Toolkit Home:
Measuring Your Business Incubator’s Impact

Most small businesses don’t make it to their fifth anniversary. In fact, according to the U.S. Small Business Administration, only 44 percent make it past four years.

Business incubators work to help businesses do better than that by offering specialized services and mentoring. Does it work? Historically, NBIA member incubators have reported that 87 percent of all graduate firms are still in business. Pretty impressive, isn’t it?

But here’s the hitch: the data on incubator graduates is more than ten years old. Funding sources, federal government officials, the media, and others want up-to-date proof of incubation’s impact. Today. In their communities and yours.

The general public doesn’t know a lot about economic development, let alone what incubation is or whether it’s effective. To many, economic development is the opening of a new chain restaurant. As an engine of economic growth, business incubators simply are not heard. We are small fish in a huge pond, and the great works demonstrated by the few are not heard by the many. We have an impressive story to tell. Without a unified voice, however, the silence is deafening.

Unfortunately, NBIA has had a difficult time gathering current information on incubator impacts because many incubation programs don’t track the success of their clients and graduates. Without hard data from incubators, NBIA can’t spread the word about the industry’s effectiveness.

Why would incubators not track this important information, especially if they have such a powerful story to tell? Because without guidance on what to track and how to measure success, it can be hard work.

That’s why NBIA, in cooperation with Southern California Edison, created this toolkit. We are providing incubator managers with the rationale and the tools they need to get started down this critical road of tracking success. We hope that this toolkit is the first step in a major data collection effort that will ultimately allow the industry not just to break the silence, but to break it with a triumphant message of success.