The compelling advantages of the Business Model Canvas Over the Immigration Business Plan - Harvard Business Review


U.S. universities and financial institutions choose the Business Model Canvas

For many years, universities worldwide often ran and promoted Business Plan contests for their students and graduates. The preference now is for submitting the “Business Model Canvas” instead. More recently in the United States, universities and IVY league business schools have began implementing the Canvas as part of their course curriculum.

“In 2015, Continental National Bank (CNB) introduced its GROW Entrepreneurship Program. This is designed to help professionals grow their companies, improve and strengthen their skills, and make meaningful contributions to their communities,” said Jacqueline Sousa, Regional Director of FSBDC at Florida International University College of Business. She attests that they teach the Osterwalder Canvas as part of a strategic growth course they are doing with CNB. FSBDC has extensive experience in providing expert advice and guidance to immigrant entrepreneurs. This expertise includes financial analysis, start-up assistance, government contracting, international business, market analysis and training.

In this Harvard Business Review video: co-creator Dr Osterwalder shows the “Canvas” being used with Nespresso as a case study.

The Canvas encourages university students to embrace a new way of thinking

It is a proven fact that Entrepreneurship Education and Technology Transfer at regional academic institutions contribute to the regional economic development. Regional academic institutions play a major role in strengthening the regional system of innovation. The key role of inventions and of bringing inventions to market is reflected in the definition of ‘innovation system’ by Christopher Freeman, who defines an innovation system as “the network of institutions in the public and private sectors whose activities and interactions initiate, import, modify and diffuse new technologies.” University innovation academies are now adapting the Canvas to spur students into action, encouraging them to embrace a new way of thinking, to develop new perceptions of their research and to realize the potential for innovation innate within themselves and within their research.

Transform into energetic and resourceful entrepreneurial thinkers

These innovation academies are an exciting intellectual space where students and academics interact in multi-disciplinary groups with mentors from the public and private sector to develop and nurture creativity, innovation, entrepreneurship and teamwork. Their mission is focused upon the pursuit of fresh ideas and new ventures. Through the creation of a vibrant multi-disciplinary environment that adapts the principles of the Canvas, these innovation academies seek to transform some of the brightest scholars the institutions have to offer into energetic and resourceful entrepreneurial thinkers

Immigrant students $30.5 billion boost to the economy

This month's USCIS data revealed that, in comparison to last year, the number of international students in the U.S. on student visas grew from 1.11 million to 1.18 million. That's a 6.2% increase. Concurrent with this increase, other countries recognize the beneficial value of attracting students from outside their borders. The latest Open Doors report showed that international students, and their families, supported 373,000 jobs and contributed more than $30.5 billion to the U.S. economy in 2015.

Chinese and Indian immigrants embody Hi-tech expertise and entrepreneurial spirit

The number of Chinese students grew by +7.9% to 353,069 while the Indian share of students grew by +31.1% to 194,438. A breakdown of the data showed a 16% increase from 413,366 to 478,851 in F & M visa students studying science, technology, engineering and mathematics (STEM) subjects in the U.S. Surprisingly, 40% of all F & M visa students in the U.S. study STEM. Yet 82% of students, from India, pursue degrees in STEM. There are more STEM students who originate from India than any other country. Their Hi-tech expertise and entrepreneurial spirit is much sought after in a country which strives to be at the forefront of innovation."

Business incubators and technology parks

In recent years, business incubators and technology parks have gained strong momentum worldwide. In layman's terms, a business incubator is a company that helps new and startup companies to develop and grow by providing business support services and financing. Business incubators differ from research and technology parks in their dedication to startup and early-stage companies. Research and technology parks, on the other hand, tend to be large-scale projects that house everything from corporate, government or university labs to very small companies, including in-house incubation programs. In regions with a low degree of infrastructure, university-based transfer organizations can play an additional role. Often, incubators and technology parks have to create this infrastructure by providing founders and SME managers with material (such as office space, IT) and immaterial (such as consulting, creating contacts) resources (Harms R., Wdowiak M., Schwarz E.J., 2010).

The Canvas – a requirement!

More recently, incubator programs have shifted their entry requirements from the Business Plan to the Business Model Canvas. Many incubators worldwide require the applicant to sketch out the Canvas hypothesis as part of the vetting process. Incubators provide many perks during the start-up stages of the entrepreneurial journey and can be extremely competitive. Besides funding, other perks can include mentoring and partnerships with influential industry contacts. Usually incubator partners and/or founders require an equity share in the start-ups in return for the business support services and financing. However, some non-profit and Government/State run programs require no equity share in the start-ups.

