Startup accelerators and incubators: what they are and what are their differences
When you launch a startup, remember that you are not alone. In fact, you can count on the help of different figures, such as the startup incubator or the startup accelerator, who can support your initial efforts and accompany you on this exciting entrepreneurial adventure.
To win the trust of these particular figures, however, you need to know them thoroughly, to know at what stage of your startup’s life they can help you and in what way. Many, in fact, tend to use the terms accelerators and incubators as synonyms, thus erasing their specific characteristics and peculiarities.
Therefore, starting with the basics is, once again, the best way not to commit missteps later.This is precisely why in the next few lines you will find, in detail, an explanation of what business incubators and business accelerators are. Only once you have defined them individually will you be able to explore their differences in depth and be able to make better decisions based on your precise needs.
What is a startup incubator?
To briefly explain what a startup incubator is, it is possible to refer to the official definition provided by the European Commission, according to which “a business incubator is an organization that accelerates and systematizes the process of creating new businesses.”
Still confused? Don’t worry: concise definitions exist to be enriched with further details. A startup incubator, in other words, is the place, physical but also virtual, within which a startup can transform from a “simple” business idea to an actual entrepreneurial reality.
Companies of this type, practically, support startuppers in the development phase of the business model so that it is able to become replicable and scalable: startup incubators validate the startup’s business model by collecting data that will be used, then, to obtain the economic resources needed to finance it and provide their expertise (offering services ranging from mentorship to the creation of the business plan), their network of contacts and, in some cases, even a physical location where they can carry on the business.
In light of what has just been said, it will become apparent to you that a startup incubator does not directly fund the company, but its support creates the necessary and ideal conditions for the company to access investment.
Of course, the “incubation” period does not last forever: the period within which the startup must become a full-fledged company and be able to generate profits and attract investors is indicatively between 3 and 36 months. However, there is no predetermined peremptory limit, also in view of the fact that each startup has its own specific needs.
Just as obviously, the support that a startup incubator is able to provide, except in rare cases (where ad hoc public funds are provided), is not free: payment, specifically, can be in the form of a fixed monthly fee or through the sale of shares in the startup.
What is a startup accelerator?
A startup accelerator is a company that directly finances the startup and offers it support in various fields, from legal to marketing-related, in order to make its growth and maturation faster and thus enable it to take a leading role within the market.
Keep in mind that accelerator programs are designed for startups that are already established, have an established business model, and have employees already actively working to move the project forward. Generally, these programs last between one and six months (maximum one year).
To take advantage of the services provided by an accelerator program, one must also pay. The most common form of payment is equity: the startup accelerator participates in the startup’s capital with a share that is generally between 5 percent and 15 percent.
What are the differences between startup incubator and startup accelerator
Now that the main characteristics of a startup incubator and a startup accelerator have been listed, it will become even more obvious to you the mistake made by those who use these two terms as synonyms.
It must be remembered and emphasized at this point that the main difference between an incubator and a startup accelerator is represented by the different moment in which they intervene to support the startup: an incubator, in fact, helps the startup in its very first months of life, when the project on which it is based has yet to take shape and find concreteness in an autonomous and structured entrepreneurial reality; acceleration programs, on the other hand, access startups that are already established.
The fact that incubators and accelerators relate to startups that are at different stages of their lives also implies that the assumptions and goals of their intervention are equally different: the incubator, in essence, prepares the startup to enter the market, while the accelerator helps the company scale the market itself and take a leading role within it.
The duration is also different: it is useful, in this regard, to reiterate that the intervention of a startup incubator generally lasts between 3 and 36 months, while an accelerator program is much shorter, since its maximum duration, indicatively is set at one year.
Finally, there is another aspect you need to take into consideration to distinguish between startup incubator and startup accelerator: in the former case, the transfer of company shares is either not provided for or is minimal, while accelerators invest in exchange for shares, participating in the startup’s capital with a percentage that, as pointed out, can reach as high as 15 percent.
How to choose between a startup incubator and accelerator
Having reached this point, the question everyone always asks is the same: okay, but what should I choose between an incubator and a startup accelerator? To fully and completely answer this question, it is necessary to reiterate that incubators and accelerators address different stakeholders, or rather, stakeholders who are at different stages of their business.
Remember, then, that enlisting the help of a startup incubator is the best solution for you if you feel you have a winning business idea but it has not yet turned into a concrete business reality, or if you have already created your startup but are immediately encountering initial difficulties due to lack of experience and tools.
If, on the other hand, your startup is already established in the market but you need to strengthen your presence and speed up your growth, you need to knock on the door of a startup accelerator.
