Startup Incubation- Criterias that you Should Meet!
In all honesty, I did not know what this- startup incubation – was just until a few days ago. That is somewhat shameful as I am a guy who is working at a startup going through this very same period. So I am going to share a bit of this word called “Startup Incubation” and share what I learned from my senior – the one who was there when this whole thing started.
From what she said, a lot of start-up businesses go through this process. As for the process itself, the incubation process is basically the time period when it is helped by another larger company. The larger company provides the start-up business with any help that they need- given that they get some of the shares and profit as well as credit in return.
As far as I know, this period lasts around two years but can be extended if the startup needs more time to grow but shows good potential. As she explained to me what a startup incubation period was, I could see her exhausted face. She probably remembered the time period when this startup was under the incubation period as well.
By now I had gotten pretty interested as well and I asked her “What are the criteria for being eligible for incubation ?” Of course, I did not say the word “eligible” I was too curious at that time and probably said something dumb. But regardless of what I said, I got the answer I was looking for. And now we enter the main topic that I want to share with you guys today. The criteria that you need to fulfill if you want your start-up business to be eligible for startup incubation.
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Criteria for Incubation
So apparently there are tons of things that you have to be able to do if you want to be qualified for being under startup incubation. I did not know anything and my curiosity had risen to the peak by this time. Now let me tell you something- I do not understand business nor am I interested in them.
However, I am an information-hungry person who loves to gather as much information as I can, and listening to what she had to prepare just to be eligible for this whole thing just made me even more curious. The first thing that she said was important to be eligible for startup incubation was that a business needs to have advanced technology as its integral part.
1. Advanced technology
As I listened to her, she said that the company should have a concept of using advanced technologies in their future plan. I asked why was this in the criteria? After all, a company can run successfully even without advanced technology as well. She looked at me as if I was a stupid person (which I felt I was after she replied to me) and asked “If a company can’t keep up with the advancement of the technology, then how long do you think the company can run on the outdated technologies and services, especially with the rush of new technology every season?”
I got it immediately and well felt stupid for even asking that. She continued her explanation.
2. Be in a cooperative relation, partner, or be a sole proprietor with the incubator
As dumb as I was feeling, the moment when she said “The start-up business and the incubator should be in a cooperative relation, be a partner or be a sole proprietor with the incubator” my attention got diverted towards that sentence. I thought for a while and thought that it made a lot of sense. After all, why would anyone invest in anything unless they could gain something from it?
This criterion will ensure that the incubator will be among the few parties who will gain profit from the start-up once it succeeds in the future and they will gain a lot of profit from the start-up as well. Being in a partnership with an upcoming business that has a lot of potentials. is a good investment after all.
3. Proof of the need for incubation
“And once you are willing to fulfill these criteria, then you will have to show them the proof that our start-up business is in need of the incubation. Now I know that you are not as dumb as you make others believe so I don’t think I should have to explain this” – she said as I was thinking about why it is logical for the incubator to have criteria of a partner, corporate or a sole proprietor of the startup.
This woke me up from my chain of thoughts but immediately directed me towards another chain. I began to think “If a startup asks for the need of incubation when they don’t actually need it what would happen? Of course, the chances of funds, services, and manpower provided by the business incubator being misused will increase. So this criteria is too logical. This one criterion is actually the main gate between their funds and services being misused!”
“It seems like you understand this as well,” she added.
4. Good Business Proposal
She continued to explain the criteria and was nearing the last part of her explaining. “Now the rest are more or less the same so I will finish this in one bulk,” she said and according to her, the final criteria all boils down to whether or not the start-up business is a good plan and work in the long run or not.
This contained questions like “How impactful will be your startup or at least how impactful do you plan to make your startup?” and “Are services and products produced by your startup company practical and doable?” Along with these two questions she said there were many things needed to fit the criteria but all of them were dependent on these two.
Now I don’t want to leave you in confusion but I don’t want to talk about this in too much detail as well, for it will just be me telling you guys what I don’t know too much about. The gist however is that the business needs to generate profit enough to sustain both the business itself and the ones who invested in the business and the environment as well.
5. What if the proposal is not good enough?
This is what I asked her when she was done with her explaining and she answered me in a simple way. “If the business proposal is not good enough but is still a practical one with room for growth, then the startup incubation will still be provided. They will guide the entrepreneurs and innovators first before they provide the incubation though”.
I was satisfied and to be honest my brain was full by this moment. So I thanked her and took a break.
Thoughts after the information
During the break, as I was taking a coffee, I thought “ This is really a good concept that is innovative in itself. Not only is this good for the profit to both parties but also an encouragement as well. Why would young entrepreneurs hold back if they can find these business incubators? The criteria is a practical one as well. After all, the only thing they ask is some profits and a good business plan”
But what about the process? What about other sources of startups ? These question remained in my mind.