American University’s Kogod School of Business on Friday plans to show off its new on-campus start-up incubator, the latest in a string of co-working spaces to pop up in and around the nation’s capital.
The incubator, one of the key components of the school’s recently announced Sustainable Entrepreneurship and Innovation Initiative, aims to provide current students and recent graduates with work space and pair them with a business mentor to help get their fledgling ventures off the ground. In addition, each business team will received a $1,500 grant to cover some initial start-up costs, such as the legal work necessary to incorporate a company.
Companies that move beyond the initial concept stage and start to show traction will be able to apply for seed capital from the university’s newly created $100,000 Entrepreneurship Venture Fund.
Stevan Holmberg, the director of the school’s new entrepreneurship initiative, said the incubator extends the business school’s legacy of emphasizing entrepreneurship, dating back to the offering of the university’s first course in entrepreneurship in 1987. The school instituted a minor in entrepreneurship last fall.
“It was time for the next step, and that step was moving from learning entrepreneurship in a classroom to living it in a live lab,” Holmberg said.
Although the incubator has not officially opened, five business teams, with a couple of dozen individuals between them, have already been accepted into its inaugural class. A dozen more teams have submitted applications.
With the launch, American University joins a quickly growing number of local universities and municipalities that have invested in building collaborative start-up incubators. In the past few years, the District has seen the opening of co-working spaces that include 1776, the Hive and the H Street GreenHouse and a pair of WeWork incubators, one in the Shaw neighborhood and another in Chinatown.
Some of that, Holmberg said, likely stems from mounting economic data showing that new and young businesses traditionally generate the bulk of new jobs. Yet many young companies are struggling to get going, much less expand, in this economic climate.
“We’re seeing a number of local governments and organizations recognizing that entrepreneurial ventures drive employment opportunities and economic growth,” he said. “At the same time, this fits into the school’s role to continue building on the educational mission of the university.”