Table 4.2. Performance evaluation: definition of key evaluation issues

Criteria

Inputs and Processes

Outcomes

Incubator mission and strategy and

Extent to which incubator tenant

Relevance

relevance to enterprise and regional

characteristics match

definition

of

development priorities.

target

market and

admission

criteria.

Financial

inputs,

operating

Cost effectiveness of outputs (e.g.

Efficiency

procedures

and

unit

cost

of

cost per

successful

business start-

providing

incubator facilities

and

up, cost per gross/net job created).

services to client companies.

Extent to which incubator achieves

Extent to which incubator achieves

Effectiveness

key operational

targets

set out in

targets with regard to enterprise and

business plan (e.g. survival and

wider regional development impacts

graduation rates).

(e.g. job and wealth creation).

Utility

Occupancy rates and take up of

Extent to which incubator services

incubator support services.

meet client needs and contribute to

performance.

Financial sustainability of incubator

Graduation rates,

retention

of

(e.g. extent to which operating costs

graduates in local area, and extent

Sustainability

are covered by income), level of

to which incubator promotes new

demand for incubator space and

start-ups in sectors of local

services,

incubator

charges

economy with long-term job and

compared with market rates.

wealth creation potential.

Enhancing the Innovative Performance of Firms

91

Criteria

Inputs and Processes

Outcomes

Start-up time – length of time

Cost of incubator units – total

required to establish incubator

investment/sq meter of space

Incubator investment cost – total

Cost

per

start-up

–

total

investment/ sq m of incubator space

investment/number of start-ups

Efficiency

Incubator operating cost – operating

Cost

per

graduate

–

total

costs/number of personnel

investment/number of graduates

Financial leverage – ratio of public

Cost per (gross/net) job – total

to private sector funding

investment/ jobs in tenant and recent

Income generation – proportion of

graduate firms

income from client charges

Occupancy rate – percentage of

Incubator turnover – number of firms

incubator space let to companies

entering/leaving incubator,

average

Incubator service utilisation rate –

time in incubator

Effectiveness

percentage

of

companies

using

Client satisfaction

–

percentage

of

incubator support services

firms

indicating

that

incubator

Response rate to client surveys –

services

meet

their

needs,

percentage of tenants responding to

contribution of incubator to firms’

client satisfaction surveys

development (additionality)

Start-up rate – number/percentage

Wealth creation – Average turnover

of admissions leading to start-ups

of tenant firms and average annual

Start-up time – length of time

growth rates, value added of business

Utility

required to start up new businesses

activities

Survival rate –

number/percentage

Job creation – number (and type) of

of start-ups still trading after three

jobs per tenant firm and annual

years

growth rates, proportion of jobs filled

by local people, job quality

Financial

breakeven

– income

Graduation rate – percentage of

minus operating costs

tenants leaving incubator each year

Sustainability

Market

rates

–

level

of

Growth sectors – proportion of

discount/premium for

incubator

graduates in growth sectors

space/services compared with local

Retention rate – percentage of

market rates

graduate companies

remaining

in

local area

Topic

Question

Issues to address

Describe the

Is this a public mission or a financial objective or both?

Has the incubator a focus by industry, technology, region or

Mission

mission and focus

customer?

of your incubator

Why have you / have you not chosen a particular focus?

and its objectives

How are you different from other incubators?

Size and

Number of full-time employees

What is the size of

Number of tenant start-ups

scope

your incubator?

Size and duration of investment fund

Is this the desired size and how you will achieve that?

Customer

What are the goals

What is customer success?

How do you measure success?

you pursue for your

orientation

How do you evaluate progress of tenant start-ups towards

start-ups?

success?

Technology: Is the technology compelling? Is there a large or

growing market for the technology? Is the founder team

committed and capable? Do you have the capability to help the

company? Will they add to a positive environment at the

Customer

How do you select

incubator?

and filter applying

selection

start-ups?

Selection process: What are your selection criteria and how are

they related to your mission, focus and objectives? Who

performs the selection? Do you have a defined or best-practice

selection process? What is your selection rate and how does it

compare to other incubators?

Office space

Office support such as secretarial services

Services

What services and

Coaching

benefits are

Access to professional services (accounting, legal, etc.)

offered

provided by the

Access to venture capital or other sources of finance

incubator?

Access to customers, suppliers and professional networks

Access to human resources

Other

Quality of

What is the quality

What services are most appreciated by your tenant start-ups?

Is there a difference in appreciation of services across start-ups?

of your services

services

How do you evaluate customer satisfaction?

and benefits?

How do you compare to other business incubators?