The family that bought the plant decided to divide up the building into smaller spaces for use by smaller companies. The family provided accounting help and assisted them with raising capital and provided other business assistance services. Since then business incubators have spread throughout the nation.
San Angelo has its own business incubator called the Business Factory located downtown in the Business Resource Center facility on North Chadbourne Street. The Business Factory is a program under the City of San Angelo Development Corporation (COSADC). Its goal is to help young firms grow and survive during the crucial start up period.
Originally started in 2003, the Business Factory has housed and supported many small businesses in San Angelo. Many of these businesses have survived and beat the odds by still being in business. According to the U.S. Small Business Administration in 2012, only a half of small businesses survive 5 years from startup. However, the National Business Incubator Association has stated that from their 2010 data, 87 percent of all firms that have graduated from their incubators are still in business. They also state this is especially true when there is technical business assistance available to incubator clients. With San Angelo’s incubator, the Business Factory, the technical business advice is located under the same roof. The ASU Small Business Development Center (SBDC) is located in the Business Resource Center and regularly provides technical business advice and training and resource connections to incubator clients as well as hundreds of other small business clients in the Concho Valley. In fact, most of the incubator clients are referred to the Business Factory from the SBDC.
In all, small business incubators are supportive environments in the startup phase for small business in the startup phase. They provide administrative services and technical support under one roof and for a set price based on the leased square footage. Rent is ramped upwards over a 3-4 year period to allow the incubator client to become financially stable. At the end of the period the client will graduate, and have paid market rates for the last year of their lease.
In addition, the Business Factory has an advisory board made up of local business owners, former incubator clients, business development officials, and financial experts that provide additional advice, connections, and encouragement to incubator clients. All this provides a supportive environment for small business to grow and thrive, which is the goal of business incubation.
For more information on the Business Factory business incubator, contact Nora Nevarez with COSADC at 325-653-7197 or contact me at the SBDC 325-942-2098.
“Business Tips” was written by Dave Erickson, Director and Certified Business Advisor, of Angelo State University’s Small Business Development Center. For more information on the topic of this article or the services of the ASU · SBDC, contact him at David.Erickson@angelo.edu.