Business Incubator Series: An Interview With Dr. Tom O’Neal, Executive Director, University of Central Florida’s Business Incubation Program — Orlando, Florida (Part 4)

By guest author Irina Patterson and Mridula Velagapudi

Irina: Do you have any special initiatives at the moment?

Tom: We try to team up with different organizations to do stuff. We’ve got a contract with the Department of Energy to put together this “MegaWatt Ventures” program.

[UCF’s Office of Research and Commercialization will receive $1.05 million to begin its program at four Florida universities: UCF, the University of Florida, the University of South Florida, and the Florida Institute of Technology. At those institutions, master’s and doctoral level science and engineering students will have the opportunity to choose promising technologies from a catalogue compiled by the participating universities.

The students will form teams to explore the development of the technologies, and each year 10 groups will be awarded $10,000 each and given six months to complete a prototype and assemble a startup team. The final competition will award one team $100,000 to start a company based on its plan.]

Irina: What limits your incubator growth?

Tom: Probably capital. The angel groups here are not investing in as many deals as they are in other parts of the country. We can have a closer link with VCs and angel investors, and this approach needs to be better. We’ve got some good resources, if you will, just talent and more smart people want to start a company. We are getting a bunch of them now, but we are having trouble getting funded.

Irina: How do you feel about bootstrapping?

Tom: Most of our companies bootstrap their operations with contracts, grants, or their own savings. Of that bunch of serial entrepreneurs who have money, who want to invest their time and money in the company, there are not a lot of them here.

Irina: Biotech and cleantech businesses, those really need financing, but IT businesses and software-driven business, they don’t really need that much money, do they?

Tom: No. They need coaching; they don’t need a lot of money.

Irina: Exactly. They need coaching; they need contacts; they need introductions to their first clients, and more so if they are in the enterprise space than in the business-to-consumer space.

Let me ask you, if you get businesses that are too early for incubation, do you refer them somewhere else?

Tom: Yes. We refer them to other people. We have actually a rich environment with entrepreneurial support organizations. We have the Disney Entrepreneur Center, and they have 13 service providers from SCORE [Counselors to America’s Small Businesses] to SBDC [Small Business Development Center], investment funds and folks like that. We refer entpreneurs to them, and if necessary, to other people.

Sometimes we do that in the beginning when they make the first call. We might do that even in the first interview on the phone; we can tell they are not ready and send them to the other places first.

A lot of times we will use our Venture Lab. The lab really helps them to better understand their market and their business opportunity. Sometimes we might accept the company later, once they have done their homework and are in a better a position to join the program.

Irina: Would you tell us more about Venture Lab?

Tom: They are part of this office as well, and they are a group of people with two main functions. One is to do market research. They put out really good due diligence on markets, customers, and geographical information systems so that we can address what are the buying trends and that kind of stuff.

And then we have been there, done that entrepreneurs who are part of our Venture Lab coaching; we call it Entrepreneurs-in-Residence program (EIR). They can help companies and mentor new entrepreneurs one-on-one, all the way from an idea to a business plan. They also do coaching for VC pitches.

For one of the angel clubs we have in the community, the Venture Lab provides them with due diligence and does market research for them. So, it is all the way from doing a little bit of work for a lot of people to doing very deep-dive work for a few people.

This segment is part 4 in the series : Business Incubator Series: An Interview With Dr. Tom O’Neal, Executive Director, University of Central Florida’s Business Incubation Program -- Orlando, Florida
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