The progress of companies like Y Combinator, an accelerator that has spawned tech success stories such as Dropbox and Airbnb, has created a clamour for similar business support in the UK. For many entrepreneurs, they are seen as a golden ticket with an implicit promise to help their businesses hit the big time.
When Zipcube, a company that co-founder David Hellard describes as an Airbnb for booking meeting rooms, began in 2013, he and his co-founders were chasing two things: funding and office space. “We applied for everything,” he says.
The UK market has responded to this demand. A recent tally from Nesta, a charity that invests in projects with a social benefit, puts the number of incubators and accelerators in the UK at 205 and 163, respectively.
However, the lines that have traditionally separated hubs, incubators and accelerators are blurring and it is hard for start-ups to discern which add value.
Incubator, accelerator or hub?
Traditionally, incubators are selective and provide indefinite access to co-working space, usually for a fee, along with some mentoring or training. They are often funded by the public sector or academic institutions, and have a strong presence in the life sciences sector as well as digital technology.
Accelerators are intensive fixed-term programmes with the aim of scaling up an established business. They can include workshops, mentoring and opportunities to pitch to investors. They might also offer funding in the form of grants or loans, sometimes provided in return for equity in the start-up, or they might charge an upfront fee. Incubator and accelerator services can overlap.
Incubators are spread fairly evenly across the UK, according to Nesta, while more than half of accelerators are in London.
Hub is a term often used interchangeably for the various forms of co-working spaces. It can also refer to a geographical cluster of start-ups or more mature businesses in a particular field.
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