Business incubators have been around since the 1950s. Typically attached to universities, these entities offered a proving ground, with back-office resources, for fledgling entrepreneurs.
Now a new breed of incubator, catering mainly to technology types, is springing up all over the country. These start up hubs offer expert mentor ship, resources like office space and legal counsel, and even seed money—typically in exchange for a small amount of equity in tiny (or theoretical) companies. More importantly, early-stage investors are paying close attention.
Paul Graham, founder of Y Combinator, is the father of all startup incubators. (Y Combinator birthed Dropbox, a file hosting company valued at $4 billion, among other newly minted tech stars.) Since Graham launched his incubator in 2005, about 100 more have come on the scene worldwide.
Like top business schools, startup incubators are particular about whom they let in. Actually, they’re stingier: With acceptance rates typically in the low single digits, your odds of getting a bid to Harvard Business School are about three times greater than nabbing a spot in a premium incubator.