Add TechStars to the list of accelerators to be avoided at all costs. They make an investment in your company on terms they can claw back the money at any time. Most of these accelerators provide little to no value, in my experience. Unless you need to know what “product market fit” means. Hilarious.
There are some corporate accelerator programs who licensed TechStars model. If they will see startup who went thru accelerator and didn't raised money - they will ask thought questions. The funny thing is, that even being in coworking space and not raising money was also a negative signal.
> Not really a reason to pick techstars over another program
When was this a debate about picking techstars over any other program? The article relates to picking nothing as opposed to joining TechStars. I think these perks are a little harder to come by when you turn an accelerator down for the no op as opposed to "I picked accelerator B instead of accelerator A".
I'd tell you that if you wanted to do an apples to apples comparison of accelerators we should save that for another thread lest we get too off topic, but that hasn't stopped others in this thread from turning the article into a TS vs Other Accelerator debate, so why should it stop you?
I started 2 companies through YC and Techstars and strongly disagree with this. Both were incredibly valuable and well worth the equity for us.
Edit: I didn't mean to say that all accelerators are worth it, but I disagree with the sweeping generalization that all accelerators are screwing their companies.
It seems to happen a lot, especially when many of these accelerators claim to invest in the team moreso than the idea. This is especially the case with TechStars. In which case, a lot of ideas are unformed, malformed, underformed, you name it.
There's only two great accelerators- YC and Techstars. The falloff after that is ENORMOUS, even just going to #3, #4, and #5.
If you go out of the top 5 accelerators, you're dealing with everyone who wasn't good enough to get into a respected accelerator. Doing an accelerator that isn't in the top 5 is a mark of incompetence- it filter for the desperate who couldn't
- The people behind, from top to down feel uninspired and could work at any random corporation; they just do not fit or appear entrepreneurial at all
- Their white labeling/partnering with corporations is super strange: weird corporations, awkward demos days with even weirder people running around having absolutely no relation to the actual ecosystem; I guess they get a lot of money for creating those joint accelerators and that's the point: it doesn't feel like proper seed investing what they do but rather like a too expensive event management service for clueless corporations
- No clear positioning; for what do they stand? Being just another accelerator shouldn't let you raise any money in 2017
In response to 3.
Techstars has a good reputation. They have been one of the most successful incubators for their 2008 programs. They don't just coach you but they connect you with potential capital/funding or companies that might acquire or partner with you. That is much bigger then getting coached.
This reminds me of a recent criticism I read about Techstars.
The argument was that if you can get into Techstars, you didn't need Techstars. (The premise there is that Techstars uses accurate, meritocratic criteria for selecting companies, which is obviously false, as it is for all human-based selection processes.)
In my opinion, the best possible scenario for accelerators is to identify/fund companies that have the following 3 characteristics:
1) Few social advantages (lacking experience, connections, etc.)
2) Will require VC because it's impossible or counterproductive for them to reach profitability quickly (Facebooks and Ubers of the world)
So let's say that the hit rate for follow-on investments for a TechStars company is somewhere close to 70% (that's fairly accurate). That doesn't necessarily represent success, but it's a start. Y Combinator is probably better than that. Now let's say that a "lesser" accelerator's hit rate is maybe half that. Still a 35% chance of some measure of success. Now maybe there's a 10% chance by going the pure bootstrap route, maybe less. So taking the money--and the guidance--in whatever form, makes you maybe three times more likely to be able to do what you love for a fairly extended period of time. Not to mention the fact that oftentimes the accelerator provides free or discounted services for being a cohort company. Good legal for a deep discount, legal office hours, design consults, dinners with VCs, etc.
I can't speak for what Oxygen is doing, or whether they're providing these services or not. But many accelerators that aren't called Y Combinator or TechStars are, and though there won't be as many successes to come out of those, there no doubt will be some. There may even be one or two who attend, learn a bit, fail, and then come back to apply at one of the big dogs later down the road.
IMO, the technical teams with very little or no understanding of sales & marketing are the ones who would get the most value out of startup accelerators. They're not gonna help you build a better a product, but they're gonna help you find resources to sustain your product development before hitting profitability.
We're currently going through TechStars with a very technical product and no experience in doing enterprise sales, marketing, and fundraising. They have helped us a lot in figuring out who to target in big companies, how to put together sales pitches, how to close pilots, how to price our product, how to get follow-up sales meetings, how to talk to investors, how to pitch a very technical product in a way that non-technical people can understand, etc.
If we end up succeeding, I'd say TechStars played a very large part in taking us from being a bunch programmers who could build stuff to being a real company with a real business model. Before Techstars when we were on our own, we would make 10 wrong decisions per each right decision we made. Having access to mentors who have been in our shoes before that can help us avoid making mistakes is very valuable.
People in this thread are hating on how TechStars programs each have a few corporate partners, but I have found them to be super helpful in getting some early traction going. They're all very open to working and adapting the products developed by teams in the cohort.
The associates, mentors, and the managing director in our cohort are all amazing and have been super helpful to us. I would highly recommend TechStars to anyone who's building a B2B company.
There is a fundamental disconnect with the concept of an Accelerator and the concept of a Disruptive Startup. If you do the math, honestly, they are a really crappy deal for the Startup. The "acceleration" they provide is little more than standard information, standard anecdote experiences, and standard MBA advice. If what they offered actually had they value they claim, they would be creating a startup themselves. Accelerators are parasites on your ambition and capability. Trust yourself, trust your team, and be adult enough to not sign up for a nanny program that is just going to treat you like children and take a portion of your equity for it.
I have not, but I work about 200 feet from Techstars Seattle and am friends with many of the companies from many of the classes there. I also work for Startup Weekend, so I've heard about a lot of accelerators all over the world.
I'm not saying all accelerators are good. Far from it. And I'm not saying accelerators don't have a ton of problems. I just don't think the article you wrote addresses any of them.
A simple way of thinking about this is that acceleration only helps if you are pointed in the right direction!
One of the common problems with many accelerator programs is that they are run by people who are not themselves experienced founders. Not surprisingly, their advice is often counterproductive.
I went through TechStars in 09. It was the single greatest accelerator for my company. We benefited from incredible mentorship and attention from the web's best and brightest. We would not be where we are today without TechStars.
We chose TechStars over YC because of the focus on mentorship. Both programs are fantastic and both will help you develop but do your research on the strengths of each so you know which will work best for you.
I encourage you to reach out to any of the TechStars founders and ask about their experiences first hand. All are happy and excited to share their experiences. You should do the same for YC.
The bottom line. Get into one of the two and kick a$$. Apply to both, do some research so you know what to expect and then make the decision.
I think you can't just give an accelerator the binary label of good/bad.
Sometimes different alumni have very different experiences. Sometimes an accelerator's niche is very relevant to one company's problem but not another's. As Sam's advice said -- it's more useful to qualitatively talk to someone you know (and also trust, or at least consider credible) to evaluate their opinions on the accelerator. There are too many unique factors.
Obviously, this is hard for a new-ish (pre-) accelerator, so one heuristic I've used instead is to review the experience of the accelerators' founders and mentor network. It's a start.
So you don't know which of the many accelerators are problematic or not or what their incentives are.
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