University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
Concept note to Establish a Business Incubator in University-Case Study of Uganda
By Ojijo Pascal, Founder & Lead, GoBigHub
[email protected]. +256776100059. www.gobighub.com
University BUSINESS INCUBATION CENTRE
(University-BIC)
1. EXECUTIVE SUMMARY
This is a concept note for the establishment of a business incubation facility at University, to be named, University
Business Incubation Centre (University-BIC). The centre will provide three type so services, namely, innovation,
financing and mentorship. The centre will utilize a single hall, which will be transformed into an open office plan, as
well as conference centre for events. The centre will be funded by income generating activities, as well as donations.
The total capital costs are projected at UGX. 17,852,500, that is, equipment costs, plus 3 months operating expenses.
The project will earn an annual profit of Ugx.9,050,000 and hence break even in approximately 2 years.
2. BACKGROUND
The Problem
The economies of the world generally, with special reference to emerging regions, with Uganda as an example, are
suffering under increased unemployment due to diminishing opportunities in the labour market, and subsequently,
there is need for enterprise development to create more jobs. This then calls for creativity, especially amongst the
youth, but that creativity faces a deadlock where ideas cannot meet capital, and when they o meet capital, the ideas
lack mentorship to be transformed into full fledge businesses. Consequently, there is need for a solution that not
only encourages creativity, but also capitalizes the created ideas, and mentors the newly capitalised ideas into
business units that can compete and add value to the investors, and customers.
About Incubators
Incubation has been identified as a powerful process of business enterprise development because incubation and
prototyping creates the bridge between innovation and commercialization. It is the process of supporting start-up
businesses in order to build entrepreneurship capability for self sustenance. This involves providing common
facilities such as physical space, shared services, skills training and business legal advise to facilitate the operations
of selected entrepreneurs and assist them until graduation when they have capability on their own.
The Solution-University-BIC
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
University-BIC is a proposed entrepreneurship centre at University. It exists to provide young businesses in the
University, as well as enterprising minds in the University, a professional office space at an affordable rate, as well
as creating a base for the various support available to them, and fostering a community of like minds.
The centre is proposed to be located at University. The city location makes entrepreneurs easily accessible to
partners and clients, as well as allowing them to conveniently reach any part of the city.
The institution is to reflect the philosophy of University as an entrepreneurship university, where students are to set
their own path through proactive initiatives, and change the world.
Current Incubators in Uganda
The following listed are the business incubation facilities in Uganda:
Mara Launch Pad/Angels Finance Cooperation-all businesses (supported by Mara Foundation, Mara
Foundation –A Mara Group) http://www.mara-foundation.org/entrepreneurship/mara-launchpad.html
Uganda Industrial Research Institute-all businesses- supported by government of Uganda-
http://www.uiri.org/index.php?option=com_content&view=article&id=95&Itemid=156
Renewable Energy Incubator -renewable energy technologies) (supported by Makerere University in
Kampala, college of engineering) http://www.energyincubator.org/
The Food Technology and Business Incubation Centre’s - food value added products (supported by
Makerere University, http://ftbic.mak.ac.ug/
Outbox-IT and service businesses- i(supported by Google, Deloitte, and Samsung)
http://www.outbox.co.ug/tags/kampala
FinAfrica-all businesses (supported by Davis, an Italian entrepreneur)-http://finafrica.org/home
Makerere University Accelerator, run at the university of Makerere, faculty of computer science, is
supported by donors from Norway, and like-minded European Entrepreneur Millionaires)
Resilient Network Africa, sponsored by USAID, and helping in innovation of ICT applications in medicine and
health sectors.
GoBigHub, run by entrepreneur Ojijo Pascal, as a for profit venture, which seeks to connect capital to
innovation business ideas.
The Challenges faced by Incubators in Uganda
Incubators in Uganda have various challenges as below:
All incubators in Uganda, except GoBigHub, are run based on donations by donors. To this end, they are
limited by grants from donors.
Secondly, incubators in Uganda mentor and train businesses, and even organize for contests and
consequently award presents to the winners. However, they do not have a running institutional program
to fund ideas, which is the main challenge facing the youth in Uganda, and Africa, how to get funding.
GoBigHub addresses this by being the first hub to have regular (every first Saturday), events, where the
entreprenuers get a chance to pitch their ideas to potential investors.
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
Current Incubators in Kenyan Universities
Kenya has a number of incubation centers connecting students, the public entrepreneurs, and funders/donors.
