There are multiple ways of funding a startup business. And one of the most famous ways of funding a startup ever since its commencement in 2005 is through accelerator programs. However, just like other funding strategies, how startup accelerators fit a business depends on various factors.
But the question is, how can one know that a startup accelerator is a good option for their business.
Here you will find the ultimate guide for choosing a startup accelerator that would fit your business. But before we further dive into the matter, let us first have a brief discussion about the work of a startup accelerator.
What do startup accelerators do?
Start-up accelerators are an integral part of the journey of an entrepreneur. In simple words, accelerators are fixed-term programs that generally last from three to twelve months.
Accelerator programs offer various benefits, including networking, mentoring, and education. While some occasionally offer investment to startups, accelerators take equity in the company that they accelerate.
Now, with over seven thousand such programs spread globally, entrepreneurs are spoiled with multiple choices.
Hence, faced with a varied range of possibilities, the real challenge is choosing the right accelerator. Nonetheless, it is easy when you have a few tricks up your sleeve.
Five Ways To Choose Startup Accelerators
Almost all accelerators would try to take the ownership stake in a company. But, eventually, accelerators affect how entrepreneurs spend their time building their companies. Hence, it is wise to choose an accelerator in the long term, just like choosing a business partner or investor.
You should find an accelerator that aligns with the current stage of your startup.
For instance, here at WGP Global we specialize in assisting early-stage and aspiring founders at their early venture stage.
At this stage, founders aim at acquiring proof and making adequate traction for proving that their startup has scaling potential.
An accelerator specialized in series A stage companies may focus more on founders having working products or services in-market, early scaling evidence, and proven ROI.
Hence, if you are at this growth stage, it would be better for you to look for an accelerator to help you determine what is working for you and incorporate processes that would enhance scaling.
Getting a ‘stage fit’ accelerator ensures that the startup gets maximum impact and value out of the entire scenario.
By Founders for Founders
It is best to check for programs run by individuals who have already run businesses or founded startups. You would want the advice and help of people having a similar experience and knowing what it takes.
Moreover, you also can learn from their failures and successes and take advantage of their network. But when you are using programs operated by non-funders, it is like being taught by a teacher who knows some theory but has no practical knowledge.
The interaction level of mentors varies greatly, and hence you should not depend on the program in meeting with a particular person. But once you leverage mentors and the network of your accelerator, you can be surprised by the mentor selection for you.
That person might not be famous like the names that first attracted you to the accelerator program. Hence, you have to judge the mentor list wisely.
Consider it a network sample with accelerator access rather than a list of individuals who can assist you.
Another piece of advice that entrepreneurs should keep in mind is that they should focus on optimizing the factors that would best help the company rather than optimizing their valuation. This also applies to accelerators.
Proficient accelerators might offer terms that require less investment but take more company ownership than others; this would help in accelerating your company more compared to your competitors.
However, it is not necessary that you need an accelerator for building a great business. They are not for everyone, but they are exceptional partners for both life and business if leveraged effectively.
The most precious resource for any business is time, and getting a clear understanding of the time commitments of an accelerator is crucial. In most cases, successful startups are led by founders who have a full-time focus on the accelerator and their startup.
Founders meet with their entrepreneurs-in-residence, engineers, designers, managers and go for in-person immersions to ensure consistent progress.
However, all this is done simultaneously by the founders while they focus on potential investment opportunities, interviewing customers, and doing business development.
Start-up accelerators have years of experience in helping entrepreneurs and founders consistently grow their businesses. In addition, they provide the founders with unique opportunities to accelerate the growth in their business religiously.
Still, ultimately, while you are choosing one for yourself, you should do thorough research before signing that dotted line.