Business Incubators

By Author: Anthony W Bills
Total Articles: 158
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Business Incubators
Introduction
Business incubators are business models that provide hands on management assistance to various businesses in management, technical and access to financial supports services. They offer shared equipments, offices spaces and services and flexible leases as well as expandable spaces and they are all offered under one roof.
. The business incubators are dynamic processes that offer a helping hand in developing young firms to survive in the market and grow during their start up periods because they are most vulnerable at that stage(Doescher, 1988). The incubators only deals with young and growing companies only through offering them with different serves and models that include;
• Expertise in doing the business
• Networks
• Facilities and equipments
Working of incubators
Incubators always need to make their ventures successful. The incubators in Geneva are known for diversifying economies through creating jobs and commercializing technologies and in reducing the risks of failing. The major aim of the incubators is to produce successful business ...
... graduates and businesses that are financially viable and that will support themselves and stand even after leaving the incubator. The incubation period ranges between two to three years.
In Geneva, incubators have complex criteria that they use when selecting their clients. Some of the incubators only accept one type of the industry while others accept mixed industries depending on the policies that run the incubator and also the capability of the incubator to support different businesses. The clients that are brought about by the incubators are at the forefront in the development of the new technologies. They are responsible in making the products and services that are at vital in improving the living standards and the quality of lives that we live. They start with the improving on the lives of those close to the business and later to a bigger grade to the society (Barrett et al, 2000).
Growth of business incubators in Europe
Economic has been the greatest motivator of growth of business incubators in Europe. The incubators have on the growth since 1994 with many startups businesses and service companies looking for cheap places to do their businesses. Though incubators alleviate employment, it’s on the long term since the investor will have a strong foundation to improve the business and be able to have a share in the already competitive market (Barrett et al, 2000).
By 1994, there were already 200 incubators in Eastern and central Europe. The internet incubators were the in the higher growth and were supporting young information technology companies. With the increase of the incubation businesses, the incubators were offering even direct financial assistance to their clients to reduce competition and also to attract more customers.
There are different factors that contribute to the success of incubators. These factors have been the reason why most incubators succeed and others fail in their initial stage. Though Incubators are famous and they are viewed to be the reason for the success of many businesses, they on the other hand fail and corrupt. The success of the incubators will merely depend with the individualized evaluation since they fail in different ways. Incubators can survive through;
• Through employing effective incubator management. A good administrator is required to effect the management of the incubator and help it survive and succeed in the market as they must play a key role in selecting tenants that would help the business in succeeding.
• Effective management support. The incubators must be able to support the clients in the management skills as they would help the businesses survive hence helping the incubator with the management skills, bookkeeping, planning and organization of their respective businesses.
• Size of the incubator; the bigger the incubator the more the tenants and diverse businesses they are likely to handle. Size has been one of the vital factor that have contributed to the success of the incubator. A bigger incubator can incubate different industries hence increasing profits.
Risks faced by incubators
Incubators are faced with many challenges and risks that threaten their existence and mode of doing businesses.
• Most of the incubators lack concise goals and strategies to achieve their goals. These are vital factors and have been a reason of failure of different incubators in Europe.
• Sources of capital: Though incubators finance their tenants, they have not been having reliable source of financing their businesses which have also contributed to the failure of different incubators.
• The role of the incubator manager has not been well defined which have also threatened the incubator businesses. Most incubators give the managers more roles than they can manage while others underestimate the role of managers giving them less roles than they should thus affecting the operations of the incubators (Doescher, 1988)
Reference:
Barrett, A., Sharpe, R., & Weintraub, A. (2000). Incubators are feeling the chill. Business Week, 113.
Doescher, F. (1988). Hatching young companies. D&B Reports, 36(4), 12-13.

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