As we face an economic crisis of unknown size, those businesses that survive the Pandemic must re-invent themselves to address both new markets and volatile business conditions. With shrunken and interrupted revenue and supply chain disruption, businesses must look to all available means to gain efficiencies.
While disaster tends to cause retreat and preservation of the status quo, failure to innovate will only prolong the consequences to achieve a position for the business worse than when the disaster started. The same resources used to restore normalcy may instead serve to create a better tomorrow. A focus on innovation is needed. Innovation does not need to create something that does not yet exist. Innovation includes simply implementing available technology that is held back by incumbent products, services and systems.
As we have seen in past economic downturns, governments and large businesses turn to innovation to restart growth:
Agrifood corporates turn to startups to hedge disruptions and get an edge on trends
Technology Is the Way Out
How To Manage Innovation During A Recession
Following the last recession, laws were rewritten to enable publication of capital offerings and extended the ability of non-accredited investors to make investments through crowd funding to assure capital needed by small businesses to innovate and create new jobs.
As communities rally to create jobs, generate revenue and rebuild, an accelerant is the establishment of economic recovery projects. These projects achieve quick economic impact through collaboration of multiple businesses, the government and community organizations.
One option for an economic recovery project that may be implemented in most communities is that of an ‘innovation hub’. The mission of each innovation hub can be styled to match the assets of the community in which it is located. It is expected that stronger community support will be gained by addressing a problem of the community, however the greater goal is to export products and services outside the community and import money.
Rather than a ‘one size fits all’ operation that attempts to generically serve all businesses, optimal outcomes may be achieved by a focused theme where specialty equipment and facilities can be shared. This efficiency in operation will advance each participating business and innovation.
1 – commercial or industrial building that can be adapted and improved with specialty equipment and capabilities
5 to 50 – businesses who may specially benefit from the facility
# TBD – suppliers and subcontractors
$ TBD – capital stack of equity, debt financing, grants and government disaster relief funding
1 – private/public partnership
1 – community
These requirements may be scaled up or down and custom fit to each community.
Concurrently (to achieve maximum speed):
Seek nominations of themes for the innovation hub and make a selection
Share the idea with the community to gain support and to speed the identification of businesses, suppliers and contractors and equity investors.
Based upon the theme, identify a property, determine needed equipment and improvements, obtain bids (from as many businesses as possible) and set a budget
Seek applications by businesses to make use of the facility (pre-sell leases with options to own a portion of the property)
Identify and obtain needed equity investment as part of a capital stack with investors participating in both the appreciation of the property as well as taking equity stakes in each participating business
Facilities must be designed to facilitate ‘work from home’, distributed workforce and tele-work occupations.
In addition to improving quality of life through innovation for all who use the products and services of those businesses participating in the innovation hub, this economic recovery project will also:
Create immediate jobs for all businesses providing supplies and services,
Provide a foundation for a new industry within the community, and
Make participating businesses into customers of other businesses within the community.
An innovation hub may be championed by a property owner, an economic development agency, any business that may participate in the innovation hub, a vendor of any specialty equipment or contractor of facility renovation or a community leader.
Innovation Hubs as an economic recovery project will be the principal topic of the next free Small Business Pandemic Survival & Recovery Webinar presented by Karl Dakin and produced by the Capital Innovation & Technology Institute that will be held at 9 am MDST (Denver) on Tuesday, May 12 at Knowledge Avatars in a Virbela virtual office platform. You may register now at https://knowledgeavatars.com/Pandemic_Survival_and_Recovery_Webinars.
The Capital Innovation & Technology Institute now offers for sale the Small Business Pandemic Survival & Recovery Kit with information on development of a capital strategy and accessing funding from government disaster relief programs. https://knowledgeavatars.com/small_bz_pandemic_survival_kit
This article was first published on LinkedIn on May 8, 2020 at https://www.linkedin.com/pulse/collaborative-innovation-toward-economic-…