There are different types of business incubators that focus on particular industries or on a particular business model, here are some examples:

Seed accelerator - a business incubator focused on early startups;

Virtual business incubator - online business incubator (no incubator offices are involved);

Public incubator - a business incubator focused on the public good;

Social incubator - a business incubator that facilitates social enterprises;

Kitchen incubator - a business incubator focused on the food industry;

Startup studio - a business incubator with interacting portfolio companies;

Venture builder - similar to a startup studio, but builds companies internally;

Corporate accelerator - a program of a larger company that acts akin to a seed accelerator.

Attractive Visa Incubator concept for immigrant entrepreneurs in the U.S.

Immigration specialists ExecVisa work with academic institutions and investors to assess the most favorable factors, and identifies the least favorable factors, related to proposals for incubator and technology park programs specific to entrepreneurship visas. These programs offer positive support for immigrant entrepreneurs. This comes in the form of consulting, mentoring, prototype creation and co-funding for them. These programs bring more than additional financial support to the immigrant's start-up. In addition, knowledge, potential clients and partnerships with influential industry contacts for channels of distribution. The latter perks are extremely attractive to an immigrant.

Finding and using Key Partnerships

He or she may have a great product/idea but lacks the familiarity, and network of connections, within that specific U.S. market sector. These specialized visa incubator concepts, are programs of support that attract more immigrant investors and innovators/inventors to the U.S. These programs provide the immigrant entrepreneurs with contacts and support essential to the launch and survival of the business. Key partnerships, channels and customers are three main building blocks stipulated in the Business Model Canvas.

In support of the proposals for these visa incubator concepts, refer to the most recent research findings below. They validate the innovative and entrepreneurial nature associated with immigrants in the United States:

Twice as likely to succeed

The latest ITIF survey found that immigrants make up 35.5% of U.S. innovators. These are defined as people who make 'meaningful and marketable innovations' to tech-related industries. Moreover, a recent INSEAD report showed that the U.S. continues to be the world leader at attracting inventive talent from abroad. Between 2001 and 2010, the U.S. attracted 194,608 foreign inventors. Since 1995, foreigners have accounted for more than half of the net increase in the sector of the labor force comprised of scientists and engineers in the U.S. Immigrants were involved in one in four technology start-ups in the U.S. between 1995 and 2005. It is an established fact that foreign talent are more likely to be entrepreneurs and innovators; are twice as likely to start a business and apply for patents at double that of the native rate.

US has many attractions

Switzerland is the leader in Europe at attracting immigrant inventors, according to the recent WIPO report. The Swiss system for innovation and business support has helped in attracting significant talent from nearby countries. Even so, with all of the countries of Europe combined, the U.S. is still the leader in attracting immigrant inventors. Registering companies and protecting intellectual property rights are very accessible to immigrants in the U.S. An individual can apply to register a trade mark online in that individual's name - without the necessity to partner with a U.S. Citizen or own a U.S. company as is the case in some countries.

Billions of dollars - Repatriating knowhow

The latest NFAP study found that immigrants started more than 50% of America's startup companies valued at $1 billion dollars or more and are key members of management or product development teams in over 70% of these companies. The research finds that among the billion dollar startup companies, immigrant founders created an average of approximately 760 jobs per company in the U.S. The collective value of the 44 immigrant-founded companies is $168 billion, which is close to half the value of the stock markets of Russia or Mexico. The findings help illustrate the increasing importance and contributions immigrants contribute to the U.S. economy.

Conclusion – many supports from multiple sources

This article is the second in a series of articles on immigrant innovation and entrepreneurship in the U.S. The first article concluded that the insights and expertise propagated by Dr Osterwalder are worthy of further examination and implementation by any immigration attorney unfamiliar with his work. Set out above are the compelling reasons for choosing Dr Osterwalder's Business Model Canvas. The huge positive contributions immigrants make to an economy, that they are twice as likely to succeed! That they can benefit greatly in their quest by being familiar with the numerous supports available to them as detailed in the referenced publication.

Advice and guidance for all

The $30.5 billion boost to the U.S. economy, contributed by the nearly 1.2 million international students, should prompt in-depth studies into the current and potential economic impact their innovation and entrepreneurship has on the U.S economy. Such studies can influence immigration reform in relation to student and graduate entrepreneurship visas. The high level of international STEM students should influence U.S. technology parks to re-assess their resources and attract more immigrants by way of entrepreneurship visas. Moreover, the most recent research findings that validate the innovative and entrepreneurial nature of immigrants in the U.S. support proposals for visa incubator concepts. Dr Osterwalder’s video above has highlighted how Nespresso was forced to adjust its business model to a certain extent. External pressures came from the intellectual property environment wherein some of their patents recently expired. This allowed rivals to offer useable alternative coffee pods at vastly reduced prices.

Reprinted with permission.

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