There are more than 140 startup accelerators in Europe while five years ago we only knew about the existence of Y Combinator, Startupbootcamp and Techstars.
Although startup accelerator programmes have become an integral part of startup ecosystem and there are plenty to choose from, I decided to dig deeper and find out if the experience is really worth it by questioning a few startups from different countries who have attended the programme and the ones who decided not to. So here are some findings:
Know what you are looking for and set your goals
Before joining an accelerator you should have specific goals in mind. Are you looking to find investment? Would you like feedback for your product and mentorship? Are you looking for new contacts and to grow your network? Do you want to enter a new market or validate your business model?
Raising money is not the only reason why you should join the accelerator programme. In fact when you are only looking for immediate funding, joining an accelerator might be wrong decision. Most of the startups surveyed did not join the accelerator programme just for the money, but for mentorship and access to their network.
Not all startups are right for accelerators, and not all accelerators are right for startups. It’s important to look at the wider value an accelerator can offer you. You should avoid going to an accelerator just for the money. The money is really to cover the cost of you attending, and perhaps working on an MVP.
Make sure you are ready to be mentored! Most likely you are already in love with your idea so it might be difficult to respond to constructive criticism or answer very well targeted questions. If you can, you are definitely on the right track and joining an accelerate will give you a lot of feedback about your product and prepare you for the pitch to investors. If you cannot handle criticism about your product/idea you are probably wasting your time. In fact 30% of startups that are rejected by accelerator programmes at interview stage because of this.
Go hard or go home
In most cases the best startups might not be local and require you to relocate. Can you take the risk to relocate your entire team if you already have one? Or if not, can you relocate and take a risk to be away from your daily business activities?
Or if you commute back and forth, is it worth it? Could it slow down your growth? Or even if it does maybe it’s worth it in long term..
Good accelerators are very intensive, exhausting and efficient. Disappearing for 3-6 months requires the support from your team, family and friends.
Bear in mind that joining an accelerator is not joining a summer camp. If you have taken this journey, you need to make maximum out of these 3-6 months in the programme. You should be the first in and last out every day, take the most out of the networking events and mentoring sessions. You should grab as many meetings as you can and introduce yourself to as many people as possible cause you never know who can become very valuable to your business. This requires a high level of commitment and you should only focus on this for the time being.
According to David Hellard, the Partner at Zipcube.com the overall experience joining Ignite 100 was very good and highly recommended but the only drawback was that as being part of a regional accelerator in Newcastle, a lot of the support was conditional on staying in the area, as were the networks.
Choose the right accelerator
There are bunch of startup accelerators to choose from. A lot of them offer cheering, a desk and some little more. How to be sure you are applying for the right one? Is there a right one at all?
Picking an accelerator is like adding a brand to your startup CV. Although the application process might take longer and be quite competitive, you should always aim for the best ones. A great brand might also attract great employees, good investors and even potential clients.
Although joining Techstars, Y Combinator, Seedcamp or Startupbootcamp could be your number one option, you should not forget the nature of your startup.
Don’t forget that accelerators are your first investors and make sure you do your homework cause some might not be able to justify taking 6-10% of your business. Make sure that they have experience in your target market, research how solid their network is and how much time they dedicate on you.
A good accelerator will bring a lot more value than just money. The right accelerator will have mentors who are specific to what you do, or will be based in a city where you can grow your business better than where you are now. Accelerators should be all about networks. Mentors give advice, but also open doors to their networks. But beyond mentors, look at who the partners and sponsors are, and how they can help you. A good choice of accelerator will involve you making a very strategic decision, to go there because the contacts and location will bring serious value to your startup.
- Tobias Stone, CEO of EyeFocus Accelerator
When choosing the right accelerator talk to people who have already participated the programmes, consider if you are ready to relocate or you can also stay regional. Research the connections the accelerators have and make sure how dedicated they are to offer you the best value for your business.
Is the time right for your startup?
90% of the startups I talked to had joined the accelerator programme in build phase. “The ideal time to join you the accelerator is when you have a MVP ready and your core team in place but before you have achieved product/market fit”, says Bradley van Leeuwen, Fintech mentor for Techstars and Startupbootcamp
You should definitely join the accelerator if you haven't found your product/market fit yet as for a start up this is the most difficult part and accelerators can be most lucrative to help you find it.
While building your sales funnel and scaling up, you need your first funding and support what startup accelerators can offer you.
Accelerator programmes are great for first time CEOs and entrepreneurs, who can quickly pick up valuable knowledge from mentors and investors who have “been there and done that”.
If you already have verified your product/market fit and you just want to expand to another market or raise funding it might make more sense for you to do it on your own if you cannot afford to be away from your business.
What’s the key takeaway?
The startups who have participated the accelerator programmes have said that that joining the programme definitely had a large impact on their startup. They were able to test their ideas with larger community, discuss and develop their ideas and product. They learned to be focused and dedicated on their business, met a lot of new people, friends and business partners. You have higher potential to get the access to funding, either during the time you spend in the programme or post an accelerator.
The programme helps you to avoid typical startup pitfalls and speed up your efforts. Besides you can have a great PR exposure by attending the programme.
What's your experience?
The article was originally published by CoFounder Magazine.