Ongoing research by UK Business Incubation (UKBI) - the industry body for incubation and incubator centres - suggests there's now less risk in starting a business within a business incubator than being employed in the private technology sector.
It has found that over 90% of young and small companies that are incubated are still flourishing after 3 years. Furthermore, over 80% of these companies are still trading after 5 years, by which time they have normally left the incubator. This compares with a 3-year success rate of just 41% for UK businesses in general - according to the findings of the Office of National Statistics and HMRC.
The Universities of Bath, Bristol, Southampton and Surrey provide incubator facilities for technology businesses under the SETsquared Partnership programme (www.setsquared.co.uk). Bristol University's incubator, or Business Acceleration Centre, recently won UKBI's "Established Business Incubator of the Year 2008" award. Its director, Nick Sturge, said, "With many major technology corporations laying off staff by the thousands, starting a business with the resources of a focused business incubator behind you is now less of a risk than staying where you are and waiting for the axe to fall. If you have already been laid off, there's never been a better time to look at the option of starting on your own - there's never
been more support available."
SETsquared centres provide business mentoring, coaching, access to university expertise, investment readiness training, introductions to potential investors and subsidised office space. Many of the entrepreneurs that start businesses in them come from large corporations. They include ex-executives at Vodafone, Hewlett-Packard, IBM and Rolls Royce, as well as academics seeking to commercialise their research. "It can cost from as little as 100 a month to get set up in a SETsquared centre and we estimate that the facilities, advice and expertise we offer is provided at about one-tenth of the cost of buying it on the open market", adds Sturge. Companies within SETsquared Business Acceleration Centres have raised over 120 million investment in the last 4 years and have created more than 1000 new jobs. There are now over 300 business incubators in the UK, compared to a handful at the start of the last recession in the early 1990s. Lord Mandelson opened the latest one in Harlow on 3rd December 2008.