Entry to an incubator, and acces to the business-building services it provides, usually requires an enterprise to have a properly constituted legal structure, a realistic business plan and a product or service that can be taken to market. The pre-incubation process is designed to help enterprises reach these entry criteria so that they can benefit fully from the incubation process.
Objectives
The main objective of the pre-incubation stage is to support entrepreneurs (see area ICT-enabled entrepreneurship) in transforming their ideas into legally constituted companies with marketable finished products. The main contribution from the pre-incubation process is that it guarantees that companies entering the incubation process are “ready to be developed”.
Entrepreneurs before the pre-incubation stage may not have legally constituted companies, approved business plans, marketable products and/or services to be offered.
The pre-incubation stage must be organized so that the three main objectives are addressed:
- a legally constituted company
- a duly approved coherent business plan
- a product/service ready to be offered to the market (or at least a prototype).
The company will be ready to start up its incubation stage (see guideline Business Incubation) once these three objectives have been achieved. These two stages (pre-incubation and incubation) can be offered by the same entity (incubator) or by different entities (pre-incubator and incubator).
Pre-incubators are usually (but not always) located in universities and may be focused on supporting technological companies.
Several courses and consulting services can be offered during the pre-incubation stage that enable entrepreneurs to develop their business plans, incorporate their companies and develop their products or services. For further details about services offered, see guidelines Support Services, Operational Support Services, Management and Strategic Support Program and Technology Support Program.
Under this framework, a useful strategy is to use the preparation of the business plan as a catalyst for completion of the pre-incubation stage.
Key Issues
Development of a Business Plan
The business plan format and contents vary in accordance with the intended target (venture-capital investors, incubators, banks, etc). The business plan must contain at least the following information: executive summary, strategic business vision, company description, products and services, market analysis, marketing plan and financial plan.
The objective of the business plan is to function as a brief introductory tool covering the main characteristics of the business. The business plan then becomes an important guideline that will be used to implement every action taken by the company. Furthermore, it is an excellent company-marketing tool.
Some key business planning tasks:
- Identify risks and propose plans to minimize/avoid them
- Identify strong/weak points related to the competition
- Get to know the market, define products/services and marketing strategies
- Analyze business financial performance
- Assess investments and estimate return on capital invested
Responsible Parties
Consultants and incubator managers
Indicators
- Total number of projects already assisted at the pre-incubation stage
- Number of projects at the pre-incubation stage
- Total number of projects resulting from entrepreneurial programs
- Number of projects assisted at the pre-incubation phase that moved on to the incubation stage
- Level of success of the pre-incubation stage
- Percentage of projects approved in relation to the total number presented
- Number of companies, which conclude the pre-incubation stage each year
- Increased demand of projects assisted at the pre-incubation stage
- Increased demand of projects resulting from entrepreneurial programs
- Increased demand of projects assisted at the pre-incubation stage that moved on to the incubation stage
Results
Increase in the number of well-structured business plans presented to incubators.
Examples
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