Do you know what you are getting into?
Thinking of applying to an accelerator? Ask yourself these five questions first.
Generally, an accelerator provides a small amount of seed money, from $20,000 – $100,000 for a small amount of equity, from 5-15 percent. Some accelerators, often those associated with universities, provide no funding and take no equity. All accelerators offer some type of mentoring, often in the form of classes and workshops as well as one-on-one feedback. Most provide co-working space.
Is it worth it to you?
Speaking to current and former accelerator participants, they raved mostly about the connections that they received. The two big benefits everyone mentioned were opportunities to discuss design and development with other entrepreneurs and being part of a network of that could introduce them to everyone from investors to potential key employees.
On the other hand, they said that the perks some accelerators cite in selling themselves to entrepreneurs – “$50,000 worth of free and discounted services” – were often not worth much. If a business was already incorporated, the availability of free legal assistance to incorporate wasn’t helpful and many weren’t at the stage where they needed $1,000 a month of server space.
Can you do it?
At the Kaplan EdTech Accelerator info session last April, both “alumni” companies mentioned finding during the accelerator program that one of their co-founders was just not a fit for the company. That is definitely a lesson to be learned sooner rather than later, but it’s a painful one, nonetheless.
The typical accelerator program is 3-4 months and requires the co-founders be on-site for the duration. So, if it is in New York City or Silicon Valley, be prepared to move, at least temporarily.
“The goal of the accelerator is to help a startup do roughly two years of business building in a few months,” Mike Bott of The Brandery.
You’re going to need to be able to put everything else in your life on hold.
You need a product. Make something. Accelerators don’t invest in ideas.
Are you aware that the odds are against you?
“Less than 1% of venture-backed start-ups have a Latino co-founder.”
That is a really depressing statistic, especially given that accelerators say over and over that the best way to get into an accelerator is to be referred by someone in their network. Go into this with eyes wide open. The odds are probably against you, but all accelerators do back companies with which they have no previous connection.
When can you start?
Like everything, you can do it one step at a time. Our team at 7 Generation Games put together a six-month plan to be “accelerator-ready”, everything from finishing off other consulting contracts to free up our time to having an updated Angel List profile.
Don’t even know how to get started? The best resource I’ve found is this Google Hangout from Launch LA on How to Get Into an Accelerator.
Author’s bio: AnnMaria De Mars, Ph.D., is CEO of 7 Generation Games. She’s a world Judo champion and some call her abuela. Her biggest hobby includes breaking stereotypes.