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Venture Acceleration Networks

A Review of Existing Models

 

This report presents the findings of a World Bank-Russian Venture Company global study of 15 programs seeking to accelerate innovative entrepreneurship by managing, nurturing and leveraging social and business networks. The report discusses program roles and impacts, operational models, network-building, venture selection, financing, organizational structure, and adaptation to different innovation ecosystems. It extracts good practices and discusses the role of state support.

Venture acceleration networks consist of experienced, skilled and well-connected individuals who provide hands-on support to entrepreneurs. They help propel viable business ideas to the market place by accelerating the regeneration of ideas and connecting entrepreneurs to the market. They achieve this by:

  • Educating entrepreneurs through on-the-job training on a broad range of practical skills related to the business growth.
  • Connecting entrepreneurs to markets, capital, customers, partners, experts, information and role models through introductions, brokering and by creating bonds of trust and credibility.
  • Validating business ideas through strategic advice and direction, and by creating a supportive environment for business development experiments.

The impact of venture acceleration network programs extends beyond the entrepreneurs they serve directly to the wider community of entrepreneurs, investors, and business service providers. They provide investment-ready or screened opportunities for potential investors. They reduce public and private resources invested in nonviable business ideas by accelerating their path to failure through market validation. They help match management and technical talent from the labor force with the appropriate businesses. They match service providers with potential new clients. And finally, they help create a culture of entrepreneurship.

 

Venture acceleration networks experiment with a wide range of approaches to financing, management, network creation, selectivity, service delivery and structure. Three main approaches emerge from this variety, although most of the programs do not fall neatly into any single category. A first approach aims to commercialize technology projects for short-term payoffs (e.g. creating spin-offs). A second approach aims to build a local self-sustainable innovation ecosystem with broad medium to long-term payoffs (e.g. creating linkages in the entrepreneurship community).  A third approach aims to foster a market for innovation-related services by building capacity, transparency and efficiency in the service provider market, and raising awareness among SMEs.

 

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