Entrepreneurship,Innovation & Technology

Nurturing Ground for Innovative Ventures

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A regional platform for incubating and developing start-up ventures in Asia has taken off with the leadership of CUHK Business School

A regional platform for incubating and developing start-up ventures in Asia has taken off with the leadership of CUHK Business School and is providing a unique opportunity to nurture and support entrepreneurial talents in an otherwise difficult environment for innovation. Considered a market leader, the “Pan-Asia Venture Development Platform” was born two years ago and is the  one of its kind in the entire Asian region.

The founder of this platform, Prof. Wilton Chau, Professor of Practice in Entrepreneurship and Associate Director of CUHK Business School’s MBA Program, says its goal is to develop promising regional and even global ventures through a three-pronged platform that provides entrepreneurs with support in fundraising, commercialization and human resources.

First, as a major funding platform, it helps to support incubation programs at the Hong Kong Science Park — the largest incubator in Hong Kong — through providing financial subsidies, facilities and consulting and marketing services.

Second, as a conduit for commercialization the platform helps innovators roll out their products in the market.

“This is the most difficult stage of all when it comes to launching a start-up venture,” comments Prof. Chau. “If you can get through this step, funding will come.”

So far, the platform has helped start-up entrepreneurs to build strong networks of companies in different industries, helping to access major customers regionally. The Platform currently has access to many industries such as telecommunications (12 telecommunications companies in 10 countries), healthcare (a major hospital network in Asia), education publication, and direct sales reward redemption programs (one of the largest in China).

Third, the platform leverages the human resources found among CUHK MBA students. Since 2008, CUHK Business School has been offering MBA students a venture capital course taught by Prof. Chau. Some of the students have entered the venture capital industry upon graduation and have formed a venture capital funding network for this platform.

In their fund-raising for entrepreneurial venturing course students learn how to conduct fund-raising for young ventures and how to write investment proposals.

Start-up entrepreneurs from all over the world are regularly invited to the course to present their project ideas to the students, who would then help to make these projects more viable through building strong business models for the young ventures.

“If the students develop chemistry with the entrepreneurs, they will continue working on the projects after graduation,” explains Prof. Chau. “In some cases, three or four students would form an ‘operating cell’ and invest money in the projects.”

So far, the platform has supported technology ventures and start-up projects in Hong Kong, mainland China, Taiwan, Singapore, India, Israel, Germany and the United States. This year, there are two to three projects that run out of mainland China.

Prof. Chau stresses, however, that these projects are self-sustaining and do not take resources from CUHK, except for the participants, who are either current MBA students or graduates.

From Concept to Practice

According to Prof. Chau, the education of entrepreneurship has three layers. A successful and practical entrepreneurship education program depends on the workings of all three.

The first and the outer layer, concerns raising the awareness for entrepreneurship. This can be achieved through hosting lectures, conferences and networking forums with successful business people.

The second and the middle layer, has to do with training. Prof. Chau has a unique view on how to teach entrepreneurship.

“My view is that models of success can’t be repeated. When you teach students success models, it is just plain lying to them because the scenarios are never the same for different people every time. So instead, I teach failure factors through failed cases. If I teach a dozen of ‘failed cases,’ my students will have a collection of failure factors that they can pay attention to when starting their ventures and therefore will have a higher survival rate for their future businesses,” says Prof. Chau, adding that he often uses his own “failed cases” in his 20-plus years of venture capital experience.

The third layer — the inner circle, is the execution part, which is also the trickiest part. According to Prof. Chau, most professors do not engage themselves in this layer when teaching their business students about entrepreneurship. By contrast, in the MBA course that he teaches at CUHK Business School, he not only helps students formulate their business model and start real-life business projects, but also co-invests in those projects that he believes to be promising in terms of profitability and shares with them his network of business contacts.

“I match the students’ investments by 50 to 100 percent,” he says. “They feel more confident if I also share the risk and show my commitment to the fund-raising and commercialization process of their start-ups.”

As for his criteria for choosing projects to invest in? High-tech ventures with exponential growth potential, ranging from telecommunications, biotechnology to food and beverage. Each of the ventures should have the potential to become a leader in its field and to make its mark on the world map.

Playing the Pioneer Role

Within the ecology of innovation, no other universities in Asia offer these opportunities to their students and the industries. As such, the Pan-Asia Venture Development Platform is unique.

Rachel Chan, founder and chief catalyst of Innofoco, a Hong Kong-based consultancy that specializes in branding, innovation and entrepreneurship and conducts strategic and policy studies in these areas, says the platform can play an important role in establishing Hong Kong as a true incubator for start-ups in Asia.

“Wilton’s platform is a Pan-Asian platform,” says Chan. “We always say Hong Kong is an Asian hub. But our connections are actually quite limited. I hope this can be a major platform to link Hong Kong with the rest of Asia. We can build Hong Kong as an incubator for start-ups in Asia. Hopefully it will attract talents from all over Asia.”

Chan has had the chance to work with Prof. Chau last year when he was one of the members of the judging panel for an entrepreneurship award. “He is the leader in this area so we wanted to pick his brain on how to foster an innovative entrepreneurial ecosystem,” she says.

According to Chan, who is studying the Hong Kong start-up ecosystem for InvestHK, it is imperative to groom start-up talents in Hong Kong, as well as intermediaries who can support start-up activities. She recognizes the valuable work Prof. Chau has contributed in this area.

“What he has been doing at CUHK is nurturing talents as well as matching them with relevant help and support, whether it’s funding, industry know-how, expertise or market contacts,” she says. “You can’t really start a successful business if you don’t have the connections and know-how. The platform can provide intellectual, social and financial capital much needed by start-ups.”