Community Colleges + Business Incubators = A Winning Combination

Cover Story

In communities of all sizes across the country, business incubators on community college campuses are fostering economic development and job growth. With strong community connections and a long-standing dedication to supporting small businesses, community colleges seem especially well suited to house business incubators. Here are a few examples of the results being produced by business incubators located on NACCE member campuses:

• The Business Innovation Center at Salt Lake Community College’s Miller Business Resource Center is Utah’s largest publicly-funded incubator. Since opening its doors in 2003 as a mixed-use incubator, it has tripled in size and changed its focus to attract software development companies responding to needs in the medical, financial, and information technology industries. The 14 companies now in the incubator employ over 35 people full time and generate combined annual revenues of over $17 million.

• The Center for Business and Technology Incubation at the Asheville-Buncombe Technical Community College in Asheville, NC, is home to 51 companies that have generated $12 million in revenue and $10 million in investments and created and sustained 138 full time jobs with an average wage of $14.46/hour. The expansive 141,000-square-foot, mixed-use incubator opened in November 2006; about 44 percent of the space is now occupied.

• At the Springfield Business Incubator (SBI) at Springfield Technical Community College (STCC) in Springfield, MA, current tenants employ 50 people and generated annual payroll and subcontract wages during 2008 of more than $2,011,000. Taken together, current tenants and the companies that have graduated from SBI employ over 250 people.

Home-grown Businesses

Exactly how many business incubators are linked with community colleges is not known, but the National Business Incubator Association (NBIA) estimates that as many as 30 of its members are located on community college campuses. NBIA members have reported that 84 percent of incubator graduates stay in their communities. This fits right in with the mission that many community colleges set for themselves when they establish an incubator.

"It has become extremely difficult to recruit large companies to your area as they have the option of moving anywhere in the world,” says Amit Singh, dean of Business and Computer Science at Montgomery County Community College in Blue Bell, PA, where work is underway on creating a business incubator that will open in December. "The economic growth needs to come from small, home-grown businesses. And there is no better way to produce local business leaders than having an incubator and training future entrepreneurs right in your own backyard.”

Tracy Kitts, vice president and chief operating officer of NBIA, says, "A business incubator can help strengthen the ties between local businesses and the college. The college can provide resources (space, labor, equipment) that the small business needs, and the small business can provide financial support and placement assistance to the college and its students. For instance, an incubation program can help link small businesses with students and provide those students with a real-life learning lab to supplement their classroom education. Also, an incubator company can provide the school with immediate feedback on their entrepreneurship curriculum.”

"Community colleges work closely with the business community and can customize a business incubator to reflect the economic drivers of that community,” says NACCE founder Tommy Goodrow, who oversaw the creation of STCC’s incubator. "You have to establish that there is a need first. Then to succeed, you have to have the funding, you have to have knowledgeable management and you have to have an advisory board and community business support. Those are the keys to success, along with support from the leadership at the institution and the board of trustees.”

While there are obviously financial hurdles for big ticket items such as construction or renovation of existing space that need to be overcome when establishing a business incubator, some key resources are already readily available in many communities. For example, incubators typically have advisory boards made up of local business people who are eager to support business growth. Russ Yelton, executive director of Entrepreneurial Ventures and Business Incubation at Asheville-Buncombe Technical Community College, reports that they have been able to establish a professional services office where local volunteers, including attorneys, CPAs, specialists in patent law, and marketers, provide 120 hours a month of free counseling to incubator tenants and other area businesses.

Businesses operating in community college-based incubators can’t say enough positive things about the support they receive. "The guidance of experienced business professionals at the incubator is invaluable,” says Ashlea McLeod, CEO of MotoDuds, Inc., a designer and distributor of quality leather riding and racing gear for women motorcyclists located at the John Pappajohn Entrepreneurial Center Business Incubator at North Iowa Area Community College (NIACC). "Without their help with finances, business strategy, global trade, international business practices, and marketing, we would still be at square one.”

Todd Gordner, CEO and president of ProLogic, a software firm located at the Springfield Business Incubator at STCC, describes another incubator benefit. "The atmosphere is very positive and motivating,” he says. "You can walk down the hallways and everyone knows you and is there to support you. This just feels like a place where you want to work.”

On the Drawing Board

With communities everywhere scrambling to respond in positive ways to the economic downturn, a number of NACCE members are moving forward with plans to create new incubators or expand existing ones. At the NIACC incubator, which opened in 2007 and now hosts six companies with several others preparing to join soon, expansion plans call for creating satellite incubators across a nine-county area.

Connors State College in Warner, OK, started with a two-space incubator that was certified by the Oklahoma Department of Commerce in the spring of 2008. Their idea was to start small and prove the concept before expanding. Plans have already been developed to turn a former dorm into incubator space, possibly for companies interested in creating value-added products based on the region’s extensive agricultural industry.

When the incubator at Montgomery County Community College opens later this year, it will be the first incubator serving the county, which is north of Philadelphia. "We’re capitalizing on what’s already established here and tapping into our existing resources,” says Ayisha Sereni, coordinator of the school’s Center for Entrepreneurial Studies. "We’re a community college; we’re about the community. We have people walking through these doors every day who have dreams of having their own business. There’s no reason why we can’t provide them with the tools to open those businesses.”