Startup Freak Community for entrepreneurs and small businesses
To get a Job you undergo a college education specific to the job, but if you want to start your own business, which education do you undertake? Most often people who want to startup are are too new to the business world, inexperienced, poor, or unconnected to acquire any customers/investors/publicity on their own. Startup Accelerators and Incubators play a major role in connecting this gap and help you launch a successful Business.
What is Accelerator & Incubator?
Whatever you call them accelerator, incubator, combinator, co-working space, virtual incubator, corporate incubator, idea factory they’re all incubators in the sense that they are organizations setup to nurture small startup enterprises by providing them with different services they are too new to.
Accelerators are for profit and are generally run by VCs, with an open application process, taking in groups of start-ups consisting of small teams, supporting them with funding, mentoring, training and events for a definite period (usually 3-6 months), in exchange for equity.
Incubators are created by governments or universities and business communities interested in creating new economic centers. Incubators focus on providing the startups with infrastructure, office setup, printers, high internet access, assistance in getting bank loans & guarantee programs, helps with business etiquette etc.
Differences between an Accelerator and an Incubator
Incubators |
Accelerators |
|---|---|
| Incubators say, “We’ll give you space for free or cheap. That will give you a great start.> | “Accelerators say, “We’ll give you mentors and a little bit of seed capital. That will give you a great start. Oh, and we’ve got some co-working space, but that’s minor.” |
| Incubators say, “We’ll make intros to great PR folks and lawyers if you want — it’s optional.” | Accelerators say, “We’ll bring lawyers and marketing folks into give you disgustingly actionable talks and allow you to ask them whatever you’d like. But you don’t have to hire them. It’s just part of your experience, because we know you don’t know what you don’t know.” |
| Incubators say, “Stay as long as you want. We want to see you succeed.” | Accelerators say, “You’ve got 8 or 12 or 15 weeks to gain some serious traction. But we expect massive iteration out of your team. Because we want to see you succeed.” |
| Incubators say, “We foster small business creation with a joint partnership between the county, the state, and a consortium of regional nonprofits dedicated to sparking job and economic growth” | Accelerators say, “We fund you, connect you, and drown you with mentoring and knowledge. |
| Incubators focus on infrastructure | Accelerators on getting things done. |
| Incubators say, “Clean tech? It’s popular. We’ll help incubate them!” | Accelerators say “Clean tech? Astoundingly tough to launch. No ROI. We can’t go near ’em.” |
| The key word for an incubator is “structure” because that’s what it provides. It’s an attempt to make a small company act like a big company, have a reception and networked printers. | The key word for an accelerator is “action”. You’re expected to build something and deliver it to a market. The place or office is secondary. |
So you need an incubator at initial stages, meaning you got an idea, you’ve done some market research, got a basic prototype, now go and apply to an incubator. That incubator will help you develop basic skills, streamline your idea and help you attain profitability.
Once you have learnt to operate your business you need someone to help you accelerate and catch up with competitors. An accelerator program is something which comes into play then, which helps you compete in market, get more users, probably pivot and cruise.
In other words, while incubators help companies to stand and walk, accelerators teach companies to run.
