Choosing the Right Small Business Incubation Program as an African Entrepreneur
In 1959, in an industrial warehouse in Batavia, New York, the first “official” business incubator was created by one Joseph Mancuso. Since then the idea has exploded globally in an era where new ideas that can be translated into viable businesses are crucial in sustaining our future.
Essentially incubators are, like a baby’s incubator in a hospital, a supportive body that takes care of a young company or startup by supplying experienced advice, office facilities and possibly financial investment also.
The range of types of support can vary between incubators, so while obviously a young company that has seized on a new idea is desperate for any help it can get, it is important to be aware of what options there are out there before leaping at the first offer.
Having said that, incubators can mean the difference between your business being a success or failing. They can help in so many ways which will not even occur to you at the beginning but will prove vital as time goes on. The overheads of setting up a basic office with computers, printers and internet can be very challenging at first, so that is an obvious big help.
Then there is simply meeting lots of useful people in your industry, i.e. networking. An incubator can help with doing market research, which is vital for making sure that your idea is actually viable in the first place. You can receive training in basic accounting and financial management, as well as business etiquette and presentation skills .
Once your business is on its feet, you will then be keen to meet “angel” investors or venture capitalists who may be keen to make it possible to upscale your model, obviously seeking a return from their investment. Ideally your incubator would make this possible and help you to negotiate a fair deal.
Alternatively, perhaps a bank loan is the way to go. An incubator might also lend a hand with marketing your product or service.
There is also the fact that as a young company you may need more structure in your operations, according to standard business practice. This will give you valuable external accountability when it comes to attracting investment. Another reason to seek an incubator.
When looking at an incubator to apply for, make sure it is a good match for your startup. They should be focused on the same sector that you are looking at, and the startups that they are taking on should be at the same stage as you. If your company is already in business it may not be ideal to be working with others who are starting from scratch. Take a look at whether they know the local market for your product or service really well. Also ask yourself will you be able to focus on your own business as opposed to continually being a part of the incubator’s activities.
The advantage of the African Leadership Academy’s Youth Entrepreneur Support Unit (YES-U) is that it is a collaboration between leading business incubators on the continent, so it is able to put together a customized support plan that will suit your particular startup.
YES-U offers a three-track business support program for fellow and ALA Alumni entrepreneurs, who are supported from business foundations to investment readiness. Each support track has clear outcomes that, when looked at in aggregate, gives credibility to the businesses, improves their customer acquisition and retention, improves their operational efficiency and profitability as well as prepares them for investments from financial institutions, Angels and Venture Capitalists. This type of support is flexible enough to grow and adjust to the business growth and needs of the Fellow and Alumni business.