Belgium Case Study 2002

Benchmarking of Business Incubators

Incubator: Centre d’Entreprises Héraclès 1. Background and Regional Context The Centre d’Entreprises Héraclès is based in Charleroi, an area of traditional heavy industry now undergoing industrial reconversion. Héraclès is a BIC (centre européen d’entreprises et d’innovation). It was founded in 1985, originally on a site near central Charleroi. Héraclès is one of 7 BICs in Wallonia, where the (regional) government has given encouragement to this form of incubator and most are members of EBN. There are a few other incubators in Wallonia, which are not members of EBN. The position in Flanders is different. We were told that there are no BICs in Flanders and that the most common forms of incubator there are similar to managed workshops. But support is at a regional rather than a federal level. Héraclès was founded in 1985 as 3E (the name was changed later) in response to the need for new businesses to replace jobs being lost in the old heavy industries of Charleroi. It was founded with support from the regional government, IGRETEC (see below) and from the European Commission, through the structural funds. Charleroi has at various times had objective 1, objective 2 and transitional status. Héraclès has continued to receive structural fund support and comment that they would be unable to continue without such support. It also receives support, particularly in the form of buildings, from IGRETEC, the agency for economic development for the region of Charleroi. The incubator offers services both to external companies (who are not tenants) and to tenants. There is a comprehensive range of services including: ·

Obtaining finance (it is involved with a seed capital venture and is setting up a network of business angels)

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Set up and business planning

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Assistance to micro enterprises (often outside the incubator)

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Innovation assistance

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Marketing and obtaining partners

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Infrastructure services (e.g. office facilities, secretarial facilities, broadband internet, etc)

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Benchmarking of Business Incubators

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There is also an associated Euro Info Centre on the same site. Since it was started Héraclès has assisted over 250 companies and created over 1200 direct jobs. Many of the companies have graduated from the incubator. Héraclès stays in touch with as many companies as possible and believes that the survival rate of companies is about 80%. Héraclès concentrates on businesses offering innovation – but will provide start up advice to other businesses outside the incubator As indicated above, Héraclès considers that it could not continue its operations without continued financial assistance. It considers that this assistance flows through to new companies in the incubator and can be looked at as short-term start-up assistance for a series of new companies and new jobs. The view at Héraclès is that it is necessary to concentrate on output measures rather than controlling inputs in detail. Héraclès considers that its present cost per job is approximately €7.500, which compares favourably with the cost per job of other sources in Wallonia of up to €75.000 in jobs saved in existing plants. Héraclès prepares regular reports to justify its funding. They include input indicators, (intermediate) output indicators and result indicators. A copy is appended: there must be some concern that some indicators (e.g. ‘nombre d’entreprises bénéficiaires de conseils ponctuels’) and difficult to measure and that the result indicators are not taken as far as cost per job Héraclès prepares good publicity material and has a comprehensive web site at http://www.heracles.be. 2. Incubator Operations The incubator is now on three sites in Charleroi. The original site (still the headquarters) is a former barracks converted to provide offices. A second site is on a business park ‘Parc d’activités Héraclès’ where there are several buildings provided by IGRETEC. A third site on a science park will be opened shortly. Site

Area (m²)

Number of units

Typical unit (m²)

Centre d’Entreprises Héraclès

1700

44

20 to 70

Parc d’activités Héraclès

4800

40

20 to 60

48

60 to 90

There are 8 staff of whom 4 are managerial (including offering advice outside the incubator) and 4 are secretarial. Admissions go through a number of stages. All companies making enquiries are offered a meeting. Some 250 enquired in the last year. All are offered some advice at a meeting – for example a reference to another adviser if there business is not appropriate to the

Benchmarking of Business Incubators

incubator. Héraclès concentrates on business with an innovative aspect. Of the 100 or so appropriate enquiries, 50 companies a year are supported, half in the incubator and half outside. The incubator offers comprehensive services, listed in the section above. Tenants can stay as long as they like but if a company grows it will find it is too expensive to stay in the incubator. A typical period in the incubator is 5 to 7 years. 3. Good Practice Examples Mix of companies inside and outside the incubator: Héraclès offers companies the choice of working inside the incubator or receiving advice and services externally. Some services, such as marketing support, can easily be provided externally and it is a good use of incubator resources to provide services in this way Choice of locations: There is now a good choice of locations. At the original location it would not be possible to carry out some noisy manufacturing operations because of the close proximity of units. But at the parc d’activités this is possible – and example from the visit is a company making oil drilling bits which is able to bring in some machining operations. The new location at the science park will extend the range available. Range of support, particularly in respect of marketing: The incubator places considerable emphasis on marketing. They demonstrated examples of brochures and logos designed for companies. In the wider context, they place emphasis on networking amongst incubator members and outside and help screen potential suppliers to incubator tenants. They have organised stands at trade fairs on a joint basis for the incubator companies Follow up of graduates: A strong effort is made to keep in touch with incubator companies after they have left and there is an annual follow up asking for basic information such as numbers of jobs. The incubator’s objective in doing this follow up is to ensure that the incubator has information on outputs. But it also provides information to continue networking activities Output measures: Attached are the output measures used for justifying funding. Héraclès considers that there should be more emphasis on final output measures, e.g. cost per job created, and whilst inputs need to be controlled, there should not be micro management of inputs 4. Views on Key Issues We spoke to three companies who are in the incubator. They are a company specialising in innovative game based learning (LUDICA sprl), a company manufacturing oil drilling bits and an IT company.

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Benchmarking of Business Incubators

All companies were tenants of the incubator, rather than companies receiving advice outside. Two were new start-ups and the oil drilling bit company was founded by a group of employees of a similar company who had been taken over by a US company. They left when production was moved to the US. All companies mentioned the availability of the right sort of space and services. The oil bit company mentioned the incentives available to start up in the Charleroi area. None had in fact used the incubator’s services for the original business plan but felt that this was a useful facility for other companies. 5. List of Interviews Name Philippe Chevremont Lucyan Papiernik

Position Director, Héraclès Development manager, IGRETEC, the agency for economic development in Charleroi. Three tenant companies

Views on Performance measures - Belgium Inputs General information mailings (number of mailings and number of companies sent to) Number of information folders requested Number of information seminars held Number of media publicity actions Number of enterprises visited Intermediate outputs Number of companies present at seminars Number of projects identified Number of companies benefiting from communal (office) services Number of business plans prepared Number of companies benefiting from prompt advice Final output Number of businesses created Number of jobs created Number of businesses saved Number of jobs saved

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Benchmarking of Business Incubators

Quarterly qualitative report under the following headings: Promotion Services Jobs created Business plans Joint actions Other matters

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