Mike Armstrong, August 20, 2012
So many business incubators and co-working spaces for small firms have opened in the Philadelphia area in the last three years that when two more sprouted this summer, it felt as if the region might be reaching a saturation point.
But considering that these two incubators are in Chester County and mark the first ones the county has had in many years, the question is: What took it so long to join the shared-space rally?
First, the particulars. Evolve IP L.L.C., a provider of cloud-computing technology and services, opened a 10,000-square-foot incubator for information-technology firms at its offices at 989 Old Eagle School Rd. in Tredyffrin Township earlier this month. Hankin Group opened a 40,000-square-foot incubator for biotech companies at 665 Stockton Dr. in Uwchlan Township in July.
Both privately owned incubators offer small amounts of space, from a few hundred square feet to several thousand. They provide the shared services, equipment and conference rooms that are standard fare at all incubators.
What makes these two a little different is they are located in Chester County’s Keystone Innovation Zone, a state designation that provides certain tax advantages and other services to businesses. An enterprise that leases space would be able to tap the resources of the Chester County Economic Development Council’s Ideas x Innovation Network (i2n), which runs the KIZs in Chester and Delaware Counties.
A big incentive is the availability of up to $100,000 in KIZ tax credits annually that a start-up could use or sell for cash, according to Mary Fuchs, co-director of i2n.
Not just any company can move into one of the KIZ incubators. To qualify, a business must be less than eight years old and operate in the life-sciences, information-technology or energy sectors, Fuchs said.
Despite having some of the best-known local high-tech addresses – Malvern, Exton, Wayne – Chester County didn’t have dedicated small spaces available to attract the next generation of start-ups. Hankin Group, which had empty laboratory space available when 3-Dimensional Pharmaceuticals, a division of Johnson & Johnson, was shut down, and Evolve IP, which has grown to about 80 employees in only four years, responded to a formal request by the Economic Development County and agreed to host incubators, Fuchs said.
Though there are other incubators offering lab space and IT-intensive environments in the region, especially in Philadelphia, Chester County’s economic-development officials are following a well-thumbed playbook.
The number of incubators in the United States has climbed to 1,250 currently from about 1,100 in 2006, according to the National Business Incubation Association. Linda Knopp, its director of policy analysis and research, attributed that increase in part to community organizations trying to stimulate economic growth and job creation.
Knopp said surveys show that the “graduates” of incubators tend to stay in the region where they started.