Definition
Incubator
An incubator is an organisation that nurtures very early-stage startups with workspace, resources and guidance, usually over a longer, open-ended period.
Incubators help founders develop an idea into a viable business by providing office space, infrastructure, mentorship and sometimes seed grants. They often operate without the fixed timeline of an accelerator and may be run by universities, government bodies or corporates. In India, many incubators are linked to academic institutions and government startup initiatives.
Unlike accelerators, incubators frequently do not take equity and focus on the earliest, idea stage rather than scaling. Both aim to improve a startup's odds of survival and fundability.
Related terms
- Pre-Seed RoundA pre-seed round is the earliest external funding a startup raises, often to validate an idea before a product exists.
- BootstrappingBootstrapping is building a company using its own revenue and the founders' resources, without raising external equity.
- AcceleratorAn accelerator is a fixed-term, cohort-based programme that gives early startups mentorship, resources and often a small investment for equity.
Plain-English explainer from The Dispatch Investors Encyclopedia. General information, not financial advice.