Incubating innovation: the role of incubators in supporting business model innovation

Abstract

Purpose The role of incubators in promoting startup growth has received close research attention, but the findings paint a conflicting picture. This study aims to reduce the ambiguity surrounding incubator impact by exploring how incubators can support startups with business model innovations – a significant growth factor for startups neglected in the incubation literature. Design/methodology/approach Using a multiple-case study design, the authors conducted semistructured interviews with incubator directors and startup founders, offering insights into their experiences. The transcripts were coded following the Gioia method. Findings This study shows that incubatees are exposed to and struggle with business model innovation. Therefore, this study explores how incubators can support startups in innovating their business models. Research limitations/implications This research reveals the importance of addressing the psychological needs of entrepreneurs in incubators. By offering emotional support, incubators can create a positive psychological environment, helping entrepreneurs face fears and challenges. This highlights the human side of entrepreneurship, which has not been considered in the incubation literature. Practical implications Incubator directors can strengthen their programmes’ impact by offering tailored support for business model innovation and facilitating network connections. Policymakers should encourage ecosystem collaboration and allocate resources to effective programmes. Originality/value This research fills a gap in the incubation literature by emphasizing the significance and need for support for business model innovation. This study also offers original insights into the psychological dimensions of entrepreneurship.