Startup City Magazine
A monthly magazine for business startups and young entrepreneurs.

Incubators and accelerators: Fueling the growth of Startup landscape in India


Incubators and accelerators: Fueling the growth of Startup landscape in India

With a phenomenal growth rate, the startup ecosystem in India stands fourth largest in the world. Notably, growth of startup ecosystem in India took pace in recent years. The number of startups in 2014 was estimated to be 3000 which is expected to reach nearly 12000 by 2020; it is not passing but a revolutionary phase unquestionably. It’s definitely going to change the way the markets are working today in India. Such an accelerated growth is fueled by several initiatives from government, consolidation activities, evolving technology and a burgeoning domestic market. Furthermore, massive funding activities initiated by investors are also facilitating startups through incubators and accelerators to help them access various resources and foster an entrepreneurial culture all over the country.

Startup Incubators and accelerators have been playing a significant role in the development of the Indian start-up landscape. They are being put in place to aid startups in getting their business off the ground by providing them mentorship and investor relationship benefits. So, what are Incubators and accelerators and what role do they play?

To incubate an idea refers to nourishing an idea to let it evolve and grow into reality. As the name suggests, start up incubators are organizations that help start ups to develop by providing services such as management training or office space. An incubator is space, where you can locate your business in a centralized work place with many other startup companies. Usually, the startups in these incubators are all funded by the same investor group. Startups can use the space as long as they want, or until their business scales up and requires relocation. Startup incubators are generally public funded and take on equity.

A startup accelerator leads startups quite differently. They associate with startups for a particular time frame or period (usually from 90 days to four months) and basically intend to accelerate the growth of their business and give it a jump start. The investment from accelerator is minimal but the mentorship provided in the stipulated time proves to be a boon for startups and largely results in raising venture capital from a third party entity.

Both the programs are transformative in nature as they can empower budding entrepreneurs with resources as well as with the wisdom to use those resources. Moreover, these programs vastly enhance the chances for raising capital having included rigid screening processes.

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