What does incubate mean?
Corporate incubation is the process by which companies validate a new business or value proposition, enabling it to mature in small increments without exposing it to the regular performance expectations of an operating business.
What does it mean to incubate an idea?
You incubate an idea by nurturing it toward growth, testing each aspect of the business model to validate it, before investing in a full roll-out.
Why is incubation so important for innovation?
Incubation helps us learn how to convert a great idea into one that can have an impact in the world.
Why is corporate incubation so important for a business?
Incubation enables companies to learn whether an idea will work before committing human and financial resources, it can also protect a new venture from organizational pressures that may overwhelm them, such as quarterly business reviews, quality standards, and application of core business processes designed for larger entities.
How can a company foster incubation of new business ideas?
The best way for companies to foster incubation of new business ideas is to adopt the practices of business experimentation. That means making clear statements or hypotheses about why they think their idea is good, who it is for, why they will use it, how much they will pay, how they will buy it, and so on. Having made these statements, a company can then design a business experiment to test them in the real world with customers.
What are some examples of companies that got corporate incubation right?
Amazon has a highly disciplined approach to incubation. The CEO Jeff Bezos has said that the number of experiments a company runs is a very good indicator of how innovative it is.
“To be innovative, you have to experiment…If you know it is going to work in advance, it is not an experiment!”