Kimberley Brook, Director of SETsquared Bristol, reflects on what we look for when selecting new technology startups, and the questions to ask yourself before you apply to the incubator.
SETsquared Bristol has two incubation programmes, Quest and Propel, designed to support founders at every stage of their business development. Across our programmes we are currently incubating over 90 technology startups from a broad range of sectors. Member companies can make use of the bespoke business support we offer including Entrepreneur in Residence sessions, Business Review Panels and personal coaching and mentoring.
What sets us apart is that we ‘incubate’ companies rather than accelerate. This means we do the slow parts of the journey as well as the fast-moving elements.
The life cycle of a company through SETsquared Bristol will depend on several factors, including what stage it is at when it joins us, the speed it is growing and if it requires funding.
One of the questions I get asked most is ‘what do we look for in potential members?’. The answer is several things, and a good place to start before you apply to SETsquared Bristol is to ask yourself the following:
What stage is my business at?
There are typically three stages of a company’s life cycle, Discover, Launch and Grow.
At Discovery Stage you are still going through the ideation process and finding out if your solution fits a market need.
At Launch Stage you have validated your business idea and now plan to test it and launch into your market.
At Growth Stage you have a proven product and business model and are now ready to scale your business, build your team and reach more customers.
Typically, we work with individuals at Discovery stage and with companies at the Launch and Growth stages. If you are still at the Discovery phase then you’re probably too early for incubation at SETsquared Bristol but we provide a suite of other training courses available to support you at this stage. If you are interested in our support but not sure what course or programme is best for you, do get in touch with the team at email@example.com.
“Crucially, we want to understand how your tech gives you competitive advantage.”
Is technology at the core of my business?
We only accept technology businesses where the technology itself is at the centre of your business proposition. In other words, it is the tech that will be the reason your business will scale rapidly.
Ideally, we want to see a product, which means we don’t give membership purely to consultancies – although we have plenty of consultancies that are pivoting to develop a product. Crucially, we want to understand how your tech gives you competitive advantage. So, have you thought about how your tech is unique and if it is defensible? What is stopping your competitors copying you? What is the business opportunity and market?
To have a viable business opportunity, you need to know what the problem is that you are solving, who has this problem, and how your solutions solve that problem. When we talk to new companies, we are interested in how big their opportunity really is. Have you worked out how you might get your product to buyers? We call this the ‘route to market’.
Do you have a business model?
This is all about knowing how you might make money from your business. At Quest, our earlier stage incubation programme, we will work with you to determine the best business model for your business. For our incubator Propel, we look for business owners who have thought through how their business will generate revenues, and crucially how much profit they might walk away with from sales.
Have you considered how your business could make money and how you may grow this income?
Have you got your financials covered?
At an early stage with your business idea, you should have made some cash projections and assumptions on Profit and Loss (P&L). You may have already raised some money or been awarded grants which allow you to launch your business. Have you thought about how much runway your finances currently give you? Have you thought about what funding you might require over the next 12 – 24 months and what you need to scale in the future?
“It’s never too early to think about your plans for developing product, sales and marketing and how your operations will work.”
Who is your current team and where are the gaps?
It’s never too early to think about your plans for developing product, sales and marketing and how your operations will work. We will ask about the founder team and how they add value, as well as your plans to grow your team. Who are the key hires you will need to get you to the next stage? What type of roles do you need? How will you pay for them?
Do you have an exit plan and what are your personal aspirations?
It might seem strange to think about the end just as you are starting-up but having a view of the different exit routes will influence many aspects of your decision making at earlier stages. Also, you are about to embark on the rollercoaster ride of your life so it’s worth stopping to check what you want from the experience. It can be helpful to ask yourself: where will I be in five years in relation to my business?
Above all, can SETsquared add value?
We don’t expect you to have every one of these areas covered and polished to apply. We DO expect you to know where the gaps are, and to come prepared to talk about that in an open and honest way. The interview is an opportunity for us to find how we can add value to your business and to assess the level of training and support needed to help you take your business to the next level.
What if I’m not ready?
We recognise that the above assessment criteria is suitably tough and robust. However, even if we don’t offer membership, we will provide you with lots of feedback, and, where possible, signpost to other available programmes and support offered within Bristol’s fantastic startup ecosystem.
Ultimately, even if you’re not ready now you may be ready in a few months. Several of our most successful SETsquared companies didn’t make the cut the first-time around. What they did do is take away the benefit of the advice and feedback they received at interview and came back when they were ready.
If you think you’re ready for one of our incubation programmes, apply here.
Find out more about SETsquared Bristol.