Starting an incubator is like thinking you can create Michael Jordan by running enough kids through a basketball camp.
That’s not how Michael Jordan was created.
The multiplication of mediocrity happens through three mechanisms:
First, you've got what I call the "spray and pray squared" effect. Not only are VCs spraying capital across too many companies, but now incubators are spraying "expertise" across too many VCs' companies. It's like homeopathy, you're diluting the already diluted.
Second, there's the standardization of strategy. Every company gets the same advice, regardless of context. It's like prescribing penicillin for every medical condition. Sometimes it works, usually it doesn't, and occasionally it kills the patient.
Third, you've got the mentor carousel. Hundreds of "successful" people giving contradictory advice to founders who don't have enough experience to know what to ignore. It's like trying to learn boxing by having 100 different trainers for one minute each.
Now, there are exceptions. Y Combinator (YC) under Paul Graham was different. They understood something fundamental: you can't scale wisdom, but you can scale the environment that makes wisdom more likely to emerge.
They did three things right:
They focused on founder quality above all else
They created peer learning environments instead of top-down instruction
They aligned their interests with founder outcomes, not vanity metrics
But for every YC, there are 50 incubators that are essentially startup hospices masquerading as startup hospitals.
Want to know how to spot a good incubator? Here's my checklist:
They reject more than 97% of applicants
Their partners have actually built companies
They're focused on specific types of companies where they have deep expertise
They measure success in 7-10 year outcomes, not demo day valuations
You know what most incubators measure instead? Number of applications, press mentions, and how many founders wear their branded t-shirts. It's like measuring a hospital's success by how full the parking lot is.
Yet it’s so tempting to want to start an incubator. It would be a fun operation to run. You outsource all the risk, have a day filled with coffee and talking, and have a small chance of a big payday. Meanwhile, you’re getting management fees all the way through. But it’s not a good use of time for serious people, and outside the top 3 incubators I’ve never seen a serious person running an incubator.
The solution? We need fewer incubators and more what I call "company nurseries." Small, focused programs that nurture specific types of businesses with specific expertise. But that's not going to happen as long as everyone thinks they can be the next YC by copying their 2008 playbook.
Let's be rational about this:
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