Business incubator units are an effective support mechanism for new entrepreneurial firms in that they provide basic facilities, office space, administrative staff and expert managers during the volatile start-up and growth process. This enables entrepreneurs to reduce operating costs and focus their attention upon product development. There are also many intangible benefits to incubator placement such as enhanced firm credibility, access to established business networks and the opportunity to share the challenges of entrepreneurship with peers. From this study of such a unit in the Republic of Ireland however, it became apparent that as the firms grew and sought to enhance credibility and protect market share, disadvantages emerged regarding incubator placement. Firm proximity created tensions concerning privacy, the protection of intellectual property and competitive strategies. It was also evident that as the firms became more mature, the need to develop independent, secure internal systems could be impeded by the ready availability of support and advice from the incubator management team.