Incubator or accelerator: Choosing the right support for you
It’s known that incubators and accelerators are optimal solutions for catapulting tech startups or innovative companies with strong growth potential, but what sets them apart? And most importantly, when and why should they be used?
The incubator, as its name suggests, fosters the journey from the beginning. It mainly helps seed and start-up companies, that are legally registered or in the registration process, who want to answer the question: Does my product solve a real problem or meet a true need? Since it’s a matter of viability and profitability for the company, it’s crucial that the proposed innovation has a place in the market and interested buyers.
In the incubation stage, support for startups can last from a few months to a few years. Grouped as a cohort, entrepreneurs are generally encouraged to share collaborative workspaces (co-working) and are working to establish their business model premise. Value proposition, target client group, distribution model, costs, earnings as well as partners and suppliers are all worth considering.
This phase that combines theory and practice, involves training, mentoring and advice on developing entrepreneurial skills. It also involves refining the product and connecting with potential clients or investors, especially during technology demonstrations or networking activities.
Turn to the accelerator when you’ve made your first sales and, by refining your business model, you want to stimulate growth by maximizing your sales and search for capital. Startups are then in the expansion phase where they have some experience in the market and hold a marketable product that is ready to be distributed on a large scale, especially on a global scale.
In this case, support is short-term and focuses on coaching and peer co-development. It’s also more focused on each company’s specific needs. For no more than a few months, entrepreneurs are supported in developing their client network as well as refining their business plan and financial package. It’s also an opportunity to prepare for their first round of financing with investors to meet their significant capital needs. All areas of a company’s management, including human resources, production and marketing, thrive with this support, even if it’s focused on rapid growth. It also aims to develop entrepreneurs’ soft skills as these become increasingly important in human resources and business communities. Interpersonal relationships are a major determinant of an organization’s success and failure.
How do support organizations fit in?
Unlike incubators and accelerators offering niche services to technological or innovative companies, support organizations cater to corporate clients with more traditional business models. They can be non-profit organizations dedicated to supporting entrepreneurs, economic development organizations, universities or collaborative workspaces. These organizations play a key role in the ideation or growth phases. Nevertheless, it’s still essential to knock on their door to tap into their expertise and network or get public financing.
What’s in it for you?
Companies that turn to support are more successful and grow faster than others. A Ministère de l’Innovation et de l’Entrepreneuriat study (in french only) found peer support to be one of this approach’s main benefits. On top of sharing expertise, peer-to-peer relationships make overcoming isolation possible, which then promotes the mental health of entrepreneurs who are often put to the test in the early stages of a startup.
What should you do?
To benefit from this experience, you must be prepared to step outside of your comfort zone and be open-minded. There’s no wrong time to turn to support and develop your entrepreneurial skills, both soft and hard. It’s proven beneficial to have seasoned individuals with specialized experience share their expertise and experiences as well as their network of companies with their cohort.
How do you choose the right resource?
Before starting the search, ask yourself what you’re looking for. For example, do you want to turn to a university incubator to tap into their pool of students with specific talents? Are you seeking investors? Above all, it’s important to choose an actor working in your industry. Since several hundred resources are dedicated to supporting Quebec businesses, it’s worth it to look for an appropriate resource.
|Technology||Le Camp||CTS Santé
Startup en résidence
|Agriculture||Incubateur agricole Boréal (in french only)||
Centrale Agricole (in french only)
|Agri-food||Mycélium (in french only)|
|All sectors combined||The “Accélérateurs Québec” (in french only) search tool developed by our partner MAIN (Mouvement des accélérateurs d’innovation du Québec)|
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