Does your social enterprise really need an Incubator?

The startup space is crowded with incubators and accelerator programmes today, many of these catering to social enterprises. There are specific differences between the two, with incubators focusing on startups in their early stages. In this article, we’ll focus on incubator programmes.

Simply put – An incubator is a structured programme, creating an environment that assists and enables startup to grow from infancy. Meant for startups in their earlier stages, the programme may or may not operate on a set schedule. Startups are given a small seed investment, and access to a mentor network, in exchange for a small amount of equity.

Incubators generally cater to a specific market or vertical and social enterprises are no stranger to incubation schemes.  VillgroDasraUnLtd IndiaDeshpande Foundation are among the successful incubators aiding social enterprises.

But what does that mean for your enterprise? We at Impactpreneurs have listed down the basics–

  • Network effect

    Incubators connect you with a network of established individuals and organizations. Incubators can tap into this vast resource of expertise while moving forward. There will be no dearth of professionals to connect with and these connections will last forever (not just the duration of the programme!).

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  • Environment

    A big difference lies in how enterprise development is structured. The programmes consist of a bunch of contemporary startups, generally working under the same roof. This creates a professionally superior environment for the enterprise to grow. There will be a set time-frame in which the mentorship, the motivation, the zeal will be unmatched – an environment which can’t be simulated on the outside.

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  • Recognition

    The fact that these programmes are extremely difficult to get into in the first place is a differentiator. The brand recognition soars and it sets you apart from a hundred other startups in the sector. This also means your enterprise will have an increased access to finance in the future.

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  • Equity

    These services won’t come free of charge though, as any such investment would be in exchange for equity. Legal viewpoint aside, it would impact the very decision making process. Suddenly, you’d no longer have the flexibility you had. Suddenly, you’d be accountable for your actions.

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  • Commitment

    It is a structured programme, warranting an investment of additional time and resources to meet successive criteria (as per time-frame)–time and resources which would have otherwise gone into building your enterprise.commitment

  • (Conflict of) Interests

    Much of your efforts would go into aligning the enterprise motivations to that of the programme. This includes rushing into decisions you might not otherwise be comfortable with. This is especially critical for social enterprises. For instance, the programme may stress on delivering social values relative to profit, but it may not align with your enterprise’s ideals.

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Rather than believing the hype, you should do the homework. There are many things that need to be considered – the subjective aspects (team, culture, etc.) and the objective ones (equity stake, network, etc.). Looking at former incubates would get you some sense of the work style and culture. After that it all comes down to the basics – What stage you’re at? How you want to build your company?

Here are some social enterprises who have been successful incubatees: Sustainable AgroMilaap First Energy NanopixONnergyAyzh, Uniphore

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