Theoretical foundations of incubator success: Applying business incubation and entrepreneurial value creation to post-incubatee development

Abstract

Background: A business incubator’s main goal is to produce successful firms that will leave the programme financially viable and freestanding. Incubator graduates have the potential to create jobs, revitalise neighbourhoods, commercialise new technologies and strengthen local and national economies. Aim: This study aimed to investigate the influence of business incubation and to develop a theoretically grounded and practically applicable framework that will address the business incubation process and service gaps identified during and after business incubation. Setting: The population for this study was Gauteng-based entrepreneurs who have graduated or exited business incubation programmes, as well as incubation managers, mentors and programme developers. Methods: A qualitative, inductive case study research design was used to gain a deeper understanding of the role played by business incubators and to what extent they were successful in enabling growth and sustainability. Results: The provision of a structured business incubation mentoring and coaching approach enhanced the incubatees’ business development skills and their confidence to position themselves in the market. Despite the many challenges that post-incubatees face outside an incubation programme, incubatees have marginally managed to find ways of ensuring the continued existence of their businesses. Conclusion: Incubators enabled nascent entrepreneurs to develop and grow their businesses in the market post-incubation. Incubators are still limited in the provision of highly skilled industry mentors, and acquiring funding is a challenge for post-incubatees. Contribution: A theoretical and practical gap was filled in understanding the influence of a business incubation process once entrepreneurs have graduated from the programme, as per the case of post-incubatees in the Gauteng province.