Summary of Article

The Information and Communications Technology Incubator Program is the follow-up project to the Building on IT Strengths program run by the federal government.

The ICTIP is smaller in scope and there is less money available, but the people running the incubators seem content with the early days of the scheme, which was announced in May last year.

The successful incubator participants on the four-year program were declared a few months ago. They are Australian Distributed Incubator, Divergent Capital (formerly BlueFire Group), Entrepreneurs in Residence, Epicorp, Information City Australia, inQbator, In-tellinc and Playford Capital.

The government's objective for its $36 million is to identify and support young information and communication technology businesses with potential.

While the strategies for assisting those ICT businesses vary, as do the techniques used by the eight incubators operating under the scheme, the overall goal is to create sustainable businesses which can grow to the stage where they are able to secure their own funding.

Robert Crompton from Information City Australia, for example, says it has modified its approach under the ICTIP project. "We're more like a venture capitalist, or at least a mini-VC, than an old-style incubator," he says.

A director at the Queensland-based inQbator, Laurie Hammond, says one of the improvements in the new program is that the cap has been taken off the amount which can be invested in a business.

Incubators also learned some important lessons from the earlier program. An exit strategy is critical.

Author: Jason Clout
Date: 15/03/2005
Source: AFR
Publication: Australian Financial Review
Section: Enterprise