Date of Award

1-1-2009

Document Type

Campus Access Dissertation

Department

Educational Leadership and Policies

Sub-Department

Educational Administration

First Advisor

Michelle A. Maher

Abstract

The purpose of this case study is to understand and explain the characteristics of a small business incubator located on the campus of a community college. Business incubation and entrepreneurship programs are increasing in number on community college campuses across the country (Montoya, 2009). As community colleges have traditionally played a role in workforce development, they increasingly have to change the method in how they play this part. "Economic growth needs to come from small, home-grown businesses. And there is no better way to produce local business leaders than having an incubator and training future entrepreneurs right in your own backyard" (Amit Singh, Dean of Business and Computer Science, Montgomery County Community College, as cited in Montoya, 2009).

Springfield Technical Community College houses one of the most prominent business incubators on a community college campus. This study examines the distinctive factors of the Springfield Business Incubator. It provides an assessment of the economic development contributions to the Springfield, Massachusetts community and that of the Pioneer Valley in Western Massachusetts. The study examines the relationship between the academic and noncredit areas of Springfield Technical Community College and the Springfield Business Incubator. Finally, the case study reviews the financial relationship between the two entities.

Extensive interviews and focus groups were conducted of staff from both the Springfield Business Incubator and Springfield Technical Community College. Document reviews of existing by-laws, contracts, private letter rulings, and other public documents were conducted. Focus groups and direct interviews of Advisory Board members, incubator tenants, and incubator graduates were taken during a one week period of immersion at the subject site.

The findings of the study reveal that business incubation at a community college can generate business sustainment at or above the rate of nonprofit mixed use business incubators within their same category. Incubator graduates from the Springfield Business Incubator had a ninety percent survival rate after five years, as compared to a national average of eighty-seven percent for similarly incubated companies.

The Springfield Business Incubator also employed a development team approach with respect to mentoring tenant companies. Tenants were assigned a group of three advisory board members who met with the tenant on at least a quarterly basis. Tenants generally reported that they found the development team approach beneficial to their progress and growth. Advisory Board members were subject to a conflict of interest policy that provided for disclosure and sanctions for improper tenant-board member relationships. The conflict of interest policy adopted by the Scibelli Enterprise Center Advisory Board does not provide an absolute prohibition on potential conflicts of interest. This study recommends the usage of prohibitory language with exceptions made upon disclosure to and review by the advisory board.

The study found little or no nexus between the credit and noncredit programs of Springfield Technical Community College with regards to the Springfield Business Incubator. Incubated companies were not founded by community college graduates or students, and the tenant companies rarely hired students to work inside the incubator. Tenants also reported that they did not avail themselves of noncredit programs offered by the College. Alternatively, tenants chose to work with advisory board members, participate in free or low cost training programs offered by one of the five business support organizations at the incubator such as the Small Business Administration, the Massachusetts Small Business Development Corporation, or the Senior Council of Retired Executives (SCORE).

While the Springfield Business Incubator has earned notoriety for its practices, compared to other research by Molnar et. al. (1997), the incubator is inefficient in its production of jobs. The cost to create the incubator along with the operating subsidy provided by the Commonwealth of Massachusetts was much greater than the average small business incubator. This economic difference is magnified by the fact that the leasable square footage within the Springfield Business Incubator is roughly half that recommended by existing literature on business incubator operation.

Two-year college administrators may use this research in determining the efficacy of a business incubator on their campus and the possible benefits for their communities. Administrators may also find benefit in structuring any economic development programs around incubation and how they might improve their own efforts based on the results of this study.

Share

COinS