Some of them are:
1. The Innovation Centre at Strathmore University will have cost the institution Sh10 million. Here, budding entrepreneurs will be given seed capital to kick-start their projects. The state-of-the-art facility will accommodate up to 50 entrepreneurs and comes with a tech hub. Additionally, there are offices for Business Process Outsourcing (BPOs), business mentorship and consultation. Idea Foundation from Norway had committed about Sh13 million ($160, 000) to support four viable projects in four rounds this year. This means at least 16 budding entrepreneurs will get an average Sh800, 000 for their enterprises. The manager in charge is Mr. John Matogo. 2. The University of Nairobi boasts of the AfriLab centre which was set up in 2011 and brings together student innovators with the objective of designing new products. 3. Others that have in the past shown interest in incubation concept are Egerton University and Jomo Kenyatta University of Agriculture and Technology. 4. Kenyatta University, with the support from the Chandaria Foundation has invested more than Sh50 million towards the Chandaria Business Innovation and Incubation Centre. It is expected to be launched early next month and will admit 18 to 25 students for entrepreneurship training for between six months and a year.
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
3. PROPOSED METHODOLOGY
Activities/Programs
The University-BIC will run activities under three themes of creativity, capital, and mentorship, as below:
1. innovation programs
conferences /seminar trainings
monthly speaking sessions to inspire and inform the incubatees. The speaker programme will bring keynote
professionals to talk to entrepreneurs on technical issues of relevance to them, such as taxation and venture
capital.
2. capital programs
pitching forum (for incubatees to pitch to potential investors)
proposal submission (for mentees to get funding without necessarily pitching)
3. mentorship programs
peer to peer mentorship (connecting incubatees with each other for mentorship). the biggest benefit of all
to the young entrepreneurs, though, is the benefit of working together in a common space. Sharing of ideas
and resources, cross-selling, and professional introductions are an inevitable consequence and of
immeasurable benefit to the leaders of small, growing businesses.
senior mentorship program (connecting incubates to achievers to mentor them)
desk spaces at the venue for incubatees to be in an office set up, and share. this is an open space has an
open-plan layout with modern furniture befitting the professional image required by ambitious young
entrepreneurs. Members are able to make use of a fast wi-fi internet connection, lounge area, conference
room, and the professional touch of having their guests received by a receptionist. This location and
facilities would normally come at a cost well out of reach of a small, growing business, yet they go a long
way towards enabling Uganda’s most promising young entrepreneurs to position their companies as
professional and reliable.
Other Centre Services
Help with business basics
Networking activities
Marketing assistance
High-speed Internet access
Help with accounting/financial management
Help with presentation skills
Links to strategic partners
Access to angel investors or venture capital
Comprehensive business training programs
Advisory boards and mentors
Management team identification
Help with business etiquette
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
Technology commercialization assistance
Help with regulatory compliance
Intellectual property management
Management
The centre will be managed by an employee, an entrepreneur, and dedicated staff member, who will be the
executive director of the centre, and will work to brand, and represent the centre globally, with the objective of
getting members, getting partners, and getting turn-over of members into full fledged businesses. The management
team will be assisted by receptionist, and clerk (who will also manage the fresh drinks and snacks bar.
Models (In-House or Virtual)
University-BIC will use two models of incubation, namely:
Virtual Incubation is whereby the incubated enterprises are supported at their facilities.
In-house Incubation is whereby the enterprise is supported at the UIRI campus.
Partnerships
Working smart, through win-win-win joint venture agreements, the University=BIC will be able to work with partners
from the following agencies and fields:
Industry Relationship Individual Partners
Government Sponsorship of events Ministry of Finance ; Ministry of
Education;
Competitiveness and Investment
Climate Secretariat (CICS)
Universities Competitions
Conferences
Joint Programs
Makerere University, Kampala
Faculty of Food science and
technology
Makerere university faculty of ICT
Business associations Networking
Capacity building
Connecting entrepreneurs to
capital
Chamber of commerce
Investment clubs association of
Uganda
UIA
Incubator networks
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
Society Entrepreneurs needing desks, etc.
Corporations Joint enterprises for production of
implements
Microsoft/ IBM/ Facebook/ Google,
and other Silicon Valley tech
companies,
Donations, sponsorships, technical
knowhow , conferences
Income Sources
The centre will generate income from the following sources:
INCOME SOURCE DETAIL
Grants University donation to centre Government donation to centre Foreign embassies and missions donations Corporations donations Donations by entrepreneurs Prize money donations Income generating activities Secretarial bureau Refreshments and snacks bar Commissions on financing deals sourced by centre Rental of desk space by outsiders (dedicated) User fees by members Conference fees/training fees
Performance Measurement
The activities of the centre will be measure based on the 6S Performance Measurement Matrix, taking to account
the ability of the project to deliver results to the entirety of stakeholders, namely:
Staff;
Shareholders;
Society;
State;
Suppliers; and
Shoppers.
