Now, back to reality.

I challenge your assertion that tough love or benign neglect is the only way to churn out successful new companies. Yes, you are correct that most entrepreneurs are passionate and highly driven. Unlike most of us, they pick up and move on after making a mistake. But just because they learn from their failures, doesn’t mean we should set them up for failure in order to succeed!

You are worried that coddling all these new businesses in incubators will diminish entrepreneurs’ drive and resourcefulness and therefore their chance of success. Based on our research into a variety of incubators, most are not as coddling an environment as you describe and most do not readily dole out funding. First, you must compete to get into most incubators, many of which have waiting lists of qualified applicants. Also, the incubators we studied have a limited term for resident clients. They push companies out when they either fail to meet agreed upon milestones (a bad thing) or they expand beyond the capacity of the facility and its resources (a good thing!). And when entrepreneurs graduate from incubators, we’ve heard time and time again how they give back to the incubators that shaped them, helping younger companies persevere through the challenges of start-up. If giving back and helping people avoid mistakes you’ve made is akin to “mothers’ milk”, then let’s drink up!

A more fundamental issue I think you are getting at is whether or not incubators matter. What would happen if incubators weren’t around? It’s really hard to say. You rightly point out the recent explosion of incubators around the world. Everyone wants to get in on the act, but not all are doing it well and not all will churn out the next PayPal and Facebook.

Offering cheap, shared office space and a coach or two is not incubation to me. True incubators offer a whole suite of services to promising new companies across sectors. We need to track the performance of graduate companies more rigorously, comparing long term job and real income growth in comparable jurisdictions, one with incubators and one without.

All things being equal, my guess is that those areas with full-fledged incubators achieve higher rates of success for start-ups of sustainable new businesses. Whether or not this occurs on a low baseline or a high one, it boosts the local economy.

I don’t think that incubators dull entrepreneurial motivation nor do they give false courage through subsidy to wannabe entrepreneurs. Those who are lazy and are looking for handouts won’t even make it in the door of a rigorous incubator.

Cutting funding and other forms of support isn’t the answer. We need these jobs and this creative spirit to drive our economies forward. We should not make life more difficult for new business start-ups.