Startup founders looking to start off on the right foot often turn to startup accelerators or startup incubators for help. They have become very popular in Nigeria, and a number of successful startup existing today got to where they are with the help of incubators and accelerators.
The terms “accelerator” and “incubator” are often assumed to represent the same concept. However, if you’re a first-time founder, there are a few key distinctions you should be aware of it you are planning on signing up to any.
They both offer entrepreneurs good opportunities. Founders get help to quickly grow their business and they often better their chances of attracting top VC firm to invest in their startup at a later point. Still, the programs are different frameworks for startup success.
Incubators specialize in growing new and early-stage businesses. They are a good way of moving a business from pre-startup into its start-up phase before acceleration, and will begin to introduce you into the world of ‘entrepreneurship’.
Startup incubators are referred to occasionally as business school, taking entrepreneurs with promising ideas and teaching them how to run a successful startup. They offer expert membership, resources like office space, legal counsel, and even seed investment – typically in exchange for a small amount of equity.
The most distinct difference between accelerators and incubators is the time frame of each. Accelerator programs are a tool for rapid-growth companies. They work with startups for a short and specific amount of time, usually from 90 days to six months. While incubators can be seen as tool for the “childhood” of a startup, accelerators can guide entrepreneurs from “adolescence to adulthood.”
The primary function of accelerators is connecting startups with mentors, guidance, and resources. Accelerators also offer startups a specific amount of capital. In exchange for capital and guidance, accelerators usually require a very little percent ownership of your company.
Accelerators or incubators?
If you’re really not sure where you sit, then ask the company that you’re applying for about what they are and what they do. It’s important to also know that even incubators and accelerators may misuse the terms, or may have different goals. Be sure that it can benefit your business, and don’t waste time applying things that won’t benefit what you’re doing.
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