Are incubators a good investment?
A new report from the Economic Development Administration places these types of public investment higher that other forms of infrastructure investment. Incubators generate 20 times more jobs than community infrastructure projects, like road or water projects. Effective incubator projects work for two reasons.
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First, they fill a hole in the local real estate market. For reasons that have to do with cost structures, commercial markets tend to underserve the needs of smaller companies.
Second, effective incubators support their companies with networks of resources. Entrepreneurs create value from assets they do not own. They need networks to find, align, and leverage these assets quickly. The Youngstown Business Incubator is an excellent example.
Here's the EDA report.
