This term seems to stem from the modern business world, yet it is not a brand new concept. In 1956, Massey-Ferguson – the largest industry in Batavia, N.Y -, closed down, leaving 850,000 square foot complex of multistory buildings and driving unemployment to more than 20%. The new owner decided to divide the buildings and rent them to separate businesses that would be nurtured through shared office services, assistance with raising capital and business advice. It became the first world business incubator.
What is a Business Incubator Today?
It is a collaborative program designed to help beginning businesses and startups succeed. Incubators are a real help to entrepreneurs, particularly in the beginning, when they need a guide or a helping hand in solving problems associated with running a startup. They offer their help through providing work space, seed funding, mentoring and training. The sole purpose and function of a business incubator is to help entrepreneurs to grow their businesses successfully.
Beginnings can sometimes be harsh, especially in business. Not all of entrepreneurs knew from their very first day of work how to get the access to a needed loan, get a connection to higher education resources or a link to angel or venture investors. Probably, not all of them knew how to make their presentation properly, because everyone isn’t born with their best presentation skills. Startup incubators provide all of the help needed in the areas mentioned above; this organization also contributes to providing office space for businesses or even getting a good internet connection, which in most cases is an incredibly crucial thing.
Who Runs a Startup Incubator?
Usually, these are non-profit organizations, run by both public and private entities. As startups are very often founded by young and people, who are often still studying, startup incubators are sometimes associated with universities and business schools, which enables its students to take advantage of these kind of programs. There is also a group of programs formed by the government, civic organizations, startup organizations or successful entrepreneurs. There are no rules on who can be a startup incubator, because the thing that matters the most is to give a chance for people to develop and spread their brilliant projects out on the market.
Who Can Take an Advantage?
As the media focuses on tech startups, it is often hard to imagine that incubators aren’t limited to just one industry – yet the focus of incubators varies by region. For example, in the north of the U.S, there are some incubator farms, while New York City – the capital of fashion and home to some of the best restaurants – is a home to several incubators for the food and fashion industry. When talking about specific startup incubators, however, we shouldn’t forget and omit the all-purpose incubators that consider all kinds of startups, regardless of industry.
Startups can take a great advantage of programs such as Y Combinator, TechStars, Capital Factory and many more listed on the Forbes’ Hottest Startup Incubators List. The concept may be – and in many cases is – an incredible way to help kick off a business, so don’t hesitate to check them all out!