Since arriving, I have met with many companies who speak about their success coming out of technology incubators.
It got me wondering what it is about incubators that contributes to the Silicon Valley ecosystem.
There are a large number of these technology incubators in the Valley. The most well known, of course, being Y Combinator and 500 Startups, which have produced a great number of very successful companies including Dropbox, Airbnb, TaskRabbit and Twilio.
What are we missing?
Even the Danish government has an incubator out here.
Granted, there are quite a few of these incubators in the UK as well, seedcamp and springboard are two that jump immediately to mind. So what is it about the US incubators that make them so noteworthy?
Meet the HealthTech startups pitching at Elevator Pitch LIVE 2017
Sending founders to school
Having never worked in an incubator myself, it is difficult to say for certain what exactly is their key to success. However, I have developed a theory: incubators here function like universities.
This makes a lot of sense when you think about it. In an incubator you go to classes and lectures, meet with mentors, develop an alumni network and get to put a big name on your company “CV”. I even have “office hours” this afternoon with Geva Perry, who has mentored some of the top startups in the Valley.
Much like universities do, incubators in the US fight over the best startups in a way I don’t think they have to in the UK. This has prompted incubators in the Valley to offer an ever widening array of features and programmes. What you can learn has become the most important factor when choosing which incubator to apply for. Some startups even decide based on who mentors there; the same way you would choose a grad programme based on the professors.
Competition is fierce
More importantly, in the Valley at least, getting into a good incubator does for a startup what getting into a good university does for an individual. It gives you bragging rights. People I meet will talk about how they are Y Comb ‘11 (Y Combinator Class of 2011), and they say that like I should be impressed. And to a certain extent, I should be.
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The competition to get into the top incubators is fierce – more so, I think, than it is back home. And if you can get accepted to one of the top incubators, it will give you a leg up when speaking to investors and potential clients.
Finally – and I promise this is the last university metaphor – like an Art graduate’s final student showcase, demo days at these incubators are major events. They are open to the public and, if you do one, you had better have all your ducks in a row because you can be sure that some very important people will be judging you on it.
In any case, Incubators are a rare opportunity for startups to work together at a stage when competition for resources is non-existent.
During this time, learning is be the number one motivator. Founders here appreciate and take advantage of the fact that incubators are a strategic shortcut to better understanding your opportunity and how best to maximise product to market fit. In other words, even if you fail – you fail forwards.
Meet the three PropTech startups pitching at Elevator Pitch LIVE 2017
Then again…. it could always be the fully stocked kitchen!
Can it work in the UK?
There are calls in the UK for entrepreneurship to be taught in universities and schools. From what I have seen here it is clear that entrepreneurship can be taught, but I am not sure that schools are the right institutions or environments to be doing the teaching. I would argue that incubators should be teaching our next crop of founders. This has already begun in London with the launch of Seedcamp in 2007.
For those of you not lucky enough to be a part of Seedcamp, more incubators are needed, but London has a problem. Creating a successful incubator is not just a matter of sourcing some office space, it requires successful founders to provide teaching and mentoring. Given that successful founders are in short supply in London (compared to Silicon Valley) what are we to do?
Founder speed dating
For those of you in Tech City who are wishing for a better mentoring system, here is my idea: “reciprocal mentors”. Go and find a company in London that is at a similar stage as your own, get to know the founder and agree to each spend one afternoon in the other’s business, once a month and mentor one another!
In this way you each have the opportunity to see how another company is run and you have someone to speak to who is experiencing similar problems to you.
Think of it as peer-to-peer mentoring. It’s not a perfect solution, but we have to start somewhere. Perhaps a reciprocal mentoring meetup with a speed-dating format could be a good way of getting things going.
Ending with a bang
It was the 4th of July this week and most people were away, which made things a bit quieter.
I have to admit that I was working and didn’t go out to see any fireworks (had nothing to do with me being a British scrooge, honest) but I certainly heard them!
A friend of mine sent me a great video about last year’s fireworks display in San Diego, during which 15 minutes of fireworks were accidentally detonated simultaneously. “Epic fail”, as they say.