Before selecting the case study location, it is exceptionally difficult to estimate the true cost of setting up an incubator and operating it. So much depends on the ability to source second hand equipment in the case study area, the layout of the local office and the local salary requirements for incubees.
This being said, an approximate cost estimate has been prepared for the running and operation of a 50 person incubator. This is broken down into:
Estimated Setup Costs:
- Incubator hardware: $20k – $25k
- Incubator security: $6.5k – $8.5k
- 10% contingency for equipment shipping costs: $2.5k – $3.5k
- Total Estimated Setup Cost: $29k – $37k
Estimated Operating Costs:
- Intangible tools: Software, domains & hosting: $10.5k – $17k
- Incubator gatekeeper to assist with incubator operation & setup on the ground:~$40k/year
- Incubator contributor promotion cost: ~$50k/year (crypto)
- Ongoing incubator logistical support/monitoring: $35k – $50k/year
- Incubee salary payments ($3-$10 every day of the year): $55k – $182.5k/year (crypto)
- Total Estimated Yearly Operation Cost: $190k – $340k
Full cost estimate of setting up and running a 50 person incubator for a year: $220k – $380k
TotalCrypto believes that a year’s worth of incubee salary costs is likely to be the largest cost for incubator formation. Reports from sources like the PEW research Center state that 71% of the world’s population live on less that $10 per day. This research leads TotalCrypto to conclude that it should be possible to appropriately incentivise incubees within the boundaries of this cost estimate.
A full breakdown of incubator cost estimates can be reviewed in Appendix 8.