Business incubators: what can they offer small businesses?
Business incubators are focused on helping fledgling ventures to develop. They provide support in the form of mentoring, physical environment, shared services and resources and, in some cases, finance.
Typically, incubators assist businesses that are at the early stages of development - start-up companies.Such companies may still be in the product development phase, may not have entered the market and typically have yet to receive external investment.
The incubators help individuals who have a great idea or concept but may lack the business expertise needed to make it succeed.
Most business incubators offer offices, and shared resources and services. For start-up companies this can mean the difference between a home office and credible, professional premises.
The costs of services such as internet connections, telecommunications and administration are shared - and therefore usually reduced.
Some incubators also offer financial support, sometimes in return for an equity stake.
Business incubators also offer mentoring. Through mentoring, start-up companies can gain insights into business and get assistance with strategic and financial planning, marketing, human resource management and many other aspects of business.
Mentors are typically business professionals with specialised skills and experience.
Start-up companies based in an incubator also benefit from being part of an environment where people can share their experiences with other individuals.
This can help to develop valuable business networks.
An example of a successful business incubator is AUT Technology Park.
Set up by the Auckland University of Technology in January last year, the park now houses 12 IT-oriented companies, 13 commercial businesses and four university research projects.
The park, located in James Fletcher House in Penrose, provides professional corporate office space, mentoring, shared services, administration and procurement support and subsidised occupancy to its incubated business.
It does not take equity stakes in its start-up businesses.
The Technology Park is having an open day on Wednesday. To register to attend, visit the Technology Park Open Day website.
