At the water cooler, mention an incubator and your colleagues might think you are referring to the device that keeps a hen’s eggs warm until they have had time to hatch. But if you mention the word to Robert Sharp, he recalls his days working in Silicon Valley where he launched his high-tech career in an incubator.

Jonathan Rowe, director of the UNCW Entrepreneurship Center, instructs his students about a business incubator by borrowing the egg incubator analogy.

A business incubator, according to Rowe, provides resources to a very early or young start-up company that has great potential to grow.

Entrepreneurs will join an incubator to grow and to generate more sales. When the companies become “more financially stable they can fly on their own,” Rowe said. At that time, the company will step out on its own, get its own location and hire its own staff.

Rowe suggested that incubators mostly focus on companies with a potential for high-growth—helping to nurture the high-growth—versus a small business. In an example, if a business wants to venture into cookie delivery, it would probably remain a small business of one or two people.

For a start-up company, an incubator can provide, Rowe explained, resources, collaboration and affordability.

Often, incubators are non-profit and are tied to a university. An incubator, for instance, might house four separate companies in one building and these businesses share resources. An administrative assistant can answer calls for all the businesses and they share copy machines, computers, and telephones. A lawyer or an accountant can be brought in for an hour or two. The cost of services or equipment can be shared or resources might be donated.

“It can give the perception of a much bigger company,” Rowe said. There are the “economies of scale and spreads it out.”

There are several incubators across the state, including those with university affiliations. North Carolina State University has one, the Technology Incubator. UNC Charlotte is involved with the Ben Craig Center, which Rowe wrote in an e-mail, was “organized by a ‘who’s who’ of business and government organizations.”

With the commercial real estate space available in this economy, some offices could transition to an incubator-type space and Wilmington might be moving in that direction.

UNCW’s future plans include a non-profit space for biotechnology research at the Center for Marine Sciences campus. 

Realizing that he needed office space, Robert Sharp started collaborating on BuenaSpace, which plans to open its doors in early April. Building upon Sharp’s Silicon Valley experiences with incubators, he has developed a hybrid incubator that allows for a space that will encourage collaboration.

This Wilmington space is a partnership between Buena Sustainable Communities, Sharp’s wife’s business, and Digieffects, his own company. They will be the anchor businesses in BuenaSpace. The couple is currently marketing the space and locating people to fill it. Located downtown at 27 North Front Street, Sharp is renovating the entire 2,500 square feet of the second floor to provide a co-working environment similar to his experiences with Silicon Valley.

Although BuenaSpace hopes to attract remote workers, those in creative industries and entrepreneurs, it will also incorporate a non-profit element into its mix with its first pro-bono project being Leading into New Communities (LINC).

In the Wilmington area, “there has been an explosion of remote workers and freelancers who are now working out of their basement or a coffee shop. This is a better place, more conducive to working,” Sharp said.

“A space like this would help to continue to revitalize downtown and help foster high-paying jobs that Wilmington needs,” Sharp said. He also sees BuenaSpace as “helping downtown, provide a great space” while allowing the company to become involved in pro-bono work for the community and as a recruiting tool for Digieffects.

An incubator, Rowe said, also is a place for collaborative work.

Rowe said an office full of similar-minded business can give an entrepreneur people with whom to collaborate. There is a value from being around other people rather than working from home, perhaps isolated from other entrepreneurs.

Sharing the resources brings an element of affordability to the equation of an incubator.

Members of an incubator would pay a flat fee instead of dealing with various costs associated with renting or leasing an office, such as phone and Internet services, electricity or furniture.

According to Rowe, there are two forms of incubators: non-profit and for-profit. With each model, there may be an application process or some “filtering process” to determine if the businesses are a good fit for each other.

Obviously, a for-profit incubator is interested in making money by selling the package of an office and its suite.  A non-profit incubator is interested in “attracting start-up companies to the area,” Rowe said. “Attracting high-growth businesses to the area creates jobs and creates companies.” It can also help local companies grow by helping to attract financing.

Although much collaboration can happen virtually these days, city business centers that can support many incubators, such as the Research Triangle area surrounding Raleigh, have technology customers that subscribe to the basic definition of an incubator.