Startups and entrepreneurship is the most significant aspect for economic and national development. In the past decades, several startups have applied to the incubators or mentorships to accelerate the business growth. Every entrepreneur has the dream to start the entrepreneurial journey and lead it towards success. Startup and business incubators play a significant role in nurturing business ideas. The prominent task of these incubators is to provide all the facilities and sources to the start-ups. Creating a successful start-up is not an easy task, as you have to face several challenges and hurdles. So there are major benefits of startup incubators, as they accelerate the growth of your business plan and give the wings to your dreams.
Let’s discuss it more briefly!
What are the Start-up Incubators?
A Start-up incubator is an entity that provides all the essential and fundamental equipment and resources to the entrepreneurs. These assist about:
Network for a successful start-up
Thus these incubators help the new ventures in tackling the initial hitches. The incubators not only provide support in the technology or establishing the business rather guides in testing the products and getting the feedback from the industry.
Now you might have got an idea that the incubators provide all the fundamental and infrastructural support to your business idea and help you in executing that.
Accelerators vs. Incubators
The prime difference between the incubators and accelerators is that accelerators receive financial support from an existing company. On the other hand, incubators work independently and have connections with venture capitalists, angel investors, government authorities and universities. You can also have a look at incubators vs accelerators for a better understanding of the subject. However, to make the difference easier, some most important factors are as under:
- Duration: Incubators work as an open-ended timeline and accelerators operate within the set time frame of 3 to 4 months.
- Purpose: Incubators support the entrepreneurs in starting the business, on the other hand, accelerators assist the existing business in growth and development.
- Environment: Well, incubators and accelerators both work to provide a collaborative and supportive environment. This is the area where both are like each other.
- Application Process: Incubators invest and support the local start-ups and accelerators using the traditional model for entry into their program.
- Capital: Accelerators provide a specific amount of capital or funding to the existing businesses, and incubators provide the funding to the start-ups, that is derived through governmental bodies and universities.
Thus it can be said that the accelerators are those greenhouses that provide the growth to the new and small plants and incubators are the seeds to fertilize the plant with the right soil.
Types of Incubators
Several business incubators are related to the specific industry, and business model to help them in earning their name. Here some major types of incubators are defined:
1. Social Incubators
These incubators transform the lives of the people by providing innovative approaches to solve social changes. This is the combination of passion for social mission and entrepreneurial discipline. Many initiatives are there that flourish, develop and encourage social entrepreneurship. You don’t need to get enrolled with any specific category like charity or social enterprise. All you need is a perfect business idea with the motive to provide a positive environmental or social impact.
2. Academic and Scientific Incubators
These incubators are familiar with many universities in the United States, and also offer business incubator facilities. They target the students of the universities, so all you have to do is that you have to be a student at the institution. These academic incubators provide scientific and technical assistance to test different concepts of start-up ideas.
3. Virtual Business Incubators
These are the most common incubators and provide the capital and professional advice to execute their business concept in reality. These incubators require you to set up a physical shop at the incubator’s location (website). With this, the virtual incubators allow the business to have the advice and resource support that is offered to them. But they have to maintain the warehouses and offices away from the site of the incubator.
4. Corporate Incubators
Corporate incubators are good at offering financial resources and conducting some things such as prototype and market testing. The companies which get enrolled under this scheme can enjoy great access to commercial markets. There can be some conflicts of interest with the start-up companies. With this corporate incubators have many resources and the ability to mobilize these also.
5. Medical Incubator
As far as medical incubators are concerned, they have to face many challenges and hurdles in the terms of validation and realizing effective product development. Additionally, they have to face financial hurdles also. So the incubation centers which are specialized in health care can take assistance from these incubators to boost the growth of their start-ups. As they play a great role in grooming the economy. Moreover the medical incubators, accelerators and health care start-ups driving a high level of innovation in this industry.
6. Seed Accelerator
This model is very common in the incubator industry. These are the combo of a high-quality filter and a broad portfolio approach. The high-quality filter focuses on attracting bright talent and under the broad portfolio approach, the incubator accepts several companies to support them in the huge success.
7. Kitchen Incubators
The food industry is growing rapidly. This has increased the demand for kitchen space by taking assistance from the incubators of the kitchen concept. These incubators provide small food start-ups techniques while entering the local market. They follow some provisions like sufficient capital to resolve the financial barriers of high cost, as the purchasing or leasing of the kitchen space is very expensive. With this, they provide assistance related to accounting, marketing, financing and insurance.
8. Local Economic Development Incubators
These incubators work for large businesses and provide versatile services from hosting to administrative tasks. They provide the coaching and consulting options by assisting the start-ups in gaining the financing help. They do not provide direct financing. Rather help the ventures in getting access to the external sources of financing. These incubators are small and can face the issues of stability of available resources.
Thus the incubation centers are a boon for many start-ups as these provide every assistance to the business. This helps the ventures in growing and establishing the entities in the market.
Most start-ups face hurdles and challenges at the initial stage. Therefore the incubators have been established to assist the entrepreneurs in executing their business idea into reality. These centers provide all the fundamental information and resources to the ventures. So you do not have to move from one place to another to get business assistance, as these incubation centers provide all kinds of assistance under one roof.
Start your business with these incubation centers and enlighten your entrepreneurial dream with success.
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