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Startup accelerator

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Startup accelerators, also known as seed accelerators, are fixed-term, <a href="Cohort_(educational_group)" title="Cohort (educational group)">cohort-based</a> programs, that include <a href="Mentorship" title="Mentorship">mentorship</a> and educational components, and (sometimes) culminate in a public <a href="Sales_pitch" class="mw-redirect" title="Sales pitch">pitch</a> event or <a href="Demo_day" class="mw-redirect" title="Demo day">demo day</a>.<a href="#cite_note-1">[1]</a> While traditional <a href="Business_incubator" title="Business incubator">business incubators</a> are often government-funded, generally take no equity, and rarely provide <a href="Funding" title="Funding">funding</a>, accelerators can be either privately or publicly funded and cover a wide range of industries.<a href="#cite_note-2">[2]</a> Unlike <a href="Business_incubators" class="mw-redirect" title="Business incubators">business incubators</a>, the application process for seed accelerators is open to anyone, but is highly competitive.<a href="#cite_note-accelerating-studies-3">[3]</a> There are specific accelerators, such as <a href="Corporate_accelerator" title="Corporate accelerator">corporate accelerators</a>, which are often subsidiaries or programs of larger corporations that act like seed accelerators.<a href="#cite_note-4">[4]</a>

<div class="mw-heading mw-heading2"><h2 id="Distinctive_qualities">Distinctive qualities</h2></div>

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</style><div role="note" class="hatnote navigation-not-searchable">See also: <a href="Business_incubator" title="Business incubator">Business incubator</a></div>

The main differences between business <a href="Business_incubator" title="Business incubator">incubators</a>, <a href="Startup_studio" title="Startup studio">startup studios</a>,<a href="#cite_note-5">[5]</a> and accelerators are:<a href="#cite_note-accelerating-studies-3">[3]</a><a href="#cite_note-miller-6">[6]</a>

<ol><li>The application process is open to anyone but highly competitive. For instance, <a href="Y_Combinator_(company)" class="mw-redirect" title="Y Combinator (company)">Y Combinator</a> and <a href="TechStars" class="mw-redirect" title="TechStars">TechStars</a> have application acceptance rates between 1% and 3%.</li>

<li>Seed <a href="Equity_investment" class="mw-redirect" title="Equity investment">investment</a> in <a href="Startup_company" title="Startup company">startups</a> may be made, in exchange for equity. Typically, the investment is between US$20,000 to US$50,000 in the US, or £10,000 to £50,000 in Europe.<a href="#cite_note-accelerating-studies-3">[3]</a></li>

<li>The focus is generally on small teams, not on individual founders. Accelerators generally consider that one person is insufficient to handle all the work associated with a startup. However, a number of 'founder first' accelerators exist that focus on solo founders, including <a href="Entrepreneur_First" class="mw-redirect" title="Entrepreneur First">Entrepreneur First</a>, <a href="Antler_(venture_capital_firm)" title="Antler (venture capital firm)">Antler</a>, Oneday and Underdog Accelerator.<a href="#cite_note-7">[7]</a></li>

<li>The startups must "graduate" by a given deadline, typically after 3 months. During this time, they receive intensive mentoring and training, and they are expected to iterate rapidly. Virtually all accelerators end their programs with a "demo day", where the startups present to investors.<a href="#cite_note-gilani21-8">[8]</a></li>

<li>Startups are accepted and supported in cohort batches or classes (the accelerator isn't an on-demand resource).<a href="#cite_note-9">[9]</a> The peer support and feedback that the classes provide is an important advantage. If the accelerator doesn't offer a common workspace, the teams will meet periodically.</li></ol>

The primary value to the entrepreneur is derived from the mentoring, connections, and the recognition of being chosen to be a part of the accelerator. The <a href="Business_model" title="Business model">business model</a> is based on generating <a href="Venture_capital" title="Venture capital">venture-style returns</a>, not rent, or fees for services.

