Part IV: Go Edupunk - When Incubators Don't Work in Healthcare

So when will incubators in startup health NOT work?

When the group (and leaders or PMs or 'community advocates' or coalition) does NOT take the time to sort out IP ownership (or the lack thereof, by going completely open platform/open source) and establish guidelines for gainful exits.

Anytime you're shackled by IP issues in incubators, future output is leg-shackled to an open-ended debate that can get ugly, fast.


When else will healthcare incubation NOT work?

1. An incubator will NOT work in healthcare if it's a thinly veiled disguise for larger incubator members (big firms) to 'acquire' tech and keep the innovation and development process on a tight leash.

• UNLESS the incubator sponsors/sponsees AGREE to this goal up front (and in writing, por favor).
  
• With that type of patronage agreement, this form of incubation can be very successful (Exhibit A: Microsoft).

2. An incubator will NOT work in healthcare IF its members can't agree on a central and unifying goal/vision so integral that we're all willing to wring out ways to make it happen, with blood and sweat and tears.

• Startup life is hard. You work your a%$ off, sometimes with little personal/professional financial incentives.
  
• If your chunk of change is an equity stake and a low salary, and the incubating company/group/product tanks, you're left with some bills and a good lesson in getting back on your feet.
  
• This goal can be quantitative (ROI goals for each firm in the incubator within 2 years, etc) or qualitative, but should ideally be both.
  
• You have to pay the rent, yes, but you also have to feed the soul.

3. Incubators in healthcare will only work IF you don't stop when you get the warm-and-fuzzy "we're gonna save the world" feeling.

• IF you don't move quickly from idealistic dreaming (vision: consumers will be able to access healthcare goods and services, online and offline at will) to functional organizational mapping and strategic flow planning (with end products, pricing discussions, budgets, deadlines and innovation lifecycles of how to get there) - you're all fluff with no future, and that doesn't incubate anything other than depression.

4. Incubators and healthcare won't work IF you don't agree on compensation, or the lack thereof.

• IS this whole thing voluntary?
  
• Does someone get a salary for coordinating?
  
• Is other staff involved?
  
• Are MEMBER companies' staff expected to contribute time, output?
• If so, what is the staff's role with respect to incubator member firm interaction?
  
• What support are they expected to provide?

5. Incubators in healthcare won't work IF you don't agree on how new members/applicants will be added, and how/why old members will drop away.

• What is the structure?
• What do you call yourselves? An angel network with office space? A healthtech incubator? A mentor network? A startup plantation? An accelerator? Whatever the name, get the sticky issue of cohesive identity establishment out of the way first.
  
• Who's picking the applicants?
  
• What are the selection/enrollment criteria?
  
• How bare bones does it need to be? How open access?
  
• Is there an approval process for incubatees? Budget changes? If so who signs off? And what motivations do they have?

Final thoughts:

IP is the hairy wart on healthcare incubation's nose, but that doesn't mean we should ignore it. That thing may just be cancerous.

Incubators in healthcare won't work IF you don't agree on an intellectual property platform, OR clearly state that you're leaving this up to the parties negotiating incubation agreements.

But if that's what you're really about, you're just a matchmaker for partnerships, not an incubator, right?

Tomorrow we'll take a global, quantitative look at services incubators in a variety of sectors provide, and how they're structured - just in case, oh, you're in the process of launching one.