Local community accelerators can boost growth for small businesses
“Incubation is a unique and highly flexible combination of business development processes, infrastructure and people, designed to nurture and grow new and small businesses by supporting them through the early stages of development and change.”
According to research by Mastercard UK, more than a third (37%) of family businesses surveyed feel they would benefit from business mentorship and guidance.
More people in local communities are choosing to set up their own businesses instead of working full-time for more established organisations. This means there will be a growing need for hands-on support and practical resources, aside from funding, to help these entrepreneurs grow their businesses while tackling the challenges of running a business in an increasingly difficult economic climate.
Business accelerator programmes are in a unique position to fulfil this need. The British Business Bank defines a ‘business accelerator’ as an organisation that provides support to “early-stage and start-up businesses through investment, short-term mentoring and training”.
There are many accelerator and business incubator initiatives across the UK and globally. Some accelerators and incubators are linked to universities because of their research capabilities; others are linked to venture capital or private equity firms because of the investment opportunity.
Business accelerator vs business incubator
In a 2018 research paper on business incubators and accelerators in the UK, prepared by Nesta and funded by the Department for Business, Energy and Industrial Strategy (BEIS), there were 205 incubators and 163 accelerators operating in the UK at the time of the research.
While both have many similarities, business incubators are differentiated by providing workspaces to their members in addition to mentorship and growth support. This means they tend to be situated regionally or locally, and they might be able to offer long-term business support to entrepreneurs.
On the other hand, accelerators might focus on supporting a business to scale within a set time frame. This could be anything from 3-6 months, and sometimes up to 12 months, with a view to investing in exchange for a percentage (known as equity) of the business. Investment amounts and equity will vary by accelerator programme.
Why do local accelerators matter?
Most accelerators and incubation programmes focus on technology, high-value manufacturing, life sciences and health-related businesses because of their potential for rapid growth and commercialisation.
This means that many established small businesses in sectors that don’t have the same commercial appeal or potential may be missing out on the critical support they need to tackle challenges, grow their business, and contribute to the economy.
Historically, local authorities outside major capital cities have experienced slower development and lower productivity because of the UK economy’s reliance on a small range of sectors and regions for growth.
This kind of regional inequality is what led to the UK government establishing local enterprise partnerships (LEPs) in 2011, to reduce the disparity in regional productivity and accelerate economic development in local economies. Did you know that there is a Buckinghamshire LEP?
By encouraging partnerships between businesses and local authorities, we’ve seen the creation of more geographically dispersed jobs that allow people to set up businesses, grow their income, and participate actively in all areas of the economy.
Creating accelerators and business incubator programmes in local authorities is a fantastic way for small businesses within these communities to access the same high-quality support and resources that larger organisations in tech-enabled sectors receive.
Benefits of a local accelerator and business incubator
Some of the benefits a business can expect to receive from an accelerator include:
Incredible networking opportunities with industry experts who could also be mentors.
Training programmes and workshops for important skills you need to make your business thrive, from marketing and data analytics to financial accounting.
Access to potential investment because some accelerators also have funds from which they make investments in businesses.
Innovation is at the core of entrepreneurship, and accelerator programmes offer an immersive environment for founders and business people to collaborate, connect, tackle issues creatively, and refine anything from the business plan and model to the go-to-market and growth strategies.
If you’re running a small business - or thinking about setting up your own business - in Buckinghamshire and you want to have a chat about issues you’re facing or questions you have, get in touch with us!