To return to the original question, then, it must be concluded that when choosing between a startup incubator and a startup accelerator, you must consider the specific needs of your startup and the goals you intend to pursue, in relation to the specific stage it is at.
How to access a startup incubator or accelerator
Choosing is different from being chosen. Crucial, then, is that you also know how to gain access to a startup incubator or accelerator.
You must, first, submit an application for access and, then, pass a selection based on specific requirements indicated directly by the entity that organizes the incubation or acceleration programs.
Very often, among these parameters, great importance is given to the team behind the startup and, in particular, its skills but also its ambitions. This is another reason why you should carefully consider who to surround yourself with in this entrepreneurial venture of yours.
Among the other factors that can make a difference in accessing an incubation or acceleration program is, then, the target audience for which the startup is intended. To arrive prepared for the appointment, therefore, the advice for you is to provide in good time for market analysis through the so-called TAM SAM SOM (a special tool used to understand the market segment you intend to target), competitive analysis and measurement of the traction of your startup (by traction is meant the validation of your product, that is, proof that someone is interested in it and is willing to pay to use it).
Incubators and startup accelerators may then ask you for a pitch deck presenting your business idea. In some cases, you may also be asked to present what is known as the Minimum Viable Product: that is, basically, the first version of the product your startup is developing.
What are the startup accelerators and incubators in Italy
Economist Peter Ferdinand Drucker once said:
“Behind every successful enterprise is someone who has made a courageous decision”.
In reference to his words and with regard to the discourse addressed here, we might add: the important thing is to know where to find that someone who is ready to make a courageous decision and support your enterprise.
You should know in this regard that according to the Social Innovation Monitor report for the year 2021, there are 229 startup incubators/accelerators in Italy.
About 57 percent of them are located in northern Italy. Lombardy is the region that hosts most of them with 58, followed by Emilia-Romagna with 30 and Lazio with 19.
Let’s find out the main Italian accelerators and incubators:
B-Plannow® is the ideal partner for startups that aspire to succeed; it is a collaborative program designed to help startups grow robustly in an increasingly complex and competitive ecosystem. B-Plannow® offers one-stop support, solving management problems through mentoring, training, pre-seed funding, and access to debt and venture capital. B-Plannow® is a unique start-up accelerator in Italy, with proprietary management techniques developed over time that combine experience and innovation into a winning method. B-Plannow’s ultimate goal is to help start-ups grow rapidly, become profitable companies, expand, and create value for their shareholders through accelerator programs that take them to excellence as quickly and sustainably as possible.
DigitalMagics is an incubator and accelerator of innovative startups and scaleups that offer high-value technology content and services. The incubator initiates Open Innovation programs to assist Italian startups in their process of innovation, service delivery and production. Through a collaboration with Talent Garden, an Italian coworking network for digital professionals, and Tamburi Investment Partners, an Italian investment and merchant bank, Digital Magics has opened several coworking campuses offering training courses.
Luiss Enlabs is an open startup incubator and accelerator. Since 2012, the first example in Italy in which a university (Luiss), a certified incubator and a venture capital (LVenture Group) collaborate nationally and internationally to promote entrepreneurship in the tech sector with a program that takes place twice a year. To be precise, Luiss Enlabs invests 250,000 euros in ambitious digital startups and helps them build valuable partnerships. The accelerator also facilitates diversification, scalability, and global impact during all stages of fundraising and provides access to its vast network of more than 90 companies and founders.
PoliHub is an innovation and business incubation center at the Politecnico di Milano, Italy. It offers services and support to startups and innovative companies to help them grow and develop. It is an incubator and accelerator that supports startups at every stage of development through services, relationships and expertise. Polihub offers various acceleration programs from 12-16 weeks to 6 or 8 months for tech and science startups seeking market entry and incubation with mentoring, customized meetings, business strategy and pitching assistance. In addition, Polihub offers workstations, offices and meeting rooms in its coworking space.
dPixel is a venture incubator and innovation company that helps grow startups, companies, and institutions through innovation. It connects ambitious startups with established companies, helps companies improve their competitiveness through digital transformation, and assists institutions in building social impact and economic development initiatives. In addition, dPixel has launched a 4-month innovation course, OpenPMI, which enables young Italian graduates to work within companies to deliver new and fresh solutions.
UniCredit Start Lab
UniCredit Start Lab is a business platform that supports young entrepreneurs and innovative startups in all sectors. It offers a multidimensional program with cash grants, network development, mentoring and management training. In addition, UniCredit Start Lab provides industry, business, technology and strategic partnerships. The platform also serves as a commercial bank operating in 17 European countries.
