Incubators and accelerators

Key definitions

Incubators: focus on businesses in the start-up phase, by providing support for economic growth including mentoring, spaces, training and access to finance. They provide support for approximately 1-2 years, with dedicated spaces and reduced rent rate. Incubators are usually funded mainly through membership fees/rent.

Accelerators: support those start-ups and small businesses that have a high potential of rapid growth. Difficult to distinguish from incubators, they provide support for a maximum of 12 months. They are typically growth based  where payment is done via equity rather than fees. Accelerators are usually funded through corporate sources rather than public sector or universities.

Co-working spaces: facilities for businesses to operate from, including shared offices, event spaces, maker spaces, etc. Sharing spaces often means a reduction in costs per business.

 

The landscape

Accelerators are mainly based in London (50%), with incubators and co-working spaces being spread more equally across the U.K. In the North West, thre are approximately 92 IACs, with majority being located in Manchester and Liverpool, with some in Preston, Lancashire, Chester and Warrington and several co-working spaces in Cumbria. IACs have the potential to boost productivity and innovation in the NW, yet the NW is losing out to London where vast majority of IACs are located.

IACs are key in providing the social spaces and networking for start-up businesses, along with training programs and access to finance. Collaboration across members of IACs is often the case.

Growth of IACs is recent. Over half of IACs have been established since 2012, mainly outside London, in cities such as Manchester, Birmingham, Cambridge and Bristol. Manchester also sees a strong presence of co-working spaces in the North West. In the NW, there are 19 incubators, 9% of the total incubators in the UK, whereas there are 10 accelerators, which make up 10% of the national figure. As compared to other regions outside London, the NW has the highest number of accelerators. Within the NW, there are no accelerators in Lancashire, with Greater Manchester leading on accelerators presence. Cumbria remains the only LEP area without incubators or accelerators.