Four Simple Steps to Creating an Incubator/Accelerator

One of the really fun things about being involved in the early-stage scene here in Atlanta is that I get to network and meet with a lot of people who share the common vision of fostering a better startup ecosystem for our community. Included in this are representatives from various chambers of commerce, academic institutions, and governmental agencies. It seems that a common thread among many of these groups is that they all get excited about the prospects of launching an “incubator” in their respective geographies.

Unfortunately, many of these well-intentioned endeavors never get off the ground, or they take forever to gain traction. Why? Bureaucracy. While they all see the benefit from an economic stimulation perspective, they lose sight of what is really important – traction. Let’s face it – they are going to try and encourage tenant entrepreneurs to gain “traction” – ostensibly so they can graduate from the incubator, and become a viable force in the local economy.

It’s time they drink their own medicine. Stop wasting time with steering committees, breakout groups, and herding cats – start executing.

I recently met with one of the local Chambers of Commerce – one in a very affluent part of the city. They are very excited about launching an early-stage incubator, but for a year now, they’ve been “talking” about it.

Here is my easy four step plan for anyone who wants to launch something like this:

1. Forget about “incubators” – think “accelerator”

Incubators imply infrastructure. Not needed. Acceleration implies movement – traction. Much more salient. Forget about creating a building and charging rent from an early-stage company. You will automatically rule out 90% of the ideas that will eventually become viable players in the economy. By its very nature – if a company can already afford to pay your rent, they shouldn’t even need you. They already have traction.

2. Find a kid with a good idea

Imagine that. Jimmy is building a new software company from the ground up. Latch onto him. I was a judge last week for the Georgia Tech Business Plan Competition. Lots of fun. One company in particular actually said in their business plan that they were considering a move to Silicon Valley. Not if I can help it. Grab them before they get desperate.

3. If need be, Give him a place to hang his hat

Got a spare cube laying around? Stick Jimmy in it. Let him use your small conference room. Give him Wi-fi access. Whatever. Just do it. Just don’t charge him. Do it because you give a flip.

4. Help him.

Leverage your network and other resources to help Jimmy on a practical level. If he has a marketing question, set up a coffee with Bill, your longtime college buddy who now runs marketing for a hot tech company. Help Jimmy build his own network. Mentor him. That’s what it is all about. The next thing you know, Jimmy is an ambassador for the cause, and contributing to others.

Yes, Virginia – it’s just that simple.

Forget the bureaucracy. Find a kid with a good idea, stick him in your office, and help him. Acceleration. Good things happen.

On that note, stay tuned for an announcement about the cloud, our (StartupLounge.com’s) new model for early-stage acceleration here in Atlanta.

Cheers.

1 Comment

  1. Here’s another two.

    1. Don’t try to make money on it. One of the reasons incub/accelerators (Is there really any practical difference between incubators and accelerators other than the word “incubator” is no synonomous with “miscarriage”?) is people try to make money on them. Look – by definition, you cannot make money where there is none. if the “advisors” have all the money, then the venture has less/no money to actually build the business. You know who the incub/accelerators tend to benefit? The people receiving grant money, drawing salaries, and providing consulting services.

    2. Staff incub/accelerators with people who have invested in and/or started their own businesses. Yes, you have to pay such people more. Maybe a lot more, and *still* appeal to their sense to community. I don’t care how many books you’ve read, how many classes you’ve taken, how many people you’ve advised. Your perspective and wisdom changes radically when it’s YOUR personal financial security on the line, YOUR marriage you’re wrecking by chasing your dream, YOUR kids’ college fund, YOUR capital funding the deal, YOUR responsibility to sell products you don’t have, and YOUR responsibility to make payroll. The quality of your advice goes from comfortable arms-length, no-skin academia to useful and credible when you’ve been in that seat and, frankly, that actually gives a compelling reason for the accelerees to take your advice seriously.

    Not interested in creating an incubator unless you get paid? Nobody who has been an entrepreneur wants a job to share his knowledge at a pay cut? Then don’t be an incubator. See if you can get your funders to put money into a seed fund instead. If entrepreneurs are going to make mistakes, at least let them do it without paying for the middle man.

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