Seed accelerators do not necessarily need to include physical space, but many do. The process that startups go through in the accelerator can be separated into five distinct phases: awareness, application, program, demo day, and post demo day.<a href="#cite_note-accelerating-studies-3">[3]</a>

Accelerators provide enough funding to get a company to demo day, from which point the startup is on its own.<a href="#cite_note-10">[10]</a>

<div class="mw-heading mw-heading2"><h2 id="History">History</h2></div>

The first seed accelerator was <a href="Y_Combinator_(company)" class="mw-redirect" title="Y Combinator (company)">Y Combinator</a>, started in Cambridge, Massachusetts, in 2005, and then later moved to Silicon Valley by <a href="Paul_Graham_(computer_programmer)" class="mw-redirect" title="Paul Graham (computer programmer)">Paul Graham</a>.<a href="#cite_note-accelerating-studies-3">[3]</a> It was followed by <a href="TechStars" class="mw-redirect" title="TechStars">TechStars</a> (in 2006), <a href="Seedcamp" title="Seedcamp">Seedcamp</a> (in 2007), <a href="AngelPad" title="AngelPad">AngelPad</a> (in 2010), Startupbootcamp (in 2010), Tech Wildcatters (in 2011), several accelerators of <a href="SOSVentures" class="mw-redirect" title="SOSVentures">SOSV</a>, <a href="Forum_Ventures" title="Forum Ventures">Forum Ventures</a> (In 2014), Boomtown Boulder (in 2014) and <a href="Antler_(venture_capital_firm)" title="Antler (venture capital firm)">Antler</a> (in 2017).<a href="#cite_note-gilani4-11">[11]</a>

In Europe, the first accelerator program was started by Accelerace in 2009 in Denmark (strongly subsidised by the Danish government) followed shortly after by Startup Wise Guys in 2012 in Estonia.

With the growing popularity of seed accelerator programs in the US, Europe has seen an increase in accelerators to support a growing <a href="Startup_ecosystem" title="Startup ecosystem">startup ecosystem</a>.<a href="#cite_note-12">[12]</a>

Forbes published an analysis of startup accelerators in April 2012.<a href="#cite_note-forbes1-13">[13]</a> Since 2010 there has been a substantial growth of <a href="Corporate_Accelerator" class="mw-redirect" title="Corporate Accelerator">Corporate Accelerator</a> programs, which are sponsored by established organizations but follow similar principles.<a href="#cite_note-14">[14]</a>

<div class="mw-heading mw-heading2"><h2 id="Impact">Impact</h2></div>

Whether accelerators increase the success of accelerated firms is not always clear. A number of studies have shown that accelerated cohorts perform better than non-accelerated firms, but this is potentially due to the selection effect of programmes (i.e., the accelerators might be good at 'picking winners' rather than creating them). However, studies using <a href="Regression_discontinuity_design" title="Regression discontinuity design">regression discontinuity design</a> show that accelerators can indeed have impact over and above their selection effect, and may also have wider ecosystem spillovers (although this does not necessarily apply to every program).<a href="#cite_note-15">[15]</a>

<ul><li><a href="Business_incubator" title="Business incubator">Business incubator</a></li>

<li><a href="Corporate_accelerator" title="Corporate accelerator">Corporate accelerator</a></li>

<li><a href="Forum_Ventures" title="Forum Ventures">Forum Ventures</a></li>

<li><a href="Flex_space" title="Flex space">Flex space</a></li>

<li>List of startup accelerators</li></ul>

<div class="mw-heading mw-heading2"><h2 id="References">References</h2></div>

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</style><cite id="CITEREFCohen2013" class="citation journal cs1">Cohen, Susan (2013). <a rel="nofollow" class="external text" href="https://doi.org/10.1162%2Finov_a_00184">"What Do Accelerators Do? Insights from Incubators and Angels"</a>. Innovations. 8 (3–4): 19–25. <a href="Doi_(identifier)" class="mw-redirect" title="Doi (identifier)">doi</a>:<a rel="nofollow" class="external text" href="https://doi.org/10.1162%2Finov_a_00184">10.1162/inov_a_00184</a>.</cite>

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<li id="cite_note-2"><a href="#cite_ref-2">^</a> <cite id="CITEREFBoneAllenHaley2017" class="citation report cs1">Bone, Jonathan; Allen, Olivia; Haley, Christopher (2017). <a rel="nofollow" class="external text" href="https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/955469/business-incubators-accelerators-uk-report.pdf">Business Incubators and Accelerators: the National Picture</a> (PDF) (Report). UK Dept of Business, Energy and Industrial Strategy.</cite>

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<li id="cite_note-accelerating-studies-3">^ <a href="#cite_ref-accelerating-studies_3-0">a</a> <a href="#cite_ref-accelerating-studies_3-1">b</a> <a href="#cite_ref-accelerating-studies_3-2">c</a> <a href="#cite_ref-accelerating-studies_3-3">d</a> <a href="#cite_ref-accelerating-studies_3-4">e</a> <cite id="CITEREFLisa_BarrehagAlexander_FornellGustav_LarssonViktor_Mårdström2012" class="citation book cs1">Lisa Barrehag; Alexander Fornell; Gustav Larsson; Viktor Mårdström; Victor Westergård; Samuel Wrackefeldt (May 2012). <a rel="nofollow" class="external text" href="http://acceleratorstudy.com/">Accelerating Success: A Study of Seed Accelerators and Their Defining Characteristics</a>. Gothenburg, Sweden: <a href="Chalmers_University_of_Technology" title="Chalmers University of Technology">Chalmers University of Technology</a>. Retrieved September 14, 2012.</cite>

