When it comes to starting your own business, there are a myriad of things you need to know, and chances are you’ll need some assistance. You may have heard the terms Accelerators and Incubators bandied about, but it’s unlikely that you’re aware of just what each of these really means, and what benefit they can have to your business. Here, we take a look at what incubators and accelerators really do, so you can make the right choice for your needs.
Both incubators and accelerators can help fledgling businesses get off on the right foot by helping businesses grow quickly – which in turn can attract better investment opportunities. However, the way they go about this is very different.
Incubators
Generally, incubators come in a little earlier in a businesses start-up than accelerators. Often sponsored, or even run by the Government, VC companies, or major corporations (although there are still some independents around), these incubators provide the right conditions for businesses to sprout and grow the seeds for success. Each incubator works in a different way, however, and the application process for each is entirely different – as criteria for acceptance relies on your business matching the goals of the incubator. Once you’re in, you’ll be offered assistance with things like management training, marketing assistance, access to funding, mentorship and IP management. However, some incubators come with co-working space, which can be a real asset, as they usually operate on a month-by-month lease basis, and rents are often lower than for private offices.
Accelerators
Whilst most incubators don’t have a set time limit for assistance, accelerators usually set a time-scale for the mentorship they receive. Companies accepted into accelerator programmes generally spend a few weeks or months being mentored – but the top-level accelerator programmes are incredibly hard to get into. Usually, accepted businesses receive a small investment seed and mentoring from a network of mentors, allowing them to use the growth and troubleshooting advice given in exchange for some equity within the start-up. At the end of an accelerator’s time-scale, a presentation to the media and to potential investors will usually be scheduled, leading to further growth.
Application for both accelerator and incubator programmes may be difficult, but the assistance they can offer to a new start-up is certainly beneficial, and they are well worth considering if you want a business that has a strong footing to grow from.
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