24 / 03 / 2021

What are business incubators and how they can facilitate the development of a company?

Starting your own business is inevitably connected with considerable financial contributions, as well as a large amount of time spent on acquiring new skills and expanding qualifications in various fields, not necessarily related to the nature of the company you want to create. An entrepreneur starting their career, who does not possess sufficient capital to employ a group of specialists, must reckon with the fact that, for own sake, they will have to obtain knowledge in the field of accounting and labour law or the ability to create sales offers. Fortunately, there are institutions which aim to help young businessmen in making their dreams come true and provide information on how to get the necessary funds and knowledge in the most critical subjects. These units are the so-called Business incubator, which we will take a closer look at today.

A business incubator is a form of company that assists start-ups in their development by providing services such as management training and office space. The National Business Incubation Association (NBIA) defines Business Incubators as a tool to catalyse regional or national economic development. The NBIA classifies its members' incubators according to the subsequent five types of incubators: academic institutions; non-profit development corporations; commercial development projects; venture capital companies; and a combination of these.

Business incubators differentiate themselves from research and technology parks by their dedication to start-up and early stage companies. On the other hand, science and technology parks are usually large projects that house corporate, government or university laboratories as well as very small companies. Most research and technology parks do not offer business support services, which are a characteristic feature of an incubation program. However, many science and technology parks run incubation programs. Incubators also differ from the U.S. Small Business Administration's Small Business Development Centres (and similar business support programs) in that they serve only selected clients.

Of the most popular business incubators operating in the United States are AngelPad, Y Combinator, StartUp Health, and Techstars. Y Combinator is the most famous business assistant organization in the world. It invests $150,000 a year in a number of start-ups. Techstars aims to connect founders and their teams with other entrepreneurial entities, experts, mentors, investors, and corporate partners in order to facilitate the development of their businesses. StartUp Health's digital portfolio includes over two hundred companies on five continents, eighteen countries and over sixty cities. AngelPad is an American seed-stage start-up incubator, launched in 2010 by Thomas Korte with six former Google employees. It offers mentoring, seed money and networking on two ten-week annual courses.

Entrepreneurship incubators greatly facilitate the process of starting a business and minimize the costs needed for a start, therefore, it is worth getting acquainted with their activity, as it may bring measurable benefits and accelerate the realization of dreams about running a successful company

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