This is the second of a three-part series on business incubators (See Part 1 and Part 3).
Many entrepreneurs who join Fetola’s business development programmes are looking for some kind of business/enterprise funding in the form of grant finance with about 30% to 40% of entrepreneurs who enter the programme looking for mentorship, says Chantal de Kock, general manager at Fetola Business Development Professionals.
It’s no surprise that many of the country’s entrepreneurs are looking to incubators to help them access funding for their businesses.
Fetola offers entrepreneurs access to business skills training, consulting services and business education.
De Kock unpacks the role of incubators in helping entrepreneurs access enterprise funding, shedding light on:
– What funding support entrepreneurs can expect from incubator programmes
– The role of incubators in getting SMEs funding ready
– What’s beyond the money
Initiating the funding conversation
The first question we ask is: “Is the business ready for money?”, and then: “What is the money for?” Many entrepreneurs think money will solve all their problems.
It has to be about more than just money
Fetola’s focus is on the ‘leaky bucket’ principle: [which asks] where are the holes in your business? Is it in HR, finance, contracts, performance reviews, skills, lack of networks or mentorship? Fetola would rather plug all the holes first and then wait until the company is investment-ready.
Some business owners believe that money will plug all the holes in their leaky bucket, while others have unrealistic expectations
Dealing with entrepreneurs’ unrealistic enterprise funding expectations
Some business owners believe that money will plug all the holes in their leaky bucket, while others have unrealistic expectations. Participants sometimes do not realise there are milestones they have to reach on the programme. But if they are committed, their life and businesses change because the programme is effective.
- See also: Is My Business Funding Ready?
Getting enterprise funding ready
An effective incubator program will first ensure that all the holes in the bucket are sealed. Secondly, they need to assess where entrepreneurs are. Thirdly, the programme should ensure that these businesses are not set up for failure.
The entrepreneur must be realistic about his business’ capacity – they must test systems and processes on a small order before chasing the big fish. Sometimes one unrealistic, huge order can destroy the business.
Support and networks are as valuable as funding
Entrepreneurs can network, not just with other participants on the programme, but with broader networks as well. Very often strong friendships are forged, sometimes even collaborations.
Participants on a specific programme also form a peer support group for one another and they often motivate one another and introduce their peers to other opportunities.
