Startup Accelerators & Incubators

Incubators, or start-up accelerators, have existed since the 1950s. Today, incubators are often sponsored by private companies and public institutions like colleges and universities. Many incubators cater to technology companies. (One of the best-known incubators—Y Combinator—created Dropbox Inc., now valued at more than $10 billion.)

Business incubators offer companies, who are in the early stages of development, resources such as physical office space, shared services, expert mentoring, consulting services, legal counsel, and seed money (typically ranging from $10,000 – $150,000).

In exchange, an incubator is given equity in return.

It is difficult to get accepted into the most prestigious incubator programs. Acceptance rates for these programs tend to be in the single digits, so you might have an easier time getting into Harvard Business School than one of these premium incubators. Fortunately, there are hundreds of other incubators around the globe with varying eligibility requirements.

Incubators have a stellar record of helping start-up companies succeed. According to the PapaJohn Entrepreneurial Center, 60% of new businesses fail, but 90% of start-ups nurtured by incubators are thriving after three years and 87% are still in business five years after they launch.

Incubators are a great place to make connections with influential people in your industry. After your time at an incubator, you may walk away with 5 to 10 influential people who are deeply engaged with and eager to help your company grow.