Definition of Business Incubator

What does the term "business incubator" mean? What is the definition of the term "business incubator"?

A business incubator is a company that provides support to small businesses that are just starting out.

Usually in exchange for a stake in the company, a business incubator will provide powerful incentives for a small company, namely office space and mentoring.

For instance, let's say that two young college graduates have an app that has caught the eye of a business incubator.

The incubator takes a small piece of the young company, and in exchange, they agree to provide networking possibilities, free office space and mentoring.

The people at the top of the business incubator will have experience starting and running a company, so they can provide valuable expertise to a growing company.

In addition, the providing of free office space will greatly help to minimize the costs of the small startup company.

Business incubators usually provide a strong value proposition for new companies, though small companies must be sure not to give up too much of their company.

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