Partnerships, Linkages, Networks and Service Providers an Incubator Needs
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Many factors determine the success in establishing and operating incubators. However, the role and support of the stakeholders is a critical factor in successfully establishing and operating an incubator. Key stakeholders like partners, linkages, networks and service providers add up to the success of an incubator, if executed well.
Incubators have a stronger standing if they are supported by a broadly-based partnership of public and private sectors. The funding arm, corporate and industry partnerships, university collaboration, linkages with government bodies, network associations play a significant role in the building a good ecosystem for the incubator. Network of angels, venture capitalists, associations, corporate forums and investing arms an incubator provides eases the accessibility problem for the startups.
Partnerships, Linkages and Networks
Creating partnerships and linkages with investing and funding arms, angel forums and network to provide access and funding support to the incubates — this also acts as a pipeline for the funding forums that are looking to fund promising startups.
Collaboration with industry and corporate takes place to leverage on the private sector inputs, whether in the form of finance or other types of support like expertise, access to facilities, corporate venturing, go-to-market support, scaling up etc.
The corporate and key market players also boost the growth of a startup.
Alliance with network associations help startups, entrepreneurs network and synergise and helps them promote their product, make valuable connects and accelerate their growth.
Linking with government bodies and agencies is essential to get government support and benefits. There are a wide range of grants provided by the governments to promote innovation and entrepreneurship. Hence linkages with such bodies provide information, knowledge and access to apply for such benefits.
Incubators with sound linkages with technology-base, clusters, network, universities and professional network stand a higher chance of being successful.
Partnership and linkage should be on a collaborative model and not on a co-operative model. The difference here is that in collaborative model both have a long-term objective of creating value as whole while co-operative model has a short-term objective that benefits each party not necessarily equally. A collaborative model will also bring long- term sustainability for the eco-system. In the collaborative model the leadership plays a major role in making things happen.
Apart from these linkages and partnerships, an incubator should also bring on board other service providers to provide secretarial, legal and auditing support for the startups.
Professional legal, accounting, secretarial, business modelling, strategic planning, sales & marketing, finance, human resources, tax consultants who will provide their services at a subsidised/nominal rate as otherwise these start-ups will not be able to afford their services. These business support services will create great value to the start-ups as often the start-ups are unware of the implications and tend to ignore the nitty gritty aspects of structuring and managing a company.
Here the incubator can provider a space for the service providers visit regularly and interact with the start-ups, initially their service can be free bono basic and then on a discounted model and once the start-ups have picked up the service providers can charge a full rate. The service providers can also doanequity based model which can be of great value to both the service provider and start-ups.
Many incubators struggling have not put these in place and hence the outcome of the incubators is comprised. In India we are just getting started and many of these incubators are lacking the support system required, it will take them some time to get this going.
Often incubators believe by providing space they have given what the startups need. However, if we look at North America or Europe often these incubators are housed in old buildings which the local authorities have given to local colleges to setup incubators, these incubators are well placed in terms of linkages, partnerships and service providers.
In conclusion the success of an incubator will very much depend on building the partnerships, links and a set of good service providers, it is worth noting that it takes lot of effort and time to have these in place.