I’m sure you have heard the term incubator once or twice in your life before in relation to medical aid for newborns. Just like the meaning of the term used medically, business incubators are units that are set up to help young businesses like startups get their footing.
A business incubator is an organization which provides a workspace to startups and new ventures with all the resources that they may need in order to survive and grow. These resources are usually provided at one location for the ease of access but things may differ with different organizations. Incubators can be looked at as universities for businesses, where a newbie business and venture can access all the technology and information.
And just the way a university connects students with professionals and companies, incubators also connect startups and new ventures with veterans, advisors, mentors, training companies and even potential investors. This is all done in the hopes that one day these startups and ventures will go out in the world of business and leave a mark which in turn benefits the country.
Business incubators are non-profit organizations usually sponsored partially or wholly by both private and public entities that are looking to support the growing business initiatives in the country. And although a large part of incubators are sponsored, not all incubators are; some work independent of any external help from anyone. They are not answerable to anyone but the law of the country and focus on promoting and supporting new businesses.
From the previous paragraph it is quite obvious that there is not only one type of incubator. So, let’s study what other types there are for a better understanding of incubators and their functions.
Types of incubators
There are several types of incubators that are not as well recognized but are a sanctuary for budding projects.
Online business incubators:
These incubators focus to help business ventures without them having to be located at the incubator’s site like it was used to be in the past. Online business incubators or virtual incubators provide the businesses to seek out their advice and services through virtual mediums without going through the cumbersome process of setting up a shop at incubator’s site.
This type of incubator is suitable for the businesses who do not wish to use the workspace/office services provided by the incubators. Instead, they want to carry out their activities from their own offices and avail services that they require off of incubators thorough virtual mode. It gives the applicant businesses the liberty to pace their progress according to themselves. It also gives them a chance to understand where the help is required in a better manner; boosting their confidence and reducing dependency on the incubators.
Business incubators were founded that focuses on the medical technology and biomaterials known as medical incubators. These incubators encourage innovation and entrepreneurship in the field of medical technology. These incubators provide their support to innovators, startups and other organizations that show an interest in advancing in the field.
Medical incubators are set up to encourage an interest in business with medical prospect and help those who are struggling to keep their head above the water. These incubators are an extended hand of help for businesses that are willing to seek help and grow.
As the name suggests, these incubators are associated with providing support to new businesses in the food industry. Usually the companies which look towards food for incubators for help are in the business of manufacturing specialty products which are high in value and low in productivity.
Food incubators not only help these businesses by providing a workplace at lower rates than the market but also support them in the process of producing, packaging, marketing and selling the first few batches.
This is the business incubator that is focused on the good of the general public. Business environment is volatile and is changing our ways to do business every day. The NPOs are finding it harder to survive in the capitalist environment and public incubators aid them by finding ways to help them become more business centric, so that they do not fade out in the changing business world.
Public incubators play a very important role in the development of the businesses that wish to do good for the society and people. In the world of profits and competition, there is an increasing need for people who take initiative to aid others. No society can prosper without looking out for eachother and public incubators are set up to provide secure and reliable resources to those who are interested.
This business incubator deals with early startups. They are also known as startup accelerators and are fixed-term, cohort based programs that provide services that focuses on educational aspects of the process and provides mentorship as well.
Unlike traditional business incubators that are government funded and only focus on selected parts of the industry, seed accelerators can be funded either privately or publicly with their focus being on a wide range of industries.
There are a whole lot of other types of incubators that are focused on ifferent areas such as education, tourism, technology, etc. These incubators are set up to help selected sections such as others. They provide a good overall progress of the nation.
From providing office area on lower rent rates to helping the new companies in selling their products, incubators offer a wide range of services and resources to the businesses in order to help them achieve their goals. Some of these services are as mentioned below:
Networking has become one of the most important aspects of business over the last decade and half. Hence, the need to have proper networking resources and presence is crucial than ever before. Incubators provide assistance with the networking activities of startups and new ventures in addition to providing the resources required to initiate and handle networking.
2. Financial management:
In addition to providing the help with market research and marketing in general, incubators also render assistance with accounting/financial management. Young businesses often are not able to afford a well experienced accountant or financial manager to keep their unnecessary expenses at bay and keep records of all the transactions as is required by the law. Hence, incubators have the provisions to aid with the financial frontier of the business, if required.
As mentioned above, new businesses are usually cramped for money and require funding through banks, institutions and investors. Incubators provide these businesses with links and access to such people that may sanction loans, funds and invest in their business, respectively. Incubators act as an intermediary to the both businesses and interested investors.
