Definition: An organization designed to accelerate the growth and success of
entrepreneurial companies through an array of business support
resources and services that could include physical space, capital,
coaching, common services, and networking connections
Business incubation programs are often sponsored by private
companies or municipal entities and public institutions, such as
colleges and universities. Their goal is to help create and grow
young businesses by providing them with necessary support and
financial and technical services. There are approximately 900
business incubators nationwide, according to the National Business
Incubation Association.
Incubators provide numerous benefits to owners of startup
businesses. Their office and manufacturing space is offered at
below-market rates, and their staff supplies advice and much-needed
expertise in developing business and marketing plans as well as
helping to fund fledgling businesses. Companies typically spend an
average of two years in a business incubator, during which time
they often share telephone, secretarial office, and production
equipment expenses with other startup companies, in an effort to
reduce everyone's overhead and operational costs.
Not all business incubators are alike, however, so if you have a
specialized idea for a business, try to find the incubator that
best suits your requirements. If you're interested in finding an
incubator in your state, visit the National Business Incubation Association's
website. Or get in touch with your local economic development
agency, located in the phone book under the listing for your state
government. You can also call the information offices of your local
colleges and universities to see whether they have any business
incubation programs.
If an incubation program seems interesting to you, be prepared
to submit a fleshed-out business plan. The plan will be reviewed by
a screening committee to determine whether or not you meet the
criteria for admission. Incubators carefully screen potential
businesses because their space, equipment, and finances are
limited, and they want to be sure they're choosing to nurture
businesses with the best possible chance for success.