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The Role of Incubators in Startup Growth: Advantages and Types

Published On
May 24, 2023
Read Time
Shanti Mohan

Did you know that Dropbox, Airbnb, Quora and Reddit owe their mega-success stories to an incubator? Y Combinator, one of Silicon Valley’s most sought-after business incubators, held these startups' hands in their early years. 

The fact these startups are now multi-million dollar businesses today proves how the role of incubators in startup growth is vital.

Incubators are institutions that bring the necessary expertise, tools and resources you need to transform their business idea into a tangible and viable reality. They enable you to survive the entrepreneurial journey when the going gets tough. 

In the past few years, several incubators have come forward to drive startup growth in India.

This blog will explore everything you should know about incubators.

Role of Incubators in Startup Ecosystem: 4 Significant Benefits

Incubators can support your startup in several ways:

1. Mentorship

Incubators have mentorship programmes through which you can find business mentors. These mentors will listen to your ideas and problem areas, identify value propositions and help you implement your plans. They can foresee pitfalls and unlock opportunities for your venture. 

Mentors can also help you achieve operational excellence by setting up the right teams, processes and organisational structure.

2. Funding

According to a study by CB Insights, 47% of startups failed due to a lack of financing, and 44% of startups ran out of cash in 2022. These were the two biggest reasons for startup failure. So, no matter how great your idea or product is, it can fail to take off if you don’t have the capital to develop or market it. 

Incubators can provide you access to investors and other sources of startup business financing. The fact that an incubator backs you increases your chances of receiving funding.

3. Professional Resources

Your startup requires various resources at different stages of business. For example, market research tools are necessary to validate the idea in the pre-launch stage. 

Technological know-how helps build an e-commerce website after the product gets market traction. A legal team can help file intellectual property rights right before competitors can copy the idea. 

The role of incubators in startups involves tapping into their broad network of experts in different fields to help you pool these resources. They can also help you find working premises and high-end business equipment without breaking the bank. 

4. Business Training

Shashank ND and Abhinav Lal co-founded the online doctor consultation app Practo in their final year of engineering in 2008, when the Indian startup ecosystem was nascent. They had to struggle to navigate their way to success. 

Fortunately, this is not the case today. Given that an increasing number of students are taking up entrepreneurship as a viable career, several incubators are giving wings to their dreams.

So, if you are a passionate student or a novice entrepreneur looking to incubate your idea, incubators can give you a head start. They can equip you with the necessary skill set and knowledge through comprehensive business training.

4 Main Types of Incubators 

There are four types of incubators you can reach out to for guidance:

1. Government-Backed Incubators 

State and central governments have their own incubation cells to encourage entrepreneurship. The role of incubators in startups is to support the work towards society's betterment. 

For example, agriculture, environment or healthcare startups have higher chances of getting through government incubation programmes.

2. Private Incubators

These incubators are formed by a group of private entities or individuals, such as seasoned entrepreneurs. They are generally for-profit incubators and may ask for a fee or equity stake in exchange for their services to your startup.

3. Corporate Incubators

These are large companies or MNC conglomerates which set up in-house incubation programmes. The role of incubators in startups includes bringing ample and dedicated resources to the table for startups. They generally collaborate with startups to develop innovations in their business domain. 

4. Academic Incubators

Several universities and academic institutions in India run incubation programmes. They usually support student or alumni entrepreneurs. Academic incubators also serve as a forum for the exchange of business ideas.


The role of incubators in the startupin startup ecosystem is that of a catalyst in the growth of young ventures. They empower startups to graduate to the next level by opening new doors for them. They play an instrumental role in providing a roadmap to startups and helping them focus on what matters the most.

Scalix understands that the startup world is full of different challenges. We can help you connect with the right incubators. 

Join our Early Founder Programme to know more.