Every business owner has a strategy when they start their business but not all are successful in the harsh and volatile environment of business. Hence, the need to connect with good strategists arises in new businesses.
A business incubator recognizes this need and bridges the gap between the two, resulting in better business strategies for the sprouting business endeavors.
Business incubators also act as an advisory board and mentor the business owners and associates during the first phase of handling a new business. They help in identifying the right people to create the management team that would prove to be the best for the business.
Incubators have a huge role in shaping the management of the businesses that are under their guidance and are even involved directly in the proceedings of the business in some cases.
The comprehensive business training programs organized by the incubators allows the participants to acquire new skills or further develop the existing skill set of the person. Such skills may be related to presentations, strategies, decision making, etc, even business etiquettes are pondered upon during the training programs.
Starting your own business requires continuous grueling and focused efforts usually without much knowledge about the harsh business world. The dream of being your own boss and calling all the shots can easily transform itself into a horrible nightmare in the absence of proper guidance and experience. Hence, even the government has recognized the need for healthy interference and taken a positive step towards helping out the people who decide to start their own business.
The government of India has established India’s first ever business incubator named 36INC in Chhattisgarh, for people who seek out help in business matters.
36INC focuses on providing a stimulating and supportive environment for individuals and companies with innovative outlook towards business. But before we go ahead and further discuss the objectives and offered services of 36INC, we shall take a look at what a business incubator is.
As 36INC is a fairly new business incubator, the number of businesses that seek assistance from the organization is on the humble side of the scale but the rigorous efforts and hard-work that the team of 36INC has been putting in for the better of the participants are commendable. And surely, it is just a matter of time when 36INC would be counted among the best business incubators out there.
36INC understands that innovation is the root of new discoveries and that innovation can happen in two levels.
· Research and development: In India R&D is initiated and nurtured by the large corporate sectors, SMEs, R&D institutions, National laboratories and academic institutions. Furthermore, institutions like IITs, NITs and universities support and encourage students who are interested in innovating something new. These educational institutions are creating new opportunities and environment for innovation at the very basic levels.
· Vision, initiative and hard-work: Individual innovators who look to innovate in order to find new and viable solutions for the local problems with their unique vision. But mere vision is not enough for innovation; one needs the will to take initiative on the said vision and heaps of hard-work to follow up the initiated task.
Moreover, innovation at individual level is harder level is harder to sustain, due to the absence of a support system to nurture their ideas.
In India, while there are a good number of individual level innovations happening, the systems to productize them through commercial ventures are yet to be fully developed. This is aggravated by the absence of linkages of researchers and innovators with the market, and the social milieu that does not accept failure very kindly.
Business Incubation has been globally recognized as an important tool for economic development and job creation.
Hence, NSTEDB, which focuses on tapping and incubating the potential ideas and innovations through a well defined venture /enterprise creation process and by effectively utilizing requisite expertise, facilities and other infrastructure available within an institution and its adjoining region has initiated TBI as a flagship program across the country.
Technology based new enterprises are typically characterized as high risk and high growth ventures, and as such, they require an enabling environment like TBIs to enhance the prospects of success.
In India, technology business incubation efforts are two decades old. In these two decades, incubation has helped weave many inspiring and motivating success stories of young entrepreneurs, and have helped in creating a positive environment for entrepreneurship in general and for incubators in particular.
36INC based in Chhattisgarh provides the aforementioned services and much more to the businesses that are accepted under their various programs such as AIC which is also a state and AIM supported business incubation center.
While business incubators are open to all, they do not admit everyone in their programs. Apart from the business ideas that are feasible and executable in reality, certain criteria are to be met by the applicant in order to be admitted in the programs offered by the business incubators.
This is done to ensure that the businesses that are being associated with the incubator have the potential to grow and flourish with their help and go a long way. Furthermore, this allows the incubator to focus more on the selected group of businesses and support them to the best of their ability.
Incubators are making their contribution to the company’s growth and innovation. Good business incubation is encouraging young entrepreneurs to come forward with their unique ideas and visions. Indian market has seen a rise in entrepreneurship that has been building over the last 2 decades. Finally, the efforts to get the people of India interested and excited to initiate their own business are bearing fruit and even the people who were afraid of the risks involved in business, are looking to enter the business world.
Incubators are set to encourage, aid and promote the rising new innovative ideas of aspiring entrepreneurs. Incubators are as ambitious as the excited individuals and companies who are looking to make a change.