October 5, 2015
At some point in their lifespan, most startup companies have to consider if joining an accelerator is the right move for them. Given that there’s been a major influx of accelerators over the last few years, some reports saying that the numbers are doubling at annual rates, it’s an incredibly important question to consider.
We’re working through the schedule of workshops, panels, and fireside chats at this year’s Tech Cocktail Celebrate Conference, and our attendees were able to get an inside look at some of the top accelerators in the US to help answer this question: Tech Wildcatters, 500 Startups, DremIt, and Techstars. Led by our very own Ronald Barba, Gabriella Draney Zielke, Elizabeth Yin, Jodie Sweitzer, and John Fein sat down to discuss the evolution of the accelerator, where the model is headed, and what added resources startup teams can add to their toolbox.
What started out with the simple question about the density of accelerators – Fein thinks there are too many – snowballed into a discussion of how the evolution of the accelerator will actually have a marked impact on the world of VC.
“I think it’s the venture model that will be changed by accelerators – it’ll be more data driven,” says Zielke. “I expect to see the next round of early stage venture capitalists as people who previously ran accelerator programs.”
Yin took this idea a bit further, explaining that there’s been a huge infusion of investment capital, especially through platforms like AngelList. Because of this, Yin says that the older VCs and their current models will have to adapt to a future where it’s no longer viable to simply write a check: they’ll have to also provide value in other ways like growth or networking help. The value proposition that accelerators offer, then, becomes potentially the most important tool a new, evolving accelerator can offer their participating startups.
“I think sometimes people forget or don’t know that there’s a lot more to it than three or four month program. It’s about the network you put together,” says Fein.
A defined network provides meaning for a startup, and as that network becomes more defined so too does the general direction of the accelerator. Yin mentioned that it’s important for an accelerator to pick one specialization and then stick to it and avoid diluting their program by trying to take on too many roles at once. Case in point is Tech Wildcatters, one of the first accelerator programs int he US to establish and cling to one specialization – in their case, it’s B2B.
“We’re Dallas, Texas,” says Zielke. “We can’t compete with consumer stuff on the West Coast, so why don’t we just do what we do best?
It becomes an imperative for startups to research an accelerator, then, and figure out how they’ve chosen to define their program. After all, you’re not going to want to join a B2B accelerator if you’re a B2C startup.
“It’s always that know thyself question: what is it you want out of an accelerator? When you find it, court them like they would court you,” says Zielke.
So, how are you supposed to find that perfect accelerator? Our panelists think that the best thing any entrepreneur can do is to speak with the founder and startups that have been affiliated with an accelerator. Specifically, entrepreneurs want to focus on the most recent classes, engaging with both successes and failures alike. And this will help the people running the accelerators get a grasp on where you’re coming from as a company.
“We want to make sure the companies are doing it for the right reasons,” says Fein. “If you’re just doing it for a PR bump or for the capital from the accelerator, you’re not really in it for the right reasons. You have to be open to getting feedback and making the most of your time and network.”
Throughout the entire panel, the one thing everybody kept circling back to and emphasizing is that you have to make sure the accelerator model fits before you commit. If you look up the top programs and choose based purely on rankings, you’re going to have a bad time because it won’t be a good fit. Further, while each accelerator has different criteria for what they look for in applying startups, a lot of it boils down to one thing: a strong team and a team first mentality.
On October 4-6, Tech Cocktail Celebrate Conference is gathering hundreds of attendees, industry leaders, and inspiring speakers in downtown Vegas to meet the hottest startups and investors from around the country, learn and collaborate with others turning their communities into startup cities, and enjoy music, parties, and llama spotting. Check out more Tech Cocktail Celebrate Conference coverage here.
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