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Self-sufficient Vietnamese incubator
The Vietnam Climate Innovation Center (VCIC) is a business incubator for Vietnamese start-ups specialising in sustainability and climate solutions. The VCIC was set up two years ago as a World Bank initiative and needs to be self-sufficient from 2021. PUM is helping it on its way.
Climate change is a public concern worldwide and awareness of the problem is rising, including in Vietnam where its geographical location makes the country particularly vulnerable. As incubators are well-suited for developing local innovative business, the World Bank decided to invest in the VCIC, and in the space of just over two years, the VCIC has supported 38 start-ups thanks to World Bank financing. The question now is what the incubator has to offer new entrepreneurs when the World Bank steps back in 2021. In order to be able to stand on its own two feet, the VCIC asked PUM for help and various missions were agreed upon that would focus on the transition phase, product development, fundraising and the incubator’s clients.
‘Earning capacity and expertise development have to go hand’
Non-profit to profit
Following up the first mission, which mainly focused on structuring the incubator, Anthony Hoogeveen signed up for the second PUM mission. He quickly ascertained where the problems lay. ‘The VCIC is an extension of the World Bank and acts as a non-profit organisation. Changing to operating as a profit organisation demands a huge turnaround in the way it thinks and works. At the moment the financing from the World Bank is the main reason most start-ups sign up for selection by the VCIC. As soon as the funds have been awarded, the VCIC generally plays a controlling role but real support in terms of market research and product development is lacking.’
Knowledge and capital
In order to develop a revenue model and be of relevance to start-ups, Anthony feels the business needs to be reorganised. ‘The VCIC employees are young and well qualified. In the current organisational model, they have to play the role of expert but their young age means they lack sufficient experience. My advice is to use them as account mangers so that they can guide the process and maintain the contact with the client. In that way, you can find out what the client really needs and on the basis of that, you can hire in the right expertise. That means you have to invest in building up a network of experts from universities and business. And the VCIC will need to build a network of investors. It’s only when they can bring new entrepreneurs into contact with knowledge and capital that they can really have something to offer. Earning capacity and expertise development have to go hand in hand for VCIC.’