The process of nurturing a startup that shows promise of being able to introduce new ideas and methods into the Thai tech community is vital. It helps the entire tech community grow and develop to take their place among the world leaders in technology.
There is a popular saying that "It takes a village to raise a child." This is also true in the tech community. Unlike traditional businesses, the tech industry relies on new and novel ideas and practices of the community as a whole to drive technology forward, and this includes ideas and processes of the young startup business. To make this nurturing successful as a whole requires different types of input from different types of entities within the tech community.
We'll look at the 6 different types of organisations within the broad umbrella of the tech business, what they can offer, and the ways they can benefit from this nurturing philosophy. Nurturing shouldn't be thought of as a charitable enterprise Each of these 6 different entities hopes to gain something through their involvement in the nurturing process and how much of an impact they can have on the respective startup can mean the success or failure of their efforts.
In this respect, participating in a nurturing programme is an investment, with the potential success of the startup being the payoff. But it’s a much less tangible investment for certain organisations than it is for others. We’ll look at some of the benefits to the nurturing organisations as well as the startups.
Large Thai and multi-national companies operating in Thailand have a lot to gain from participating in the nurturing of startups. Everyone in the tech community keeps their fingers on the pulse of the community.
By keeping tabs on successes in the community, maybe even the startup they're nurturing, they can have access to various ideas, people and processes that could be used to improve their own business. These large companies look at the nurturing process almost as an arm of their own research and development efforts. By nurturing other startups, they can keep an eye on their progress and growth. They can include those elements of the startup that are successful in their own processes.
For startups and entrepreneurs, the benefits are obvious. Being in the same relative boat as a startup they are nurturing allows other startups and entrepreneurs to share their experiences, provide moral support and learn firsthand from the mistakes of others.
It’s being in the same type of business, having the same goals, but taking different roads toward achieving those goals. The mistakes your fellow startups make are lessons you both can learn from to improve both of your businesses.
For investors such as hedge funds and venture capitalists, the benefits of participating in a nurturing programme can be less tangible on the surface, but just as logical in the way a successful funding organisation is managed.
Effective funding isn’t just handing over a lump sum of money to the owners of a startup and leaving them to either fail or succeed on the idea that first attracted the investors. Effective funding is protecting that investment as best you can by using your past investment experience in tech companies to teach the new startup the lessons you’ve learned along the way.
These lessons may contain some hard truths that are hard for the startup to swallow, but they also may be the key to securing success for the startup, proving the investor made the right choice.
Before we get into the benefits for incubators and accelerators, we need to point out the difference between the two terms. Incubators are aimed more at getting a company off the ground in the early days of their existence. By creating a physical space and an educational programme that allow these generally cash-strapped startups to put their promising ideas into a more tangible form, incubators provide a much-needed 'nursery' environment for fledgeling companies.
Accelerators are programmes created and geared toward accelerating an established company’s growth and expansion. Their programmes are generally of a fixed length of time that the young, but established company pays for directly. The programmes typically focus on a problem area the young company is experiencing and the expertise of the accelerator is used to solve the problem.
Because of this difference between the two, incubators tend to be non-profit companies and organisations. The government or university may sponsor them. Whereas, the accelerator is generally a for-profit company selling their accelerator programmes based on their record of success they have had with other startups.
The goal of governments and universities in the nurturing process is much broader in scope and much longer term. Supporting a business sector that is the leading financial performer simply makes economic sense. It helps both the global and local economy. A growing business sector, like the tech industry, also creates jobs and job opportunities.
A government that nurtures other companies to succeed in the tech industry is a government that is forward-looking and trying to raise their GDP. For startups, having government support can be priceless. They can ease rules and waive regulations to promising ideas and processes that would benefit the economy.
For a university to enter into the nurturing programme of a startup, it also makes sense but from a different angle. The university survives on its admissions. Knowing a particular university has a proven record of having a positive impact on the success of startups will drive up the number of people applying to that university seeking an education in the tech industry.
The university can also provide a scholarly 'think tank' approach to the tech industry and become a leader in educating people within the industry. This also can be invaluable to the startup in providing a resource they can turn to in helping solve problems in their area of business.
For support organisations and service providers, supporting a nurturing programme for startups is simply a good business practice. It can be as symbiotic an experience as other startups and entrepreneurs participating in a nurturing programme. It can also be as enriching as a big company’s participation.
The support organisation and service provider offers their expertise in specialised areas depending on the young company’s tech focus. Generally, these startups and support organisation develop their relationship with each other depending on what each can offer the other.
The startup gets access to specialised services and equipment. The support organisation receives the benefit of feedback and possible improvements to these services and equipment, plus the continued development of their section of the industry.
Both startups and nurturing organisations can benefit significantly from a fruitful nurturing programme. As the tech industry continues to develop and expand, nurturing programmes may well become the recognised path for all young companies to take.
Their record of success in creating startups that develop to become as sound financially as they conceptually mean that nurturing programmes themselves will only continue to develop along with the tech community. And that is good news for all of us.