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Startup accelerators: 👍 or 👎?
[Full disclosure: I am the cofounder of and have run an everchanging startup accelerator experiment since 2009.]
As we prepare to recruit our next class of startups, we are curious as to how the changing dynamics of the market are affecting founders and the decisions they're making about their companies. One of our concerns — obviously 😅 — is the current perception of startup accelerator programs, their perceived value to founders, and the likelihood that folks are still interested in applying to these programs.
Which leads me to ask…
Beyond YC and Techstars which are clearly in a category of their own, is the startup accelerator model still relevant to you and the work you do, or is it simply a relic of startups gone by to which we're clinging out of nostalgia…?
Interested to hear your thoughts.
P.S. This doesn't have to be pro-accelerator feedback. I am also completely willing to hear that you don't find any value or use in accelerators. That sort of feedback is extremely helpful and welcome, as well.
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There's two formal thoughts on this..
1. There great to help newbie founders learn the stuff that's truly needed to build.. legal, accounting, marketing, etc.. once they have the skills, the real work starts, to see if they can build it, profit/arr and later scale it.. but it's also great for experience/seasoned founders too.. Learn new things, network and meet or build together.
2. The second - Is clout. Just having the name on that deck/press/VC mind - makes or breaks ANY startup on gaining more funding, more staffing, more press, more network, more access to more access..
With me, having gone thru YC Startup School F19 for my SUs OneCarPayment.. https://www.startupschool.org/us..., I've learned more about "why, who, what, when and how" to build a rocketship startup and learn to network with solid people.. Every min on call with our group was a lifetime experience to learn - "how to sell yourself,your company to others"..
So it really depends, on the founders how they want to learn.
general thoughts:
* covid has definitely put a damper on the construct - travel to X
* some accelerators tough to swallow, e.g., zero funds, 2-edged SAFEs
* vertical / topic accelerators generally more valuable than geo / regional
* mixed outcomes in my experience on speed dating week / weeks -- lots of places do it, but the raw data isn't convincing that it's entirely effective -- think it boils down to how it's executed - need to think more on that / why
* best accelerators have direct feeds into customer leads, hence why vertical is a lot better for this in general, as it's usually easier to build that -- and even geos can leverage -- hey our area is really great at X
* need better filters for angels who never write checks, mentors there for the ego strokes, etc., on average a full third of the roster is usually a waste and turn off for the startups in the program
[disclosure] have been through two, advised others, etc.,
@gotobits Thank you so much for this thoughtful response, James! I love all of these points. And yeah, we're definitely struggling with the all virtual, all of the time stuff. Having mentors "fly in" to visit isn't quite the same via Zoom 😕
@turoczy yeah, not sure anyone has truly nailed the virtual accelerator experience and there's probably room to innovate here -- one option could be PIE^2 -- and really like the math pun, done one of of a few ways:
* each cohort has resident and virtual members - think people at MIT vs. doing the OCW MOOC version of some college course -- so people who attend in-person get the full experience and some select folks, or perhaps anyone can participate virtually
e.g. if PIE is great at X, i can keep my day job and maybe push extra hard on my side hustle during that window, etc. and compete for a virtual demo day spot
* alternate cohorts -- less a fan of this angle
@gotobits Love it. We did something last class that was similar but more "high touch" vs "light touch" and it seemed to work. Light touch, to satiate your appetite for puns, was called "Slice of PIE."
Currently, we don't have the option of "in person" at all because our office space partners remain in remote mode. And we're overly cautious from our side because we a) don't want to risk the health of our founders and mentors and b) understand that if a founder winds up getting sick, that stops an early stage company dead in its tracks. So it's not worth risking it.
We'll likely wind up running this cohort as fully virtual again (with full program and light touch participants), with the hopes of returning to fully in-person in 2023.
Hi Rick! I think any way we can help startups be successful is a good thing to do. I volunteer mentor with www.creativedestructionlab.com and they don't take equity but they are definitely along the lines of helping startups be successful. We're in 10 cities around the world (5 Canada where it started, 3 in the US and one each in Oxford UK and Paris France). I love it...it's one of the most rewarding things I do in life.
I definitely feel a pro-founder accelerator is a great thing. The pace of the world has accelerated significantly over the last 20 years and these days it's hard for a first-time founder/co-founder to get it all right (well, impossible). An accelerator can definitely help them on the path to success. I hope the accelerator is founder-first and not accelerator-first. I know for sure that anything you're involved in would be founder-first, but maybe not all accelerators are like that?
I see a lot of startup studios too...that's an interesting avenue if there are founders that aren't ready to go it alone, but I'm not sure that's a repeatable formula...founders have to live/breathe their startup with tremendous drive and lack of sleep. I wonder if they'll have that level of commitment as part of a studio.
Neil
P.S. Did you upgrade your phone? :)
@neil_wainwright Thank you so much for this thoughtful and insightful response! (And yes, I was finally forced to upgrade my phone 😂)
Totally depends on the stage of the startup and the founders. For first-time founders, a program where they can understand the in and outs of building a startup would be awesome. On the other hand, if you have received money and you are too diluted it could be not that good to go into one of these programs, you probably already know a couple of things to find PMF or scale. Again, it totally depends on where the startup and the founders are.
@daniel_leal Thanks so much! I really appreciate your chiming in here — and your perspective
Orbit