What are incubators and how they can help a start-up? What’s the difference between Incubators and Accelerators?
Incubator is a company that helps new start-ups develop and grow by providing tangible and intangible services. Tangible services are like sharing equipments like copy machine, phone, computer and internet access etc, share office space, share business services such as accounting, marketing, computing and legal services. Intangible services are assisting in securing start-up capital, networking activities. Business incubation helps start-ups reduce the uncertainty, financial burdens and resource issues they are usually troubled with. Providing a nurturing and supportive environment, access to intensive business support along with financial and mentorship support, incubators help realize the entrepreneur, true prospects of the start-up.
Both accelerators and incubator help firms to grow by providing guidance and mentorship, but in slightly different ways and, and more importantly at different stages in the life of the business. In order to get this straight, let’s draw an analogy and say that the life of a business is like the life of a human being. There are roughly three major stages of life: childhood, adolescence and adulthood. Business incubators mentor companies through childhood while business accelerators guide them through adolescence.
What do you think about Incubators in India? Is Bangalore truly a hub of Incubators in India?
There are not good enough startup incubators in India at present. Ideally, the incubator should be started by those with lots of experience and achievements, as it is majorly about mentors. At present incubators are creating an ecosystem that provides start-ups with a co-working space and lets them grow without worrying about infra-structural and other basic issues. First few months in the beginning of a startup are very critical, what these incubators do is to take a lot of their pain and help them grow.
Bangalore is a place of innovation and talent, success of Flipkart and other start-ups in Bangalore has made it popular among entrepreneurs which has led incubators to make its base in Bangalore.
Who would you recommend as Incubators?
Well, good Incubators are those who possess relevant experience and achievements, as it is largely about mentors and those who mentor the start-up in such a way that can make a difference in the early life of a start-up. Hence, the core of a true business incubation programme is the services it provides to start-up companies.
So, an entrepreneur has to choose from big pool of Incubators present in India as who fits their criteria best.
For instance: AngelPrime is hugely passionate about supporting start-ups and invest in not more than 3-4 companies a year. It is for those start-ups targeting global markets in the US, Europe, Asia and Africa. They operates in the Scale Hacking phase of start-up, where the start-up iterates and fine tunes the product as well as increase the customer base to meaningful numbers.
NSRCEL is an incubation centre run and managed by IIM, Bangalore. They offer various incubation offers all the basic facilities to start-ups including an office space, desktops, Hi Speed Internet facility, Uninterrupted Power supply etc. The funding is primarily through government grants and its disbursement is in accordance with the guidelines that have been laid down by the primary funding agency. The incubator provides mentoring from their eminent faculties and also offers seed money support.
GSF want to push innovation and entrepreneurship through angel and seed investing. Their mission is to encourage flow of informed, knowledgeable mentorship capital to the start-ups.
Now, not only big names like Tata and Birla but also small investors and incubators are helping the new start-ups sail through the rough phase of this long journey. An adage regarding the relevance of incubator for start-up by renowned entrepreneur, Ratan Tata recently said about nurturing start-ups, “It is important to nurture them; it’s important to support them. Not all start-ups are going to be successful. The creative ones usually face the problems in finding support, because they are doing things others have not done before. Such ventures – the promising ones – need to be nurtured.
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