Business incubators could be a huge resource for creating the kind of local, sustainable, inclusive businesses that aim to promote the revitalization of Oakland as opposed to its gentrification.
Unfortunately, the flaw of a catch-all term like “business incubator” is its tendency to obscure important differences among what-all is caught, leading to the misrepresentation of the misifts. As certain characteristics end up most commonly associated with the term, they are assumed to apply to all versions of “incubators.” So big names like Y-Combinator, Techstars and Kicklabs come to define the genre, instead of being defined by it.
As a result, the terms “incubator” and “accelerator” are increasingly synonymous with tech-focused grooming factories that work by converting startups into roulette-like investment opportunities.
That may be a bit harsh. Venture capital has nurtured many important ideas into the mainstream, but it is also, some say, the principal inflator of the new tech bubble (and associated real estate bubbles). With profit as its purpose, this version of business incubation has faced the usual complaints, and, as a byproduct, obscured the importance of other business incubation models.
Which is a shame because alternative incubators in Oakland are gearing up right now to grow our local, sustainable, inclusive businesses, but they are only as good as the ideas they incubate.
Alternative incubator models have little in common with the VC version, and in fact, often have little in common with each other. The central defining feature of any incubator is its intention to improve the likelihood that a business will succeed, but how it does this, what it expects in return, and what it defines as “success,” are all important considerations, too often overlooked.
As Justin Quimby, from Jingletown based manufacturing incubator BlueSprout, put it, “VCs are under pressure to generate outsized returns for 1 or 2 of their companies because that one company could then make the profit for that entire fund.”
Describing the model that BlueSprout employs he said, “we are trying to help build companies that are singles and doubles, as opposed to the grand slams that many other incubators and venture capitalists need.”
BlueSprout, PopupHood, Uptima, and the Bay Area Worker-Coop Academy are all Oakland based incubators that do not fit the stereotype. BlueSprout provides access to advanced manufacturing tools and industrial zoned workspace in addition to more typical incubator fare such as business development and mentorship. PopupHood’s modus operandi has been negotiating short-term lease subsidies for new, local, independent retailers that it is incubating, with big-picture goal to revitalize transitional urban areas.
“We are really trying to incubate local businesses so that they can keep their financial equity in a place that they have lived and worked and loved,” said Sarah Filley of PopupHood, “We are prioritizing our social impact.”
At Uptima Business Bootcamp the goal is to develop self-sustaining social enterprises that, after completing the flexible bootcamp modules, will become cooperative owners of the incubator. And the Sustainable Economies Law Center (SELC) along with several other organizations including Project Equity and Green Collar Community, has created a new Worker-Cooperative Academy, a psuedo-incubator designed to help startups as well as established businesses navigate the legal, institutional, and tax peculiarities specific to worker cooperatives.
Some of these programs are very new. Both Uptima and the Bay Area Worker-Coop Academy are just now approaching their application deadlines (there’s still time!) for their first cohorts. Ricardo Nuñez of the Sustainable Economies Law Center said, “this is a pilot academy, we are creating the curriculum, and trying to figure out where we can, in the future, increase our impact creating successful worker owned businesses.”
The point being: while Oakland’s alternative incubator models are poised to help, their impact will be shaped by the people and organizations that work with them. They are looking to create small businesses that last, not quick returns on investments. “If we can help generate a couple companies that employ 10-15 people each, that’s going to be fantastic,” said Justin.
It’s a shaky metaphor, but in a way these incubators could be a Trojan horse in the fight to build an Oakland that is more than just a bedroom community for SF tech. They can help Oakland’s ideas and Oakland’s people get past the initial barricades-to-business and on to the good fight. But only if people recognize that this is a horse of a different color of wood, and climb inside. Like I said, it’s a shaky metaphor.