Although company startup incubators are highly thought of by external observers, they nevertheless have a number of flaws, which a new cooperative alliance of digital services providers for entrepreneurs claims it can remedy.
Five digital solutions providers in Chicago have come together under the ‘Ensemble’ banner to offer a totally new service which they are calling an ‘excubator’. The idea is to provide a “one-stop digital services suite for entrepreneurs desiring ‘do-it-for-me’ solutions,” explains the Ensemble managing partner George Deeb. Ensemble’s business proposition consists of providing young companies with all the support they need, covering ideation and launch, venture capital raising, technology development, Internet search engine optimisation, social media marketing and public relations. A key difference from standard incubators is that Ensemble offers a substantial discount on its services package to startups in which the Ensemble member companies jointly decide to take a stake.
An approach designed to substantially raise the odds of success
Ensemble claims that by drawing on the collective best practices and go-to-market playbooks of the member companies and their collective base of clients, its approach will increase a startup’s chances of success by two to three times versus alternative solutions, and materially improve return on investment. Moreover, unlike incubators, which select only a small proportion of applicants based on the decision of a committee whose members do not always have much entrepreneurial vision, an ‘excubator’ is designed to work for any startup that has a budget to pay for its services. In addition, there are no time or location constraints. While accelerator programmes are generally limited to twelve weeks, an excubator can help to grow and scale up a company right through to success. Furthermore incubators and accelerators have the disadvantage of requiring the startup to relocate to its premises. When it comes to charging for its services, Ensemble offers a substantial cash discount for startups who bundle their purchasing of all member companies’ services. An even deeper discount is available where Ensemble member companies are collectively willing to take an equity position in the startup.
Expert team geared to profitability and co-branding
The majority of other company startup support programmes require the entrepreneur to learn to do everything him/herself. Ensemble, by contrast, surrounds an entrepreneur with other successful entrepreneurs with a view to finding the best possible solution for that particular startup. George Deeb explains that his ‘excubator’ model is “by entrepreneurs for entrepreneurs,” linking their interests closely together. By aligning with successful excubator members, a startup will benefit from a ‘brand halo’ that will help to reassure investors and future partners with the likely prospect of success, he argues. Thus, as an alternative to the incubator, the ‘excubator’ hopes to spawn a new generation of startups, substantially reducing the considerable risks they face during the launch phase.