Want to Summit Quickly? Go to campsix.

Internet Incubators... Starting a company used to mean all-nighters at Kinko’s creating collateral material, finding and equipping offices, learning accounting software, writing your own legal documents and press releases, and endless searches for investors. And, oh yeah, building your product and finding customers. Entrepreneurs report spending more than half of their time on non-core activities. That delays new products and can be fatal to a fledgling Internet enterprise. Enter the incubator. Incubators accelerate new company gestation periods by outsourcing (perhaps I should say in-sourcing) all non-core activities, freeing the entrepreneur to focus on building and selling the "new new thing" -- while it's still new.

To see an incubator in action, Bob Potter and I recently visited campsix in San Francisco. Vectiv, mentioned in Monday's Dispatch, is part of campsix. Neil Cohen, Founder and Chief Marketing Officer of campsix, gave us a whirlwind tour of their 32,000 sf space. With a staff of 60, campsix provides a full range of business services, including technology, marketing, recruiting and finance. At any given time, campsix has the capacity to support four companies, typically for six-month intervals. At the end of that time, incubatees are expected to get their next round of financing and leave the nest. And how does campsix make money? Normally campsix puts up capital and trades services for equity. This means that you'll be living in the same office with your venture capital. So forget those Friday afternoon golf outings.

Perhaps there's a lesson here for the rest of us, as incubators represent the purest form of what Geoffrey Moore, author of the new book, "Living on the Faultline," calls "virtual integration." According to Moore, the best way to increase shareholder value is to outsource all non-core activities so that a firm’s best resources can be dedicated to those activities that create and sustain differentiation. Everything else is "context," which wastes valuable resources. According to Moore, "The winners in the new economy will be those who can craft the most imaginative solutions to managing context and then put in place pragmatic outsourcing relationships that really work." ... So what context should you be outsourcing?

--Peter Pike