Incubators are the future of business," said Howard Morgan, vice chairman of Pasadena-based Internet incubator Idealab. "The model has created a way for start-ups to hit the ground running by learning from and collaborating with other companies in the incubator.

Most incubators specialize in a particular product or industry. Since the bulk of funding for New Jersey incubators comes from the New Jersey Commission on Science and Technology, the majority of incubators are involved in high-tech projects. Typically, incubator funding comes from nonprofit organizations such as economic development centers, colleges and universities.

Increasingly regional companies, such as the Arena Stage in Washington, DC, have been incubators for actors and productions that have eventually proved successful on Broadway.