Business Hatcheries - Incubators Support Innovation

Steve Jobs and Bill Gates* weren’t the beginning of the “start your business in your garage” movement. In 1938, those fun guys, Dave Packard and William Hewlett, joined forces in a small house in what is now Silicon Valley, using the garage for the office. HP was born.

What does an entrepreneur do when the garage gets too small? Or you just want to get your car back where it belongs? Join an incubator.

Incubators accelerate the development of entrepreneurial companies through an array of business support, resources and services, developed or orchestrated by incubator management, and offered both in the incubator and through its network of contacts. The main goal is to produce successful firms that will leave the program financially viable and freestanding -- and who will give back to the community by creating jobs, revitalizing neighborhoods, and strengthening local and national economies.

It is not a simple thing to join an incubator. They come in all shapes and sizes, with various perks. And you can’t just walk in the door. You do need to apply -- the incubator, remember, is also a business. It is looking for businesses that will pay for themselves. Once in the door, you’ll find benefits including

•    working in a nurturing environment designed to help small businesses share experiences with each other and conduct business with one another thereby reducing the risk involved as start up
•    accessing facilities and equipment otherwise unavailable or unaffordable
•    discovering available financial and technical services and resources and learn how to utilize those services
•    finding mentors
•    paying for these benefits at a reduced or flexible rates

From Incubator to Mezzanine

When a business is ready to leave the incubator, the incubator will often assist in getting the business set up on the mezzanine level. This is an intermediate step before becoming a full-fledged business. At the mezzanine level stage of a company's development, venture capitalists (VC) are more likely to look at the company, prior to its going public, as there is a lower risk of loss than at the incubator stage.

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* Historically, Gates started in his dorm room, but who will ever be sure?

Posted from Broadside: Taking Aim at the Social Revolution