Business incubation is a dynamic process of business enterprise development. Incubators nurture young firms, helping them to survive and grow during the startup period when they are most vulnerable. Incubators provide hands-on management assistance, access to financing and orchestrated exposure to critical business or technical support services. They also offer entrepreneurial firms shared office services, access to equipment, flexible leases and expandable space all under one roof. An incubation's programs main goal is to produce successful graduates - businesses that are financially viable and freestanding when they leave the incubator usually in two to three years. Thirty percent of incubator clients typically graduate each year. According to the Impact of Incubator Investments Study, 1997, 87% of incubator graduates are still in business. Like venture capitalists, incubators impose selection criteria upon prospective clients. Some accept a mix of industries, but others concentrate on industry niches. According to NBIA research, incubator clients may be classified as follows:
- 43% Mixed Use
- 25% Technology
- 10% Manufacturing
- 9% Targeted**
- 6% Service
- 5% Empowerment
- 2% Other
** Targeted incubators focus on assisting start-up companies from a specific industry, such as biomedical, wood products, arts, food production, fashion, etc...
