Is an accelerator the right choice for my startup?

When I was building my first startup, Fruitful Fertility, I found the entire process to be incredibly isolating. Oftentimes I found myself sitting alone wondering, “Am I doing this right? Am I focusing on the correct things? How do I do this? Am I wasting my time?”

I asked my friends, past colleagues or even prospective customers for their opinions. But I often found the most valuable nuggets of advice came from other founders, investors, or people who really understood the startup world and had access to people, resources and opportunities that just aren’t easily Google-able.

And most of those relationships started thanks to my inclusion in a few local accelerators (namely, Lunar Startups and Beta.MN).

Getting advice from experienced, strategic experts is one of the smartest things you can do when you’re running a fledgling startup...which is also one of the key benefits of joining a startup accelerator.

‍

What is an accelerator?

An accelerator is a program that provides mentorship, resources and capital in return for equity in a startup. The purpose is to help startups grow significantly over a short span of time.

Accelerators often offer their startups free office space, unique content or curriculum, access to investors and consultants, invitations to exclusive events and more. Of course all of this is dependent on the specific program, and there are a lot of them!

Often admitted in batches, many accelerators open 1-3 cohorts a year. And while some focus on a specific industry, market, technology, or stage, others are more general. Regardless, almost every accelerator program has a rigorous application and screening process.

‍

What is the difference between an accelerator and an incubator?

Accelerators are designed for later-stage startups who already have market validation (proven interest in the idea or business), a working product, a strong founding team and paying customers. These companies primarily need capital and connections to keep the momentum going even faster.

Incubators are usually designed for earlier-stage startups. Founders may have a great idea, but they’ve yet to find a solid business model or launch an MVP. They primarily need time and capital to keep validating their idea and talking to potential customers. They also usually need more help on the technology side of their growth.

‍

The benefits of joining an accelerator program

While it depends on the individual program, the benefits of joining an accelerator program often include:

• Credibility and clout
• Capital aka cash
• Access to a workspace
• Unique networking opportunities with influencers, founders, investors and industry experts
• Specialized, structured programming or curriculums
• Discounts or access to important infrastructure and SaaS tools like AWS, Google Cloud, Hubspot, Salesforce, etc.
• Collaboration opportunities with other startups

‍

The drawbacks of joining an accelerator program

Accelerator programs aren’t a great fit for every team and every startup. Some of the drawbacks include:

• Time-consuming to apply and participate; ask yourself if you really need this support or if you're just procrastinating
• Many programs are seasonal, so the timing can sometimes be off
• The best ones are very competitive with acceptance rates as low as 1.5%
• May require your team to relocate or put the rest of your life on hold
• Might not be specific to your industry or company milestones
• Require giving equity
• Could just be a distraction and not help you towards achieving your company’s specific milestones
• Does not guarantee growth or success

‍

‍

Not all accelerators are created equal

Accelerators like Techstars and Y Combinator are the most prestigious (and competitive) in the industry. Mostly because many of their portfolio companies have a proven track record. This gives them access to the most elite, hard-to-reach investors, founders and connections.

Because these programs are highly competitive, they often require a significant commitment on behalf of early-stage teams. Oftentimes teams are asked to give equity, relocate entirely (or sacrifice some level of quality or connection to participate remotely), change their business model or make other accommodations just for the opportunity to be included in the cohort.

There are also many smaller, more localized accelerators which could be a better fit if you’re in an earlier validation phase or not willing to make larger sacrifices for the opportunity to be included in a more global program.

‍

First things first: why do you want to apply?

Before you submit a single application, ask yourself honestly: WHY do I want to join an accelerator? Is there a particular person or brand I want to work with? Is there funding I need? Introductions? Specific industry credibility?

It's important to be honest with yourself about what you want to get out of the experience and what your company needs to get out of the time and resources you invest.

‍

Before you apply: do your research

If you’re considering applying to an accelerator program, you need to thoroughly review the details for each individual program.

When does it start? When is the application deadline? Would you need to relocate? How many team members can be included? Will you be expected to exchange equity for the opportunity? Is the program specific to your industry or vertical? Is this program equipped to help your individual startup and your current challenges?

Oftentimes, if you’re working in a specific vertical (e.g. healthcare, fintech, consumer packaged goods), it can be more helpful to find a more niche accelerator that aligns with your specific audience, sales process, or industry.

Lastly, ask other founders for their opinion on specific opportunities. With LinkedIn, it’s easy to track down other founders who have actively participated in past accelerators. Shoot them a casual, quick email and ask them if they think it was worth the equity/investment/time. You’ll be surprised by how many founders respond and want to offer up their honest feedback and thoughts!

‍

Accelerators can add a ton of gas

Depending on your startup, your team, where you are in the process and what type of assistance and resources an individual program can offer you, joining an accelerator can be a great opportunity.

But ultimately, you and your team need to weigh the pros and cons and ask yourself the biggest question of all: Will joining an accelerator be a distraction or a strategic next step for the company’s growth?

‍