established a Growth Forum with the active participation of regional stakeholders and local authorities and governments, and created a Regional Business Development Centre.

Company managers and entrepreneurs making use of Regional Business Development Centres first met with advisors to develop a diagnosis of the company’s growth potential and to identify areas of weakness. The diagnosis meetings were free of charge. Based on this diagnostic, the Regional Business Development Centre helped the entrepreneur/SME develop a growth plan.

To support the implementation of the plan (helping the firm to strengthen its management and address identified weaknesses), the Regional Business Development Centres supported companies with their own services. They also referred them to relevant private services providers (e.g. banks, accountants and lawyers), as well as to other stakeholders (e.g. knowledge and research institutions) and national public services (e.g. the Patent and Trade Mark Office or the Trade Council). The support provided covered a range of objectives such as helping them to create and strengthen supply chain or addressing knowledge or skills gaps.

Regional Business Development Centres also assisted companies with technical development, marketing, IP management, training or finances. The costs of this subsequent assistance varied depending on the nature of the services provided and where they were delivered. Some services were provided free of charge. Others, especially those provided by private consultants, could be subsidised up to 50% of their market value.

Regional Business Development Centres also provided a range of general services to the community at the regional level, such as giving economic and business information, sectorial specialized support or early warning in case of national or international business issues. Regional Business Development Centres did not have a set sectorial focus.

Each of the five Regional Business Development Centres (Central Denmark, Northern Denmark, Southern Denmark, Zealand, and Greater Copenhagen) tailored its provisions according to local needs, including the sectoral composition of each region and the funds made available locally (including EU funding). For example, the Regional Business Development Centre South Denmark offered support for general business but also had more specific tools for assisting companies with innovation, often in relation to advanced technologies and the Central Denmark Centre also offered services to foreign entrepreneurs. The North Denmark Centre offered a graduate placement scheme called Growth via knowledge and Regional Business Development Centre of Copenhagen offered a set of courses entitled Network-driven innovation leadership that encourages companies to work with others to increase their knowledge and innovation potential.

All Regional Business Development Centres offered assistance with gaining access to finance and developing better IP management and protection. Most also offer assistance to the development of new ideas. Many of the services provided involved advice from consultants. Some of the services offered were local variants of a national scheme.

Regional Business Development Centres aimed to connect local and national priorities and to provide a single entry point for local and national level business support. They were well-connected to local ecosystems of business development service providers and were linked to both local and national level priority setting mechanisms.

The Ministry of Industry, Business, and Financial Affairs and the Local Government Denmark (KL – the association and interest organisation of the 98 Danish municipalities) were responsible for the programme strategy. The Danish Business Authority was the organisational body responsible for implementing it at the national level. Subject to the approval of the Regional Council and the Danish Business Authority, each of Denmark’s five regions established a Growth Forum (made up of regional stakeholders to develop and implement the respective regional economic development strategy), which was given responsibilities for the development and management of a regional economic strategy and a corresponding Regional Business Development Centre in 2007.

The objectives of the centres were set in the National Agreement on Regional Business Development Centres. National targets for the Regional Business Development Centres were set annually. The evaluation of the performance of the Regional Business Development Centres took into consideration three key areas:

  • Volume (a description of the extent of services provided and the number of clients involved);

  • Quality (an assessment from the clients’ perspective of the quality of the services provided);

  • Effect (the extent to which growth among beneficiary firms can be attributed to the Regional Business Development Centres).

Nine KPIs and corresponding targets were set covering the three areas:

Performance against the KPIs was assessed based on three methodologies: (i) an examination of the data collected by the Regional Business Development Centres’ Client-Relations-Management systems; (ii) interviews with clients and a survey conducted by external consultants; and (iii) a statistical exercise conducted by Statistics Denmark in order to determine the impact of the Regional Business Development Centres on enterprise growth in terms of employment, turnover and exports.

No information is available on the monitoring and evaluation methods of the newly established Business Hubs, however, continuity between the two programmes suggests that some of the KPIs and methods may carry over into the evaluation process of the Business Hubs.

An evaluation undertaken in April 2013 by the Iris Group for the Danish Business Authority concluded that the five Regional Business Development Centres had different competences and priorities, but that, in general, they fulfilled their role as business advice centres for the different private and public stakeholders.

According to monitoring information, 2 146 companies undertook a “growth assessment” in 2016 (the Regional Business Development Centres’ core service) and 88.2% of these were referred for further advice to private or public sector specialists. Another 3 181 enterprises were served by the Regional Business Development Centres in another manner that year. These figures represent a small increase over the previous year (0.5% increase in growth assessments conducted; 1.5% increase in referrals for further assistance; 0.3% increase in more general interactions). In 2014, the Regional Business Development Centres conducted 2 124 growth assessments nationwide, almost 6% above the target set. Another 3 385 companies participated in other Regional Business Development Centre activities, such as conferences and workshops.

A further performance assessment carried out by the Danish Business Authority (Erhvervsstyrelsen) found that the Business Development Centres had contributed to creating 1 305 jobs from 2013 to 2015. The evaluation estimated that the economic return on the investment made by the municipalities (DKK 98 million in 2013, approximately EUR 13 million) was DKK 5.07 for every DKK 1 invested (Danish Business Authority, 2016).

As part of this evaluation, companies were also asked to assess the assistance received from the Regional Business Development Centres. Some 93% reported that it had had a high or moderate positive effect on their firm’s development. As with previous evaluations, the assessment found that companies who used the Regional Business Development Centres continued to outperform similar ones that did not. This was true for growth in employment, turnover and exports, although the differences between the Regional Business Development Centre users and the control group was narrower than the previous year for the first two variables. Some 60% of companies using the Regional Business Development Centres experienced growth in employment (10% more than in the control group), while 5% more companies than in the control group experienced turnover growth.

The alignment of the national strategy defined by the Ministry of Business and Growth with the concrete actions and business support offered by the Regional Business Development Centres at the regional level required coordination among the Danish Business Authority (in charge of the programme at the national level), local and regional government authorities (in charge of business support and promotion in their region) and Regional Business Development Centres managers. To address this challenge, a multilevel governance framework was defined and adopted for the programme, with both top down and bottom up contributions. This notably involved regular meetings bringing together the Danish Business Authority and the five Regional Business Development Centres.

In 2017, the government established the Commission on Simplification of Danish Business Promotion to revise the structure of the Danish business-support system. The Commission recommended bringing all business development support under a single umbrella to increase clarity for entrepreneurs and improve efficiency as well as further decentralising support and anchoring it at the local level. Following this consultation, business promotion efforts were reorganised in 2018 as a two level system. At the national level, the Danish Executive Board for Business Development and Growth (Danmarks Erhvervsfremmebestyrelse) sets national strategic objectives. At the local level, six Business Hubs (Erhvervshuse) were created as one-stop-shops centralising local business development support and providing an entry point to national programmes (European Commission, 2019; European Commission, 2018). Previously, there were two entry-points for local business support: basic business support was provided by municipalities while Regional Business Development Centres offered support to growth-oriented entrepreneurs. The five existing Regional Business Development Centres (Væksthuse) were closed. Upon the creation of the six Business Hubs (Erhvervshuse), some resources and staff were transferred from the defunct Regional Business Development Centres. A digital platform was also introduced as part of the reform.

Another initiative addressing co-ordination challenges for the Business Hubs is the co-operation agreement signed between nine Funen municipalities to form of a cross-municipal collaboration under the auspices of the Business Hub, bringing together all business support and simplifying the regional landscape.

Overall, the Regional Business Development Centre programme was successful in providing businesses to local firms and promoting job creation and supporting firm development. However, the business development service system was still deemed complex and was further simplified through the transition to the Business Hubs programme. Based on the experience of the Regional Business Development Centres, some key factors can be identified for similar programmes to be successful:

  • Initiatives seeking to implement regional one-stop-shops should seek to involve local stakeholders in the governance and strategic development of the hubs. The local ownership of Regional Business Development Centres was positively perceived by local authorities and was thought to help adapt the offer to the local context.

  • Similar initiatives set aside resources to gather feedback on user experience in different centres as well as monitor longer-term impact of support on firms. The use of control groups to evaluate impact on firms was a strong feature of the Regional Business Development Centres evaluation design.


Compent (n.d.), “Business Development Centre, Central Denmark”, https://compent.net/cases/vaeksthus-midtjylland/ (accessed on 20 May 2019).

Danish Business Authority (n.d.), Danish Business Authority website, https://danishbusinessauthority.dk/ (accessed on 25 May 2019).

Danish Business Authority (n.d.), Danish Business Authority (Erhvervsstyrelsen), https://erhvervsstyrelsen.dk/ (accessed on 25 May 2019).

Danish Business Hubs (n.d.), “Danish Business Hubs (Erhvervshuse) website, https://virksomhedsguiden.dk/erhvervsfremme/content/ (accessed on 25 May 2019).

Danish Business Agency (2016), National Agreement for Regional Business Development Centres for 2015, Statement of Performance, Danish Business Agency, Copenhagen, www.kl.dk/ImageVaultFiles/id_77357/cf_202/15032016_Resultatopg-relse_2015.PDF/ (accessed on 25 May 2019).

European Commission (2019), “Business Development Centre, Denmark”, European Commission, https://ec.europa.eu/growth/tools-databases/regional-innovation-monitor/organisation/business-development-centre-central-denmark (accessed on 28 May 2019).

The Incubators Programme and the Business Gardens programme aim to increase value creation by supporting business development and innovation. Both programmes are complementary, they support business development services providers aimed at different profiles of firms.

The Incubators Programme aims to boost innovative entrepreneurship and support further development of existing businesses. The incubators target innovative ventures with growth potential.

