Business Incubator for Startups – Should You Opt For One?


In the age of start-ups where businesses are springing up by the second, every entrepreneur is trying to get off on the right foot. This has led to yet other participants in the startup ecosystem – Accelerators and Incubators. Many start-ups are increasingly taking the support of Incubators and Accelerators to launch their business successfully. Although both of them support the same motive, they are different in their techniques and have their own share of plus points.

First Lets Understand What a Business Incubator is?

An Incubator is a structure that was designed to help a startup grow. It does not cater to one business, but nestles many businesses’ under its roof. Their services include networking platforms, infrastructure support, assisting in management among others. Incubators work with startups and entrepreneurs for a longer period of time as compared to Accelerators – usually 6 months to 2 years depending on the program.

Is it required for your business?

According to recent reports, it is said that firms that graduate from an Incubator have a higher survival rate than a non-Incubator firm. This said, it is also important to mention, that only the most competitive and deserving firms get the opportunity to be a part of the Incubator program; hence, the survival rate.

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Some questions to ponder over before choosing to apply for a startup incubator program.

  • What is your purpose of joining an Incubator?
  • Are you looking for thorough mentoring or just shared office services?
  • Does the Incubator have resources that are specific to your interest? Take, for instance, mobile applications. Are they experienced in that field or do they provide generalised service? It’s always better to choose an Incubator that is specific to your business interest.
  • Do they include development programs, panel discussions and workshops that help business development?
  • How much equity are you willing to grant?

This said, it is important to mention that there are different Incubators for different purposes. For instance, there are some who are purely meant for transferring knowledge, and then there are those that help you with the capital. Additionally, you can opt for Intrapreneurship Incubator in a company if your business can give the company a competitive advantage.

Let’s have a look at the pros and cons of a Startup Incubator program.

– How does it help?

  • They help you get a better understanding of where you could go wrong so that you can avoid mistakes early on.
  • You are provided either an upfront capital or the means of capital later.
  • It is a great way to make connections and grow your network.
  • It assists you in connecting with Angel Investors and Venture Capitalists, which ups your game on the funding front.

– What are the downsides?

  • It is very difficult to get into an Incubator program.
  • It could not be worth the percentage of equity demanded.
  • They are more ‘team’ focused and are likely to give less importance to the ‘product’.
  • It is time-consuming, as you have to maintain a professional front and be present whenever required. So if you already have work cut out for you and have played in the field of startups earlier on, then an incubator program can be given a miss.

Simply put, Startup Incubators are advantageous for businesses interested in a pool of resources, transfer of knowledge and the chance to develop innovatively. An Incubator then deserves your attention as an entrepreneur, but fervently demands a reality check. You need to be thoroughly aware of what exactly are you going to get when it comes to mentoring, funding, support; keeping in mind the competitive process to get in, the equity required and your bootstrapping capabilities.


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