So you’re a newbie entrepreneur who’s landed a spot in a hot incubator program. Great! Now what? Being a part of an incubator program can be a great boon to your startup (for more details, check out my recent blog post: Are Incubator Programs a Good Fit for Your Startup?). In fact, according to a study conducted jointly by the University of Michigan and the National Business Incubation Association (NBIA), a whopping 87% of business incubation graduates manage to stay in business.
But simply being in the incubator program isn’t going to make your company succeed. If you want to make the most out of your time in an incubator program, make sure you:
1. Find great financial advisers. Finding mentors is one of the many reasons that startups choose to join an incubator program. Mentors can provide great support and insight on both macro and micro startup issues. One particularly critical issue to look to your mentors for help with is in setting up your accounting and finances.
Many early-stage companies aren’t so strong in the finance department. But, if you’re starting a business, having your finances in order is essential—and the key is to get them set up early and correctly. Advisers can help establish your day-to-day accounting functions like setting up an accounting system, payroll, and preparing financial statements. They can also offer guidance on larger financial strategy concerns such as creating a budget, understanding your cash flow and cash burn, and maintaining regulatory compliance.
Contact Early Growth Financial Services for help with both financial strategy and day-to-day accounting.
2. Get assistance with technical development. You probably already have great tech know-how on your team, but an incubator program offers the opportunity to work with other folks with strong technical knowledge from a variety of industries, bringing a unique perspective to your technical development. This is one environment where everyone will speak your language and someone is always available to trouble-shoot, work out a particularly sticky problem, or strategize.
3. Network to find potential angel investors and venture capitalists. Many incubator programs provide participating startups with some seed money. The amount varies widely, but it’s generally not too much—just enough to give entrepreneurs a chance to focus on their companies and grow to a certain degree.
The real money comes through the contacts you make while involved in an incubator program. Other startups in your program may have their own investors; getting introduced to these investors could be a good first step in fulfilling your own funding goals. Take advantage of all available networking opportunities that promise to open doors to potential investors.
4. Develop a plan to attack the market. You’re a first-time entrepreneur; your incubator program mentors are not. They’ve been there, done that. You may have a great idea—that’s how you got into the incubator program—but your success is a matter of approach and follow-through. Ask questions and take advantage of the specialized instruction your incubator program can provide. Use your advisors to test and retest the feasibility of your idea and strategize the best plan to take your idea to the marketplace, at the most advantageous time.
5. Idea share with other startups. Some incubator programs are niche; that is, all the startups in the program are in the same industry. Other incubator programs have greater variety. Regardless of what kind of program you are a part of, there are still bound to be tons of fresh ideas bouncing around. Talking with other entrepreneurs can give you a much-needed new perspective on your own ideas. Learn from others and be a gracious teacher as well, open to listening to others and sharing your own knowledge.
6. Enjoy free rent and office-mates. If you’ve been working at this for a little while, you’ve probably outgrown your own apartment (theoretically, if not physically) and the novelty of working in a cafe. Incubator programs offer shared space and resources. Depending on your program, you may finally have access to a conference room, a copier, and even secretarial services. And, the best part? It’s all free!
7. Have fun! Ask anyone who has been in an incubator program for the inside scoop, and you’re sure to hear stories of free pizza, beer, and bar outings. If you’re just starting your own company, you’re going to have a lot of responsibility and there’s certainly a big learning curve. But don’t forget your reasons for starting your own company: following your passion, escaping from the daily grind, forging your own destiny, and enjoying life. Now here’s your chance! The friends and social connections you make during your time in an incubator program are as valuable as any of the other benefits you’ll receive—and a whole lot more fun! As your incubator program helps to take your startup to the next level, take the time to enjoy the perks and relish this exciting time in your life.
How has an incubator program worked—or not worked—for your startup? Tell us about it in comments below or contact Early Growth Financial Services for more information about incubator programs and early-stage financial support.
David Ehrenberg is the founder and CEO of Early Growth Financial Services, a financial services firm providing a complete suite of financial and accounting services to companies at every stage of the development process. He’s a financial expert and startup mentor, whose passion is helping businesses focus on what they do best. Follow David @EarlyGrowthFS.