Phyllis G. QueenBusiness Consultant for TFCE on: Business Incubator/ Innovation Center
Business Incubator(National Business Incubation Association) Business incubators are instrumental in accelerating the success of entrepreneurs with the start-up of new or fledgling companies.
Different Types of Business Incubators(National Business Incubation Association) • Non-profit (94%) • For-profit (6%) Made up of: • Technology (39%) • Manufacturing (3%) • Mixed (54%) • Specialty or Niche Markets (4%)
Operators/Sponsors ofBusiness Incubators (NBIA) • Economic Development Organizations (31%) • Government Entities (21%) • Academic Institutions (20%) • Hybrids (8%) • For-profit Entities (4%) • Other Types of Organizations (8%) • No Sponsor (8%)
Types of Services • Business Basics Assistance • Marketing Assistance • Technology Assistance • Networking Activities Assistance • Financial Management Assistance • Regulatory Compliance Assistance
Types of Services (cont.) • Assist with Access to Capital • Access to Internet Services • Access to Higher Education Resources • Assist with Presentation Abilities • Access to Business Training Programs • Assistance with Intellectual Property
Asheville-Buncombe Technical Community CollegeBusiness Incubation Program • Business plan must be submitted • 2 year term in program • Submit to open book accounting • Complete four business seminars • Attend monthly tenant meetings • Pay rent
Asheville-Buncombe Technical Community CollegeStudent Business Incubation Program • 12 month extracurricular activity • 4 student run businesses selected each year • Requirements same as for businesses except: • Maintain student status • College & community event participation
Ben Craig Center (UNC Charlotte) • Graduated 102 companies (as to date) • 80% financially viable at graduation (avg. 3-5 yrs. incubation stay) • Client base is: 44% Technology 39% Service oriented 17% Product sales
Nussbaum Center for Entrepreneurship(Greensboro, NC) • Graduated 130 businesses • 80% success rate • Over 1200 jobs have been created • In 2005 alone, 125 million in revenue and 4 million in tax revenue added to local economy.
Fayetteville N.C. Business Center(in partnership with Fayetteville State University) • Hands-on approach • Flexible space in which to grow • Marketing assistance • Special topic seminars
2005 N.C. Statistics(Department of Commerce) • New business start-ups – 25,906 • Business failures – 22,867 • 3,039 difference • 88% - failure • 12% - success https://edis.commerce.state.nc.us/docs/stateComparison/NC_NC.pdf
Manufacturing jobs lost between July 2007 – July 2008 totaled approx. 18,000. Construction jobs increased from July 2007 – July 2008, creating approx. 1,900 jobs. What happened to the other 16,100 people who lost their jobs? “Quite simply, the state’s rural economies are not creating enough high- and middle income jobs to meet all of their local employment needs. For some workers, the option is to settle for underemployment or no employment.” Loss of Jobs (N.C.)(Bureau of Economic Analysis)
North Carolina Unemployment(According to U.S. Department of Labor) • Unemployment rate 6.6% as of July 2008 • .7% increase from June 2008 – July 2008 • 1.9% increase from July 2007 – July 2008
N.C. Annual Unemployment Rate 1995-2005(N.C. Commission on Workforce Development)
N.C. & Robeson County Unemployment Rates1994-2003(N.C. Employment Security Commission)
Statistics(U.S. Dept. of Labor) Unemployment in September 2007
Statistics (cont.)(U.S. Census Bureau ) % of families living below poverty level in 2006
Statistics (cont.)(U.S Census Bureau) Median household income in 2006:
PER CAPITA PERSONAL INCOME(Bureau of Economic Analysis) “In 2006 Robeson had a per capita personal income (PCPI) of $21,675. This PCPI ranked 99th in the state and was 67 percent of the state average, $32,247, and 59 percent of the national average, $36,714.” http://www.bea.gov/regional/bearfacts/action.cfm?fips=37155&areatype=37155&yearin=2006
Business Incubation Success • Historically 87% Success Rate (Nationally) (National Business Incubation Association) • Every 50 jobs created by an incubator client generate another 25 jobs in the community. (National Business Incubation Association) • 88% of NC incubator graduates remain in close proximity of the incubator and continue to contribute to the community economy. (NC Technological Development Authority, Inc.)
Effectiveness of an Incubator as an Economic Development Tool • Stimulates entrepreneurship • Potential to build community wealth • Create new jobs • Increase community tax base • Community revitalization
In Summary In light of the information provided, we see that a business incubation program has proven to be a successful tool in improving the economic status of a community. Since 52% of Americans work in a small business setting (between 1 & 499 workers), it is proven to be a continuing source of vitality for our economy producing ¾ of the economy’s new jobs between 1990-1995. http://economics.about.com/od/smallbigbusiness/a/us_business.htm So, considering the facts presented, we should do all we can to see new businesses succeed in order to sustain/improve the economy?
Plans of TFCE • Academic institutions • Local organizations • Lending institutions • Seek funding