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
4. FINANCIALS
Capital Investment
Item Unit Qty Unit Cost Total
Computers 3 750,000 2,250,000
Scanners 1 200,000 200,000
Photocopy 1 1,500,000 1,500,000
Conference Laptop & Projector 1 2,500,000 2,500,000
Conference Table & Chairs 1 1,200,000 1,200,000
Binding Machine 1 50,000 50,000
Laminating 1 100,000 100,000
Air conditioners 1 100,000 100,000
Fridge 1 1,200,000 1,200,000
Tables (4-in-1)) 10 10,000 100,000
Chairs 40 15,000 600,000
Total cost 9,800,000
Variable Costs
Variable Costs
Item Unit cost/day Unit Cost/month Prod. Cost/year
Staples and punching machine 1,000 30,000 360,000
Paper 15,000 450,000 5,400,000
Sub-total 480,000 5,760,000
Fixed Costs
Fixed Costs
Utilities (garbage, phone, power & water) - -
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
Sales & Marketing 500,000 6,000,000
Salaries 1,500,000 18,000,000
Renting - -
Depreciation (Assets write off) Expenses 204,167 2,450,000
Sub-total 2,204,167 26,450,000
TOTAL OPERATING COSTS 2,684,167 32,210,000
Pricing Schedule
Revenue Unit Selling price Qty/day Qt/Month
Rental (outside incubatees) 200,000 10 2,000,000 Refreshments & Snacks 20,000 1 520,000 Membership 10,000 10 100,000 Binding 2,000 5 260,000 Printing 50 12,500 325,000 Photocopying 50 12,500 325,000
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
Profitability Analysis
Revenue per month per year
Rental (outside incubatees) 2,000,000 24,000,000
Binding 260,000 3,120,000
Refreshments & Snacks 520,000 6,240,000
Printing 325,000 3,900,000
Membership 100,000 100,000
Photocopying 325,000 3,900,000
Operating Costs (2,684,167) (32,210,000)
Profit 845,833 9,050,000
Assumptions
The project is based on the below assumptions:
Working days are 26 days per month, 32 per year;
A projection of 10 outside member incubates, paying 200,000 ugx per month for use of services, and 10,000 member fee per year to attend all functions at no cost..
Rent is freely offered by the university;
Depreciation (fixed assets write off) assumes 4 years life of assets written off at 25% per year for all assets.
Direct costs include materials, supplies and other costs that directly go into production of the product.
……………………………………………
Author Profile/ Ojijo Pascal
Ojijo has worked extensively with collective investment schemes generally (namely, investment clubs and cooperatives), as a consultant on financial literacy, legal advisory, strategic planning, and leadership dynamics. In this area, he has also authored two leading texts on collective investment schemes, with one on Cooperatives, Successful Cooperatives - Managers' Guide to Acquire, Retain and Grow Membership, Savings and Assets and one on investment clubs, Making Money Together - Ojijo's Investments Club Manual. He sits in bank of Uganda Financial Literacy Advisory Group/ Financial
University Business Incubation Centre
Concept Note For Establishment Of A Business Incubation Centre At University.
Draft developed by Ojijo, The Founder & Lead at Go Big Hub.
M: +256 776 100059 E: [email protected]
Literacy Sharing Group (FLISG), and is a co-founder of Uganda Ministry of Finance sponsored committee of Champions promoting Investment clubs, Investment Clubs Association Of Uganda-ICAU. He has helped in the training and or setting up of various cooperatives, including ministry of foreign affairs cooperative; finance ministry cooperative; NEMA; NARO; Gender Ministry cooperative, and Nsamizi Institute cooperative (Mpigi), to name but a few.
Ojijo is also a lawyer and guest lecturer in Financial Services Law, ICT Law, Legal Rhetoric and Law Firm Management; and a communications expert specializing in strategic planning, public speaking, and writing skills. He has worked with various clients including ministry of finance (Uganda); Bank of Uganda; Ministry of Gender; Technoserve; AIESEC; AYDL; UMYDF; CCEDU; PEDN; Foundation for Human Rights; several universities, companies, and individuals on personal branding, financial literacy, business coaching, and entrepreneurship.
Ojijo is an author of 51 books; Inua Kijana Fellow; Performance Poet’ Armature Pianist; and entrepreneur owner of luopedia.com, lawpronto.com, naniwapi.com, gobighub.com, allpublicspeakers.com, bankitgroup.com, and achibela.com.
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