An Ace College Initiative: Ascend-Ace Startup Center

Business Incubators are not an all-knowing entity for guaranteeing success nor is that claim being made. On the contrary, they should be an additional resource for entrepreneurs to test their ideas before implementing them. An argument that startups save money through such incubators in the long run can be made as they tend to build their product in a simulated, but realistic, market. Furthermore, they can also make as many mistakes as possible there before launching their product into the real world — proving to be less costly than failing in the actual market.

Nonetheless, most participants, and even incubators themselves, have somewhat of a flawed metric for success by associating it to only funding. This was revealed by a Harvard Business Review article which went on to further disclose that the problem with using this success metric forced untested entrepreneurs into a financing round that often fails. Over 99% of companies should be made to grow organically and self-sustain without the need for additional external financing because some things cannot be solved through simply injecting extra capital[i]. This does not mean that business incubators should suddenly focus on decoupling from funding, rather they should teach what those things that cannot be funded are and at the same time provide funding through seed capital and angel investments where appropriate.

Setting this as a guiding principle, Ace with Ascend tries to make sure that these mistakes will not be made. Through the flagship Pre-Incubation program participants will be provided necessary funding and guidance on how to become independent. Moreover, at Ace Institute of Management a community workspace has been set up and mentorship services will also be provided to its students. Today’s university students want more than academic degrees; they strive to start their own business, develop new products and are looking to start social movements.

Universities want to align their academics along with active participation of students in innovation and entrepreneurship systems.

With this goal in mind Ace Institute of Management launched its own incubation program for its current students as well as alumnus.

Ascend Pre-Incubation Program

On September 5, 2020 Ace Start Up Center (Ascend) kicked off its flagship Pre-Incubation Program with its first official cohort. The 5-months (or 20-weeks) long program has been designed to be a comprehensive and intense course that will develop and grow the startup ideas that choose to partake. Participants are put through a tailored curriculum that includes a coach for each module, offers a bi-weekly guest speaker, and involves hands-on activities. The program will lay the groundwork for selected companies to test and validate their ideas and be market ready to launch after its completion. Here the participants learn:

1. How to evaluate startup ideas and execute the idea into a successful business with guidance from experts and professionals

2. To set business milestones and/or goals to track the growth and progress of venture

3. A range of relevant skills to apply to their business through relevant workshops

The program ends with ‘demo-day’ where the startups will showcase their business ideas in front of an audience of business experts, investors, faculty members, and mentors. Upon graduating the Pre-Incubation program, Ascend will provide seed capital to deserving ideas as they enter the market. Additionally, although optional, startups can also choose to stay with the incubation center after Week-20 for another 6-months; Ascend calls this its ‘hand-holding’ phase. Here, further guidance and mentorship will be provided to startups as they enter the market and operationalize. Nevertheless, to reach this phase would not only symbolize a Startup idea getting through expert inspection but excelling despite of it.

Why put your business idea through an incubator?

One might, however, still question the validity and effectiveness of participating in business incubators in Nepal, and these queries are reasonable especially when there may be a cost associated in engaging with them. At the same time, Nepali entrepreneurs are faced with the fact that more than 90% of Startups fail in Nepal not because of extraordinary reasons, but because of generic ones like founders’ incompetence, their personal problems, and market irrelevancy for their offerings[ii]. When being able to view both possibilities though, one cannot help but be more inclined to support incubators because it would be more costly to fail in real-life rather than in a simulation.

For instance, pilots go through flight simulators before they fly real aircrafts because the cost of failing in real-life for them is fatal. Hence, a business incubator should also be viewed as a business simulator where all the extremes conditions and uncomfortable situations of a market are mimicked, albeit not as precise as the simulator’s used by pilots. More importantly, it would teach those business ideas that fail here would, more likely than not, translate into also failing in the real-world. This gives these startups a chance to redefine themselves by adjusting for the factors that caused their idea to cease to function when it was simulated in a controlled environment.

The worst that can happen when participating in business incubators is that some hopeful entrepreneurs face the reality of their ideas just not working for now, or forever for that matter. Successful incubators also do not invest in helping launch ideas that are likely to fail. Take for example Silicon Valley’s Y-Combinator Management, one of the world’s most successful business incubators who have launched more than 2,000 Startups like Airbnb, Twitch, Reddit, Dropbox, and more. Only 11% of all their launches have failed after market-entry[iii]. This is just one of many examples of how incubators around the world have been helping young investors and entrepreneurs turn their visions into something concrete more often than failing them.

In Nepal, Ascend is by no means the first as KUSOM’s Idea Studio, Rockstart Impact, Biruwa Ventures, and other similar incubators have already existed. Nevertheless, through this program Ace also intends to be a part of this movement and help grow this sector while also helping young entrepreneurs realize the validity of their startup plans.

References:

[i] MITRA, S. 2013, Aug 26,. The Problems with Incubators, and How to Solve Them. Harvard Business Review. ISSN 0017–8012.

[ii] GAUTAM, N. 2020. Nepali startup ecosystem: the growth so far & the future. New Business Age, April, p. 26.

[iii] TAI, J., 2019. How to pick the best incubator for your startup. Jun 27, [online] [viewed 1 October 2020] . Available from: https://www.forbes.com/sites/theyec/2019/06/27/how-to-pick-the-best-incubator-for-your-startup/.