5 Innovative Business Incubator Strategies

So you want to join a business incubator?  Here are 5 key strategies to help you compare options.

1. Stake it to make it 

If the incubator doesn’t have a stake in the companies, they are just selling real estate.  That’s a fine model, and it is innovative as a real estate strategy- just not all that innovative as an incubator.

Innovative business incubators have a stake in the companies they incubate.   They live or die, in the long term, based on their incubated companies’ successes.  The stake can come in equity, royalty debt, convertible debt, or some combination. Usually the rent is lower and the selection process is tougher for these incubators.  The key is that the incubator’s life depends on your success; not just on collecting rent!

2. Niche

Good incubators aren’t all things to all people.  This goes back to the above, if an incubator just sells real estate, they don’t really care who comes in the doors. Incubators that have a stake also need to have an expertise and a synergy amongst tenants to help them succeed.

Some niches are within an industry.  For example, a biotech niche may have the lab space to go along with it.  Here is an example of a biotech incubator in Fayatteville, Arkansas that has seen great results. Some niches are built around types of business models, for example, SaaS products with reoccurring subscriptions.  Whatever it is, if there is not a niche, be wary. Most incubators pool resources, e.g. accountants, lawyers, etc.  But if you have a niche incubator, you can bet the professionals in the group have been-there, done-that before and can really be of assistance.

3. Cut the crap

Great business incubators cut out all the crap for the entrepreneurs.  Internet hookup? A/C? Electric bill? Copier and printer? The incubator needs to be taking care of it and proactively making sure the entrepreneurs never touch that stuff.  Some of the best ones provide food and drinks, or at least streamlined access.

Every minute the entrepreneurs spend time on crap is every minute they are not building their business. This is generally well understood with incubators that follow point 1.

4. Great communicators

Your business is unique.  If the incubation manager knew how to run it, she should have done so a long time ago.  A great incubation mentor helps empower the entrepreneur as best they can to find their success.  A key to this is in communication.  Facilitating team communication and helping the entrepreneur weed through the noise, is key.  Go here for more reading on good non-violent communication.

5. Use the crowd

Great incubators use the crowd.  Crowdfunding is a great start.  Doesn’t matter if you are selling equity, a product, or looking for market feedback.  You need to get your product out there and see what the market has to say.

Surveymonkey is a great way to get answers on paper but even better is to have a beta and see how people actually respond.  People are terrible predictors of their future activities.  Listen to these guys talk in detail about how to nail a customer interview.


Incubators are great tools.  But they are not created equal.  Most incubators are clever real estate plays rather than true business development tools.  Find one that suits your needs and watch for these 5 innovative incubation strategies.

Did you find this article helpful? Click on one of the following buttons
We're so happy you liked! Get more delivered to your inbox just like it.

We're sorry this article didn't help you today – we welcome feedback, so if there's any way you feel we could improve our content, please email us at contact@tech.co

Written by:
James helps empower entrepreneurs. Some key projects have been in webtech, brain-health, crowdfunding, and running an incubator in Haiti and Florida. James is a graduate of Yale University with a degree in the Humanities. His work has been featured in the Yale Business Society magazine, the Yale Entrepreneur, at the Katz School of Business, and he has spoken at the Yale School of Management and the Business Society's conference on sustainable enterprise in developing nations. Some Projects he is proud of include: EquityNet, DrPerlmutter, SlideMoor, LEVE Foundation, or visit Proton Enterprises to learn more.
Explore More See all news
Back to top
close Building a Website? We've tested and rated Wix as the best website builder you can choose – try it yourself for free Try Wix today