Incubator to assist Internet ventures

PenNetWorks, an early-stage business "accelerator" owned by the University, will open this week, according to Craig Markovitz, PenNetWorks' chief operating officer. Operated by the Pittsburgh-based Redleaf Group, PenNetWorks will provide funding and assistance to people and groups starting Internet-related companies. The accelerator will be housed on the fifth floor of 3535 Market Street, in the University City Science Center complex, for at least a year. The facility's permanent location has not yet been chosen. Penn Executive Vice President John Fry said that he hopes to house the facility in the Hojoka Building at 31st and Walnut streets, but that the final decision is on hold until the real estate situation on the eastern edge of campus becomes clearer. University officials hope to eventually acquire the land west of the Schuylkill River, currently owned by the U.S. Post Office. PenNetWorks is the first phase of the University's P2B initiative. The plan involves establishing three other incubators each targeted at a different tech-related business area. The PenNetWorks temporary office will have office space for all of its supported companies, as well as conference and recreation space and offices for Markovitz and University Associate Vice President for Business Services Lisa Prasad, who has been working on the project with Fry. PenNetWorks has already received almost two dozen business plans for consideration, most from people or groups affiliated with the University. About three quarters of the proposals have come from graduate and undergraduate students. Markovitz expects to receive between 500 and 1,000 proposals a year. PenNetWorks will support seven to 10 companies in its initial year of operation. The incubator will be "open to everyone in the region interested in locating in West Philadelphia," said Markovitz, a Redleaf employee. "By default, we're going to get a lot of Penn people." "This furthers the long term economic development of University City," Fry said. "Through [PenNetWorks,] there's the opportunity to start new businesses." Companies will spend 12 months or less in PenNetWorks, Markovitz explained. The accelerator will serve companies in the earliest stage of development. He emphasized that PenNetWorks will help anybody who has good ideas, not just experienced entrepreneurs. "There's no shortage of talent, no shortage of ideas, no shortage of opportunity," he said. Markovitz is working to get corporate sponsors to join PenNetWorks. A big-five financial firm and a large area law firm have made verbal agreements to provide support for PenNetWorks companies. And a computer manufacturer has pledged $80,000 of equipment for the facility. Markovitz has met with officials from the Wharton Small Business Development Center, the Medical School, the University City Science Center's Port of Technology and the Penn Center for Technology Transfer, among others, to promote PenNetWorks and set up partnerships. PenNetWorks will also play a role in Wharton's business plan competition, Markovitz said, possibly sponsoring or providing judges for the contest. Companies coming out of PenNetWorks will be set up with venture capital. Safeguard Scientifics,the Internet Capital Group, a Safeguard affiliate and Redleaf itself are possible sources of funding. Fry said the University will not take a stake in student-run companies. However, Penn will take an interest in faculty-run companies according to University intellectual property policies, and can invest more money in the faculty projects if required, Fry said. "The University is not doing this so the University can make money," Fry said. "It should be part of the overall experience at Penn to have access to this kind of incubator."

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