When I think back to why we applied to Seedcamp, it was probably the money that attracted us in the first place. We’d been working on School of Everything for about a year, running the company on a very small amount of cash which was rapidly running out, so â‚¬50,000 of investment was quite enticing. My guess is that for a lot of teams applying for accelerator programs, in advance of being accepted, it is the idea of investment that initially peaks their interest in applying. I’d like to test that hunch though.
In truth what accelerators give first time founders is actually very different. Having spoken to quite a few companies that have been through Y-Combinator, Seedcamp and the like, there are a few themes that stand out:
- Accelerators give you the chance to meet people in the tech industry, both from successful startups and in larger tech businesses. Many of the people I’ve spoken to have told stories about how they met people who later went on to help them be successful. This could be the guy from PayPal who tells you what you need to do to take payments in a particular way or the branding consultant who gives you the insight you need to change your name. For Seedcamp, Techstars and Springboard, this is achieved through ‘mentoring’ (for example see this list from Seedcamp) while in the case of Y-Combinator, the speakers are the most obvious exposure the teams have to people who are already founders.
- Accelerators give you introductions to investors and time face-to-face with them which can be hard to get for first-time founders. Because accelerators do a great job of providing a quality pipeline of new companies (more on that in a future post), a lot of investors make sure they go along to accelerator events and getting them all in the same place is something that is a very rare opportunity for new companies.
- Accelerators give young companies validation. The idea that you’ve been vetted by a group of successful founders and investors helps any early stage company, whether that’s with journalists, or investors or potential clients. It helps to be able to say that you’ve been selected as a ‘promising startup’ by an accelerator program. The value of that validation is linked to how well the program is regarded. Saul Klein has written about this in relation to Seedcamp.
- Accelerators give you a peer support group. Strange as it might seem it’s actually quite hard to meet people who are doing the same thing as you, even in London and to some extent in other tech hotspots. And for teams who are starting out elsewhere, it’s really tricky. The problem is that most interactions with other founders are very superficial and you really need to be spending time in the same building or meeting each other regularly over the course of a few months to get to know them to a level where you can provide each other with meaningful support.
- Finally accelerators provide pressure. A number of people have said that one of the things they got out of an accelerator program was a deadline and basic framework for getting there. Of course every company should be able to provide this themselves, but in reality in the early days it’s tricky to do.
So those are first thoughts. Let us know if there’s anything we’ve missed in the list of benefits for founders.
- TechAviv Goes To Seedcamp; Exploring The Rise of Israeli Microfunds & Angels (techaviv.com)
- Defining Accelerator Programs (paulmiller.org)
- The Startup Factories (paulmiller.org)