The Business Gardens Programme aims to stimulate regional development by supporting business creation and boost growth of existing firms in District Areas. It also aims to reinforce the role of counties in support of regional development. The business gardens target firms in sparsely populated and remote areas, i.e. District Areas.4

Both programmes co-locate start-ups and provide them with access to expertise, training and coaching services and facilitate linkages with investors. They aim to help start-ups develop their network and foster peer learning. Indeed, many innovative firms fail at early stages in spite of promising business ideas as they lack the means to develop their potential. The incubators programme aims to provide these firms with a conducive environment to grow past these challenging stages. Entrepreneurs in rural areas face specific challenges related to the lack of access to the skills networks and capital needed to develop their businesses. Business gardens aim to connect them with relevant resources locally to grow.

The Industrial Development Corporation of Norway (Siva) aims to spur innovation capabilities and economic growth in all parts of the country with a special responsibility to promote growth in rural areas. Among its activities, Siva supports firm development through incubators and business gardens, which offer co-location services to promote growth and development and offer access to expertise and networks. Siva provides financial support to incubators and business gardens enlisted in the programme. These incubators and business gardens are referred to as “Siva partners”. The business gardens are often co-owned by Siva, counties, municipalities or private organisations. Their operating cost have to be sustainable, but they rarely generate substantial profits. Incubators are often part of and partially owned by a research facility, though some are stand-alone firms. Research facilities often have close ties to a university or college in the region, and may be (partially) owned by them. There were 34 incubators and 40 business gardens in the programme as of January 2020. On average, a business garden serves 56 firms while an incubator serves 61. Overall, Siva partners offer support to 4 000 start-ups and small businesses yearly.

Business gardens and incubators are selected on their capacity to serve their respective target entrepreneurs: business gardens must be active in providing and facilitating access to competence, networking opportunities and infrastructure for SMEs and entrepreneurs and be suitable as a knowledge-based grouping for SMEs in a small community. Incubators should be implanted in regions at a stage of development where focus on innovation is of strategic importance. They should demonstrate linkages with industry as well as with higher education and research organisations.

Siva supports Siva partners programme operators (incubators and business gardens) through expertise sharing and a network. Business gardens and incubators also receive a subsidy in support of their operations. The grants guidelines were revised in 2016. The grant volume depends on the incubator or business garden’s characteristics in terms of results, targets, objectives and potential. For 2018, there were four grant levels for incubators: NOK 1.5 million (approx. EUR 153 000), NOK 2 million (approx. EUR 200 000), NOK 3 million (approx. EUR 300 000), NOK 4 million (approx. EUR 400 000) and NOK 5 million (approx. EUR 510 000). The same year, the grant levels for business gardens were: NOK 1.4 million (approx. EUR 143 000), NOK 1.7 million (approx. EUR 173 000), NOK 2 million (approx. EUR 200 000) and 2.5 NOK million (approx. EUR 255 000).

The ownership and financing of business gardens varies. Aside from the Siva grant, they often get financing from regional governments. In addition they can collect fees from the firms they serve.

The incubation programme is funded by the Ministry of Trade, Industry and Fisheries and the Municipal and Regional Authorities Modernization Ministry. The Business Garden Programme is financed by the Ministry of Local Government and Modernisation and the counties. They cover 75% of the programme’s operation. The business gardens received 25% co-financing from the counties until 2017.

Incubators and business gardens also receive funding from other sources (e.g. county councils, private sector, higher education and research institutions) and are active outside of the incubator/business garden programmes, which positively affects their incubation activities according to the programme evaluation.

Siva cooperates with both the Norwegian Research Council and Innovation Norway. The business gardens and Incubators organise activities in support of other national programmes, such as the Siva Catapult-scheme which supports the development of national infrastructure for SME innovation.

A mid-term programme evaluation was conducted in 2017 by the SNF Centre for Applied Research at NHH, covering the period 2012-16. The evaluation aimed to assess (i) the programme’s organisation, (ii) its impact on the firms wo use the incubation and business gardens’ services as well as (iii) the role of incubators and business gardens in the regions.

The evaluation was based on a survey of incubators (37 respondents), business gardens (43) and firms enrolled in incubators (333) and in business gardens (494). Interviews with Siva representatives and programme managers were also conducted. Previously conducted satisfaction survey and operating data were also used. A range of KPIs were used to evaluate the programmes’ performance:

Four incubation programmes were also evaluated in the previous iteration of the incubators programme (evaluations in 2003, 2008, 2009 and 2013).

The 2017 mid-term programme evaluation found that both programmes were serving their established target groups in terms of the service providers supported and the companies served through them. The evaluation found a positive impact of both programmes on the entrepreneurs who received support. It also recorded positive results in terms of building local capacity to facilitate entrepreneurship and business development. In particular, the evaluation found that Siva promoted learning between operators and strengthened the networks for incubators and business gardens, mostly at the national level. It also found that county councils played an important role as co-funders of business gardens and supported their development.

The evaluation showed that incubators tended to be located in central areas (74%) and serve young firms, often in knowledge intensive industries (69%). Participating firms tended to have higher growth ambitions than these in business gardens. Incubators were well linked to Innovation Norway (the national innovation agency) and business clusters but also collaborated with a wide range of actors (e.g. county councils, local businesses, HEIs). Incubator managers who responded to the survey estimated that their main contributions were strengthening participants’ business knowledge and an increasing firm survival. 79% of participating companies reported being satisfied or very satisfied with their experience, especially in terms of business development support: 88% reported a positive impact of their affiliation with the incubator on their firm’s development. The effect was significantly higher for firms located in the incubator’s premises.

In contrast, business gardens tended to be located in peripheral municipalities (60%), and in District Areas (89%). Business gardens tended to serve more established firms and cover a wide range of sizes and industries. Business gardens primarily reported linkages with other local businesses and other innovation companies (e.g. incubators). Co-operation with counties is found to have contributed to increased linkages with research and education institutions as well as linkages with other business gardens. While companies in business gardens tended to collaborate less with research and education institutions than those in incubators, there was more collaboration among enterprises in business gardens than in incubators. Business garden operators who responded to the survey estimated that their main contribution was to improve participating entrepreneurs’ business knowledge. Other cited contributions included developing networks with research and education institutions and innovation. Some 77% of participating companies reported being satisfied or very satisfied with their experience, particularly in terms of skills development. Some 80% reported a positive impact of their affiliation with the business garden on their company’s development.

Through a quantitative analysis comparing firms served by incubators/business gardens to firms that have not been affiliated with those support programmes, the evaluation estimated higher levels of value-added after 3 years.

The evaluation provided recommendations including developing stronger linkages to communities and stakeholders and developing models for more tailored follow up with former participant companies.

Incremental changes have been implemented over time to improve the efficiency of the programme. For example, Siva has introduced a tool helping incubators and business gardens to report on the use of the grant and, optionally, other sources of funding. Formalised processes were also put in place to conduct structured talks between operators and Siva using a tool called Qimono. The structured talks are held every 18 months and the process involves an extensive assessment questionnaire to identify areas for further development in a particular business garden and incubator.

Following an assessment, a further differentiation in the grant amounts paid to incubators and business gardens was introduced in 2016, in order to increase support to providers with untapped potential and downgrade support to bad performers. The new system also facilitates exit of bad performers.

The two programmes have demonstrated a positive impact on service providers (Siva partners) and the firms using them. In particular the programme was successful in targeting support to different profiles of firms by supporting two types of operators targeting different populations of businesses and entrepreneurs. Key lessons for the development of similar programmes include:

  • The use of non-governmental structures helps obtain a good geographic coverage. It is crucial that similar programmes include capacity building and networking for partner organisations, to ensure good quality support is provided and help the development of strong local business support ecosystems.

  • The use of a brand to signal quality services is helpful for users to navigate the system. The system must be designed to allow for exit of sub-par service providers to maintain service quality while helping providers with potential to improve. Programmes should set up a robust evaluation framework and sufficient resources to regularly assess impact of different delivery structures on firms.

  • Monitoring of incubators and personalised feedback for incubator staff are important for development. Incubator programmes should set up a formalised system for incubator managers to report on their activities, communicate regularly with, and receive personalised feedback and guidance from programme managers.

  • Programmes should not overlook supporting small structures. Evaluation suggested that smaller incubation structures showed better results than larger facilities.

  • Physical co-location of start-ups is an important part of the support offered. The evaluation found that firms which opted for physical co-location received stronger benefits than those who received services without locating on the premises.


Jakobsen, S.-E. et al. (2017), Midtveisevaluering av Sivas Inkubatorprogram og Næringshageprogram [Midterm evaluation of Siva’s Incubator Programme and Business Garden Programme], SNF Centre for Applied Research at NHH, https://v4dp610i86t3v9gxdj0cbh10-wpengine.netdna-ssl.com/wp-content/uploads/2017/06/midtveisevaluering-nh-inkprogram.pdf (accessed on 25 April 2019).

OECD (2008), OECD Territorial Reviews: Norway 2007, OECD Territorial Reviews, OECD Publishing, Paris, https://doi.org/10.1787/9789264038080-en.

SIVA (2019), “Sivas næringshageprogram (2011-juni 2021)” [Siva's business garden programme (2011-June 2021)], Https://V4dp610i86t3v9gxdj0cbh10-Wpengine.Netdna-Ssl.Com/Wp-Content/Uploads/2019/04/Kortversjon-Nringshageprogrammet.Pdfn (accessed on 21 May 2019).

SIVA (2018), “Sivas inkubasjonsprogram (2012-2022)” [Siva's incubation programme (2012-2022)], https://v4dp610i86t3v9gxdj0cbh10-wpengine.netdna-ssl.com/wp-content/uploads/2019/04/kortversjon-inkubasjonsprogrammet-1.pdf (accessed on 21 May 2019).

