In fact, Incubator is a device, which hatches eggs, and chicks are born. It hatches eggs of ostrich, hen, pigeon and other birds. In simple words, a sustainable life takes its breath under favorable conditions and a nurturing environment. Now, when you apply this concept to startups then you can get the basic concept of a startup incubator.
Business incubator helps your startup to grow. Hence, your startup develops into a sustainable existence.
How does an incubator help your startup
Incubators are home to various venture capitalists, angel investors as well as other mentors for entrepreneurs. By providing office spaces or legal expertise, they allow startups to focus more on the running of the core business.
This ecosystem provides you much needed support to develop your new startup. This support can be in the form of:
- Infrastructure: Startup incubation centers provide office workspaces, workshops for startups. Therefore, they can get initial prototype. Then it becomes easy to take off your idea.
- Networking: Incubators help multiple startups simultaneously. When these startups work under one roof, then they connect with other entrepreneurs of same industry. This helps them to gain insights to improve their product. Many incubation programs even arrange meetings for networking. Meet-ups help entrepreneurs to build them team, find new ideas, and get insights to polish dreams and many other benefits.
- Financial advisory/ Intellectual property teams/ Legal advisory: Incubation ecosystem provides financial advisors, IP teams and legal advisors to the entrepreneurs. Therefore, those seedlings can make well-informed decisions.
- Contacts for potential investors: Business incubators have been in the field of launching startups to become a legitimate business. Because of this, they have multiple contacts with previous and potential investors. They even help the entrepreneurs in developing a perfect pitch deck.
- Initial Prototype Manufacturing: Many startup accelerators have tools and equipment to manufacture prototypes, 3D models and even final products. A product passes through phases of prototype development, experimentations, testing and final implementation.
- Initial financial support: : Startup accelerator has pool of investors. Such business angles provide an initial fund to set things into motion. Hence, a business setup can begin humbly with pitching the idea and developing the concept
- Training and guidance: They also provide training from market experts on how to begin, develop and implement ideas. They closely monitor your progress, guide you how to improve your reach and get the target market.
Different types of incubators
There are multiple incubators in the market ready to support you. However, the requirements and support they provide, are different.
There are academic hubs (universities, institutions), privately funded incubation centers and free starting incubators (with free initial services). Every business accelerator serves its purpose with their predefined terms and conditions.
Most of the incubation centers work in physical space. In addition, some incubators operate virtually. They all provide support and guidance for your project. Hence, the objectives of both types of forms are the same.
Why Should You Take Support From an Incubator?
Although capital can buy most of the services, a business incubator provides. However, it is unable to buy the benefits of a network, expertise of business owners, and constant guidance of the experts. Whereas, startups need support, guidance, networking and other benefits.
The strong network of business partners is one advantage of incubation ecosystem. Being part of a group of companies that are already in the spotlight helps the other startups to grow big and successful. It also strengthens their ability to gain more opportunities to pinch their products.
Since the mentors such as venture capitalists or business angels, investors are also entrepreneurs. They have been grinded by the failures, experiments and launches of new businesses. Such persons are the best teachers as they know the inside story of success and failure of a business.
Moreover, they train startup founders for vision management. It leads to more clear goals, roadmap, and strategy. Taking a help of an incubation institute actually jump-starts the startup and gives them the ability to fly solo.
If you are running low on capital, a lot of startup incubators provide workspaces, manufacturing labs, technical guidance, and startup networking meetings at a slashed down prices; helping the entrepreneurs on their way to creating their own brand.
What Do Startup Incubators Get In Return?
Academic institutions help their student entrepreneurs to nurture their ideas and successfully convert them into business models. The sole purpose is to entice potential students, as increased support to startups is an elusive deal.
Some existing companies incubate ideas to develop an eco-system around their existing product line thus making the market tilt towards their favor. This way helps the company to add value to their products. It in return increases brand reputation.
Other private incubators help entrepreneurs by providing them support in exchange for equity. Business angels and venture capitalists take share in equity and participate in company profits.
Bottom-line
Bottom-line of whole discussion _ startups are just like seedlings, which need rooting, sprouting, branching and layering. If a new idea gets mentor in its beginnings, it is a blessing. Hence, incubator is the ecosystem where a startup can find a lighthouse.
To make a startup sustainable in the long run, its founder needs to learn
- Vision management
- Consistency and perseverance
- Team management
- Leadership
- Resource management
At the beginning of every concept, founder never finds loyal companions and mentors. To turn your dreams into shady tree, it takes years. If you join the club of dream achievers, you journey might become easy and you would be able to tackle the challenges come in your way. Incubators are the right place to get a mentor.
