Indy’s Incubator Dream is a series of articles looking at the rise of co-working spaces and incubators around the country and the world. Economic development, community creation and city growth all await at the end of successful incubator and co-working ventures, but how does Indianapolis get there? [For more on Indy co-working, check out Pattern’s pop up design co-working space, The Bindery!]
The difference between a co-working space and an incubator (discussed in our first article of this series) is subtle, but important. Both are all the rage in the business world right now as they bring unprecedented levels of cross-industry collaboration and innovation, but incubators also fulfill a special role that co-working spaces do not. The idea behind the name “incubator” is that a start-up company receives not only the tools of the trade that they need to succeed (that a co-working space can provide), but also funding and long-term sustainability.
Incubators usually charge companies for space and resources, and in turn, walk the startup through its beginning stages with an expectation of a return of the profits once the company is fully up and running. It’s a symbiotic relationship that has proven to work across the country in many different cities. This isn’t the only sustainable model however, as evidenced by TechStars, who don’t classify themselves as a traditional incubator.
“We define Techstars as an accelerator more than an incubator,” Clare Tischer, communication manager for TechStars, said. “Incubators typically charge the entrepreneur money whereas we offer them $18K in seed funding, an optional $100K convertible debt note and deep mentorship in exchange for 6% equity.”
TechStars is proficient at what they do. To date, 192 active businesses have completed their program and 20 have been acquired after getting on their feet. TechStars has multiple sites in cities across the country, and each one of those cities has seen a boost in their economy. TechStars alone has created almost 1,700 jobs across the country through their program.
“We see our three month program as a condensed version of the first year of your company, accelerated to fail fast, iterate, succeed, and built for speed,” Tischer said. Success to TechStars is “Profitable, happy companies.”
Profitable, happy companies starting and thriving in the heart of Indianapolis is the ultimate end point on the road that co-working spaces and incubators are starting. Places like the SpeakEasy are already well established, and hopefully there is room for other places such as The Bindery to open and thrive, as well. One of TechStars’ founders, Brad Feld, said that a long-term vision, entrepreneurial leaders, fresh meat and engaging activities are all needed to keep a sustainable entrepreneurial environment going. It has to keep going, though, as one cycle isn’t enough.
“The only way to build a community is to move beyond boom and bust and build something over extended periods of time,” Feld said.
Everything has to start somewhere, though, and Indianapolis’ creative landscape is lacking structure. A co-working space for design creatives, The Bindery is going to be up and functional throughout the month of August to show the community that it can be done.
“First and foremost, you have to let the community know that you are there,” Caressa Brown, CEO of the Dayton Emerging Fashion Incubator, said. “You can’t make it all about fashion, because fashion won’t attract the entire city. You have to let the community know that there’s something in it for them.”
With enough effort from entrepreneurs and design creatives around the country, maybe the Bindery can be the next TechStars, pumping out successful businesses that bring more jobs and economy to Indianapolis.