Startup Incubator | Incubators are more open-ended than accelerators, and aren’t usually designed to rapidly boost growth. Instead, incubators nurture and mentor startups over longer periods of time – over a year.
While accelerators want to pay close attention to each startup, incubators provide ad-hoc help with legal and business services, as well as help turning a concept into something with product-market fit.
There are lessons you can learn from Startup Incubator Program. Check these out!
A good incubator support you to grow your business for the sake of the local economy or monetize equity in new companies that they support. This includes assistance with business basics resources, work essentials such as office space, internet, digital marketing activities, and more.
Incubators offer advice and capital to steer you in the right direction. Through their mentorship programs, young entrepreneurs are helped to avoid making costly mistakes as they grow their businesses.
- Networking Opportunities
An incubator provide founders with numerous networking opportunities, team-building occasions with fellow entrepreneurs as well as a robust business partner network.
Competition Is a Gift
- Competition Is a gift
When you start a startup, the very notion of competition can be intimidating. Instead, an accelerator will teach you to embrace the value of competitors.
- Speed Is your superpower
One thing startups do have going for them is speed, you learn to embrace this as your core advantage to outperform competitors. This speed enables startups to launch products in a matter of months or even weeks. Startups have to respond quickly to customers’ evolving expectations, so when we learned that a customer was evaluating a competitor to replace us, we acted at the speed of light to meet their needs. We built new features on nights and weekends and within two weeks we had surpassed the customer’s initial ask and leapfrogged the competitor. The customer was so impressed with our responsiveness that they upped their contract size. It’s those “code red” moments that truly move forward your product. Speed is what gives startups their most important advantage over large players.
- Customer development Is face to face
Many first-time entrepreneurs learn that this is in fact the “lean” way of building products that address a pain point. Thanks to all the resources you have access to – including mentors, customers and potential investors – an incubator is one of the best ways to build your customer strategy.
- Culture is an absolute must
At big companies, tech recruiting tends to focus more on hard skills and less on cultural fit. As a result, they hire qualified people who don’t necessarily have the leadership skills or passion to advance their organization. However, personality fit is much more critical at startups, due to their close-knit work culture. Building our startup at Techstars, we began to understand the importance of hiring missionary leaders, driven by purpose, rather than mercenary leaders, or opportunists focused on money.
We learned that the hard way when we hired a brilliant, award-winning employee without evaluating the cultural fit. Unfortunately, we realized we didn’t share the same vision or leadership principles, so despite his smarts, we had to part ways. At any startup, while the technical bar is very high, the experience is intimate, and thus requires a unique kind of dedication. As such, entrepreneurs need to focus tremendously on cultural fit, and finding missionaries, not mercenaries, as they expand their teams.
Adjust Work Style and Get Comfortable
For many, the steep learning curve of an accelerator is the perfect bridge from being a corporate employee to becoming a startup founder. You quickly have to adjust your work style, get comfortable with the lack of a safety net, understand how to differentiate from competition and grow your ideal team. Find the right accelerator, and it will give you a crash course in running a startup so when the time comes to run the business — you won’t need to crash.
Incubators usually provide office space and consultations with experts, but take a more laid-back approach. There’s no intense program here — just an environment of collaboration and support when needed.
Examples of incubators include 500 Startups and Amplify.LA.
Is an incubator right for my startup?
If your company is not ready to join an accelerator program, an incubator might be the answer. Incubators help startups solve technical and design issues when building the product, learn how to run lean, and build a successful team.
Incubators also help startups who don’t have experience operating a venture-backed startup or are up against legal and operational issues related to company structure, etc.
Incubators usually don’t require equity or put as much pressure on success as accelerators, but also don’t offer capital. It’s all a trade-off.
To summarize: if your company is very early stage and needs help getting past the idea stage, an incubator is the better fit versus an accelerator.
Incubators can run anywhere from 6 months to 5 years, which gives teams a lot more time to grapple with the problem their business is solving (albeit usually in a lower-touch environment).
Incubators are less rigid with applications than accelerators, so the process is harder to generalize; check the FAQs of incubators in your local area for specifics.
Incubators don’t traditionally offer capital to startups, instead offering office space, mentorship and partner opportunities. Because no capital is given, incubators don’t ask for a cut of equity.
The formal concept of business incubation began in the US in 1959 when Joseph L. Mancuso opened the Batavia Industrial Center in a Batavia, New York, warehouse. Incubation expanded in the U.S. in the 1980s and spread to the UK and Europe through various related forms.
Incubation activity has not been limited to developed countries; incubation environments are now being implemented in developing countries and raising interest for financial support from organizations such as UNIDO and the World Bank.
Get Powerful Connections & Build Strong Business Partner
Although not all successful businesses passed through incubation programs, it’s recommended that young entrepreneurs work with an incubator because they will show you several shortcuts. You will also get powerful connections, introduce you to investors, and help you build a strong business partner network.