Incubator Definition Based on a Review of Definitions in the Literature
-Source: Google Scholar -Search terms: incubator* AND (compan* OR firm*); incubator AND accelerator AND review -Steps: 1. Found The Evolution of Business Incubators: Comparing demand and supply of business incubation services across different incubator generations; 2. Looked through intro of article and found chart and list of definitions of incubators
Incubator Definitions in the Literature
|Institution||Publication Year||Definition||URL||Key Characteristics|
|National Business Incubation Association||Business incubation is a business support process that accelerates the successful development of start-up and fledgling companies by providing entrepreneurs with an array of targeted resources and services. These services are usually developed or orchestrated by incubator management and offered both in the business incubator and through its network of contacts. A business incubator's main goal is to produce successful firms that will leave the programme financially viable and freestanding. These incubator graduates have the potential to create jobs, revitalize neighborhoods, commercialize new technologies, and strengthen local and national economies.||Link||TBD|
|United Kingdom Business Incubation||Business Incubation is a unique and highly flexible combination of business development processes, infrastructure and people, designed to nurture and grow new and small businesses by supporting them through the early stages of development and change.||Link||TBD|
|European Commission||A business incubator is an organization that accelerates and systematises the process of creating successful enterprises by providing them with a comprehensive and integrated range of support, including: Incubator space, business support services, and clustering and networking opportunities. By providing their clients with services on a ‘one-stop-shop’ basis and enabling overheads to be reduced by sharing costs, business incubators significantly improve the survival and growth prospects of new start-ups. A successful business incubator will generate a steady flow of new businesses with above average job and wealth creation potential. Differences in stakeholder objectives for incubators, admission and exit criteria, the knowledge intensity of projects, and the precise configuration of facilities and services, will distinguish one type of business incubator from another (p. 9).||Link||TBD|
|Organisation for Economic Co-operation and Development||Technology incubators are a specific type of business incubator: property-based ventures which provide a range of services to entrepreneurs and start-ups, including physical infrastructure (office space, laboratories), management support (business planning, training, marketing), technical support (researchers, data bases), access to financing (venture capital funds, business angel networks), legal assistance (licensing, intellectual property) and networking (with other incubators and government services) (p. 4).||Link||TBD|
|Aernoudt||2004||An interactive development process where the aim is to encourage people to start their own business and to support start-up companies in the development of innovative products. (…) Besides accommodation, an incubator should offer services such as hands-on management, access to finance (mainly through links with seed capital funds or business angels), legal advice, operational know-how and access to new markets (p. 127).||Link||TBD|
|Sherman and Chappell||1998||Business incubator is an economic development tool primarily designed to help create and new businesses in a community. Business incubators help emerging businesses by providing various support services, such as assistance in developing business and marketing plans, building management teams, obtaining capital, and access to a range of more specialized professional services. They also provide flexible space, shared equipment, and administrative services (p. 313).||Link||TBD|
|Hackett et al.||2004||Viewed the incubator as an enterprise that facilitates the early-stage development of firms
by providing office space, sharedservices and business assistance. A business incubator is a shared officespace facility that seeks to provide its incubatees (i.e. ‘‘portfolio-’’ or ‘‘client-’’ or ‘‘tenant-companies’’) with a strategic, value-adding intervention system (i.e. business incubation) of monitoring and business assistance. This system controls and links resources with the objective of facilitating the successful new venture development of the incubatees while simultaneously containing the cost of their potential failure...the incubator is also a network of individuals and organizations including the incubator manager and staff, incubator advisory board, incubatee companies and employees, local universities and university community members, industry contacts, and professional services providers such as lawyers, accountants, consultants, marketing specialists, venture capitalists, angel investors, and volunteers.Typically, most incubators do not maintain their own investment fund, serving instead as a broker that introduces incubatees to sources of capital when the need arises (pp. 8). [He separates incubators by] Incubator level: primary financial sponsorship - Publicly Sponsored; Nonprofit-sponsored; University-sponsored; Privately-sponsored (pp. 8, Kuratko and LaFollette,1987; Smilor, 1987b; Temali and Campbell, 1984). [He also separates incubators by] Business assistance: 1. Shared space; 2. Low rent; 3. Business support services (pp. 8; Brooks, 1986)
|Allen and McCluskey||1990||...focus on the primary and secondary objectives of four types of incubators that are distributed along a valueadding continuum.From least value-adding to most value-adding, these incubator types include For-Profit Property Development Incubators, Non-Profit Development Corporation Incubators, Academic Incubators, and For-Profit Seed Capital Incubators.||Link||TBD|
