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Hatching Good Ideas? Characteristics of Minnesota's Business Incubators <br />Overview of Business Incubators <br />What is a Business Incubator? <br />The term "business incubator" describes a variety <br />of methods that are used in economic development <br />to nurture new, small businesses. In general, <br />incubators are intended to provide new firms with <br />the supportive network necessary to increase their <br />probability of survival during the crucial early <br />years when they are most vulnerable. <br />The U.S. Small Business Administration (SBA) <br />describes four aspects to business incubation: <br />flexible space for a number of companies at a <br />reasonable rate; <br />• shared equipment and services that would <br />otherwise be unavailable or unaffordable to <br />help businesses cut costs; <br />• experienced management advice and access to <br />professional expertise; <br />• access to capital.' <br />Candace Campbell,' an economic development <br />consultant and past chair of the National Business <br />Incubation Association (NBIA) Board of <br />Directors, also offers an additional element that <br />incubators may also provide: an environment of <br />synergy where small business people can share <br />ideas and assistance.' <br />There is no prototypical business incubator. Some <br />incubators provide physical resources, such as <br />space, shared services, and assistance with start-up <br />costs. Others focus more on providing managerial <br />and entrepreneurial resources. Incubators may be <br />sponsored by public or non-profit agencies, or <br />they may be private, for-profit ventures. They may <br />focus on a specific industry or provide services to <br />abroad range of companies. <br />Top Ten Most Offered Incubator Services <br />Help with business basics 96% <br />Conference room 92% <br />Marketing assistance 89% <br />Sharedadministratrve services 88%. <br />Networking activities 86 <br />Accouritingffinanciatmanagemerit 77°Io. <br />e p wlt access to wmmercla oans <br />loan funds/loan guarantee programs 77% <br />Links tohigher education Institution <br />Telephone system/phone answering 65% 76%.. <br />Internetaccess :62°h'-.I <br />Source. National Business Incubation Association. Accessed a[ <br />www.nbia.org/info/facts on August 16. 2000, <br />Services offered and incubator attributes provide <br />some guidance in the definition of business <br />incubators. According to a 1998 survey conducted <br />by the NBIA, the following 10 business assistance <br />services were among the most frequently offered <br />by responding incubators: help with business <br />basics (96 percent), conference room (92 percent), <br />marketing assistance (89 percent), shared <br />administrative services (88 percent), networking <br />activities (86 percent), accounting/financial <br />management (77 percent), help with access to <br />commercial loans/loan funds/loan guarantee <br />programs (77 percent), links to higher education <br />institution (76 percent), telephone system/phone <br />answering (65 percent), and Internet access <br />(62 percent).° <br />Some incubators are "incubators without walls" <br />Typically, these incubators do not house tenants, <br />but serve non-resident tenants, providing access to <br />the same services as traditional incubators, except <br />for the office space. The principle behind such an <br />incubator is that small business success is not so <br />much a function of the need for a facility, but the <br />need For advice, capital, and networking <br />opportunities. <br />Minnesota Department of Trade and Economic Developmen( <br />