Back to Basics: How an Incubator Can Help an Established Startup
So far, incubators generally have been geared toward brand new businesses. Early on, they often seemed to be searching for tech companies that had ideas that would disrupt entire industries. However, over time, incubators began to emerge that welcomed new startups in every sector.
But even after all this time, the incubator concept remains limited to newer businesses, attracting entrepreneurs who need help connecting with others in their industries for advice, funding, and general support. New businesses aren’t the only ones who can benefit from this type of program.
A “startup studio” established by Boston Consulting Group (BCG) and Torque Studios in Silicon Valley offers established entrepreneurs opportunities that are often only provided to new entrepreneurs. Through this Entrepreneur in Residence program, founders meet face to face with top business leaders in their field, creating a chance for mutually beneficial partnerships.
Could your established business benefit from this type of support? No matter how long you’ve been in business, you’ll likely find there are ways an incubator could benefit your business. Here are a few ways an incubator might help you.
Access to Funding
The startup period isn’t the only time you’ll seek investment dollars and bank loans for your business. In fact, even some of the biggest, most well-known business may gather funding to expand or take on new ventures. An incubator has the power to connect you with investors who are looking for great opportunities. A proven business may be exactly what those investors are searching for. In fact, investors may prefer to form partnerships with incubators that help out businesses that have some experience in the market over taking a chance on incubators that support brand new businesses.
Incubators usually promise to help participants find partnerships with established entrepreneurs in the area. This could be in the form of mentorships or merely making introductions that could lead to lucrative deals. Even the most established entrepreneurs could benefit from expanding their business networks, with an introduction to a key player potentially leading to great opportunities. An incubator that helps out established businesses will likely specialize in helping with these connections, since many business owners would prefer a helpful peer to a mentor. If an incubator isn’t available to established entrepreneurs in your area, networking groups and Chamber of Commerce events can be another great way to find these partnerships.
The average time a business spends in an incubator is two years, during which time they share resources with other businesses in the program. You might share a receptionist or phone system with other incubator members, for instance. Established businesses usually have those resources already set up, but that doesn’t mean you can’t benefit from access to pooled resources. A group of business participating in an incubator might choose to share the expense of setting up a booth at a trade show, for instance, or join a group of businesses in contracting with a professional designer at a discounted rate.
Entering New Markets
When established brand TerraCycle expanded into global markets, the company joined incubators in those areas to get the support it needed in various regions. TerraCycle was able to negotiate the free office space it needed to develop is new products by offering equity and a promise to pay rent when it hit certain milestones. This allowed an established business to gain access to experts it needed while also having a dedicated space in an area where it didn’t already have a presence. Established businesses may especially find incubators beneficial when expanding into overseas markets where the local landscape is unfamiliar, since incubators can provide the additional support you’ll need.
A successful entrepreneur never stops learning and an incubator offers access to learning opportunities. Some incubators host workshops to help participants learn and grow. Still others provide entry into conferences and workshops that can help satisfy your educational needs. Some incubators are hosted by colleges or universities in the interest of giving young entrepreneurs a boost. But all of them typically empower you with the tools and lessons you’ll need to increase your odds of success. When you find a resource for continuing education, you’ll gains an advantage in an always-competitive market.
Incubators can help businesses head in a new direction or establish new connections in unexplored markets. While many incubators focus on working with new startups, established businesses can sometimes work out agreements with incubators to use office space and take advantage of the many other benefits offered to businesses.