"Thanks but no thanks, we already have an incubator". "You're not an incubator? What's the difference?"
I get this kind of question every other day. And I get it, finding your way around the ecosytem of start-up support organisations is not easy. Especially the difference between accelerators and incubators.
There is a lot of variety in what each structure has to offer. However, here are a few key questions (in a handy TRUE/FALSE format) to help you get a handle on what's the right offer for the current stage of development for your start-up.
Accelerate/incubate: a quick primer
In the digital age, we are not afraid to go old school and look for a dictionary definition (we trust in the Oxford dictionary) of "accelerator" and "incubator". Here are a few clues (and a quick revision of your latin):
- Letter A -> "accelerate" (from Latin accelerat- ‘hastened’, from the verb accelerare, from ad- ‘towards’ + celer ‘swift’): Increase in rate, amount, or extent.
- Letter I -> "incubate" (from Latin incubat- ‘lain on’, from the verb incubare, from in- ‘upon’ + cubare ‘to lie’): keep (eggs, bacteria, embryos, etc.) at a suitable temperature so that they develop.
I'm guessing you are starting to get the subtleties. Here are a few more details:
"I can join an accelerator as soon I have a business idea"
An accelerator aims, as its name suggests, to "accelerate" the development of young companies. To do that, your company needs to already have been created and to have reached a level of maturity. For ToasterLAB, that level is "proof of concept", or a product that is ready to be launched. In Switzerland, the Kickstart accelerator accepts startups that are at a pilot project stage.
Unlike incubators who support entrepreneurs in setting up their business (to "hatch"), from the idea to the proof of concept stage, generally providing business premises and support services.
"I'm going to need to move my company to a new area to join an accelerator"
FALSE, most of the time.
Accelerators are mainly programs that can be followed from where you are (unlike an incubator). This is the case for ToasterLAB, for example. Some accelerators require you to be present physically for the length of the program but rarely must you relocate permanently.
Where you are based is however generally a prerequisite for joining an incubator. A large number of incubator formats exist - private, corporate, based within higher education establishments, run by regions or cities... There's a big range to choose from.
"Accelerators only offer short term support"
Both accelerators and incubators offer a fixed term of support services. While incubation can vary from 1 to 3 years (launching a company can take a lot of time!), acceleration is generally more intensive in order to get rapid, targeted results. On average, acceleration programs last 3 to 6 months. Within ToasterLAB, there is a hybrid format: 2 months of intensive acceleration followed by 10 months of post-acceleration to continue to cement the results for the start-up cohorts.
"All accelerators do is offer business contacts"
While business contacts are an essential element of acceleration programs, their actions go well beyond the exchange of a couple of business cards. You also get access to experts in various areas (international development, financial management, law, branding, industrialisation, etc. - here is a list of ToasterLAB's experts) as well as a network of investors.
Whether in the form of joint or individual sessions, training days, weekly coaching sessions, subsidised expert services etc., each accelerator has its own panel of services and actions to help you grow your business fast. Talk to the staff... and to the program alumni (you will find some of our alumni feedback here)
"Accelerators are all money-making ventures"
This is a common misconception that pits the not-for-profit model of a large percentage of incubators againt the dominant model of for-profit accelerators. The best known accelerators following the ango-saxon model are indeed for-profit ventures launched by investment funds that take equity in the companies they accelerate (in return for an investment and for services rendered). But this is not the case for all accelerators, and is not a necessary condition. For example, ToasterLAB is a "zero equity", not-for-profit model: selected start-ups pay an entry fee to access the acceleration program, but no equity is taken.
"Accelerator, incubator... so long as I choose one or the other, right?"
Incubators and accelerators both have their uses in developing the entrepreneurial ecosystem, each in their own way. Understanding the differences between the two is the way to choose the right support system for the right stage of development of your startup! For ToasterLAB, if your company is too early stage or too mature to benefit from our program, we'll tell you that... and probably point you in the direction of someone better suited to help you!
Find out more about ToasterLAB
If you want to find out more about ToasterLAB, feel free to contact me at firstname.lastname@example.org. Applications for our Agri-Food program are now open!
By Claire M
ToasterLAB's Startup manager, Claire is an adept of the world of entrepreneurs, having spent the last 4 years within an incubator and innovation centre. Her mission is to provide daily support and coordination to ToasterLAB's startups, to lend them both practical support and a direct line to the necessary contacts and expertise to get their businesses off the ground. Contact Claire at email@example.com