The Top University Business Incubators

Rice Alliance for Technology and Entrepreneurship

STANFORD, COLUMBIA AND BERKELEY DON’T MAKE THE CUT

When Bhatli began benchmarking incubators in 2012, he was startled to learn that the top universities weren’t incubating the most promising startups like private entities. “They had all the funds, infrastructure, research resources, expertise, and endowments,” Bhatli laments. “If they have all that, why wasn’t it going into producing top companies? As he dug further down, Bhatli discovered that less prestigious schools were often making a greater economic impact.

He cites Houston’s Rice University as an example. Ranked #1 in its university-managed incubator ranking, the Rice Alliance for Technology and Entrepreneurship has focused heavily on clean technology and information communications technology (ICT) since being founded in 2000. Bhatli asserts that the Rice Alliance for Technology and Entrepreneurship does two things extremely well. “First, they build extraordinary relationships with corporate partners,” Bhatli shares. He points to the university’s deep network, which includes over 400 sponsors and partners. With over 300 investors, Bhatli adds that Rice provides companies with unmatched access to capital and potential suitors.

Although the alliance doesn’t provide seed capital, it averages over 720 applications per year. Even more, it relies on business support and grants for 90% of its $2 million dollar budget. Despite its limited resources, the alliance boasts an enviable acquisition rate, headlined by Adobe’s $120 million dollar purchase of Auditude, a video advertising platform. “When you provide the right access to the market and potential customers,” Bhatli observes, it really changes the game.”

Among university-managed incubators, the United Kingdom’s SETsquared ranked #2. Unlike Rice, SETsquared is a collaboration between the universities of Bath, Bristol, Exeter, Surrey, and Southampton, generating over $1 billion dollars in investment capital over the past 11 years. Rounding out the top three is the SCUT National University Science Park at the South China University of Technology.

Overall, the United States paced the field, placing four university-managed incubators in the top 25, including Georgia Tech’s VentureLab, Portland State’s PSU Business Accelerator, and Northwest Missouri State’s Dean L. Hubbard Center for Innovation and Entrepreneurship. Although it didn’t crack the top 25, the New Ventures Facility at the University of Washington was named the most promising school-managed incubator by UBI Index. Bhatli also cited the Sid Martin Biotechnology Incubator as one to watch, particularly in light of recent IPOs and acquisitions (including Sygenta’s purchase of Pastueria Bioscience, an alumni company, for $113 million dollars).

Just below the United States, China and Canada each placed three incubators on the list. Regionally, Europe notched eight incubators in the top 25, followed by North America (seven), Asia (five), South America (three), and Australia (two).

Youngstown Business Incubator Lobby

The UBI Index also ranked university-associated incubators, which work closely with universities but are not managed by them. Here, the Youngstown Business Incubator (YBI) tops the list. A collaboration between northeastern Ohio powers like Kent State University, University of Akron, and Youngstown State University, the school scored highly for mentoring and networking. It’s biggest success story is Turning Technologies, a Youngstown-based software company that has grown to 300 employees since being launched out of YBI in 2002.

Italy’s H-Farm Ventures earned the silver in the affiliated incubators ranking. And another Ohio incubator – TechColumbus (which includes Ohio State University) – finished third. Two other incubators – the Los Angeles Cleantech Incubator (UCLA and USC) and 1871 (Northwestern University, the University of Chicago, and the University of Illinois) ranked in the top 10. Innospring, which is affiliated with Stanford University, was listed as the most promising incubator.