How to make living labs more financially sustainable? Case studies in Italy and the Netherlands

In many urban environments, so-called Living Labs have been created. A Living Lab (LL) is an emerging innovation methodology that may serve to reduce the gap between new technology development and the adoption of this new technology by users, by bringing together all key actors in the innovation process: public administration, education institutes, companies, and citizens. However, a substantial number of LLs struggle to translate the customer value created into a sustainable business model. As a result, many LLs are financially not sustainable. Several previous studies found that most LLs primarily rely on public grants; thus, they often stop their activities when public funding ends. In this paper, we draw on a comprehensive literature review and practical evidence from three cases, to develop a framework of various funding options which can be employed by any LL that seeks to become more financially sustainable.