Frontier Incubation— Breaking Out of the Tech Incubator Mold

Creative Startups lead faculty Lena Ramfelt urges incubators to rethink their “copy-and-paste” approach

Without any doubt, incubators are missing out on tremendous opportunities to support the growth of the next generation of successful and impactful companies. Recently, through my work with leading accelerator Creative Startups, I have had the pleasure of participating in conversations and programs with incubators all over the world. I’ve noticed they tend to use the same lingo, the same MO, and the same KPIs regardless of their unique location. Last week I was in a Zoom call with an incubator director who, with a very agitated voice, told me that (s)he couldn't find an electric car related company to add to the incubator. On another call, a program leader exclaimed in frustration about the lack of a food-delivery business in the portfolio. There is a myth that every incubator should try to attract the same type of companies or use the processes, activities, and structures as others to be successful and profitable.

This copy-and-paste approach is implemented without enough consideration for geographical contexts and/or other unique advantages that could shape an incubator´s market space and support the needs of entrepreneurs in proximity. If I apply the vocabulary I use when I talk with entrepreneurs, I would say that most incubators are working on outperforming instead of game-changing. In other words, they are using the same formula as the guys next door, expecting equal or better results.

How many times have I heard Y Combinator being given as an example of what to strive for even in geographies with hardly any high-tech and an established community of risk-keen investors? Yes, hats-off for Y Combinator, but remember that they are operating in what might be the hottest of tech hot-spots in the world. Eager early-stage entrepreneurs are pilgriming to Silicon Valley if there is the smallest possibility of being admitted to the Y.  Of course there are things to learn from Y Combinator, but every incubator should use their own common sense and only copy what works and adapt other traits. Most of all, they should use Y Combinator and other successful incubators as inspiration for creating their own way of supporting business growth and building eco-systems. Why? Because an incubator should not be the same everywhere; rather, the sustainable advantage lies in the old adage “dare to be different.”

Let me therefore introduce the term “frontier incubation” to suggest that we could alter our approach and unlock “hidden in plain sight” entrepreneurial potentials in different locations and thereby build robust, unique entrepreneurial ecosystems, globally inspired but still firmly based on local conditions. The word “frontier” is meant to instill a sense that incubation activities ought to be cutting edge, constantly striving to push the boundaries for what business ideas to include, how to include them, and how to facilitate growth and lasting prosperity.

So, what is the MO for frontier incubation?

Support local business opportunities for frontier innovation & growth

Successful frontier incubation lies in daring to encourage flows of business ideas that are not sectorial. Instead, frontier incubation could not only benefit from being agnostic but also by encouraging cross-sectorial business ideas anchored in the local environment (nota bene: many of those can later capture huge parts of geographically distant markets— so no worry about being too provincial!). A riddle: what happens when you merge an artistic collective with proponents of high-tech in the Sangre de Cristo foothills? You get Meow Wolf. Or what is the outcome of blending VR with creatives who are frustrated about the lack of understanding of people taking care of their mom in busy Chicago? You get Embodied Labs. Dare to be different!

Appreciate 2nd order of innovation

Entities engaged in frontier incubation are uniquely positioned to identify what should be done “one step away” from the innovation happening in a particular company: Institutional, regulatory, and market space innovation. Institutional innovation could mean engaging independent educational entities to offer shared programs to enhance possibilities of cross-fertilization among different disciplines, thereby supporting innovative thinking. Examples of regulatory innovation could be paying attention to how much time and money the entrepreneurs spend on following local, regional regulations (I am too often amazed by the stories shared by entrepreneurs around the world related to what they had to do and how long it took for them to get their business “filed”. For crying out loud: Entrepreneurs have better things to do!). Examples of market space innovation might be facilitating far-reaching innovative capabilities in companies by identifying public-private partnerships opportunities for break-through research and development. Dare to challenge the existing!

Create temporary constellations

The support each entrepreneur needs to grow their business doesn’t always look the same, and having the same set-up for different entrepreneurs increases the potential for failure. Instead, every entrepreneurial endeavor is distinct and needs its own special set of connections and contributors. Bringing together relevant actors from the community (e.g. colleges, potential investors and grant providers, landowners, business advisors, or larger companies of relevance) gives each entrepreneur a variety of inputs and views simultaneously that leads to smarter progress, higher likelihood of success, and faster transformation for the company to out-grow the incubation phase. These types of collaborations might also lead to other types of important partnerships that support frontier ecosystem building. Dare to be fluid!

Democratize entrepreneurship

Lower barriers of entry for anyone in the local economy who wants to learn more about entrepreneurship in order to potentially grow their own business. Seek out spaces where adjacent activities are happening already: makerspaces, libraries, farmers markets, etc. Frontier incubation should include offering programs so that anyone who is at all interested in learning more about what it means to be an entrepreneur and develop a business idea has the opportunity to do so. Some will be encouraged and launch a company without any further assistance, others will need support, and yet others will at least leave the program with more knowledge about what it takes to grow a business (some of those will never return, but others will come back with an idea worth future consideration). Dare to include everyone— no pre-screening necessary!

Thanks to Creative Startups, I have had the pleasure of working with entrepreneurial ecosystems all over the world. Some regions have been rather nascent, some have had the traditional nuts and bolts, and, in other places, there have been some quite interesting attempts to do it differently. I think that this variety of activities partly stems from the fact that Creative Startups works with entrepreneurs in the creative economy, which is often excluded in the outperforming attempts of traditional incubators. There is a huge opportunity for the creative economy to take on a leadership role in initiating and growing work recognized as frontier incubation. Creatives might not have the lingo, they might not admire the entrepreneurial leaders we— who are in the field— refer to for inspiration, experiences, and innovative capabilities. But who cares? Really! Creatives are without hesitation part of the secret sauce to grow frontier incubation!

Challenge me on anything of what I have suggested above! I would love to develop these initial thoughts and to turn them into the next generation of incubation activities for growth and prosperity. Dare to do it?

My thoughts above have been inspired by a book named The Prosperity Paradox. How Innovation Can Lift Nations Out of Poverty. The book is written by Christensen, Clayton M. (RIP) et al. I highly recommend it to anyone in the field of finding new ways for a region to take their destiny into their own hands  and thrive.

Creative Startups works with co-working centers, incubation hubs, and educational institutions to host acceleration programs designed by and for creative entrepreneurs. Let’s talk about partnering to bring our programs to your area today!