Is a startup accelerator valuable or a distraction?
I am thinking of applying to a few accelerator programs. I have heard mixed reviews. Some people say the advice and mentorship was really helpful and others say that they got distracted with all the events. Does anyone have any experience with accelerators? How do I know if one is right for me?
I have been involved in a casual one and a very serious one. I am sure that for some they add a lot of value. For me they required a huge amount of work (30 hours a week) were not run by successful entrepreneurs but business coaches and in the end though we were promised to be put in front of serious investors were put in a room full of angle investors. If you are looking to accelerate, chances are you need some serious investment.
I would not do it again. It cost me more than I gained. If I did, what I would look for is;
1. Who are the other companies you will be in the accelerator with? Are they as serious as you are? What are their goals (in mine half the entrepreneurs decided not to go for investment in the end)
2. Who is leading the accelerator? What will you spend your time on? For example, we were given 15 minutes to work on a value proposition. 15 minutes? Half the people didn't even know what one was. Worse, we never touched on it again. In fact, we seemed to blaze through a list of exercises but never had time to review, improve and complete. Worse half the day was spent listening to "consultants", more coaches, investors. The time would have been better spent on my business not in presentations.
My conclusion, 3 months, 30 hours a week, lost business, no investment and too much competition between entrepreneurs instead of help. However, I am in the Netherlands and the Dutch are not great at being open. In fact, most companies said everything was going perfectly well. Oh? Then why are you here. Big waste of my time, no added value, a lot of talk, little action. But again, it depends on the program.
I am a mentor for startups and matured companies, but now more focus on the matured companies as their challenges excite me more. However, here is a good link I like to share about choosing an accelerator or incubator for a startup. http://www.forbes.com/sites/georgedeeb/2014/08/28/is-a-startup-incubator-or-accelerator-right-for-you/, hope it is useful to you.
It depends on manager of startup in the end. Accelerators help get the project up and going quicker but the manager must make the final decisions or they lose control to the minders. Also some of those groups never seem to exit and become a real business. Do your own business plan to decide if it is worthwhile or not. Accelerators definitely create a collaborative environment. I think it is mainly for first-timers not experienced business people.
Accelerator Start Up is for those people who want to learn,without cost, from the experience of successful individuals. It gives you the experience and prepares you to proceed.
I also recommend staying away from programs that want you to pay a monthly retainer. I'm against taking valuable startup funds out for anything other than development or marketing. Also, do your research! Get references and go to events and chat with people. Did they really get what they were promised (i.e. awesome mentorship or funding?) and how are the people to work with? I have experience with many incubators/accelerators where people just talk at you but don't get their hands dirty really helping you achieve your goals.
The ultimate goal of these groups is to help you develop and go to market. If you need a mentorship program, look for one that is "productive" meaning:
1. It is not indefinite - there is a set end date/goal to work towards
2. They work with you to put together an effective strategy with set benchmarks and responsibilities
3. Make sure they know your industry or are willing to work hard to gain a better understanding to combine with their expertise
4. It's affordable. You shouldn't be bleeding thousands and thousands of dollars per month. You need someone who understands what it's like to be a startup and can work effectively within a smaller budget.
There are plenty of groups out there for everyone, you may just have to do some extra research to find the right one.
I am perhaps a bit jaundiced as I am in the founding group of a biotech and cleantech non-profit incubator. Accelerators commonly have a somewhat short program to get the member company along its critical path toward commercialization and then out to make space for the next in line. Our incubator has a very different model in many ways and if you can find such an incubator in your geographical area I would recommend it. Member companies can remain with us for a short as a year or as long as it may take (some have been there for 3 or 4 years). Our strengths come from the provision of a rich suite of support services aimed at getting the companies across the "valley of death" and taking care of their service provider needs so that they can focus on their science or business, Mentoring is a key component and cornerstone of our program. Each company is assigned a mentor with appropriate subject matter knowledge and experience. We also provide advisor groups with subject matter expertise. We establish goals for our companies and review with them quarterly their progress toward achieving those goals. For Biotech we have fully equipped labs. We have resident and non-resident members. Services include $5,000 of pro bono legal work from a top Boston law firm. We can also help arrange deferred or discounted legal fees and have a broad group of law firms targeting different audiences. We can assist in getting heavily discounted Freedom to Operate searches. We have a strong program for creating and refining business and capital pitches and PowerPoint presentations. The pitch to angels, strategic investors and VCs is very different and the pitch will change as the company hits various inflection points. We help in targeting the "right: capital. we have two Angel Group investors on our Board, who also serve as mentors. We provide grant identification and grant writing assistance. We have greatly discounted rates on research reports. The list of service as and benefits goes on and on but can be seen at www,NSIV dot org.We do not require members to give us equity. In any event look who the sponsors, supporters and alliance partners of an organization are as it will tell you much about the incubator/accelerator. Check out the culture and track record of the incubator/accelerator. I am wary of VCs who provide a modicum of investment and short-term residence within an incubator supported or owned by them. It is small seed capital and assistance for a significant piece of equity and the right to make further investment. It is a spread your bets approach that often imparts little long-term benefit to the company. Having been in a private merchant bank, a smaller venture capital fund and General Counsel and VP Corporate Development for well over a decade for disruptive technology (public) in the nano-formulation and processing field for pharma, chemicals, coatings, personal care and other verticals I am a good judge of what works and we carefully crafted our incubator offering based on our experience, research and the unmet needs of start-up companies. You may contact me with any questions.
In-House Counsel, Capital Liaison and Director
North Shore InnoVentures
Attorney at Law - Counsel at Finance
Like any other activity you have to manage your time for your own purposes.
Many accelerators are hang outs for wannabes, and occasionally you will find a gem.
I agree with Elaine & the answers u received already...I would add u should develop a business plan, then look at avaiable accelerTors...Suggest a Score mentor as well to help u evaluate & ask probing questions,
I am involved with several new business accelerators and I have been a new Venture Mentor with incubators and accelerators for many years. For any entrepreneur that needs to understand the totality of the process involved with starting and launching a new business they are excellent learning experiences that can help you launch your business successfully. As you may know, most new businesses fail in the first 12 to 18 months of their existence. This is primarily because they had NO PLAN and ran out of money. Do it.