Entrepreneurial Incubators

Background

The nation's first business incubator was launched in 1959 in Batavia, New York, but it was only in the 1980s that the concept began to be widely recognized. Today, there are more than 1,000 business incubators nationwide, with several dozen of them in North Carolina.

Incubators provide business support services and resources tailored for young companies, usually for free or at subsidized prices. This may include physical space and access to necessary equipment. The goal is to nurture entrepreneurial firms through the difficult start-up phase, to give them a better chance to survive and grow. Some incubators target particular types of business -- technology start-ups, for example -- while others support a varied clientele. According to the National Business Incubation Association, 90 percent of incubators are operated by nonprofit organizations focused on economic development, and nearly a third of incubators are located in rural areas.

Assisting Rural Incubators

Homegrown businesses hold special promise for helping sustain and improve rural economies, yet launching rural firms can be especially challenging. To improve the odds of success, the N.C. Department of Commerce and the Rural Center in 2004 jointly designed the Entrepreneurial Incubators grant program. The grants help cover the cost of launching or expanding a business incubator in a rural community.

For its pilot phase, the program received applications from 30 rural communities. Seven projects received grants of $210,000 to $400,000 in July 2005. The program was funded by the N.C. General Assembly with $2.25 million from the federal Small Cities Community Development Block Grant program.

In 2006, 19 rural communities applied to the program. Seven grants, ranging from $100,000 to $350,000, were awarded. This year the General Assembly funded the program with $1.75 million from the Small Cities CDBG program. The Appalachian Regional Development Commission provided an additional $400,000 to support two projects in the west.

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N.C. Rural Economic Development Center
4021 Carya Drive, Raleigh, NC 27610