The overall objective of the Fund is to improve access to finance for start-ups during the early stages of development and to support their growth. In addition, the programme seeks to increase the supply of revolving capital, improve regional financing structures, develop the competences of various actors supporting entrepreneurship financing, and strengthen collaboration between funders.

The initiative was launched to address a perceived imbalance between the existing risk capital available on the market and the demands of start-ups (Tillvaxtverket, 2014). Moreover, the funds were launched in response to the European Commission's declaration of intent to change European Union Structural Fund programmes away from direct grants to other types of instruments such as repayable loans, loan guarantee schemes and venture capital (Tillvaxtverket, 2014).

The Regional Co-investment Fund is composed of 11 (initially 12) regional funds across Sweden, established to invest in micro-, small- and medium-sized enterprises (MSMEs) in early phases of development. The funds’ individual capital bases ranged from SEK 36 million to SEK 200 million (approx. EUR 4.2 million and EUR 23.2 million). Between the start of the project and June 2015 approximately SEK 3.4 billion (EUR 322 million) had been invested in 320 portfolio companies. Public funds accounted for approximately SEK 1.4 billion (EUR 133 million) and private funds for SEK 2 billion (EUR 189 million). Approximately half of public funding was provided by the European Regional Development Fund and the rest was covered by public regional fund providers (e.g. regional organisations, county councils, Almi Invest).

The Regional Co-investment Fund was launched on 1 January 2009 and was planned to run until 31 December 2014. In 2012, the final date for investments was postponed to 30 September 2015. Follow-on investments in existing portfolio companies may be made until 31 August 2020. All shareholdings are to be divested after this date.

The Regional Co-investment Fund is managed by the Swedish Agency for Economic and Regional Growth (Tillväxtverket) at the national level, within the framework of Sweden’s eight regional European Union Structural Fund programmes. The Regional Co-investment Fund was initially driven by five owners, the former Innovationsbron,5 Almi Invest,6 Saminvest, Norrlandsfonden, and the Sixth AP Fund7 and evolved over time.

In each investing round, the public sector invested up to 50% and private investors at least 50%. Investments typically range from SEK 1 million to SEK 10 million (approximately EUR 110 000 to EUR 1.1 million). Firms with up to 249 employees are eligible for investments. Investments were carried out in different ways. In most cases, companies in need of investors would reach out to the fund, or be contacted by the funds which would actively seek suitable investments. In a minority of cases, private sector investors approached the fund together with a potential portfolio company.

The Fund aims to have a revolving capital base so that it does not shrink in the long-term, and seeks to complement the market, i.e. not to crowd-out private investment.

The initiative was launched following a pilot project including three regional venture capital funds, which invested between 2005 and 2008. Over this period, SEK 112 million (approximately EUR 13 million) were invested in 62 companies. This pilot initiative was based on the Scottish Co-investment Fund.

The Regional Co-investment Fund has no direct linkages with other programmes, although their objectives align with innovation and industrial policy.

The Swedish Agency for Growth Policy Analysis (Tillvaxtanalys) is responsible for monitoring and evaluating the programme. An evaluation report was published in 2016. A final assessment report covering the Regional Co-investment Funds and two other Swedish risk capital initiatives was published in 2019 (Tillvaxtanalys, 2019).

The 2016 evaluation process included both quantitative and qualitative assessments, as well as the consultation of an international expert panel. The impact of the Co-investment Fund on companies was measured using a comparison with a control group of firms that did not receive investment through the Fund, matched to recipient companies according to their characteristics (sales, size, productivity, age of the company, industry, etc.).

Companies were also asked to report to what extent they used the investment received to invest in different parts of their business (e.g. skills acquisition, product development, operating expenses) and to evaluate the impact of the fund on different dimensions of their activity (expansion, future financing opportunity, staff growth, etc.). Companies were also asked to rate their needs for non-financial support and to which extent these needs were met by the fund and the private co-investors.

KPIs monitored included the following:

The impact of the Fund on the functionality of regional capital markets used qualitative and qualitative indicators. The logic framework for assessing the ecosystem is presented below.

The evaluation involved around 50 interviews with portfolio companies, investors and other stakeholders.

The review of the activity of the fund found the following average characteristics for the 320 portfolio firms in the year preceding the investment date:

  • Annual turnover: SEK 6.3 million (EUR 69 million)

  • Number of employees: 6.8 persons

  • Productivity (added value/employee): SEK 334 000 (EUR 36 740)

  • Capital intensity (fixed assets/employee): SEK 801 000 (EUR 88 110)

Comparing with a control group of comparable firms supported by other funds, the firms supported by the Regional Co-investment Fund were spread among considerably more sectors.

Overall, about 80 percent of co-investors were Swedish (50% came from the same region as the fund and 30 % came from other regions in Sweden). Foreign investors accounted for about 6% of deals but they invested larger amounts, accounting for just over 10% of the total value of investments. It was not possible to determine the location of the remaining 12% of investors.

The most recent evaluation noted five key findings:

  • Overall, the funds were invested in accordance with requirements. Nearly SEK 3.4 billion (approximately EUR 374 million) were invested in 320 companies since 2009. The funds have exited from 45 companies (as of 2016) and about 10% of companies had gone bankrupt.

  • The initiative engaged new actors in the venture capital market. Only approximately 30% of the total number of investment decisions were made by companies whose primary objective is investing capital. Furthermore, the regional structure of the initiative allowed new segments of recipient firms to access risk capital.

  • It was too early to draw conclusions about the tangible effects in investee businesses. However, an overall increase in employment was observed among investee businesses. It is not clear if this was due to widespread employment creation or job creation by a few very successful firms.

  • The majority of regions experienced positive development in the capital supply structures. However, this was not uniform across and within regions. The empirical data did not allow an assessment of causality between the initiative and the structural changes in the regions.

  • Two main pathways were identified in the programme, i.e. growth in the number of investee businesses and improving the regional structure for risk finance. However, there did not seem to be a priority between either. Some of the regional funds viewed themselves as regional development players, while others saw themselves as traditional venture capital investors.

The evaluation recommended:

  • Reviewing and clarifying the formulation of the programme’s goals, and that an intervention logic is devised.

  • Streamlining the programme to:

    • Focus solely on the investee businesses' growth with no ambition in respect of structural building, or

    • Adjust the model to allow variation between a strict venture capital instrument and a broader regional development instrument, depending on regional context.

  • Implement supplementary initiatives on both the supply and demand side to construct a more coherent system.

  • Improve the quality of the investment data that is registered to improve monitoring and evaluations.

The main challenge in implementing the initiative was that the objectives for the making individual investments (either to support a firm with growth potential or to strengthen regional capital supply structures) were not totally clear. The initiative did not specify at the outset a logical framework on how the funds’ activities were to impact the capital market and firm performance. This included a lack of a clear guidance on how the different funds were to prioritise different types of investments. This also represented a challenge for evaluating the extent to which activities met the two objectives. A logical framework was developed for assessing the impact of the programme.

Another challenge encountered by some of the funds were related to the broad variation in framework conditions across regions. The industrial structure of some regions led to more limited demand: the predominance of large firms, traditional sectors, or a lack of business competencies in firms were identified as factors limiting demand for venture capital. Some regions also had a limited pre-existing supply of venture capital, which made it more difficult for fund identify private sector co-investors.

Other challenges included the limited amount of funding allocated to administrative activities (3%), which restricted the regional funds’ ability to carry out initiatives aimed and structural improvements. This challenge affected the various regional funds differently: regions where the funds manage large portfolios with relatively small investments were more affected, as such a portfolio structure tends to be costlier. These portfolios are often found in sparsely populated regions where the need for structural development initiatives are also largest.

The evaluations highlight the difficulty of measuring impact from risk capital and business angel intervention because of the uncertain timeframe in which the effects appear. Nonetheless, the evaluations point to some key lessons:

  • Evaluation should be capable of measuring impact over long time periods, and not only the short and medium term, as impact is expected to occur over a long timeframe, both on individual firms and ecosystems.

  • Policy needs to recognise and adapt to the growing importance of informal capital, including business angels. They should be considered a potentially important investment source for entrepreneurship in other finance support programmes and should be targeted alongside formal investors. For example, business angels accounted for more than 40% of private investors in the regional co-investment funds.

  • Policy makers need to design venture capital and private equity development policy measures as components in a cohesive system. Measures to strengthen the supply side should be complemented by measures that improve investor readiness. Similarly, policies that increase the supply of risk capital must also consider exit issues.

  • Policies aiming to affect individual firms and reinforce the capital market should set clear goals for different actions and assign resources accordingly. The initial programme documentation should include an explicit logic framework for the expected mechanisms that would be involved from activities to impact. It should also include proposed KPIs for each mechanism.


Almi Invest (n.d.), “About Almi Invest”, www.almi.se/en/almi-invest/about-almi-invest/ (accessed on 27 February 2020).

Growth Analysis (2016), “Effects & Experiences – Final Evaluation of the Swedish Regional, Co-Investment Funds 2009–2015, the Swedish Agency for Growth Policy Analysis”, Östersund, Sweden.

Tillvaxtanalys (2019), “Think clearly early! – lessons learned from the government risk capital initiatives of the European Regional Development Fund”, www.tillvaxtanalys.se/publikationer/rapport/rapportserien/2019-05-27-tank-tydligt-tidigt---lardomar-fran-de-statliga-riskkapitalsatsningarna-inom-europeiska-regionala-utvecklingsfonden.html.

