The first business incubators appeared in the 1960s in the United States, when designers and architects united in creative communes to create the optimal environment for business and interaction. Nowadays, the main task of a business incubator is to help people who do not have start-up capital in starting their own business.
A business incubator is a structure specializing in creating favorable conditions for the creation and development of small venture (investment) firms involved in the implementation of original scientific and technical projects. Such firms are provided with a wide range of consulting, information, material and other services, which helps start-up entrepreneurs to fully concentrate on their tasks and reduce the cost of maintaining the management staff.
Business incubators can act as independent structures, or be created on the basis of universities and large research centers. To help entrepreneurs overcome the difficulties of the initial stage, business incubators lease them office or production space on flexible terms. Lease agreements, as a rule, are concluded for a period of no more than 2-3 years, since it is believed that during this time an entrepreneur must already learn to develop his business on his own and give way to a newcomer in an incubator.
The rent for the first year is usually 50-70% of the market price and includes the provision of communications and secretarial services, use of photocopiers and daily postage. Since several start-up entrepreneurs are accommodated in one room at once, the lease provides for the joint use of the kitchen, meeting and relaxation rooms. The rent of technological equipment and machines is paid additionally, and the cost of utilities is calculated based on individual consumption in proportion to the occupied area.
In addition to preferential lease terms, the business incubator assists in the preparation of constituent documents and the passage of the registration procedure for legal entities, accounting, marketing research and business planning. They help start-up entrepreneurs to look for investors, provide mediation in contacts with potential business partners and help in solving legal and administrative problems, provide an opportunity to improve their educational level in the framework of their entrepreneurial activities.
The selection of future members of the business incubator is carried out on the basis of certain criteria. In particular, the applicant must prove that his enterprise has a real chance of success, and the goods, works or services offered by him are competitive. Applicants are also required to provide such documents as a questionnaire and a description of the entrepreneurial activity previously carried out, a financing concept, an investment and business plan.
