So you want to know how to start a business incubator business? Well then…do we have a post for you (we will tell you how).
Starting a company is never easy, especially if it entails a product or service that’s unlike anything currently available on the market. It makes sense, then, that many new companies, especially startups, look for help from those who have been there before. This kind of help often comes from what we call incubators. This means that someone with experience mentors pupils in exchange for interest in their company.
If you like helping people and enjoy the startup industry, learning how to start a business incubator business may be perfect for you.
How to Start a Business Incubator Business Step 1: Gain Experience
Someone who has never started their own business can’t be in charge of an incubator. That’d be like trying to coach a basketball team to the championship despite never having been on a team before. No one is going to pay or exchange interest in their future company with someone who hasn’t walked the walk before.
You don’t need to have started multiple startups, necessarily, though that will definitely help. If you have one to your name and have played a supportive role in helping others succeed, that can help.
While you don’t necessarily need a degree, much less an MBA, to start a successful incubator, experience is essential.
If you don’t have the experience yourself, you will have to find someone who does, and use that person or persons as credibility for your incubator.
How to Start a Business Incubator Business Step 2: Put Together Capital
If you want to learn how to start a business incubator business, you also need to put some money together. Incubators cost money because you’re not just providing pupils with your intellect. Generally, you’re also staking or supporting your mentees financially to help them make it through this lean time.
Obviously, when you first start out, you’ll probably have so few pupils that this won’t take hundreds of thousands of dollars. Still, think about living costs in your area, the equipment and facilities you will need, and a marketing budget. Then pull together the capital with yourself or other investors.
Watch the video below for answers about startup incubators and accelerators.
How to Start a Business Incubator Business Step 3: Pick Your Niche
There are a variety of ways to market your business incubator. The first decision in marketing will be…What types of businesses are you supporting or helping start-up? Is there a specific industry or amount of initial capital requirements or other niche that your incubator will target?
InfoDev.org lists the following types of incubators:
- Traditional Incubator – supports companies linked to sectors.
- Technology-based Incubator – high value, biotechnology, informatics, electronics, etc…
- Mixed Incubator – both traditional and technology.
- Social Incubator – traditional sectors of employment.
- Agribusiness Incubator – crop & livestock
- Sectoral Incubator – supports activities in a single area or niche (example software) (see infodev.org source below for more)
How to Start a Business Incubator Business Step 4: Start Networking
If you don’t learn to network, learning how to start a business incubator business is going to be nearly impossible. Networking is how you’ll help spread the word about your incubator and attract students.
However, networking is also how you’ll attract investors. Unless you want to be the only one constantly putting up the capital for these companies, bringing investors on board is essential. After a big success or two, they’ll be beating a path to your door. In the early days, though, it’s going to take some work on your part.
Just because you now know how to start a business incubator business doesn’t mean it will be easy. Stay focused, though, and success will come.
Sources & Resources for: How to Start a Business Incubator Business
http://www.infodev.org/business-incubation-toolkit – Great first resource describing more thoroughly how to start and manage an incubator
http://www.seed-db.com/accelerators – Large list of business accelerators and incubators
Let us know if we can help you with your business idea.