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Business incubation process and firm performance: an empirical review

Author

Listed:
  • Fidelis A. Ayatse

    (University of Agriculture)

  • Nguwasen Kwahar

    (University of Agriculture)

  • Akuraun S. Iyortsuun

    (Federal University)

Abstract

Industrialization is central if any economy is to be successful and the policy attempts at industrialization involve creating systems and institutional arrangements that can help accelerate the process of industrialization. Business incubation is also a system and an institutional arrangement to help nations industrialize by developing the SME sector. This paper hopes to understand how the business incubation process influences firm performance. The methodology adopted is a comprehensive and extensive review of literature on the incubation phenomenon. The review found that firm performance is greatly enhanced when a firm avail itself to an incubation program. Revenue growth, employment or job creation, venture funding, networking and alliance building are the performance indices most impacted by the business incubation process. The paper recommends that prospective candidates for incubation should develop their market, management and financial plans to increase their chance of being selected as tenants. Also, firms are encouraged to access the value-addition services of incubation as this greatly increases their chances of firm survival, revenue growth, employment and job creation, financial resources and networking and alliance building. Furthermore, tenants should not overstay their tenancy in an incubation program as doing so reduces their chances of survival upon graduation.

Suggested Citation

  • Fidelis A. Ayatse & Nguwasen Kwahar & Akuraun S. Iyortsuun, 2017. "Business incubation process and firm performance: an empirical review," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 7(1), pages 1-17, December.
    • Handle: RePEc:spr:jglont:v:7:y:2017:i:1:d:10.1186_s40497-016-0059-6
    DOI: 10.1186/s40497-016-0059-6
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    References listed on IDEAS

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    Cited by:

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    2. Sohail, Kanza & Belitski, Maksim & Castro Christiansen, Liza, 2023. "Developing business incubation process frameworks: A systematic literature review," Journal of Business Research, Elsevier, vol. 162(C).
    3. Claudia Isac, 2017. "Business Incubators and Accelerators - Instruments in the Development of the Business Environment," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 17(2), pages 123-130.
    4. Mingfeng Tang & Hao Huang & Grace Walsh & Maribel Guerrero, 2023. "The impact of entrepreneurial overconfidence on incubator effectiveness," The Journal of Technology Transfer, Springer, vol. 48(1), pages 416-440, February.
    5. Tamer Ayad & Abu Elnasr E. Sobaih & Ibrahim A. Elshaer, 2022. "University Incubator Support and Entrepreneurial Intention among Tourism Graduates: Mediating Role of Personal Attitude," Sustainability, MDPI, vol. 14(23), pages 1-18, December.
    6. Sharma, Supriya & Vohra, Neharika, 2020. "Incubation in India – A Multilevel Analysis," IIMA Working Papers WP 2020-03-01, Indian Institute of Management Ahmedabad, Research and Publication Department.
    7. Nandwa J. Musambayi, 2018. "Leadership and firm entrepreneurial performance in county governments in Kenya," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 8(1), pages 1-12, December.
    8. Bellido-Jiménez, Víctor Manuel & Martín-Martín, Domingo & Romero Luna, Isidoro, 2022. "Autoempleo en inmigrantes y supervivencia empresarial de los negocios incubados en Andalucía," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 52, pages 59-80.
    9. Leendertse, Jip & Schrijvers, Mirella & Stam, Erik, 2022. "Measure Twice, Cut Once: Entrepreneurial Ecosystem Metrics," Research Policy, Elsevier, vol. 51(9).
    10. Amir Hossein Azadnia & Simon Stephens & Pezhman Ghadimi & George Onofrei, 2022. "A comprehensive performance measurement framework for business incubation centres: Empirical evidence in an Irish context," Business Strategy and the Environment, Wiley Blackwell, vol. 31(5), pages 2437-2455, July.
    11. Michele Manconi & Salvatore Bellomo & Anna Nosella & Lara Agostini, 2022. "Attributes of Business Incubators: A Conjoint Analysis of Venture Capitalist’s Decision Making," JRFM, MDPI, vol. 15(5), pages 1-16, May.
    12. K. T. Parthiban & C. Cinthia Fernandaz & S. Selvanayaki, 2022. "Agroforestry Business Incubator—an innovative institution for leveraging technology-based business opportunities in forestry," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 12(1), pages 97-105, December.

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