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<li id="cite_note-4"><a href="#cite_ref-4">^</a> <cite id="CITEREFCrichton2014" class="citation web cs1">Crichton, Danny (August 25, 2014). <a rel="nofollow" class="external text" href="http://techcrunch.com/2014/08/25/corporate-accelerators-are-an-oxymoron/">"Corporate Accelerators Are An Oxymoron"</a>. Retrieved June 17, 2015.</cite>

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<li id="cite_note-5"><a href="#cite_ref-5">^</a> <cite id="CITEREFKronenberger2021" class="citation web cs1">Kronenberger, Craig (February 23, 2021). <a rel="nofollow" class="external text" href="https://medium.com/startup-studio-insider/startup-studios-vs-accelerators-82b8545aba0a">"What Startup Model is Right for You?"</a>. Medium. Retrieved March 23, 2021.</cite>

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<li id="cite_note-miller-6"><a href="#cite_ref-miller_6-0">^</a> <cite id="CITEREFMillerBound,_Kirsten2011" class="citation book cs1">Miller, Paul; Bound, Kirsten (June 2011). <a rel="nofollow" class="external text" href="http://www.nesta.org.uk/library/documents/StartupFactoriesv18.pdf">The Startup Factories - The rise of accelerator programmes to support new technology ventures</a> (PDF). London, UK: <a href="NESTA" class="mw-redirect" title="NESTA">NESTA</a>. p. 3.</cite>

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<li id="cite_note-7"><a href="#cite_ref-7">^</a> <cite class="citation web cs1"><a rel="nofollow" class="external text" href="https://underdogaccelerator.com/">"Underdog Startup Accelerator | Expert Support to Launch Your Startup"</a>. Underdog Startup Accelerator | Expert Support to Launch Your Startup. Retrieved August 14, 2023.</cite>

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<li id="cite_note-9"><a href="#cite_ref-9">^</a> <cite id="CITEREFChristiansen" class="citation web cs1">Christiansen, Jed. <a rel="nofollow" class="external text" href="http://www.seed-db.com/about/view?page=definition">"Seed Accelerator Definition"</a>. Retrieved September 14, 2012.</cite>

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<li id="cite_note-10"><a href="#cite_ref-10">^</a> <cite id="CITEREFKronenberger2021" class="citation web cs1">Kronenberger, Craig (March 29, 2021). <a rel="nofollow" class="external text" href="https://medium.com/startup-studio-insider/startup-studios-vs-accelerators-82b8545aba0a">"What Startup Model is Right for You?"</a>. Medium. Retrieved May 7, 2021.</cite>

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<li id="cite_note-12"><a href="#cite_ref-12">^</a> <cite id="CITEREFJohnson,_Bobbie2011" class="citation web cs1">Johnson, Bobbie (July 18, 2011). <a rel="nofollow" class="external text" href="https://archive.today/20130124035329/http://gigaom.com/2011/07/18/are-europes-accelerators-speeding-out-of-control">"Are Europe's startup accelerators speeding out of control?"</a>. <a href="GigaOM" class="mw-redirect" title="GigaOM">GigaOM</a>. Archived from <a rel="nofollow" class="external text" href="http://gigaom.com/2011/07/18/are-europes-accelerators-speeding-out-of-control">the original</a> on January 24, 2013.</cite>

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<li id="cite_note-forbes1-13"><a href="#cite_ref-forbes1_13-0">^</a> <cite id="CITEREFTomio2012" class="citation web cs1">Tomio, Geron (April 30, 2012). <a rel="nofollow" class="external text" href="https://www.forbes.com/sites/tomiogeron/2012/04/30/top-tech-incubators-as-ranked-by-forbes-y-combinator-tops-with-7-billion-in-value/">"Top Startup Incubators And Accelerators"</a>. Forbes. p. 1.</cite>

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<li id="cite_note-14"><a href="#cite_ref-14">^</a> <cite id="CITEREFHeinemann2015" class="citation web cs1">Heinemann, Florian (June 17, 2015). <a rel="nofollow" class="external text" href="https://corporate-accelerators.net/database/index.html">"Corporate Accelerator database"</a>.</cite>

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