New Technology Business Incubator Report Released

The Technology Administration of the U.S. Dept. of Commerce has just released a new benchmarking study report on technology business incubators. The study was undertaken by the National Business Incubation Association (NBIA).

The study focused on these important questions:

• What is the range of client performance outcomes across a national sample of technology business incubation programs?

• Which technology incubators could be identified as exemplary and which as low-performing?

• What ranges of business assistance services and organizational and management approaches are used by technology incubators?

• What relationship exists between best practices and performance outcomes?

• How these results can help improve incubator operations?

What were the chief findings of the study? The major findings of the study include:

• Forty-eight percent of the technology incubators were focused on information technology and electronics, compared to 24 percent focused on biotechnology and biomedical applications and another 28 percent involving a mix of client company technology concentrations

• Forty-four percent of incubators focused on companies that primarily had product-oriented business strategies, compared to 18 percent focusing on service-oriented strategies and 38 percent on clients with a mix of strategies.

• The clients of incubators with a greater biotech/biomedical client focus had raised more money, obtained more research support, held more patents and in-licensed more technology than their peers.

• Biotech/biomedical-focused incubators’ clients had slower revenue growth than IT/electronics and mixed technology incubators’ clients and fell behind mixed technology incubators in employment growth. In other words, they grew but growth was based on investment capital.

• Service-oriented incubator companies grew faster both in terms of revenues and employment than product-focused incubator clients.

Although the research yielded no strong direct statistical relationships between incubator business assistance practices and primary outcomes (e.g., sales and revenue growth), it did reveal a predictive relationship between the business assistance practices and the secondary business outcomes (e.g., equity investment, patents, research grant support, copyrights, and licensed intellectual property) that are important precursors to the primary outcomes.

Click here to download the full report.