Tillvaxtanalys (2016), “Effects & experiences – final evaluation of the Swedish regional co-investment funds 2009–15”,


Tillvaxtverket (2014), “The need for venture capital in Sweden during the EU programming period 2014–2020”, http://tillvaxtverket.eprint.se/E-View/Download/Resource✓rl=cG9ydGFsOi9SZXNvdXJjZXMvUGVybWFuZW50L1N0YXRpYy9kOTIyMDI4MWE0ZDU0YzMxYWQ3ODU5MTY4YzBmNTJmMS8wZDQyZTM4ZGJiMDY0MjQwODQwMGVkYTIxMzg4MzgyMC5wZGY1&fn=Info0564_web_150109091841.pdf.

The programme aims to help early-stage ventures to successfully raise funds in the period between the beginning of operations and the revenue-generation stage (sometimes referred to as “valley of death”), fostering survival and growth of young firms. It aims to do so by helping entrepreneurs raise funding and identifying other relevant resources to successfully develop their business.

Through its activities, the programme also aims to increase connections within the entrepreneurial ecosystem as well as provide learning and networking opportunities to students through its internship programme.

Most new ventures require investments before they are able to break even. Entrepreneurs, and especially first-time entrepreneurs, often have insufficient knowledge of the process of raising funding and are not equipped to successfully present their ventures to investors at this stage. They may also lack access to appropriate networks to find investors or otherwise fully develop their venture (e.g. finding partners, suppliers). This may lead to potentially successful ideas failing due to inability to attract and manage resources. The programme aims to bridge this gap by helping entrepreneurs connect with business angels, who tend to offer support beyond a financial contribution (Honjo and Nakamura, 2019; Edelman, Manolova and Brush, 2017).

Moreover, successful business creation requires a range of competencies spanning several areas. By connecting entrepreneurs with a diverse team of mentors, the programme aims to help them prepare for fundraising but also develop networks.

Finally, the increased interest in super-high-growth start-ups, sometimes referred to as unicorns may make it harder for new firms with a potential for moderate growth and job creation to attract investors. The programme aims to help these firms connect with business angels.

Cooperative Venturing is a programme operated by Venture Capital.Org (VCO), a regional non-profit venture accelerator created in 1983. The programme uses a diverse team of expert mentors (alumni, entrepreneurs, attorneys, Chief Financial Officers, investors, marketing professionals, etc.) to coach entrepreneurs and support them in raising capital. The programme also hosts various events for bankers and business angels to meet potential investees. The programme also aims to support diversity in entrepreneurs and engages with low-income students. VCO has helped its alumni raise over USD 14 billion (approx. EUR 12 billion), including USD 8 billion (approx. EUR 7 billion) in equity, since 1986. Each year, 60-80% of participants raise capital within a year.

The main component of VCO’s approach is “collaborative mentoring”. The mentoring programme includes four main steps: (i) selection of companies with strong growth potential, (ii) mentoring by qualified volunteers, (iii) live and virtual forums for companies to pitch to potential investors, and (iv) follow-up services to help companies find resources and capital.

Four times a year, VCO hosts a Deal Forum where entrepreneurs present to a diverse an expert panel consisting of relevant funders, often experts on the entrepreneurs’ target industries. The events are usually attended by mentors, entrepreneurs, and other stakeholders of the entrepreneurial ecosystem (e.g. service providers). The entrepreneurs receive feedback and can connect with investors and the broader community for expertise, potential investments or strategic partnerships.

When a venture is accepted into the Cooperative Venturing programme, it is invited to the next local Deal Forum where four ventures pitch to a panel of experts. A team of four to eight mentors helps each participant to prepare for this event and subsequently continue their search for investment. The mentors are drawn from VCO’s network and are chosen to represent a variety of skillsets and experiences. For example, a given team may include an industry expert, experts in areas of particular need (e.g. Intellectual Property attorney), angel investors and an expert at pitching. Each team meets virtually for an hour or more five or six times, typically at a frequency of twice a week. While the focus is on preparing for the pitch, the discussions touch on various aspects of the business, often leading entrepreneurs to make adjustments to their business models. The mentors may introduce the entrepreneurs to their own networks. Each mentor team also includes one or more interns, called “investor liaisons”. Liaisons are usually college students, often from a disadvantaged background. Liaisons support the coaching team and contribute fully to the coaching process, giving feedback to entrepreneurs.

The Deal Forum participants are eligible for participation in VCO’s large annual events, the Investor Choice Conference (ICC) – where 30-40 ventures present to an audience of investors and experts, and the Women Entrepreneurs Realizing Opportunities for Capital (WeROC) event that showcases female entrepreneurs and invite female-focused investors and lenders. Overall, over 60% of Deal Forum alumni find funding, and over 70% of ICC Alumni do.

VCO is well integrated in the entrepreneurial ecosystems in Utah and in Idaho and has linkages across the country. VCO has formal connections to other organisations. For instance, it manages the state of Utah’s Economic Development Revolving Loan Fund, connecting entrepreneurs and SMEs to capital. It also has memorandums of understanding (MOUs) and contracts with critical partners. For example, VCO formed a formal partnership with the Boise State University College of Business and Economics to create the “COBE Finance Accelerator, powered by Venture Capital.Org” (COBE FA). COBE FA will permit the development of VCO offerings and an expansion of the investor liaisons programme to more students from underrepresented populations. Another important ally is Zions Bancorporation, a regional bank (VCO, 2019). VCO also sponsors and co-sponsors entrepreneurship events in the community (e.g. Startup Week).

More generally, VCO does not invest into ventures and it does not take commissions on investments made and endeavours to maintain active links to all local and regional entities and adopt a neutral position in the ecosystem. For example, VCO’s partners in Idaho include local co-working spaces, the Idaho Department of Commerce, a variety of business organisations and local angel investor groups (e.g. Keiretsu Forum). It has also established ties with other entrepreneurial support organisations including the new Idaho Women’s Business Centre, the Idaho Hispanic Chamber of Commerce, a support group for veteran entrepreneurs, the state’s Rural Development Partnership, and the state’s largest women business owner organisation.

VCO monitors inputs, processes, and outcomes of the programme for entrepreneurs and their ventures, as well as other stakeholders (e.g. mentors and student liaisons). VCO also tracks results by demographic groups (e.g. gender). Metrics include the following key performance indicators (KPIs):

To gather data about client companies’ investment activity, VCO uses surveys of its former mentees and reports from other sources (such as Crunchbase, which provides information on private and public companies, including about founders and investments, and Pitchbook, which produces data on capital markets and business transactions). VCO also uses qualitative data as well as stories on supported entrepreneurs, in order to capture various dimensions of their impact (e.g. diversity). VCO monitors the number of hours of formal support provided by mentors, as well as their satisfaction. Qualitative aspects are also evaluated. For example, VCO tracks further connections made between mentors, co-mentors and mentees. VCO is considering further evaluation, notably a randomised control trial evaluation and an evaluation of the impact of participation on entrepreneurs’ mind-sets (VCO, 2019).

The programme has demonstrated high rates of funding success: in 2017, 62% of participants in the ICC raised external capital for a total of USD 40 million (approx. EUR 34 million), and the total amount of funding raised by VCO participants since 1986 is evaluated at over USD 20 billion (approx. EUR 17 million), half of which in equity (Table 5.4). The survival rate of VCO participants is also very high: more than 80% of supported firms created before 2008 were still in activity in 2018.

VCO supported ventures also created jobs: an estimated 1 150 jobs were created in 2017 by ICC participants alone and over 45 000 jobs were created by supported ventures since 1986. There are currently 853 alumni ventures in activity. The programme has also proven successful in supporting a diverse range of entrepreneurs (with important shares of participants being women or minorities).

During the first two decades of its activities, an important challenge for VCO was a lack of awareness of venture investing among entrepreneurs, but also among investors. As a response, VCO started engaging in educating the entrepreneurial community about angel investing and played an active role in the now dormant National Association for Seed & Venture Funding (NASVF) that pushed the growth of angel investor groups and educated prospective investors. An ongoing challenge is the investment community’s preference for funding “unicorns” rather than firms with more modest but robust growth potential.

A second ongoing challenge for the programme is the selection and maintenance of a pool of mentors. VCO finds that the cooperative mentoring methodology helps the programme weed out sub-par mentors, thanks to team dynamics. VCO mitigates the fluctuations in the pool of mentors by maintaining a group of regular mentors with longer engagement, as well as through monitoring mentor satisfaction and striving to make the mentorship experience beneficial for mentors. The team mentorship methodology offers networking opportunities for mentors while sharing the responsibility. Finally, a challenge for the programme is to differentiate itself from other actors in the ecosystems.

The Cooperative Venturing model has demonstrated positive results over time. Because it leverages existing ecosystem actors, it is suitable for transposition in other contexts. Success factors identified include:

  • A focus on the creation of networks (building the personal networks of entrepreneurs, linkages between mentors and networks within the ecosystem). Identifying actors that are committed to community building would be essential in transposing the methodology.

  • The cooperative mentoring methodology, which leverages the experience of multiple experts while sharing responsibility between them, lightening the burden of participation. Mentoring teams have been successfully used in other programmes (e.g. the Combinator and Techstars accelerators).

  • The involvement of students in mentoring teams and programme management has also been identified as a factor for success. Other outcomes associated with the internship programme have been attachment to the community, good labour market outcomes for graduates and higher rates of self-employment.

  • The programme’s pre-screening process, which allows VCO to identify projects with growth ambitions and potential and to adapt support to the type of venture.

  • VCO’s neutral role in the ecosystem is believed to facilitate linkages. While building trust with the local ecosystem requires an investment, connections with other networks can be leveraged to build capacity. It is also important to ensure adhesion by other business support actors in the ecosystem to foster co-operation and avoid detrimental competition.

  • Monitoring and measurement has played an important role in refining VCO’s methodology and in reinforcing its position in the ecosystem. The use of measurement is also important in developing linkages with investors to support productive entrepreneurs in a context where unicorns may attract more interest.

