A Q&A with Incubation Station founder and CEO Shari Wynne. The Austin-based startup incubator and accelerator was founded in April of 2012, and kicked off its second accelerator class this past March. It considers a range of companies from launch to $3 million in yearly revenue for its program.
SUB: Please briefly tell us about the vision behind Incubation Station.
Wynne: Incubation Station was created to support diversified industry in Austin. We realized that tech has boom and bust cycles, and consumer products companies can be really stabilizing factors in the economy, creating jobs and services in manufacturing and production, warehousing, shipping and distribution, and retail. Also, they are great investments, since they have tangible assets and once they have validated their product in a constrained geographic region, they can often quickly replicate and scale.
SUB: Why was this a particularly good time to open a new incubator?
Wynne: Technology incubators have been dominating the incubator scene for a while now, which is particularly evident here in Austin with incubators like Capital Factory and Tech Ranch. Austin is a city full of growth and people who are driven to create their own opportunities. We saw a lack of support in the entrepreneurial scene for the large number of CPG [consumer packaged goods] companies that were growing here, and thought about what we could to do give these companies a better chance of succeeding. This is a time of growth and innovation in Austin, and this kind of creativity should be fostered and promoted.
SUB: What kinds of companies are you looking to invest in and incubate?
Wynne: We are focused on companies in the CPG industry, and looking for companies that already have market validation, who are focusing on growing and scaling their companies. The ideal company is one who is open to making serious advances in their business, is open to the knowledge that experienced entrepreneurs and industry veterans can bring, is aligned with consumer trends, and has huge market potential.
SUB: What kinds of companies/sectors would you say are leading the way in technology innovation right now?
Wynne: We feel that companies that use technology to reimagine some of the staples of how we live, shop and eat are in the right space at the right time. Many consumer products are tried-and-true and so have remained unchanged for decades. Technology that brings innovation from stagnation in this industry will be hugely successful.
SUB: There have been several large VC raises lately, and the frequency and numbers of investment in technology companies seems to be on an upward trajectory this year. What do you think this indicates about the startup economy?
Wynne: The tech startup economy seems robust and burgeoning. There have been amazing developments in technology in the last decade, and this trend doesn’t seem to be slowing. However, we have realized that a number of investors in Austin share a sentiment that too many tech companies are high risk ventures, and too many of them fail in a big way. The advantage to investing in consumer products companies is that they have tangible assets and a well-defined path to growth. Therefore, there is an opportunity to achieve moderate success across the board, along with some home runs, rather than home runs and failures, which is typical of tech investments.
SUB: Generally, what characteristics do you look for in a company and in founders when you are considering an investment and bringing them into the incubator?
Wynne: We are looking for people who are willing to learn but that have put a great deal of time and energy into getting where they are today. We want folks who are dedicated to making their product succeed, because in an early-stage venture you are betting more on the jockey than the horse—the team, rather than the product.
SUB: What is the one primary piece of advice you would offer to entrepreneurs just starting out and building a new technology startup?
Wynne: Persevere! Starting anything always takes a huge amount of energy and time, and often there is an extended period of intensive work and investment before you finally start to see the fruits of your labor. Eventually, all the hard work will be repaid, but often it will takes much longer than initially anticipated for that to manifest.
Incubation Station – www.theincubationstation.com