What Should the Next Generation of Incubators Look Like?

14 May

By Jack Fuller, Business Development, LSN

Jack 2

If you reside in one of the many growing or established life science clusters around the U.S., you have probably encountered the growing plethora of incubators or accelerators that are emerging to support nascent and semi-virtual companies. Often, these incubators are funded by a combination of state grants, corporate partnerships, and revenue generated from renting space to emerging companies.

When giving a tour, incubators are quick to point out the pristine lab space and glass-walled conference rooms they provide to start-ups. However, they often have little knowledge about what it takes to fundraise in the life sciences: a tactical approach that requires expertise in branding, marketing, and cloud infrastructure.

Dennis Ford, CEO of LSN, often speaks about the need for emerging entrepreneurs and experienced fundraising executives alike to upgrade their approach to outbound marketing. Phone and email canvassing techniques require the same diligence and determination that even the most complex scientific experiments demand. If an emerging scientist-entrepreneur can perform 100 experiments and get one positive result, there may be hope to teach them how to make 100 phone calls to a targeted audience based on fit and get one great meeting.

LSN has spoken with hundreds of emerging life science companies, and we have realized that not everyone can take this step. If that is the case, incubators that integrate a team of marketers and business development experts should be in the future. Incubators could create an infrastructure of experts to market the companies, providing everything from branding and messaging support to website design and cloud infrastructure—even seasoned business development to aid in scheduling and running investor meetings. This is an enormous void in the current incubator environment. Early stage companies are slowly realizing that good science alone won’t get them funded. Providing that next level of tactical infrastructure will help streamline a company’s fundraising efforts and help them see the straightest line to cash.

In return, the incubator would take a transaction fee if capital was raised—a fee that could be re-invested into the incubator to provide additional staff, expertise, and infrastructure to further promote an evergreen approach to incubating companies to bring them to the next step.

Would this model work? Time will tell, but as we say here at LSN: you can walk a mile, but at the last three feet, you still need to reach across a desk and shake someone’s hand.

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