Developing a product and building a company is more like organizing chaos and founders always look for ways to make it easy. Unexpected market challenges, dynamic customer behaviour and rapid technological innovation often result in ever-evolving business plans.
To combat the myriad of challenges, startup founders rush into joining incubator programs with the sole purpose to succeed and grow their business. However, founders often miss out on gauging whether the incubator is the right fit for their business idea.
The selection of incubators should be done with the same diligence as selecting a co-founder for the startup. Founders need to live with incubators for a significant period of time, learn and take leverage of the opportunities poured in while being with the incubator. Thus, the imperative is to ask a few important questions before entering an incubator.
Is this the right time to start a business?
Starting a business is just like planning a family where your startup idea is like a baby that needs to be nurtured. There are plenty of efforts that go into planning, developing and implementing the actions that show how important it is to consider the timing before starting a business. Besides the internal factors, one of the most crucial factors that need to be considered in today’s scenario is the market condition.
For instance, founders usually get the motivation of starting a business during the flourishing years of the economy when the hopes are high. However, the right timing to start a business is only after strategizing the market-related factors when less competition is left, businesses taking exits or businesses finding it difficult to access the customers.
Before joining an incubator, founders must ask themselves whether the time is right and they are prepared enough for the grind.
What is your goal behind joining the incubator?
Many well-established companies started as a startup that used incubator. Every founder has a different mindset and goals to flourish in the market. However, when joining an incubator, a founder should define their objective clearly before starting a business which could include seeking support in R&D for product development, using office resources or requiring mentorship for launching the product, business growth and scalability.
Incubators play a crucial role in eliminating several risks that can impact the foundation of the startup in the initial stage itself. Imperative for a founder is to define their goals and know the objective before entering an incubator.
What is the niche of your business?
Many startup incubators are industry agnostic. They focus on specific business models. For instance, some incubators support a majority of legal-tech, ed-tech or HR-tech startups while others may support health-tech or agri-tech startups. Depending upon the niche, a startup founder should do his/her own research in figuring out the mentors and other experts spearheading the incubation program. It is necessary to make sure the incubation team has a strong background and expertise in helping the founder and provide him/her with relevant resources to grow their business.
Are you prepared to pivot and adapt?
It is very common to see that startup founders have a specific plan of action in their minds before starting a business. However, in the ever-evolving and competitive market, founders need to be prepared for pivot and adaptability before entering an incubator. After determining the market scenario, a founder should be prepared to make fundamental changes in their business and adapt accordingly to stay ahead in the industry.
Do you have a skilled team or the ability to build one?
Business in today’s period of competitiveness is all about people. Similarly, the success of the startup is also determined by the experience and agility of the team. If there is a solo founder, having a technically or non-technically skilled co-founder can make a huge difference. Incubators emphasize having a skilled team or the ability of the founder to build one. Furthermore, a solo founder is pulled between many things such as running for meetings, managing day-to-day business operations and looking after the market dynamics. Having a co-founder with the same passion and degree of knowledge can help in minimizing the risks of lagging and help in handling the core responsibilities of the business.
Incubators are a great way for startups to accelerate their network and spur growth. Being a founder of a startup, make sure you have asked yourself the important questions before applying to an incubator. Additionally, these questions could serve as deciding factors for a founder whether they are ready for incubation or needs more preparation before sending their application.
(Deepak Ram is Center Head, Centre for AgriBusiness Management, Utkal University & Coordinator, CII)
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