Just as incubators, accelerators and other related programs screen prospective clients, so too should entrepreneurs screen prospective programs. Here are some questions to ask when considering entering an entrepreneurial support program.
Finding a Quality Program
- How well is the program performing?
- How long has the program been operating?
- Does it have any successful graduate companies and if so, how long have they been in business independent from the incubator?
- What do other clients and graduates think of the program?
- What is the program's graduation policy, i.e. what are the incubator's exit criteria?
- How flexible is the policy?
- How long, on average, have clients remained in the program? (Incubators typically graduate companies within three years, accelerator programs are usually 12 months or less)
Qualifications of manager and staff
- How long has the current staff been with the program?
- How much time does staff spend on site?
- Have they had any entrepreneurial successes of their own?
- Do they actively engage in professional development activities or are they a member of a professional/trade association to keep them up to date on the latest in incubation best practices?
Finding the Right Match
Does the program offer the services and contacts you need?
What services do you need to make your venture successful? Business plan development, legal and accounting advice, marketing, Internet access, or specialized manufacturing facilities? Is access to a particular market critical? Then consider finding a program that specializes in that market. Special focus incubators for example, are programs that work with companies within a particular niche, such as gourmet foods, biotechnology, the arts and software. Be sure the program offers what you need or can connect you to service providers who can meet those needs.
Do you meet the program's criteria?
Find out the program's qualifications for accepting clients before applying. For example, some incubators expect prospective clients to have fully developed business plans, whereas others require a less developed idea and offer business plan development assistance.
Is the program's fee structure right for you?
Most for-profit incubators, and/or accelerators, exchange space and services for an equity share in their client companies, whereas most nonprofits charge fees for space and services. If a large cash infusion and speed to market are essential for your business success, then giving up equity in your company in order to secure quick cash may be right for you. But if you believe you have the skills to raise your own funding (with some assistance), don't want to give up any equity in your venture and are willing to build your company more slowly, then paying fees for services and space may be a better choice.