Date of Award


Document Type



Edith Cowan University

Degree Name

Master of Management by Research


School of Business


Faculty of Business and Law

First Supervisor

Dr Janice Redmond

Second Supervisor

Professor Elizabeth Walker


Australia was an early adopter of business incubation, and made substantial investments in it in the early 2000s, however local interest has declined with the closure of big government-funded projects, at a time when international interest in business incubation is increasing. This study revisits the question of business incubators and their usefulness in economic development, describing a case study conducted on a university-linked business incubator in Australia. It investigates the impact of its operations on developing start-up businesses operating from within the facility; the motivations, perceptions and priorities of small businesses tenants and former tenants; and the role of the manager in influencing the development of new enterprises. The study builds on the theoretical understanding of business incubation and a model has been developed that demonstrates the ways in which options theory, coproduction theory, networking theory and social capital theory explain stages of incubation.

The study found the principle motivation for tenants to locate their business within a business incubator was the price for the office space and not the business development assistance that is the primary service of the business incubator. Once operating from within the business incubator, however, the principle advantage perceived by tenants was the provision of business assistance in the development and growth of their businesses. The only disadvantage raised was price as it reduced the pressure to strive for profits and business growth on the tenant businesses. The interaction with the manager was found to have a positive impact on the tenant businesses and contributed to their development. The tenants believed that the interaction was on their own terms and that they could seek advice whenever they needed from the manager. The manager believed that he could add value by assisting the tenants directly, with connecting them and introducing tenants to other service providers and businesses when required.