Do you have a great business idea but you're a little short on funding or short on business know-how? If you answered 'yes', then you might want to consider a business incubator (or ecubator as they are sometimes called when referring to an online business.)
Business incubators are organizations that provide various forms of assistance to entrepreneurs who have a good idea but need some help putting it into action. Depending on the nature of the incubator, you could receive mentoring, investment capital, referrals to suitable markets or use of equipment or space.
Although business arrangements may vary, typically you will be asked to give up a portion of equity in your business in return for the assistance you will receive.
If you are looking for an incubator, consider the following:
- You will need a complete business plan. Do not expect to approach an incubator with a few notes or a great idea. You must do your homework first.
- Before applying to an incubator, check around and talk to business owners who have been "incubated" by this organization. Are they satisfied? What do they have to say about their experience with this entity? There are many incubators around, and not all are equally solid or equally viable.
- Do you already have the business acumen that you will need, or could you use some mentoring? Many entrepreneurs say the best incubators are those that provide ongoing guidance and consultation in addition to financial assistance. Some go so far as to say that incubators providing financing without mentoring may not survive for the long haul.
- If the incubator provides mentoring, does the team consist of people who have direct experience in your industry? Many say that this direct experience is an important consideration.
- Does the incubator under consideration have business contacts that will be made available to you? Some incubators have large databases of contacts worldwide, and will work with you to bring your product to their attention.
- Are you prepared to listen to advice and to discuss your business with a team of people? If you are a "one person show," then this type of arrangement might not be for you.
- Do you have the communication skills and the people skills to defend your ideas to a group who might be skeptical or have other visions? You'll walk a fine line. On the one hand, you must be open to receiving and considering advice from people with more expertise than you. On the other hand, it's your idea and your vision and you must defend it where appropriate.
- If the incubator provides mentoring, how are conflicts and differences of opinion handled? Is there a policy for conflict management?
- What degree of accountability is required? Expect to be asked for a reasonable number of reports and paperwork, and expect to be asked to attend meetings with your mentors on a regular basis.
Once you have located the incubator that seems right for your situation, submit your business plan and be ready to move quickly if you are accepted. Many "incubated" businesses operators express surprise at how quickly things can move once the "go ahead" happens.
Article by June Campbell - Writing Services by Nightcats Multimedia Productions.
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June's writing has appeared in several international print and online publications. Her web site offers a number of resources to small businesses - including guides for proposal writing, business plan development and more.