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Find an incubator, baby!
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September 24, 1999: 2:47 p.m. ET
Business incubators are pervasive and can be a great source of support
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NEW YORK (CNNfn) - If you think incubators are just for chicks, think again. Incubators offer entrepreneurs orchestrated business support, including mentoring, financing programs, and a mix of compatible neighbors.
There are about 600 business incubators in 48 states, up from 400 in 1995, according to Dinah Adkins, executive director of the National Business Incubation Association, in Athens, Ohio.
"High-tech incubators usually have a university as the prime sponsor," said Adkins.
Ron Scovil, founder of Mixx Entertainment, moved into an incubator on the University of Southern California campus in 1997. "We hope to become a full-fledged film production company," said Scovil, who received start-up funds from Mitsui Venture and Nippon Venture in Japan.
Egg Company 2, or EC2 as it is known at USC, has meeting spaces, offices, and an array of expensive, high-tech equipment, including AVID video editing systems. Scovil and his employees take advantage of the equipment, increasing their ability to grow.
"The most vital things about the incubator are the consultations and the meetings," said Scovil. "You save money on professional services. The people here are like angels with a lot of contacts."
Scovil admits that "the screening process to land a spot at EC2 was pretty intense. We found out about this incubator from a friend who was one of the people who set up the high-tech equipment," he said. "We were trying to figure out our vision, and it just meshed with what Egg was doing."
While many incubators are hatched on college campuses, some are privately funded ventures. Foundation Capital in Menlo Park, Calif.., for instance, invested $1 million on idealab!, a Pasadena incubator for Internet companies. idealab! attracted the funding in part because it was founded by Bill Gross, a veteran software entrepreneur.
There are a couple of dozen companies with idealab! now, and Foundation Capital expects to invest in some of them. Meanwhile, they have a safe and comfortable place to work.
To find out more about business incubators, check out the National Business Incubation Association's Web site at www.NBIA.org. 
(Excerpted from 201 Great Ideas for Your SmallBusiness. Copyright 1998 by Jane Applegate. Published by arrangement with Bloomberg Press. Excerpts appear each Friday on CNNfn.com.)
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Jane Applegate
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