Any business, be it private or partnership owned, requires tools that facilitate its growth. Startups involve a lot of planning and process that isn’t easy to learn and grasp by oneself. There is a need for mentorship if one wants a sustainable business and a well-produced capital.
If you’ve ever been involved with a start-up, more often than not you may have come across the terms ‘accelerator’ or ‘incubator’. And if you’ve found yourself being confused between the two, you’re not alone.
An incubator can be easily mistaken for an accelerator because of the common factor between them – purpose. While both entities serve the same purpose of enabling the growth of an organization, the services that they offer aren’t the same.
Let us take a look at both the aspects that help in the process and understand their hand-in-hand approach with start-ups.
An incubator facilitates a company’s growth by providing services such as affordable office space, resident companies which in itself provide advice from experts, mentors or administrative support along with provident office equipment, training and investors. Their services also include legal assistance like finance and business development connects. With access to mentorship, a business has a better chance of success.
While some incubators run independently some are run by VC firms, angel investors, government entities, and major corporations; to name a few. While some incubators have an application process, others tend to work with ideas and companies they have contacted through trusted partners. Incubators focus on a particular market or vertical, all depending on the party they are sponsored by. More so, an incubator is an option that involves a co-working atmosphere.
An incubator is more of a long term, easy-going procedure and lets one understand the flow of revenue and market through a better perspective.
An accelerator, on the other hand, is a short term yet intensive process. As the name suggests, it ‘accelerates’ the growth of an organization, in a sense, it accelerates factors in the revenue and marketing aspect of a startup.
Accelerators have an application procedure, where entrepreneurs can spend anywhere from a week to a few months with mentors who help build ideas and in turn build the business in a systematic manner, making sure to avoid unnecessary problems. In exchange for a small amount of equity, an accelerator provides a small seed investment with a large network of mentorship. Typically the mentorship network consists of start-up executives, venture capitalists, industry experts, and investors.
Incubator vs. Accelerator: Still deciding on which one to choose?
Incubators and accelerators both offer great opportunities to help young, aspiring startups get headed in the right direction, but it’s up to you to decide who you wish to start with. It depends on how fast you want your company to grow. Incubators tend to take the process slow and don’t have a tight timeframe. Whereas, accelerators have a time frame and help build your company quicker than you expect. Once you’re done assessing your business requirements, the accelerator vs incubator battle will be finally over.
Nordic Intent is dedicated to helping entrepreneurs and businesses start, grow and accelerate their companies. Click here to know more about some of the projects Nordic Intent has on-boarded.