Phyllis G. QueenPhyllis G. QueenBusiness Consultant for Business Consultant for

TFCETFCE

on:on:Business Incubator/Business Incubator/Innovation CenterInnovation Center

Business IncubatorBusiness Incubator(National Business Incubation (National Business Incubation

Association)Association)

Business incubators are Business incubators are instrumental in instrumental in accelerating the success accelerating the success of entrepreneurs with of entrepreneurs with the start-up of new or the start-up of new or fledgling companies. fledgling companies.

Different Types of Business Different Types of Business IncubatorsIncubators

(National Business Incubation (National Business Incubation Association)Association)

Non-profit (94%)Non-profit (94%) For-profit (6%)For-profit (6%)

Made up of:Made up of: Technology (39%)Technology (39%) Manufacturing (3%)Manufacturing (3%) Mixed (54%)Mixed (54%) Specialty or Niche Markets (4%)Specialty or Niche Markets (4%)

Operators/Sponsors ofOperators/Sponsors of Business Incubators (NBIA)Business Incubators (NBIA)

Economic Development Economic Development Organizations (31%)Organizations (31%)

Government Entities (21%)Government Entities (21%) Academic Institutions (20%)Academic Institutions (20%) Hybrids (8%)Hybrids (8%) For-profit Entities (4%)For-profit Entities (4%) Other Types of Organizations Other Types of Organizations

(8%)(8%) No Sponsor (8%)No Sponsor (8%)

Types of ServicesTypes of Services

Business Basics AssistanceBusiness Basics Assistance Marketing AssistanceMarketing Assistance Technology AssistanceTechnology Assistance Networking Activities AssistanceNetworking Activities Assistance Financial Management Financial Management

AssistanceAssistance Regulatory Compliance Regulatory Compliance

AssistanceAssistance

Types of Services (cont.)Types of Services (cont.)

Assist with Access to CapitalAssist with Access to Capital Access to Internet ServicesAccess to Internet Services Access to Higher Education Access to Higher Education

ResourcesResources Assist with Presentation AbilitiesAssist with Presentation Abilities Access to Business Training Access to Business Training

ProgramsPrograms Assistance with Intellectual Assistance with Intellectual

Property Property

Asheville-Buncombe Technical Asheville-Buncombe Technical Community CollegeCommunity College

Business Incubation ProgramBusiness Incubation Program Business plan must be submittedBusiness plan must be submitted 2 year term in program2 year term in program Submit to open book accountingSubmit to open book accounting Complete four business seminarsComplete four business seminars Attend monthly tenant meetings Attend monthly tenant meetings Pay rentPay rent

Asheville-Buncombe Technical Asheville-Buncombe Technical Community CollegeCommunity College

Student Business Incubation ProgramStudent Business Incubation Program 12 month extracurricular activity12 month extracurricular activity 4 student run businesses selected 4 student run businesses selected

each yeareach year Requirements same as for Requirements same as for

businessesbusinesses

except:except: Maintain student statusMaintain student status College & community event College & community event

participationparticipation

Ben Craig Center (UNC Ben Craig Center (UNC Charlotte)Charlotte)

Graduated 102 companies (as to Graduated 102 companies (as to date)date)

80% financially viable at 80% financially viable at graduation graduation

(avg. 3-5 yrs. incubation stay)(avg. 3-5 yrs. incubation stay) Client base is:Client base is:

44% Technology44% Technology

39% Service oriented39% Service oriented

17% Product sales17% Product sales

Nussbaum Center for Nussbaum Center for EntrepreneurshipEntrepreneurship(Greensboro, NC)(Greensboro, NC)

Graduated 130 businesses Graduated 130 businesses 80% success rate80% success rate Over 1200 jobs have been Over 1200 jobs have been

createdcreated In 2005 alone, 125 million in In 2005 alone, 125 million in

revenue and 4 million in tax revenue and 4 million in tax revenue added to local economyrevenue added to local economy..

Fayetteville N.C. Business Fayetteville N.C. Business CenterCenter

((in partnership with Fayetteville State in partnership with Fayetteville State University) University)

Hands-on approachHands-on approach Flexible space in which to growFlexible space in which to grow Marketing assistanceMarketing assistance Special topic seminarsSpecial topic seminars

So, Why a Business So, Why a Business Incubator/Innovation Incubator/Innovation

Center Center for Robeson County?for Robeson County?

2005 N.C. Statistics2005 N.C. Statistics ((Department of CommerceDepartment of Commerce))

New business start-ups – 25,906New business start-ups – 25,906 Business failures – 22,867Business failures – 22,867 3,039 difference3,039 difference 88% - failure88% - failure 12% - success12% - success

https://edis.commerce.state.nc.us/docs/stateComparison/NC_NC.pdfhttps://edis.commerce.state.nc.us/docs/stateComparison/NC_NC.pdf

Loss of Jobs (N.C.)Loss of Jobs (N.C.)(Bureau of Economic Analysis)(Bureau of Economic Analysis)

Manufacturing jobs Manufacturing jobs lost between July lost between July 2007 – July 2008 2007 – July 2008 totaled approx. totaled approx. 18,000.18,000.

