Start-up incubation: the next big business?

Sometimes the best innovations are the simplest ones. Those of you who have been keeping one eye on the developments at the Consumer Electronics Show this week will, like me, be excited about the new ideas on the horizon this year. But the innovation that struck me the most came via an Israeli start-up whose product fixes a genuine everyday problem in (on the surface at least) a really simple way.

By developing a new type of battery, the company, Storedot, was able to demonstrate the ability to fully charge a Samsung smartphone in around 30 seconds. The achievement itself is mind-boggling, and yet Storedot, like all start-ups, still faces significant challenges before bringing its product to the global marketplace.

Start-ups have always been a big part of the CES, and it was no surprise to see that Eureka Park – the place where start-ups exhibit their innovations – would be 50% bigger this year, showcasing over 300 start-ups. The CES is almost acting as a giant start-up incubator, allowing these tiny companies to rub shoulders with their much bigger rivals and potential investors, as well as each other. Storedot claims to have 17 meetings lined up with various potential investors at this year’s CES, with Roman Abramovich and Samsung reportedly already on board.

Start-up incubators are a great way to help small companies expand by offering them the investment and resources that they need to make a good idea into something tangible. Some of you will know that The MBS Group has first-hand experience of incubating a start-up, having helped to grow Signal, a high-tech market intelligence service. Signal uses complex algorithms to filter relevant articles from hundreds of thousands of sources.

Incubating start-ups has become big business, and there are now lots of companies that exist solely to invest in them, hoping that one will take off. Y Combinator is a well-known example, whose early investments include Reddit, Airbnb and Dropbox. The firm pioneered the model of relatively low investments across a large number of companies: twice a year it invests US$120,000 into a number of different start-ups (the most recent round featured 85).

Tech start-ups make a lot of headlines, but the principle of providing investment and support to a small company to get it off the ground applies across all industries. Only yesterday I read about incubator kitchens in New York, where commercial kitchens rent space to food start-ups and provide them with the advice and infrastructure that they need to bring their products to market. As well as generating headlines for their innovation, though, tech start-ups are often in the news because they have been bought by a bigger, more established company. The tech sector has become famous for companies securing huge investment despite being started in a bedroom on a laptop. Facebook is one such example, and now it frequently buys start-ups as it tries to maintain its competitive edge. Earlier this week it bought, a voice-recognition start-up. Other well-established technology players have also resorted to M&A to gain a competitive edge. Apple paid a lot of money for Beats Electronics to secure the services of its two founders, Jimmy Iovine and Dr Dre, while Microsoft’s recent purchase of cult computer game Minecraft seemed to be an attempt to acquire a new market segment.

If Samsung’s investment in Storedot pays off and it becomes the first company to sell a smartphone that charges in 30 seconds, it will certainly gain an impressive edge over its rivals. Which start-ups do you think will boggle our minds in 2015? Let me know at, and have a great weekend!