  • The cooperative mentoring methodology also allows for tailored support. While most participant entrepreneurs identify funding as their principal motivation for enrolling in the programme, the cooperative mentoring approach helps entrepreneurs analyse their business model and better understand the importance of building networks in securing funding and finding partnerships. The focus on angel investors willing to share expertise also reinforces this capacity-building dimension of the programme.


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The overall aim of LINC Scotland is to improve the economy of Scotland by ensuring that ambitious, high-growth start-ups and small firms have access to an adequate supply of business angel capital to help them achieve their potential. LINC Scotland’s purpose is to support and improve the functioning of local business angel markets across Scotland, and to act as a national association and representative body for its members.

To reach this goal, LINC has set the following strategic objectives:

  • Growing the population of active business angel investors in the Scottish marketplace;

  • Harnessing the supply of capital available from investors who lack traditional business angel characteristics, but are interested in investing in start-ups, notably by taking advantage of the Enterprise Investment Scheme (EIS), a UK support programme offering tax relief to investors in higher-risk companies;

  • Growing the population of start-ups and scale-ups willing and equipped to benefit from angel investment;

  • Influencing UK and EU governments to maintain a favourable tax and regulatory environment for business angel investment;

  • Influencing the Scottish Government and Scottish Enterprise to operate and deliver supportive policies and interventions that are complementary to the development of business angel market in Scotland and support it;

  • Gathering information on of the operation, trends and needs of the business angel marketplace and developing innovative measures to facilitate its operation.

LINC Scotland addresses a problem of information asymmetry where entrepreneurs with high-potential businesses find it hard to find equity capital, and high-net-worth investors find it hard to find suitable investments. This problem can be addressed through education and training of both parties, the promotion of angel investment and representation of the interests of investors.

The rationale for the creation of LINC Scotland was threefold: (i) a network could increase the size of funding available beyond what angels would invest on an individual basis by enabling them to pool their investments into larger investments; (ii) bringing together angels with successful entrepreneurial careers with high net worth individuals without the expertise or networks to invest (so-called “smart” and “dumb” money) could offset the low number of angels in Scotland; (iii) a network could create angel groups to be partners with the co-investment fund.

LINC Scotland8 is the national association for business angels in Scotland. Its membership includes around 200 investors operating individually and 21 structured angel groups or syndicates, representing another 1 300 other investors. LINC is a private non-profit organisation and does not act as investment advisor but rather acts as a “soft infrastructure” supporting the development of the business angel sector.

LINC acts as a central clearing house bringing together high-potential SMEs with business angels who will share their experience, knowledge and contacts in addition to funding. LINC also operates a range of other programmes including awareness-raising and education, identifying and supporting new business angels, encouraging the creation of new groups and international networking. It also publishes Young Company Finance, a monthly magazine and website that shares information on early stage funding deals in Scotland.

LINC is a delivery partner for the Scottish Government’s ERDF-funded SME Holding Fund Strategic Initiative, which aims to provide access to financing for SMEs looking to enhance competitiveness and grow in regional, national and international markets, enable SMEs to access research and development and provide finance to innovative start-ups other lenders would consider too high-risk.

LINC is a founder-member of Business Angels Europe and represents its members in engagements with the Scottish and UK governments and the European Commission.

LINC is well embedded in the Scottish entrepreneurial ecosystem and endeavours to connect with other representative bodies in the entrepreneurial ecosystem to promote an entrepreneurial culture.

Several impact studies have been conducted on LINC and on LINC members (discussed in the next session).

As an ERDF-funded programme, the Scottish Angel Capital Programme managed by LINC is regularly independently assessed against targets.

Table 5.5 shows progress to targets set for the ERDF-funded Scottish Angel Capital Programme for the first 2.5 years of the 3.5 year programme (the latest available). The Programme had exceeded most of its targets pro-rata, and in one target, employment, it had achieved more than double the target.

Monitoring results show an increase of the volume of deals facilitated by LINC over the year. In 2018, LINC members invested around GBP 50 million (approx. EUR 55 million) of private capital, representing around 80 deals in high-growth Scottish companies. This compares to an approximate GBP 40 million (approx. EUR 44 million) invested in 87 deals in 2017, and GBP 250 million (approx. EUR 270 million) committed in the previous ten years from 2008. In 1996-97, total deal value was GBP 2.6 million (approx. EUR 2.8 million).

A recent evaluation of the Scottish Co-investment Fund (SCF) (Malcom Watson Consulting, 2017) finds that LINC played strong role in helping the Scottish Investment Bank (SIB) to further develop the equity market for growth ventures through the SCF.

The final evaluation of the July 2015 to December 2018 Scottish Angel Capital Programme concluded that over the course of the Programme, LINC members had invested a total of GBP 84.9 million (approx. EUR 92.7 million) in 144 businesses at an average level of GBP 2.0 million (EUR 2.2. million) per month; attracted matching investment of GBP 98.5 million (approx. EUR 107.5) in these businesses from other investors at an average level of GBP 2.4 million (approx. EUR 2.6) per month; and contributed to the forecast creation of 313 jobs and been the first external investor in 80 new enterprises (Malcolm Watson Consulting, 2019).

A survey of LINC members in 2019 found that almost one third (31%) stated that their syndicates would have not grown without LINC Scotland support. Over half (54%) considered that their syndicate had grown more quickly than would have been the case without LINC Scotland Support and only 15% considered that LINC Scotland support had not affected their growth. The survey report also noted that members valued not just the financial support provided by the Programme for the development and growth of angel syndicates, but the information, knowledge and peer learning provided by LINC, enabling syndicates to learn from each other, and the role played by LINC as a lobbying platform, helping to educate policymakers and the media on the role of angel investing in the economy.

The most significant challenges in the early years of LINC Scotland were education of entrepreneurs and their advisors of the benefits and process of angel investing. LINC members reported that entrepreneurs were not “investor ready” and that existing support schemes did not offer appropriate support on this issue. In response to this challenge, LINC developed a pilot “Trial Marriage” scheme in 1998/99, where investors could get up to GBP 7 500 of grant funding if they contributed at least 25% of eligible costs to address these business development issues. For example, an investor might undertake extensive market due diligence that involved travel and time spent with potential customers or suppliers. Of the six companies aided, five subsequently were invested in. the programme was supported with ERDF funding.

Building on this pilot, LINC launched the ERDF-funded Investor Ready Fund, in which companies that were near being investible by a LINC member could apply for up to GBP 15 000 (approx. EUR 16 400) of convertible grant funding to address business development issues identified as preventing investment by the investor (or LINC Scotland). Issues were typically a combination of market analysis and access issues, financial structuring and forecasting issues, technology validation issues, patent and intellectual property issues, and legal due diligence (EKOS, 2013). An important part of the scheme was ensuring that companies had the right solution provider to address these issues. Between 2000 and 2010, 62 grants were awarded under the Investor Ready Fund, of which 25 were converted into equity, 18 were repaid, and 19 were written off (EKOS, 2013). The Trial Marriage scheme was reviewed by Mason and Harrison (2001; 2004) and the Investor Ready Fund was reviewed by EKOS (2013).

A second challenge occurred in downturns after the dot com crash in the early 2000s and after the global economic recession in 2008. As venture capital companies and banks significantly reduced their investing activity in early stage companies, angel groups were left with portfolio companies that needed follow-on growth funding. As a result, the proportion of new deals declined after each downturn, only beginning to recover several years later. For example, in 2002 members of the Archangels syndicate invested only GBP 1.5 million (approx. EUR 1.6) in new companies but GBP 4.3 million (approx. EUR 4.7) in its existing portfolio (Business Insider, 2 January 2018). Mirroring this, in 2011, only 13 “new to portfolio” companies were invested in by LINC members, compared with 65 follow-on investments. Unfortunately, research suggests strongly that returns from follow-on investments are worse than from initial investments (Wiltbank and Brooks, 2017). Despite these issues, the number of investments by LINC members rose from 2003 to 2015, though around 75% of deals were follow-on deals.

In the last two decades, the greatest challenge has been in securing exits for angels from their investments, with a recent survey of members finding that training and information on securing an exit was the most popular potentially new service that LINC could facilitate (Boag, Harris and Harrison, 2009; Malcolm Consulting, 2019).

LINC Scotland has successfully grown an active angel market in its region and has remained in operation through changes in government policies and economic shocks. Possible environmental supporting factors for LINC Scotland’s success include the dynamism of the local ecosystem and supportive attitude of the Scottish state, the development of favourable regulatory regimes for angel investing in the UK, and innovative funding instruments such as the Scottish Co-investment Fund that facilitate risk-sharing and portfolio growth. Key lessons from evaluations of LINC Scotland include:

  • Choose an appropriate institutional form to allow for efficient use of resource. A key success factor in the beginning was the Enterprise Trust status of LINC Scotland. This offered tax breaks to its corporate sponsors, access to European Union Structural Funds support, and an important exemption under the UK Financial Services regulations that enabled it to introduce investors to investees.

  • Include education and awareness raising. Early work by LINC focused on education of the market on the merits and processes of business angel investment, targeting entrepreneurs, but also government officials and the media.

  • Foster partnership between angel groups and syndicates. LINC managed relations between angel syndicates to ensure cross-learning and contribute to the development of new groups. There were 21 angel groups in Scotland in 2019, up from around 5 in 2003. The partnership approach between syndicates also helped the leaders of Scottish angel groups inform UK government initiatives to promote angel investing. By becoming a visible organised representative group through their Angel Leaders’ Forum (ALF) organised by LINC, they became a natural counterpart for government officials to consult with.

