Business Incubators and Accelerators

Time travel a decade back and remember the starting up a business requirements. An idea shaping into a final product with a handsome amount of investment, and then taking the product to a market with its ample demand. It was never tough to get an idea, but finding investment and market was a hard nut to crack. Also, the product manufacturing time was  very high.

Welcome back to 2015, when business startup is comparatively far easier and the credit goes to specially business incubators and accelerators. These are the supporters for the businesses to shape up, perform, grow, and gain more. In other words, these are the services that help the an infant business in meeting up its needs, such as: investment, market, etc.

One can find the aim of business incubator and accelerator to be similar, and that is why these terms are, sometimes, used interchangeably. Actually there exists considerable difference in terms of their operations.

Business Incubator

Business incubators are the service provider for a business startup. They aim to create a foothold of the business in the market. Just as a new born child, business startups also require special care and friendly environment to grow into a stable business. Business incubator provides that special care and environment for a startup to flourish and learn the tactics for survival.

Business networking, management assistance, advisory, presentation skills, guidance on ways to attracting the possible finance sources, etc. are some of the services that business incubators aim to implant into the business. But generally, it does not involve a direct financial support. Business incubator, in this way, can be considered as a basic business service provider along with low cost office spaces.

The time for which a business incubator pampers a business is not certain. It is a goal oriented approach to support a business till it reaches a stager where it can look after itself. Usually, even the settled businesses, in some ways, remain associated with the business incubators to support other popping up businesses.

Business Accelerator

Business accelerators are the supporting platforms for the businesses that have passed the initial and most vulnerable stage. Business accelerator helps a business though accelerator program. Accelerator program is a financial deal in which business accelerator will directly invest an amount of money in the business and earn back from the profit. Like business incubator, there are many different ways in which a business accelerator can help a business, such as: helping in adopting better productivity methods, shaping business strategies, etc. Since, there is a direct investment of money involved, business accelerators are expected to enhance the productivity of the business. These are short term plans and are expected to last for 6 months at most. Once the accelerator program is over, the business and business accelerator will separate their paths.

Any business can require an accelerator, no matter what stage it is at. Stagnancy in productivity can arrive for any business and business accelerator is a way to overcome that. It has a simple fundamental aim- raise the growth rate. And an external investment and mind is a great way of achieving that.

Final Note

Well, if there is a straight question, which is more important, incubator or accelerator; then I would never be able to choose one. If the question arrives with a slight change as: “Which one is more important for business startup”, I would quickly pick business incubator. Similarly, for a settled business, business accelerator is the requisite.