Business incubation is often described as an economic development best value. For every dollar of estimated annual public operating subsidy provided the incubator, according to National Business Incubator Association data, clients and graduates of NBIA incubators generate approximately $45 in local tax revenue alone.
NBIA members report that 84 percent of incubator graduates stay in their communities and continue to provide a return to their investors. Publicly supported incubators create jobs at a cost of about $1, 100 each, whereas other publicly supported job creation mechanisms commonly cost more than $10, 000 per job created. Every 50 jobs created by an incubator client generates another 25 jobs in the community, the NBIA says.
The Alabama Small Business Development Center Network works closely with many incubators located throughout Alabama, and is a member of the NBIA. Alabama small business counselors can connect clients with the incubator that will best fit their needs.
Most incubators offer a range of business support, including low-rent space, shared office services, access to funding sources and more. By locating in a business incubator, a start-up company can save valuable working capital, putting it to use instead for core business operations.
These savings are possible because incubators provide shared office equipment, power (for office space), office furniture (as available), restrooms and even coffee and a water cooler. The physical premises in which the companies locate in contribute to:
- Synergy: Opportunities for clients to share equipment, employees, contacts and to learn from each other.
- Services: A central location where management can efficiently provide daily consulting, services and training.
- Focus: A community focal point for entrepreneurship that is attractive to government and private sponsors and business service providers
text by Dave Helms • photo by Nick Stakelum