Excubator: an alternate model of support for start-up ecosystem

Abstract

Incubators and accelerators have recently experienced increased attention as a model of start-­-up facilitation in developing countries. Venture capitalists see incubators as a means to diversify risky investment portfolios, while would-­-be entrepreneurs approach incubators for start-­-up support. The different incubation business models (not-­- for-­-profit, for-­-profit, public/private entity), can be broadly categorized in five incubator archetypes: the university incubator, the independent commercial incubator, the regional business incubator, the company-­-internal incubator, and the virtual incubator. The world economy is also in the midst of a profound transformation, spurred by globalization and supported by the rapid development of ICT (Information and Communication Technologies) that accelerates the transmission and use of information and knowledge, redefining the way companies do business. In this report we propose an overarching incubator model ( excubator model) that synthesizes elements and best practices emanating from the five archetypes empirically identified and also incorporates substantially higher economies of scale and scope, as well as global knowledge arbitrage potential. An architectural blueprint has been proposed and explored for designing virtual incubators as a knowledge and innovation infrastructure which would link entrepreneurs with a global network of Business process experts, B school students and Experienced entrepreneurs, and thus help not only bridge, but also leverage, the diverse digital, cultural, socio-­-political knowledge. The implications of this archetype for facilitating both venture business activity and broad-­-based economic development has been researched in a pilot project. The pilot project to help with the research on this model involved creation of an online space that can provide an inclusive solution for all startups that desire assistance with different aspects of running a business at different stages. The concept is to bring entrepreneurs desiring do-­-it-­-for-­-me solutions that give everything they need to succeed under one roof, including consulting for business advice, technology development and venture capital. Members can collectively take an equity position for services they provide. Finally, a checklist for creating an incubator is promulgated with the intention of being used at each stage of incubator development, that includes feasibility, launch, maintenance, operations and improvement.