Construction jobs Construction jobs increased from July increased from July 2007 – July 2008, 2007 – July 2008, creating approx. creating approx. 1,900 jobs.1,900 jobs.

What happened to What happened to the other 16,100 the other 16,100 people who lost their people who lost their jobs?jobs?

“Quite simply, the state’s rural economies are not creating enough high- and middle income jobs to meet all of their local employment needs. For some workers, the option is to settle forunderemployment or no employment.”

North Carolina UnemploymentNorth Carolina Unemployment

(According to U.S. Department of (According to U.S. Department of Labor)Labor)

Unemployment rate 6.6% as of July Unemployment rate 6.6% as of July 20082008

..7% increase from June 2008 – July 7% increase from June 2008 – July 20082008

1.9% increase from July 2007 – July 1.9% increase from July 2007 – July 20082008

N.C. Annual Unemployment Rate 1995-2005N.C. Annual Unemployment Rate 1995-2005(N.C. Commission on Workforce Development)(N.C. Commission on Workforce Development)

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

1995 1996 1997 1998 1999 2000 20012002 2003 2004 2005

Une

mpl

oym

ent R

ate

North Carolina

MetroRural

N.C. & Robeson County Unemployment RatesN.C. & Robeson County Unemployment Rates1994-20031994-2003

(N.C. Employment Security Commission)(N.C. Employment Security Commission)

0

2

4

6

8

10

12

14

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

CountyState

StatisticsStatistics(U.S. Dept. of Labor)(U.S. Dept. of Labor)

Unemployment in September 2007Unemployment in September 2007

Robeson County  Robeson County    

6.1%6.1%

North Carolina North Carolina    

4.7% 4.7%

Statistics (cont.)Statistics (cont.)((U.S. Census BureauU.S. Census Bureau ) )

% of families living below poverty level in 2006% of families living below poverty level in 2006

Robeson Robeson County County

25.5%25.5%

North North Carolina:  Carolina: 

15.1% 15.1%

Statistics (cont.)Statistics (cont.)((U.S Census Bureau)U.S Census Bureau)

Median household income in 2006:Median household income in 2006:

Robeson Robeson CountyCounty

$29,195$29,195

North North CarolinaCarolina

$40,729$40,729

PER CAPITA PERSONAL INCOMEPER CAPITA PERSONAL INCOME

((Bureau of Economic Analysis)Bureau of Economic Analysis) ““In 2006 Robeson had a per capita In 2006 Robeson had a per capita

personal income (personal income (PCPIPCPI) of $21,675. ) of $21,675. This PCPI ranked 99th in the state This PCPI ranked 99th in the state and was 67 percent of the state and was 67 percent of the state average, $32,247, and 59 percent of average, $32,247, and 59 percent of the national average, $36,714.” the national average, $36,714.”

http://www.bea.gov/regional/bearfacts/action.cfm?fips=37155&areatype=37155&yearin=http://www.bea.gov/regional/bearfacts/action.cfm?fips=37155&areatype=37155&yearin=20062006

Business Incubation Business Incubation SuccessSuccess

Historically 87% Success Rate (Nationally)Historically 87% Success Rate (Nationally)(National Business Incubation Association)(National Business Incubation Association)

Every 50 jobs created by an incubator Every 50 jobs created by an incubator client generate another 25 jobs in the client generate another 25 jobs in the community.community.(National Business Incubation Association)(National Business Incubation Association)

88% of NC incubator graduates remain in 88% of NC incubator graduates remain in close proximity of the incubator and close proximity of the incubator and continue to contribute to the community continue to contribute to the community economy.economy.(NC Technological Development Authority, Inc.)(NC Technological Development Authority, Inc.)

Effectiveness of an Effectiveness of an Incubator as an Economic Incubator as an Economic

Development ToolDevelopment Tool Stimulates entrepreneurship Stimulates entrepreneurship Potential to build community Potential to build community

wealthwealth Create new jobsCreate new jobs Increase community tax baseIncrease community tax base Community revitalizationCommunity revitalization

In SummaryIn SummaryIn light of the information provided, we see In light of the information provided, we see that a business incubation program has that a business incubation program has proven to be a successful tool in improving proven to be a successful tool in improving the economic status of a community. the economic status of a community.

Since 52% of Americans work in a small Since 52% of Americans work in a small business setting (between 1 & 499 workers), it business setting (between 1 & 499 workers), it is proven to be a continuing source of vitality is proven to be a continuing source of vitality for our economy producing ¾ of the for our economy producing ¾ of the economy’s new jobs between 1990-1995. economy’s new jobs between 1990-1995. http://economics.about.com/od/smallbigbusiness/a/us_business.hhttp://economics.about.com/od/smallbigbusiness/a/us_business.htmtm

So, considering the facts presented, we should So, considering the facts presented, we should do all we can to see new businesses succeed in do all we can to see new businesses succeed in order to sustain/improve the economy? order to sustain/improve the economy?

Plans of TFCEPlans of TFCE

Academic institutionsAcademic institutions Local organizations Local organizations Lending institutionsLending institutions Seek funding Seek funding

QUESTIONS?QUESTIONS?