  • Foster engagement with international initiatives. LINC Scotland has been an early entrant or founder of several international representative bodies for business angels (e.g. the European Business Angel Network, the World Business Angels Association) and has close links with others. These linkages support the development of the local angel market and raise the legitimacy of the organisation, facilitating interactions with the government.


Grahame, D. (2013), “In the Beginning” in LINC Scotland Annual Report 2013.

Kemp, K., G. Lironi and P. Shakeshaft (2017), The Archangels’ Share: The Story of the World's First Syndicate of Business Angels, Edinburgh: Saraband.

LINC Scotland (2019), Briefing Note updated 2019, www.linc-scotland.org.

Malcolm Watson Consulting (2017), “Evaluation of the Scottish Co-Investment Fund (April 2009 – December 2013): Final report to Scottish Enterprise”, Weybridge, Surrey: Malcolm Watson Consulting.

Malcolm Watson Consulting (2019), “LINC Scotland Angel Capital Programme Interim Evaluation July 2015 to December 2018: Final report to LINC Scotland”, Malcolm Watson Consulting.

Mason, C.M., T. Botelho and R. Harrison (2016), “The transformation of the business angel market: Empirical evidence and research implications”, Venture Capital, Vol. 18, No. 4, pp. 321-344.

Mason, C.M. and R. T. Harrison (2001), “Addressing Demand Side Constraints in the Informal Venture Capital Market: the example of LINC Scotland’s ‘trial marriage’ scheme”, Mimeo.

Mason, C. M. and R. T. Harrison (2004), “Improving access to early stage venture capital in regional economies: a new approach to investment readiness”, Local Economy, Vol. 19, pp. 159-173.

May, J. (2013), “Foreword” in LINC Scotland Annual Report 2013.

Millican, J. and D. Grahame (2013), “Maintaining a Favourable Environment” in LINC Scotland Annual Report 2013.

OECD (2011), “Financing High Growth Firms: The role of Angel Networks”, Paris: OECD.

Wiltbank, R. E. and W. T. Brooks (2017), “Tracking Angel Returns: 2016 Report with 2017 update”, Boca Raton, FL: Angel Resource Institute.

The programme aims to increase the amount of private venture capital available to start-ups by reducing risks and creating incentives to investment for business angels. This is expected to help start-ups find investors more easily.

Many start-ups in Germany have difficulties funding their first stages of development, especially for founders with limited personal assets for collateral. The German market for venture capital is relatively young and less developed than in other countries (e.g. Anglo-Saxon countries) and business angel investment is low compared to the country’s overall economic performance. By providing a financial incentive to investments, the programme aims to compensate the risk linked to market failures in markets for venture capital, notably information asymmetries. Business angels also tend to be more involved in providing non-financial assistance to funded companies than other types of investors. By targeting this class of investors, the programme aims to maximise impact (Gottschalk et al., 2016).

The Investment Grant for Business Angels (INVEST – Zuschuss für Wagniskapital) offers a lump-sum participation in investments in innovative start-ups. The investment grant is not repayable if the start-up fails. The grant amounts to 20% of venture capital investments that remain for more than three years in a start-up.

Since 2017, the programme also includes an Exit Grant (Exitzzuschuss). The Exit Grant amounts to 25% of the profit made when selling the shares. It aims to compensate the taxes to be paid on the capital gains upon exiting.

The grant is capped at 80% of the initial purchase price: the total amount received (Investment Grant and Exit Grant combined) may thus not exceed 100% of the initial investment price. The Office for Economic Affairs and Export Control (BAFA), a federal agency in charge of export control and economic development, with a focus on SMEs, manages the implementation of the INVEST programme.

The programme supports start-ups in search of investors by offering a certification to existing young firms and new start-ups eligible for INVEST funding. The certified start-ups can register to be listed in a dedicated database to make it easier for potential investor to find them. The listing includes basic information on the firm and its business concept as well as contact information. Potential investors can search the database by multiple criteria, including sector, location, firm size and investment requirement.

The programme is organised along three steps. First, entrepreneurs apply for certification online.9 Second, the investor applies for the Investment Grant before the investment agreement is finalised. Third, once the shares have been purchased, the investor requests the payment of the Investment Grant for a value of 20% of the investment.

Finally, investors applying for an Exit Grant can receive their non-taxable reimbursement upon presentation of proof of selling their shares after the three years holding period.

To be eligible for the programme, an investor must be a natural person or invest through a specialised small limited liability company10. The investment grant can be used only to acquire newly issued shares with the investor’s own money or through a convertible loan. Follow-up investments after a first INVEST-supported investment are also eligible. The minimum holding period is three years and the maximum is ten. The Exit Grant is limited to natural person investors investing directly (i.e. not through a GmbH or UG).

To be eligible for INVEST certification, firms must be new or have been operating for less than seven years and have less than 50 employees. Their turnover must be under EUR 10 million and they must be present in Germany and headquartered in the European Economic Area (EEA). They should demonstrate innovativeness11. Finally, the firm must remain active for a year after the investment is made, or should become active no later than one year after the investment is complete for new firms.

The Investment Grant for Business Angels is modelled on the British Enterprise Investment Scheme (EIS) (fiscal measure), which has successfully mobilised private risk capital.

The scheme complements existing instruments such as the fund “High-Tech Gründerfonds for start-up firms” (HTGF) in place since 2005.

An evaluation of the programme was conducted in 2016. It involved an online survey comparing INVEST-supported investors and investors who have never participated in the INVEST programme. Interviews with experts of the German capital market were also conducted. A control group approach was used to estimate differences in investment volumes between participant and non-participant firms.

Quantitative key performance indicators (KPIs) measured included:

The 2016 evaluation of INVEST found that the programme successfully incentivised new investors to get involved in new innovative firms. Investors who previously were not active in supporting innovative entrepreneurs invested an estimated EUR 14.3 million through the programme, representing 30% of all investors who used INVEST. Among these, 21% were altogether first-time investors. The programme also increased investment from experienced investors. The evaluation estimates that 88% of the INVEST supported investment constituted additional capital invested in young innovative firms and that each euro invested through the programme generates another EUR 0.50 of investment.

The evaluation found that the firms that received INVEST-supported investment tended to have founders with higher qualifications and to be more growth- and innovation- oriented than those that were funded outside of the programme. However, the evaluation found that participation in the INVEST programme was initiated by firms looking for investors rather than the opposite, suggesting that these firms did not organically find investors and the programme successfully extended funding opportunities to new firms rather than those that would have been funded anyway.

The companies that received INVEST-supported investment tended to receive higher amounts of funding that those who did not. The advantage was higher for the firms with very low capital requirements: firms that received EUR 2 000 or less received on average 38% more funding if they were funded through INVEST than otherwise.

In terms of implementation, the evaluation found that both investors and companies found the process to be efficient with low red-tape. The administrative cost of the measure was estimated to be low, at 2.54% of the budget.

The evaluation found that awareness of the programme was limited outside of angel networks: 80% of the investors interviewed who did not use INVEST did not know about the programme.

Recommendations included a simplification of the application process, and of the legal examination of company contracts. The evaluation also recommended extending the programme to other legal forms and business purposes for business angels as well as extending the programme to follow-up investments. It also recommended expanding company eligibility to other sectors and increasing outreach.

Following the evaluation, changes were introduced in the programme, including:

  • A doubling of the eligible investment amount to EUR 500 000 per year and an increase of the maximum subsidy an investor can receive from EUR 80 000 to EUR 100 000 per year;

  • The introduction of an Exit Grant;

  • The extension of eligibility to UG companies (previously only GmbHs);

  • The extension of eligibility to follow-up investments;

  • The extension of eligible investments to convertible loans;

  • The broadening of the innovation criteria to include previously excluded sectors.

The evaluation did not assess INVEST’s sustainability, given the short time elapsed since the programme’s start. Similarly, the evaluation states that impact of the INVEST programme on growth and innovation could only be assessed in subsequent exercises, 8 to 10 years after the programme’s inception.

No significant challenges were encountered aside from the limited awareness of the programme among business angels. However, several changes were implemented in the programme in 2017 to improve attractiveness and foster sustainable investment in successful young firms, as described above.

The evaluation found that the INVEST programme successfully reached the type of start-ups (innovative with growth potential but having difficulties securing funding) that it endeavoured to support without conducting any assessment of firms beyond the eligibility criteria. This was identified as a strength for the programme as it suppresses the need to develop extensive business expertise in-house, leaving investors free to select their investments limiting disruption on the finance market.

Based on INVEST’s initial evaluation, the following lessons could inform the development of similar programmes:

  • Programmes should consider setting a minimum holding period for subsidised investments. This was identified as a success factor by the evaluation.

  • An important factor for attracting for first-time investors was the possibility to co-invest with experienced investors, which facilitated firm selection.

  • Programmes should develop a multi-prong outreach strategy. The evaluation of INVEST found that there was little awareness of the programme outside of angel networks, and that outreach would need to use a variety of channels as the target group (non-organised investors) is very diverse. Tax and financial advisors could be used as multipliers to raise awareness of similar schemes.

  • Programmes should endeavour to minimise red tape and simplify the application process. This may include allowing for online applications and ensuring clear communication on eligibility criteria and limiting systematic checks as much as possible.

  • Programmes should focus on young firms, as older firms with more extensive track record and finance history are less affected by the information asymmetry that puts younger firms at a disadvantage when seeking funding.


BMWi (2019), “INVEST - Zuschuss für Wagniskapital” [INVEST - grant for venture capital], www.bmwi.de/Redaktion/DE/Dossier/invest.html (Accessed on 14 May 2019).

BMWi (2016), Richtlinie zur Bezuschussung von Wagniskapital privater Investoren für junge innovative Unternehmen [Directive to subsidize venture capital of private investors for young innovative companies], www.bmwi.de/Redaktion/DE/Downloads/I/invest-richtlinie-bezuschussung-wagniskapital-private-investoren-bundesanzeiger.html.