|Allen and Rahman||1985||...the universal purpose of an incubator is to increase the chances of a[n incubatee] firm surviving its formative years. The incubator provides a protected environment in which new ventures—representing opportunities both for local economic expansion and investment—can develop.||Link||TBD|
|Temali and Campbell||1984||Incubators can be classified according to the nature of their primary financial sponsor or the business focus of the incubatees (pp. 9).||Link||TBD|
|Plosila and Allen||1985||Low priced rent, shared-services, and the existence of entry/exit policies are key characteristics of incubators (pp. 9).||Link||TBD|
|Brooks||1986||The incubator support network and university ties are key characteristics of incubators (pp. 9).||Link||TBD|
|Cohen||2013||...incubators receive rent and fees from tenant firms in exchange for office space and administrative support services. Several incubators also provide introductions to financiers, and connections to legal, technology transfer, and accounting consultants.3 When they are affiliated with a university, they may also provide services related to intellectual property; the university may also use them to transfer knowledge from faculty members to firms that are commercializing the university’s intellectual property (pp. 2). Mentorship is typically offered for a fee by professional service providers, such as accountants and lawyers (pp. 4).||Link||TBD|
|Atkins||2011||Clients: All kinds, including science-based businesses (biotech, medical devices, nanotechnology, clean energy, etc.) and nontechnology; all ages and genders; includes those with previous experience in an industry or sector. Selection Process: Competitive selection, mostly from the local community. Terms of Service: 1 to 5 or more years (33 months on average). Services: Offers access to management and other consulting, specialized intellectual property and networks of experienced entrepreneurs; helps businesses mature to self-sustaining or high-growth stage; helps entrepreneurs round out skills, develop a management team, and, often, obtain external financing. Investment: Usually does not have funds to invest directly in the company; more frequently than not, does not take equity. Investment: Invests $18,000 to $25,000 in teams of cofounders; takes equity in every investee (usually
4 to 8 percent).
|Hoffman and Radojevich-Kelley||2012||Incubators generally are nonprofit organizations, frequently associated with universities. They provide office space at reasonable rates for the startups they support. They target local startups. They do not invest in the startups.||Link||TBD|
|UK Department for Business, Energy, and Industrial Strategy||2017||Link||TBD|
|Telefonica & O2||2014||Duration: Incubators tend to offer a longer, less intensive period of support, with rolling admissions and no formal cutoff point. The majority of incubators do not invest directly but instead help startups attract investment through their networks. Fees: The majority of incubators charge membership fees or rent, staggering
the amount according to a company’s ability to pay. Workspace: Long-term office or lab space with state-of-the-art facilities is usually a central part of the incubator package. (pp 9)
|Bone et al.||2017||Open-ended duration (exit usually based on the stage of the company, rather than a specific time frame); Typically rent/fee-based; Focus on physical space over services; Admissions on ad-hoc basis (not cohort-based); Provision of services including mentorship, entrepreneurial training; Often provide technical facilities such as laboratory equipment; Selective admission (but typically less so than accelerators) (pp. 12)||Link||TBD|
|Nest - Business incubators and accelerators: the national picture (UK)||2018||Incubator - Open-ended duration (exit usually based on the stage of the company, rather than a specific timeframe); Typically rent/fee-based; Focus on physical space over services; Admissions on ad-hoc basis (not cohort-based); Provision of services including mentorship, entrepreneurial training; Often provide technical facilities such as laboratory equipment; Selective (but typically less so than accelerators). Used the categories: Source;Incubation type;City; Programme name; Organisation name; Address; Country; LEP; Geographical coverage; Public contact details; Website URL; Sector focus; Funding sources; Support offered; Number of businesses supported per year; Cohort size; Stage of business accepted; Other entrance criteria; Duration; Cost to participant; Direct funding; Equity taken; Programme description; Year launched.||Link||TBD|
pp. 2 Differences Between an Incubator and an Accelerator
-To review: Incubator & Accelerator Article and continue my GoogleScholar Search.
Obstacles of Defining an Incubator
- "There are several sources of definitional ambiguity. First is the diffusion and repeated adaptation of the original business incubator concept in order to fit varying local needs and conditions (Kuratko and LaFollette, 1987). Second is the interchangeable manner in which the terms ‘‘Research Park,’’ ‘‘Technology Innovation Center,’’ and ‘‘Business Incubator’’ are used in the literature (Swierczek, 1992)" Source. - "...emergence of virtual incubators (also referred to as ‘‘incubators without walls’’) that endeavor to deliver business assistance services to incubatees who are not colocated within the incubator." Source. - "...draw[ing[ out a distinction between incubators as real estate development efforts, and incubators as systematic business developmentbusiness assistance efforts (Brooks, 1986; Smilor, 1987b; Smilor and Gill, 1986). Source.
-Article Reviewing Definitions of Incubators
-A Systematic Review of Business Incubation Research
Source: Excepts from Atkins, D. 2011. What are the new seed or venture accelerators? Available at Link.