Business incubators: An Anglo-German affair

09 Nov 2005 | News
Reports of incubators' demise were premature

Reports of incubators' demise were premature

The number of business incubators, by country
Source: European Commission

Remember the days of incubators? Back in 1999-2000, everyone wanted to get in on a piece of the startup action. At the time, there were some 200 organisations registered with the now-defunct Business Incubators Association. These incubators plied young companies with advice, rooms, and services in exchange for equity stakes, in the hopes of giving them a turbo-start towards an IPO. The earlier investors got on board, went the thinking, the greater the financial rewards.

Fast forward to 2005 and from what you read in the press in many countries you might think that incubators have all but gone the way of the dodo. Certainly large numbers have closed their doors or transformed themselves into consultancies of one sort another. But, surprise: according to the most recent figures from the European Commission’s Enterprise and Industry Directorate General, incubators are alive and well in Europe, with more than 800 such institutions across 10 countries.

In particular, incubators are flourishing in the UK, which takes top honours with 263 incubators, followed by Germany with 208 incubators. After that, there is a wide gap; the third greatest concentration is in France, which has 83 incubators, followed by Finland with 38. By sector, the most frequently found incubators are in the fields of software development, "e-business" and computer technology.

Many of these incubators are run as straightforward technology parks that charge rent, rather than the once-popular option of taking equity stakes. Others are supported in part by regional governments. For example, the Medical Technology Centre Aachen (MTZ) in the city of Aachen, Germany, provides consulting to start-ups for up to nine months and is managed by AGIT, the regional development agency for the Aachen region. Others are closely tied to universities, such as the Advanced Centre of Excellence for Nanotechnology, associated with the University of Newcastle in the UK.

The EC's CORDIS website, dedicated to European R&D and innovation activities, provides an easily searchable database of incubators across Europe with full contact information for each incubator. Also see Gate2Growth for more information on incubator activities across Europe.

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