Gottschalk, S. et al. (2016), Evaluation des Förderprogramms "INVEST - Zuschuss für Wagniskapital" – Projektbericht an das Bundesministerium für Wirtschaft und Energie (Langfassung), [Evaluation of the funding program "INVEST - grant for venture capital" – Project report to the Federal Ministry for Economic Affairs and Energy (long version)], ZEW Centre for European Economic Research, VDI Technology Centre and Creditreform Economic Research, https://www.bmwi.de/Redaktion/DE/Downloads/I/invest-evaluierung-langfassung.html

Gottschalk, S. et al. (2016), Evaluation of the Public Funding Program “INVEST – Grant for Venture Capital” English Short Version of the Project Report for the BMWi, ZEW Centre for European Economic Research, VDI Technology Centre and Creditreform Economic Research, http://ftp.zew.de/pub/zew-docs/gutachten/EvaluationINVEST2016en.pdf

OECD and EC (2019), STIP COMPASS database, https://stip.oecd.org/stip/policy-initiatives/2017%2Fdata%2FpolicyInitiatives%2F3091 (accessed on 14 May 2019).

Start-up Global seeks to help start-ups access global markets early in their development. The programme aims to increase awareness of export opportunities among young firms, spread awareness of available government support for exporters, and help strategic co-operation between start-ups and relevant stakeholders such as investors and international partners.

The project’s initial objectives included: (i) helping more companies to export, (ii) responding to the demand from start-ups for technical assistance on exporting, (iii) measuring the interest and capacity of accelerators and incubators to support internationalisation, (iv) assessing the level of government engagement needed to have a measurable impact on incubator partnership development and start-up growth, and (v) collecting data to inform the national policies to support innovators and entrepreneurs in pursuing global opportunities. However, in practice, activities have focused on increasing awareness of and providing knowledge and information on global opportunities among start-ups. The other objectives have not been translated into quantitative targets and activities.

Start-up Global was started by the International Trade Administration (ITA) at the Department of Commerce in order to better target existing resources for exports to start-ups and young firms and make them more accessible to those firms, as export support had traditionally be focused on larger firms. Resources include advice from the Office of Intellectual Property Rights (IPR), offers of financial institutions, and services of local authorities and innovation centres. The programme was introduced as part of a wider effort to increase American exports.

Start-up Global is a partnership between the ITA and the Global Innovation Forum (GIF), a US-based non-profit which aims to connect start-ups, policymakers and other stakeholders to foster efficient internationalisation. Start-up Global was initiated following a Design Workshop hosted by the White House Business Council in May 2014, gathering around 40 public- and private- sector stakeholders, including representatives from the start-up community. A Start-up Global pilot event was held in April 2015.

Start-up Global organises events to help small and early-stage companies in their internationalisation process. The events are free and open and usually last half a day to a full day. They are organised by the Start-up Global local branches across the country (Austin, Baltimore, Philadelphia, Tempe, Long Island, New York City, Seattle, Pittsburgh, Nashville, and Washington DC) in partnership with local partners (incubators, accelerators and universities). The location of the events is decided by the Department of Commerce and GIF taking into consideration the demands and the interest of local hosts. The events include information sharing sessions and networking opportunities, with the overarching aim to help start-ups participate effectively in global markets.

Internationalisation seminars are usually structured into four to five themes, with contributions delivered either through a panel discussion or through presentations followed by questions from the audience. The information sessions discuss the opportunities and challenges of operating globally, identifying relevant public and private sector resources to help. Topics may include developing an internationalisation strategy, protecting intellectual property, finding customers and distributors, navigating international partnerships, understanding foreign market regulations and accessing support programmes. The presentations are delivered by the ITA and partners which may include representatives from global corporations, overseas organisations, incubators, relevant federal agencies, higher education institutions, investors, chambers of commerce and successful entrepreneurs. Event contributors are often from the region where the event is held and act as advisors.

The seminars also provide networking opportunities. They are designed to help participants exchange among themselves as well as promote linkages and partnerships between early-stage companies and incubators, accelerators, private investors and the government.

Information topics covered by Start-up Global events include: Product Classification (Harmonised System) Codes, Tariffs and Taxes, Controls and Licenses, Guide to Exporting, E-commerce and Digital Marketing, Export Basics, Export Training, and Country Commercial Guides. Start-up Global shares its events’ main findings online.

Local Start-up Global events are promoted via the GIF website, Export Assistance Centres across the country, universities, accelerators, local chambers of commerce, and the local stakeholders and contributors. Interested businesses register for the events via the website of the Global Innovation Forum.

The GIF releases brief annual newsletters on its activities, including Startup Global events. The U.S. Government’s Startup Global webpage links to several guides, such as country commercial guides and the export guide which are part of the existing resources made available by the Government.

Startup Global was part of the National Export Initiative NEXT (NEI/NEXT) Strategy which was initiated in 2014 by the International Trade Administration under President Obama’s administration. The strategy aimed to help American companies target overseas markets. Startup Global is managed by the ITA’s National Export Initiative (NEI) Office and the Trade Promotion Coordinating Committee Secretariat. The programme is operated in partnership with the GIF.

No quantitative KPIs have been set in relations to the programme’s objectives. Monitoring information is not publically available. Event participation numbers are collected, but follow up with participants is only occasional. There has not been an evaluation of the Startup Global programme.

At least ten information and networking events have been organised between April 2015 and October 2018. The number of participants for events typically ranges between 40 and 100. There is no information on the impact of the programme.

A first challenge encountered by the programme was its limited outreach: as information is dispensed solely through participation in the events, it is not readily available to other companies. In response to this, the programme has started publishing key findings of its events online and is developing informational products and recorded webinars. Other plans include increasing awareness raising and local events.

A second challenge encountered related to the selection of resource advisors. The events did not always include international businesses and tended not to include global partners. In response to the latter limitation, Start-up Global expressed intentions to organise international events. A Start-up Global event held in Austin in March 2018 included representatives from Korea, New Zealand, Singapore and the UK.

Potential strengths of the Startup Global programme include the involvement of multiple actors and the use of public-private partnership to leverage expertise that is not held in-house. The use of local partners for the events also has the potential to facilitate outreach to local entrepreneurs. However, in the absence of evaluation evidence, it is difficult to assess the programme’s impact and to definitively identify specific strengths. Based on existing information, lessons that could be inferred from the programme include:

  • Programmes of this kind should put strong emphasis on outreach and awareness raising.

  • As events can only serve a limited number of firms, technology can be leveraged (online resources, webinars) to maximise coverage. Formal linkages to existing resources should be emphasised, with appropriate linkages to support programmes.

  • Similar initiatives should involve SMEs and entrepreneurs in the design of the events. Regular monitoring of the business landscape, maintaining a dialogue with the business community, and formally gathering feedback and other follow up information on participants could help similar programmes to adjust events to start-up needs and increase their effectiveness.

  • Programmes inspired by Startup Global should incorporate monitoring and evaluation in their design in order to track firms needs and satisfaction, effectiveness of outreach methods and the impact of the events.


Colvin, J. (2014), “Enabling Startups to Innovate Globally”, GEreports, General Electrics, www.ge.com/reports/post/93343709098/enabling-startups-to-innovate-globally/

Facebook, OECD, World Bank Group (2018), Future of the Business Survey, 2017, https://dataforgood.fb.com/wp-content/uploads/2017/01/170726-Future-of-Business-Survey-Trade-report-July-2017-6.pdf

Global Innovation Forum (2019), “2018 Year in Review”, GIF Update, January 2019, https://globalinnovationforum.com/wp-content/uploads/2019/02/GIF-January-2019-Newsletter-Web.pdf

Global Innovation Forum (2016), Startup Global New York City, https://globalinnovationforum.com/takeaways/startup-global-new-york/

Global Innovation Forum (2015), “Global Innovation Forum Welcomes the Launch of New Startup Global Initiative”, Global Innovation Forum, https://globalinnovationforum.com/startup-global-launch-dc/

Global Innovation Forum (2015), “U.S. Department of Commerce and the Global Innovation Forum Announce Partnership to Help Startups Tap Global Markets”, Global Innovation Forum, https://globalinnovationforum.com/startup-global-partnership/ (accessed on 20 May 2019).

Global Innovation Forum (2015), “U.S. Department of Commerce and the Global Innovation Forum Announce Partnership to Help Startups Tap Global Markets”, Global Innovation Forum, https://globalinnovationforum.com/startup-global-partnership/

International Trade Administration (2014), “Startup Global”, https://2016.export.gov/startupglobal/index.asp.

International Trade Administration (n.d.), “The World is Open for Your Business.”, http://2016.export.gov/pennsylvania/pittsburgh/ourservices/index.asp

Oberholzner, T. (2018), “Startup Global–Internationalisation policy measure, United States”, Eurofound, https://euagenda.eu/upload/publications/untitled-191875-ea.pdf .

The Canada Accelerator and Incubator Program (CAIP) aimed to establish a critical mass of high quality business accelerators and incubators across the country. The programme supported leading accelerators and incubators in expanding their activities such as mentoring and business development services for high-potential Canadian start-ups and small- and medium-sized enterprises (SMEs), including young entrepreneurs. The goal was to develop innovative scale-up companies.

Canada continues to foster the development of a new generation of globally competitive companies. Dynamic, growth-oriented firms contribute to successful innovation systems and to stimulating employment creation and sustainable economic growth. The Government’s Innovation Agenda – including CAIP – seeks to ensure that Canadian firms are able to become global leaders. Business accelerators and incubators play an important role in the development of innovative businesses by providing them with hands-on advice from experienced entrepreneurs and other resources.

