Open Incubation is a venture governance model for lean, open and collaborative venture teams. It allows the participants to quickly agree on each others expected contributions, (potential) rewards and the rules of engagement of the venture team. With this ambition, I hope to provide venture teams with a governance model to find adequate answers to the five questions every venture team should ask. The answers may vary per venture team and change over time. Yet, the power of the open incubation model is that the presented frameworks are dynamic and transparent. Good venture governance guides a venture team to find a reasonable balance between contributions, roles and rewards of the venture team members. This is not only important at the start, but also during the exploration phase when venture is still seeking ways to develop its product or solution, and at the formal incorporation of a legal entity.
The Open Incubation methodology consists of three building blocks:
- Rules of Engagement – five governance design principles of the new venture that are applicable throughout the venture life time
- Contribution & Reward framework – facilitates the participants in a venture to align roles, contributions and rewards
- Venture Governance framework – guides a venture team to agree upon the rights & obligations of the participants regarding leadership, transparency and role based ownership
In the next three paragraphs the three building blocks will be further explained. Thereafter, I will provide some guidance on working with the Open Incubation model.
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