What Should Founders Look For While Choosing An Accelerator Program?
Every startup founder dreams of being part of world-class accelerator programs that could help in building success stories. But, with several incubators and accelerators out there, startup founders face difficulty knowing which one is best for them. Also, over the last few years, many business coaches have popped up to assist new-age entrepreneurs in turning their dream idea into full-fledged business opportunities, adding more confusion for the startup founders.
Hence, before applying for an accelerator program, every startup founder should ask whether the program they are applying for is fit for their specific requirement or not? Below are some of the crucial criteria they can use to evaluate a program:
What gap is the Accelerator filling?
Every founding team has specific capabilities, and founders need to evaluate if the Accelerator fills the missing gap. There are three main capabilities required to have a successful startup:
Functional: Do you understand the industry and the problem you are solving? For instance, if you are a fintech startup, do you know the real challenges of the BFSI industry, its value chain and economic cycle related to the industry, etc.
Technical: Do you have the capability to implement the idea you are envisaging? Can founders make the MVP on their own? Can they identify, hire and mentor the technical team themselves?
Distribution: Do you know how to sell your product and the proper distribution channels to reach your customers? Do you understand the buying cycle, especially if it's a B2B product? If you need a CXO to buy your product, do you have access to them?
While choosing accelerators, founders need to ask themselves the above questions to know where they are self-sufficient and where they need help, and hence, they should select an accelerator that fills the gap.
What is the stage of your startup?
Different accelerators focus on companies at different stages of their lifecycle. Many accelerators shortlist startups in their idea stage and help refine their idea and take it to MVP. On the other hand, others help companies that have reached MVP to generate revenue and scale the business. Hence, while choosing an accelerator program, as a startup founder, you should check where you are in your journey and choose the program accordingly.
For instance, several university-based accelerator programs take early-stage startups and help them with the entire process of ideation to product development. While many other accelerators focus on companies in the early revenue stage and help accelerate their revenue by designing their GTM and executing their sales and marketing plans.
What is the program structure?
Most accelerators work in cohorts, and they support close to 30 to 60 startups a year. They organize 3 to 4 cohorts, comprising of 10-15 startups in each batch. This works well for early idea stage startups, who need to learn the basics of building a business and understanding product development methodology. On the other hand, post-MVP stage startups need much more one-to-one focus.
For instance, there are accelerator programs that work with only 12-15 a year. They do not organize cohorts and focus on dedicated mentorship of each startup for their better progress
What are the core competencies of the Accelerator?
Like every company, accelerators need to have a core competency of their own. So, look at the Accelerator's founding team to determine if they have the experience and exposure of delivering what they are promising for your startup.
Making a commitment on websites and collaterals is common. However, delivering the commitment is a big task, especially if the startup idea is entirely new and revolutionary. Hence, the imperative is to do complete research on the founding team of the accelerator program to ensure your success.
Therefore, a senior and experienced founding team at Accelerator with hands-on experience and strong industry connections at decision-maker (CXO) levels can help startups drive revenue growth.
Does Accelerator have an in-house fund?
Some accelerators invest from their corpus, while others act as facilitators. Accelerators providing funding from their corpus have more skin in the game and can be assumed to be more committed to startup success.
Many startup founders consider funding as the most significant criterion while choosing Accelerator. But this is not a good approach as there are ample of other funding sources like VC firms and Angels. Founders should choose accelerators based on the holistic value addition it brings to a startup journey.
Bottomline
Participating in an accelerator program seems like reaching the first milestone in the startup journey. But understanding the outcome of participating in the program before applying can push the founders toward growth and expansion.