Fin+Tech is initiated by several Italian VCs and incubators: CDP, Digital Magics, Startupbootcamp, Nexi and Fintech District. It is a fintech and insurtech accelerator that invests up to 300 thousand euros for selected Italian startups and offers promotional support through lectures, masterclasses, and fundraising assistance. The program lasts 4 months and includes three phases: an in-depth evaluation, development and presentation of the project.
Industrio Ventures is Italy’s first hardware startup accelerator that builds and funds innovative product businesses. It offers technical, scientific and commercial assistance and access to its extensive network. In addition, Industrio’s entrepreneurial team collaborates with industrial and manufacturing partners who share knowledge and expertise with the funded startups. The accelerator program lasts more than 4 months, during which young companies work on developing prototypes, get production support, launch products on the Italian market, and receive funding of 25,000 euros.
H-FARM is a space that combines innovation, entrepreneurship and education. It helps young companies and entrepreneurs create new business models and transform digitally through its educational programs within its two schools, colleges, digital hub and foundation. On the H-FARM campus, students have access to sports facilities, a conference hall, dining options, a library and classrooms for training.
Retail Hub is the first business accelerator that helps brands and retailers find solutions tailored to their needs. The hub works with market-ready startups and scaleups, providing lead generation, market assessment, events, scouting, consulting and training. Retail Hub operates in the following retail sectors; grocery, design, fashion, luxury, pharmaceutical, automotive, sports, human resources, banking, beauty and more.
StartupBootcamp (FashionTech) is an annual three-month accelerator program that supports global fashiontech startups. The accelerator has been in operation for three years, working with 150 mentors, partners and investors and organizing demo days for startups. For several months, participants have access to coworking space, various masterclasses, an extensive global network, and discounts from leading technology providers such as Amazon, Google, Stripe and others. In addition, Startupbootcamp hosts a digital event, a Virtual FastTrack Tour, which allows potential participants to learn more about the accelerator and the intensive program.
Fashion Technology Accelerator Milan
Another fashiontech accelerator working in the fashion, luxury and retail sectors is Fashion Technology Accelerator Milan. Its acceleration program lasts six months and includes €60,000 in services and €40,000 in cash for a 10 percent equity stake. In addition to acceleration, Fashion Technology Accelerator offers consulting sessions involving revenue analysis, KPI definition, marketing strategy definition and product optimization.
Pushapp Lab is a startup studio that supports consumer mobile companies by providing support and annual funding of €25,000. The Pushap Lab team supports startups at any stage of development and provides strategy, design, and app development for ambitious startups. Currently, the firm calls itself a digital product strategy consulting firm.
Impact Hub supports entrepreneurs, corporate organizations, and public institutions striving for a better future. The hub connects entrepreneurs with large organizations, investors and the public sector by providing access to its resources and spaces and organizing startup support programs and business innovation initiatives. Impact Hub has a global network, including 8 entities in Italy (Bari, Florence, Milan, Reggio Emilia, Rome, Syracuse, Turin and Trento).
FoodTech Acceleration Platform
FoodTech Acceleration Platform contributes to the development of the Italian foodtech sector, offering help to startups and companies. The platform assists in developing projects and proof of concept, scouting international startups and more. It also has an extensive network of various VCs, angel investors, incubators and accelerators around the world. FoodTech Acceleration Platform collaborates with universities and research centers to monitor industry developments.
Vittoria Hub supports startups with three stages of development: incubation, which includes business idea and MVP development; adoption, which involves MVP support to the PoC; and acceleration to local and international markets. The program takes place in the hub’s work space in Milan. Vittoria Hub is a project of Vittoria Assicurazioni, an Italian insurance company. It is an insurtech incubator that promotes open innovation and new insurance business models.
Nana Bianca offers coworking space and a startup studio to various tech startups, entrepreneurs, freelancers and more. It also offers access to its extensive network and exclusive accelerator programs. In addition, Nana Blanca hosts various events dedicated to business area development in Italy.
There is one last thing you need to know: some of the startup incubators and startup accelerators in Italy specialize in specific sectors, such as hi-tech or food through sports. Take this into account as well when deciding to approach an incubator or accelerator.
Download the complete list of Italian incubators and accelerators
To help you identify the most suitable partner for your needs, we have developed a list of all Italian incubators and accelerators.
As you will see, the list is divided by name, city, province, region, address, email and website to allow you to get an overview of the Italian ecosystem.
If we missed anything, please let us know so that we can keep the list up to date.
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