What is Incubation Fatigue and Why are Incubation Programmes not working in South Africa? Incubation by definition is the process of keeping young vulnerable eggs warm, in the time needed for them to hatch and produce. Therefore business incubation can be defined as a process of keeping pre-business ideas and businesses warm and protected, while they grow, until they can hatch in to productive and successful businesses.
A business incubator is a company that helps start-ups develop, in the initial stages. An incubator can help start-ups develop their business ideas, marketing strategy and other business compliance governance policies. In general incubation is a stepping stone for many start-ups, and can help a small business or start-up find their feet in the real world of business.
Personal Experience: Why Incubation Fatigue
I was once a hopeful, happy and optimistic entrepreneur. I applied and was accepted in to a top South African incubation program. The program cost about R10 000 at the time, this was a lot of money to pay.
They promised lifetime mentorship and support, guidance and skills, tools that I could use to help my business become successful. Therefore I was willing to part with R10 000 for a shot at the “big time”. This was my first official program since I quit my job started my journey in to entrepreneurship.
I started to worry a little when a friend shared with me her story, she explained how she has been trying to start her business for some years now. This was for her just another program, from a list of programmes she has enrolled in. She had full blown Incubation Fatigue by this point.
She looked like a boxer, who was just tired of being in the ring.
She was on the verge of losing her house and was actively looking for a job, I looked at her and saw myself in just a couple of months. If I cannot make this business idea work, I will be on the street, or on my knees begging for my job back.
Why are Business Incubation Programmes not working in South Africa?
We got an opportunity to interview *Mpho Tebeila (*not his real name) who has experience with incubation programmes in South Africa. He recently attended a very well known incubator with an umbrella. It is well trusted as the “hope” for the black entrepreneur, business person. Why then are black entrepreneurs “sick and tired” of this hope?
Tell us about your experiences with this program
I remember being very excited about being accepted in to this program, I thought to myself. Finally, I have made it. I am going to get business now, I am affiliated with one of the leading and highly respected business incubators in South Africa.
How much Business have you got since you joined?
None, no business it has been a couple of months. I have since retrenched all my workforce and am on the verge of losing my property due to cash flow challenges.
Is the Umbrella responsible for your cash flow challenges?
I would not say that, they are not responsible, I am responsible. But they sell a false idea that they can somehow help you get started in business, but all we get is full days of attending digital marketing courses presented by a child who has been running their company for less than 6 months. How can someone who has 100 followers on twitter teach me about digital marketing?
We get business mentors who have no experience running a business, and an accountant who cannot count to save their lives. I still have to pay professional accountants to prepare my books, because the “umbrella accountant” knows nothing about accounting, but we are expected to submit monthly management accounts for compliance.
In addition, I pay close to R10 000 to keep an office address here, all the costs are adding up, but I see no business assistance whatsoever. The last of my savings are draining out and I might have to go back to look for a job.
But Entrepreneurship is about grabbing the opportunities, there must be some benefits to being in the program
Being in the program for me has derailed my journey, I spend precious time attending stupid courses all day just to remain compliant to the program I committed to. It is better to spend my days working on the business.
I spend my savings on paying accountants for expensive reports and rent for an office – when I should be spending my savings on real business needs.
I have decided to leave the incubation. As entrepreneurs, we do not have a lot of time.
I am making good connections with fellow cohorts, partnerships that will bear fruit in the future.
What would you different with what you know now
The incubators have their uses, but I would adjust my expectations. Do not expect a magical pill or any type of support beyond networking. Incubators are good for bringing entrepreneurs together, there are opportunities for partnerships between entrepreneurs and growing together.
I would not waste my time with incubation at all. If you are a spaza shop, just start by selling at the corner of the street. Maybe you will sell two tomatoes in one day, tomorow focuse on selling more, change corners, change stock – sell cabbage instead – but keep selling. You do not need to sit in an office, get a mentor attend marketing meetings all day, just sell tomatoes.
I should use my savings for stock, digital marketing campaigns, a website, an online store. Anything that will actually bring income in to the business.
Any last advice for incubators?
- Treat small business like children, with care not with a stick, we are learning and are new at this. We need support to actually grow.
- Hire actual business experts to manage programmes. We would not pick people who cannot swim to manage the swimming team, why then do we pick regular administrators to manage entrepreneurs?
- Mentorship advice is quite similar, someone who has no experience running a business cannot mentor a business person. I did not even say succesful business, just any business.
- Get an accountant who actually knows accounting
- Measure the performance of the incubation, how successful are the cohorts after incubation.
- Measure many entrepreneurs quit your program before completion