Are incubators worth it?

Kaustubh Katdare · 2015-06-17T18:44:42+00:00

The latest fashion among all the startups that are in the ideation or very early stage with products in stealth mode is to get incubated. I've even known startups that are actually struggling more to get into an incubator and get funding than working on their own product or service. The natural question here is - are incubators worth it? I've come to know that in India, MBA colleges 'should' have an incubator - which is a government order. Now the trouble with that approach is that no one in MBA college actually knows what is the typical function of an incubator! Why? Because quite often, none of the professors or the faculty and staff have any exposure to starting, running and managing a business. It's become common to see a 'spare' room or hall being converted into a startup incubator. An incubator needs to do what it's meant to do - nurture the startups, provide guidance to the new venture, help them find relevant customers, do research, make funding opportunities available, help connect with other fellow entrepreneurs and so on. But that does not really happen. The same story continues with many of the 'top' incubators. They do have big names in their portfolio; but that's all about it. None of the startups really get any worthy help from the incubators. I've even seen a model emerging that requires the startup to dilute about 10% of their company just in order to get incubated. I'm looking for experiences from entrepreneurs who've incubated. How's your experience? Are incubators worth it?

Are incubators worth it?

Kaustubh Katdare
@thebigk

Updated: Oct 26, 2024

Views: 1.2K

The latest fashion among all the startups that are in the ideation or very early stage with products in stealth mode is to get incubated. I've even known startups that are actually struggling more to get into an incubator and get funding than working on their own product or service. The natural question here is - are incubators worth it?

I've come to know that in India, MBA colleges 'should' have an incubator - which is a government order. Now the trouble with that approach is that no one in MBA college actually knows what is the typical function of an incubator! Why? Because quite often, none of the professors or the faculty and staff have any exposure to starting, running and managing a business. It's become common to see a 'spare' room or hall being converted into a startup incubator.

An incubator needs to do what it's meant to do - nurture the startups, provide guidance to the new venture, help them find relevant customers, do research, make funding opportunities available, help connect with other fellow entrepreneurs and so on. But that does not really happen.

The same story continues with many of the 'top' incubators. They do have big names in their portfolio; but that's all about it. None of the startups really get any worthy help from the incubators. I've even seen a model emerging that requires the startup to dilute about 10% of their company just in order to get incubated.

I'm looking for experiences from entrepreneurs who've incubated. How's your experience? Are incubators worth it?

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Ramani Aswath

Member • Jun 17, 2015

Kaustubh Katdare
An incubator needs to do what it's meant to do - nurture the startups, provide guidance to the new venture, help them find relevant customers, do research, make funding opportunities available, help connect with other fellow entrepreneurs and so on. But that does not really happen.
I have serious reservations about this. Yet to see a successful one. At least in biomedical technology.
At Sree Chitra Tirunal Institute for Medical Sciences and Technology we tried a model. A technology proving facility which was a flexible manufacturing unit was set up inside the campus. Any industry wishing to commercialize any of the institute developed technology could hire this and run it with its own man power (trained in that facility by the relevant group that developed the product in question). The institute helped with all documentation , standard operating procedures for every aspect of manufacture, helped with issues like site selection, building design, vendor development/qualification and assisted with getting various licenses. It continued to give technical support even after routine manufacture started if asked for.
All technologies transferred by this process are doing well even thirty years later.
However, the field has an established user base and commercial issues were not attended to by the institute.
I am given to understand that the institute is going to widen the activities to make it more viable by assisting startups to bring their own developed products to this for scaling up and productionizing.
Hope it succeeds.

(Note: This did put an enormous strain on the institue's resources. Not much returns directly, but a lot to the country in indigenization)

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