CAIP is an initiative under the Government of Canada's Venture Capital Action Plan, which provides CAD 100 million (EUR 68 million) to Canadian business incubators and accelerators to expand their support services to start-ups and SMEs. The funding is provided over five years – fiscal years 2014/15 to 2018/19. The programme provides non-repayable funding to business incubators and accelerators that can develop innovative, high-growth firms, which themselves represent high-potential early-stage investment opportunities.

The programme was designed and developed by the Ministry of Finance, with support from numerous federal ministries and agencies that have a role in supporting innovation and the businesses. The National Research Council of Canada Industrial Research Assistance Program (NRC-IRAP) was selected to deliver the programme due to its experience in supporting organisations that support innovation and its existing relationships with some business incubators and accelerators.

Funding recipients were selected through a one-time request for proposals. The process was launched on 23 September 2013, with a submission deadline of 30 October 2013. Approximately 100 proposals were received. Proposals were first assessed by NRC-IRAP to ensure that eligibility criteria were met. Eligible proposals were then evaluated by an independent panel of five experts with experience in venture capital asset management and business development. 16 recipients were announced in June 2014.

The terms, conditions and obligations for the receipt of contribution payments were outlined in contribution agreements between NRC-IRAP and the CAIP recipients. Obligations included reporting key performance data annually. All CAIP recipients were required to demonstrate matching contributions on at least a 1:1 basis during the period for which funding was received.

The programme’s non-repayable contributions were designed to support incremental activities, such as increasing the availability and quality of services offered. Eligible costs were negotiated in each contribution agreement, and covered: salary costs; overhead costs; professional fees/rates; contractor fees; travel and living expenses; operating and maintenance expenses. Capital expenditures such as the purchase of land, leasehold interest in land or the payment of property taxes were not eligible.

CAIP is one of four key measures of the Venture Capital Action Plan (VCAP) that was announced in the Federal Budget 2013. Other measures included (i) an investment of CAD 100 million (EUR 68 million) through the Business Development Bank of Canada to invest in firms graduating from business accelerators; (ii) a new Entrepreneurship Awards programme; and (iii) an investment of CAD 18 million (EUR 12 million) over two years in the Canadian Youth Business Foundation, which helps young entrepreneurs in growing their firms. Other actions under the VCAP included the establishment of four large private sector-led funds and additional resources for developing the venture capital system.

However, evaluations of CAIP noted that the links between the programme and the VCAP were not clear. Interviewed staff did not indicate that the VCAP shaped the implementation of the CAIP. The contribution agreements did not reference the VCAP and funding recipients did not identify any linkages with other VCAP measures.

The Government required two evaluations of CAIP – a mid-term evaluation in 2016 that focussed on the relevance and implementation of the programme and a second evaluation in 2018 that examined the extent to which objectives were achieved, delivery efficiency, and the potential for extending the programme.

The first evaluation responded to questions that were established by the Office of Audit and Evaluation of the NRC and CAIP management. The methodology included:

  • A review of available programme data;

  • A review of programme documentation;

  • A review of literature about the performance of incubators and accelerators;

  • A review of programme management processes, including 6 interviews in other departments and agencies;

  • 46 interviews with programme managers and staff, funding recipients and other stakeholders.

The second evaluation also used information from multiple information sources:

  • Document and data review, including a detailed analyses of incubator and accelerator performance data;

  • Online survey of 549 firms supported by CAIP-assisted incubators and accelerators;

  • In-depth interviews with a sample of 46 supported firms;

  • In-depth interviews with 15 CAIP-assisted incubators and accelerators;

  • In-depth interviews with 5 CAIP delivery staff and 5 external stakeholders;

  • Cost-benefit analysis.

The second evaluation sought to assess the impact of the programme against key expected outcomes:

  • Accelerators and incubators expand their range of programmes and services

  • Early stage firms become investment ready

  • Early stage firms benefit from innovation support resources such as expertise and networks

  • Wealth creation in Canada

Both evaluations identified a number of limitations, mostly related to the validity and quality of the data available for the evaluation:

  • Data about performance has been self-reported by incubators and accelerators – data was incomplete and required extensive cleaning.

  • Data required for the cost-benefit analysis were largely collected from incubators and accelerators, potentially limiting the accuracy and completeness of the data.

  • Some incubators and accelerators were reluctant to collect all data because it was perceived as burdensome for client firms.

The most recent evaluation identified five key findings:

  • CAIP is aligned with evolving government priorities related to support for innovative start-ups and scale-ups, including the priority of strengthening Canada’s network of accelerators and incubators.

  • Available data suggests that CAIP-funded incubators and accelerators have increased their numbers of client firms, and in many cases they evolved from small, early-stage firms to more mature firms.

  • CAIP-funded incubators and accelerators have delivered new or expanded services, which was valued by client-firms, which would not have been possible without the programme.

  • Available data suggests that CAIP funding and the resulting assistance provided to incubators’ and accelerators’ client-firms have contributed to wealth creation in Canada, notably through revenue and equity growth in client firms.

  • The delivery of CAIP was challenging, notably delivery costs that were more than double the planned costs and insufficient time to understand and adjust programme delivery, and resulted in some valuable lessons learned.

Two main implementation challenges were identified. First, the delivery of CAIP was more challenging than expected due to its complexity, which may be the result of insufficient time allocated for planning. NRC-IRAP was selected as the delivery mechanism for CAIP given their experience with contribution agreements. However, the NRC-IRAP infrastructure needed substantial adaptation to meet the new parameters required by CAIP. For example, negotiating the contributions for CAIP was much more time consuming relative to other agreements negotiated by NRC-IRAP. The development of new processes and guidelines took longer than anticipated, suggesting that CAIP was under-funded during the early implementation phase.

A second challenge was the complexity of reimbursing eligible expenses incurred by business incubators and accelerators. Evaluations indicated that the incubators and accelerators found the process complex and burdensome. Programme managers recognised the need for strong oversight but also found that reviewing claims was complex and time consuming, especially when most contribution agreements involved several parties.

CAIP was a complex programme to deliver, but evaluations identified several positive outcomes, including enabling incubators and accelerators to grow and deliver higher quality support; enabling incubators and accelerators to reach a much larger client base; stimulating client firm growth (e.g. revenue growth, investment increase); and positive spill-over effects for the economy.

Key lessons learned for the design and implementation of similar programmes were:

  • Sufficient time for detailed planning and development of administrative requirements and processes should be allocated prior to the launch of new programmes similar to CAIP.

  • Sufficient resources should be allocated for programme delivery of new programmes similar to CAIP once the level of effort required is understood.

  • Reporting requirements should be clearly specified (in accordance with a well-defined performance framework) and understood prior to signing a contribution agreement. In the years following the introduction of CAIP, a performance measurement framework for accelerators and incubators was developed and piloted to be used as a basis for reporting within the funding agreements that the Government of Canada has with business accelerators and incubators.

  • For programmes such as CAIP, where beneficiaries engage through an intermediary, programmes should consider working with other innovation and capacity support programmes to develop a concerted approach to collecting performance data. This would ensure information is available to assess the value of government investments.


Circum Network Inc. (2016), “Evaluation of the Canada Accelerator and Incubator Program (CAIP), Evaluation Report”, prepared for the National Research Council of Canada, https://ssl.circum.com/textes/caip_evaluation_2016.pdf.

Innovation, Science and Economic Development Canada (2017), “Improving Performance and Data Collection of Business Accelerators and Incubators”, Discussion paper, https://www.ic.gc.ca/eic/site/061.nsf/eng/03046.html.

KPMG (2018), “Evaluation of the Canada Accelerator and Incubator Program (CAIP), Final Report”, prepared for the National Research Council, https://nrc.canada.ca/sites/default/files/2019-04/caip_final_report_6.12.18.pdf.

National Research Council (2018), “Evaluation of the Canada Accelerator and Incubator Program: Evaluation summary report, December 6, 2018”, Office of Audit and Evaluation, https://nrc.canada.ca/sites/default/files/2019-04/caip_evaluation_summary.pdf.

OECD (2018), “Canada Accelerator and Incubator Program”, OECD STIP COMPASS, International Database on STI Policies, https://stip.oecd.org/stip/policy-initiatives/2017%2Fdata%2FpolicyInitiatives%2F3797.

Robbins, M. and J. Crelinsten (2018), “Accelerating Growth: Canadian Funding Policy for Innovation Intermediaries”, Munk School of Global Affairs, University of Toronto, available at: https://munkschool.utoronto.ca/ipl/files/2018/08/Accelerating-Growth_-Canadian-Funding-Policy-for-Innovation-Intermediaries-AU2018.pdf.


← 1. www.sfc.ac.uk

← 2. www.creativescotland.com

← 3. www.convergechallenge.com/category/partners/

← 4. The District Policy is a measure of the Norwegian Regional Policy targeted at sparsely populated and remote areas. Districts include mostly rural areas as well as urban centres in the north.

← 5. In 2013, Innovationsbron and Almi Invest merged into one organisation, Almi Invest

← 6. Almi Invest is an independent public venture capital company (Almi Invest, n.d.)

← 7. The Sixth AP-Fund sold their fund (Mittkapital) to the state-owned company Inlandsinnovation in 2013

← 8. LINC stands for Local Investment Networking Company

← 9. If the project is for an enterprise creation, the investor applies first and the company applies for certification once it is funded and registers as a company

← 10. The company must be a limited liability company (Gesellschaft mit beschränkter Haftung GmbH) or an entrepreneurial company with limited liability (Unternehmergesellschaft (haftungsbeschränkt), UG) with six or less shareholders and its purpose must include shareholding, asset management or consulting

← 11. By being active in an innovative industry (based on the commercial register’s classification), by having used public funding for research or innovation in the recent past or by getting assessed by an independent expert.

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