Why startups are so hard to incubate within a corporation


Urgency. Stress. Moments of panic. The struggle to live another day.

These are feelings that generally define most early-stage startups. No doubt, I’ve had several of these moments in the first year and a half of Dragon Army.

Early on, startups are forced to figure out how to stay alive on a daily basis. This means they have to put all of their energy into getting customers and making sure their product fits a need. A need that people will actually pay for, not just anecdotally say, “You bet I’d buy that if you had it available.”

The facts: Nine out of ten startups won’t live long enough to figure out their product market fit.

They run out of runway, or the idea was never strong enough to support a business. Or the leader was missing some key, required skills.

Either way, I believe that desperate, if-we-don’t-sell-something-we’ll-die effort is the only way that a startup really makes it to sustainability.

Unfortunately, there is almost no way to re-create this sense of urgency within a large corporation. When companies want to incubate a new idea, they try to think like a startup, but by their very nature they are the opposite of a startup.

I had the opportunity to spend time last week at one of the more interesting incubators in Atlanta. The person that founded it was talking to a large corporation and was asked, why not build your incubator within our company? His response: Because I suck at building at scale, and you suck at building nimble, desperate organizations. Those two cannot mix. Once I get a startup off the ground, I’ll definitely come to you when scale is the goal.

A lot of people are working on how to bridge corporations and startups, so the two can benefit from each other. And I believe Atlanta is the perfect place for that connection to happen. I’m just not sure yet how it’s possible…yet.


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