So I would make a few predictions here on the Next Generation of Incubators 2.0 (I’ll call them hothouses as its more part of the zeitgeist):
(i) There will be little difference in average outcome between hothoused startups and organic ones, but later hothouses will underperform on average, as…..
(ii) There will be a higher propensity for the hothouses to follow fashion, as following the crowd is an easier sell to funders. This will make them more costly than organic plays which will by and large be earlier in.
(iii) There will be little advantage gained from using youth and inexperience early up, apart from low cost of the initial “throw at wall” phase - if anything sticks, age and guile will be required, and as it has less stake, it will e at premium pricing - or the founders have to give up a large slug of equity.
(iv) The “Next Web” will not be built in the hothouses, as innovation is not really their business model - fast following is.
