John Biggs’ recent article on TechCrunch, “Forget Incubators: Here Comes The Cauldron,” (http://tinyurl.com/875v7sb) presents a fascinating take on the highly regarded and extremely popular “accelerator” model for startups. He argues that the incubator often falls short on results and rarely lives up to its lofty promise for entrepreneurs due to the very environment it creates.
Instead of the standard incubator, where a handful of dissimilar startups are dumped into one community, Biggs’ suggests a “cauldron” or “anchor” model, where a large established company (think Google, Amazon, ESPN, etc.) creates a program to work alongside other startups that are battling to operate within the same industry. The idea here being that the startup lives as a kind of friendly parasite within the walls of a larger corporation as an endosymbiont (I hate science too … http://en.wikipedia.org/wiki/Endosymbiont), growing and gaining experience from a well-established company. The “anchor” then benefits by tapping into the entrepreneurial spirit that now exists within its community.
While this is an intriguing idea, to me it’s akin to throwing a bunch of baby seals into a tank with one voracious Great White Shark. (Note to self: call “Shark Week” producers with episode idea.) While the shark and baby seals share the same water (a.k.a. work in the same industry), there’s no guarantee that the shark wouldn’t just start chowing on those baby seals. I’d be terrified if I were trying to build Spogo within the confines of ESPN.They may not want to compete with us in the beginning, but what if we started gaining significant traction and stole some of ESPN’s mobile audience? As a baby seal, I’d be much too slow. ESPN could put together a team and pump out a product in weeks.
Aside from the competition aspect, I think there is merit to the traditional concept of an incubator. A social network startup may not have many similarities to a cloud-computing platform, but both companies are surely encountering similar obstacles along the way. I’d also likely rather learn from entrepreneurial mentors (which an incubator program would provide) than from a VP of sales at ESPN who worked his way up within the same organization.
The “cauldron” is bubbling on the surface with ideas, but is there a big hungry predator swimming under the surface, too? Keep in mind that Spogo is just starting to apply to incubators, and we’re just a baby seal, but, hey, we’re learning to swim fast.