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Business incubation in the private sector, South Africa

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Abstract:

Raizcorp is a for-profit incubator in South Africa which does not receive government or donor funding. Revenue is raised through a mixture of fees and equity stakes in the client companies. The incubator's relationship with client businesses continues beyond the initial start up period to the time when businesses become profitable and beyond. This article describes Raizcorp's business model and what has been achieved so far. It emphasizes that there are no blueprints on how to run a perfect business incubator. The circumstances in different countries, and even different regions within countries, demand different solutions. Raizcorp found that operating in rural Kwazulu Natal required a different approach from urban South Africa.

Keywords: ENTREPRENEURSHIP; EQUITY INVESTMENT; INCUBATORS; SELECTION CRITERIA; SOUTH AFRICA

Document Type: Research Article

DOI: http://dx.doi.org/10.3362/1755-1986.2009.006

Publication date: March 1, 2009

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