A business incubator is a program that can assist entrepreneurs in coming up with a repeatable, scalable and sustainable business model. This is done through the provision of services such as management training, marketing assistance and office spaces. Today, many entrepreneurs in Singapore turn to these incubators for resources, mentorship and support. However, despite the backing that an incubator can provide entrepreneurs, it is important to first weigh its pros and cons before making a decision.

Joining an Incubator – What You Should Consider

Pro: Services and Facilities

One of the perks of working with an incubator is gaining access to its services and facilities. This can include assistance in setting up corporate legal structures and shareholder agreements as well as office spaces and reception desks. Remember to check whether or not their rate for using office spaces is at or below the market value. Inquire as to what other types of services you can get within the incubator. Often times, you can also get support services such as promotion and media coverage, which can help your startup company gain exposure.

Con: Limitations in Corporate Structure

An incubator will usually try to keep the companies that they invest in to be as similar as possible in terms of corporate structure. Compared to bootstrapping, joining certain incubators can limit your choices of venue for lawsuits, vesting, taxation and even residence.

Pro: Mentorship and Quality Advice

Incubators are typically run by successful and wealthy entrepreneurs. By joining an incubator, you can have access to a network of seasoned mentors who can guide your business through veteran advice.

Aside from quality advice from successful entrepreneurs, you can also gain access to a wide network of diverse people. You can get a lot of opportunities to contact the successful alumni of the incubator, and ask them to share their experiences with you. When choosing an incubator, factor in how much time various partners within the incubator allot for mentorship.

Con: Equity Stake Negotiations

A business incubator is a business itself. The benefit an incubator gains from supporting start-up companies is equity stake. This means that the incubator will become a shareholder or a holder of a convertible note to your business. This may range from 2 to 10% of the stocks of the company. The negotiation for this percentage may become a bit complicated and off-putting to some entrepreneurs.

Pro: Support Network

An incubator promotes an inspiring environment in which you and your respected peers can exchange ideas and provide constructive criticisms for each other’s products and demos. The program also opens up opportunities for collaboration and other business arrangements.

Con: Incubator Responsibilities

As a part of a support group, you also have to fulfil your role within the dynamics. This may mean allotting some time for additional responsibilities to the incubator. Take into consideration how much time and effort you have to spend working with any third party when deciding whether or not to join an incubator.

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Founder @ The New Savvy
Anna Haotanto is the Advisor (former CEO) of The New Savvy. She is currently the COO of ABZD Capital and the CMO of Gourmet Food Holdings, an investment firm focusing on opportunities in the global F&B industry. She is part of the founding committee of the Singapore FinTech Association and heads the Women In FinTech and Partnership Committee. Anna is the President of the Singapore Management University Women Alumni. Anna invests and sits on the board of a few startups. Anna is also part of the Singapore Chinese Chamber of Commerce & Industry Career Women’s Group executive committee. Anna’s story is featured on Millionaire Minds on Channel NewsAsia. She hosts TV shows and events, namely for Channel NewsAsia’s “The Millennial Investor” and “Challenge Tomorrow”, a FinTech documentary. Anna was awarded “Her Times Youth Award” at the Rising50 Women Empowerment Gala, organised by the Indonesian Embassy of Singapore. The award was presented by His Excellency Ngurah Swajaya. She was also awarded Founder of the Year for ASEAN Rice Bowl Startup Awards. She was also awarded the Women Empowerment Award by the Asian Business & Social Forum. Anna has been awarded LinkedIn Power Profiles for founders (2018, 2017), Tatler Gen T, The Peak’s Trailblazers under 40 and a nominee for the Women of The Future award by Aviva



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