WHAT IS A BUSINESS INCUBATION OR ACCELERATION MODEL?
An incubation or acceleration model is the way in which support is offered to startups , in order to increase the companies’ likelihood of survival. Business incubation arises as a response to the need to provide strategic and practical support for new companies, with a view to increasing their chances of success and accelerating their growth.
Incubation offers a structure and set of resources to help startups overcome these difficulties, take safer steps and prosper in the market. In this way, the specific needs of startups and the preferences of entrepreneurs determine the choice between different incubation approaches.
DEMAND FOR BUSINESS INCUBATORS
The demand for incubation or acceleration services is driven by the recognition of business opportunities by entrepreneurs, who seek access to resources, mentoring, contact networks and shared infrastructures. This demand can be met by different incubation models, varying according to the specific needs of each company. In the private sector, incubators are managed by private organizations and offer services with a greater focus on financial return for investors or on the growth of startups in specific sectors, often seeking investment in exchange for participation in the incubated business . There are two main approaches:
Physical and virtual incubation
Physical Incubation: Involves the use of a physical infrastructure such as a building, to provide guidance and business development services. That can include models such as Business Innovation Centers, University Incubators, Research Incubators and Stand-Alone Incubators.
Virtual Incubation: Focuses on an advisory role, without the need for physical facilities.
SUPPORT SERVICES
Incubation and acceleration models may include the following components:
1.Access to physical resources.
2.Office support services.
3.Access to capital.
4.Support in processes/training.
5.Networking services.
These services are essential to provide startups with the environment and resources necessary for their growth and success.
DIFFERENT INCUBATION AND ACCELERATION MODELS
There are several options available when incubating a startup:
1.Accelerator Programs:
Accelerator programs are designed to provide a quick boost to startup growth. They are generally shorter in duration, ranging from a few months to about a year. During this period, startups receive intensive guidance and mentoring from experts in specific areas, such as technology, health, finance, among others. These programs often include workshops, training sessions, networking and access to potential investors. The main objective is to help startups develop their products or services quickly and efficiently, as well as preparing them to raise capital and scale their businesses.
2.Incubator Programs:
Unlike accelerator programs, incubator programs are a little longer. They focus on end-to-end company development, providing ongoing support to create a solid foundation for sustainable growth. This includes developing the company’s infrastructure, creating detailed business plans, guidance on legal and accounting aspects, networking opportunities with other companies, and accessing capital through partnerships with investors or financial institutions.
3.Corporate Incubators:
These incubators are run by large companies and are aimed at startups that are aligned with the parent company’s core business. They offer specific resources related to the industry or sector in which the parent company operates, such as access to customer networks, technological support, marketing and branding assistance, as well as direct financing. The objective is to boost innovation within the parent company and leverage new business opportunities.
4.Virtual Incubators or Virtual Accelerator Programs:
These programs are generally conducted online and offer resources such as webinars, tutorials, management tools and collaboration platforms for startups. They allow entrepreneurs to participate in incubation or acceleration programs without the need to be physically present in a specific location. Além disso, Additionally, they provide access to mentors, investors and other resources remotely, allowing for greater flexibility and global reach.
5.Government Sponsored Programs:
These programs are funded and supported by the government with the aim of promoting entrepreneurship and economic development. They offer a range of services such as seed funding, tax incentives, access to infrastructure, training and mentoring, and connections to support networks. The aim is to provide a favorable environment for new companies to grow and prosper, contributing to the creation of jobs and the development of the local economy.
Each business incubation model offers unique benefits. Choosing the most appropriate model must consider the specific needs of each startup, in order to guarantee its success in the market. It is important for entrepreneurs to carefully evaluate their options before deciding about which type of incubator is best for their startup.
