Startup accelerator: Difference between revisions

Revision as of 15:30, 26 September 2022

Revision as of 18:58, 2 October 2022

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{{Short description|Company that invests in and supports startups}}

'''Startup accelerators''', also known as '''seed accelerators''', are fixed-term, [[Cohort (educational group)|cohort-based]] programs, that include [[mentorship]] and educational components and culminate in a public [[sales pitch|pitch]] event or [[demo day]].<ref>{{cite journal|last=Cohen|first=Susan|title=What Do Accelerators Do? Insights from Incubators and Angels|journal=Innovations|year=2013|volume=8|issue=3–4|pages=19–25|doi=10.1162/inov_a_00184|doi-access=free}}</ref> While traditional [[business incubator]]s are often government-funded, generally take no equity, and rarely provide [[funding]], accelerators can be either privately or publicly funded and cover a wide range of industries. Unlike [[business incubators]], the application process for seed accelerators is open to anyone but highly competitive.<ref name="accelerating-studies" /> There are specific accelerators, such as '''[[corporate accelerator]]s''', which are often subsidiaries or programs of larger corporations that act like seed accelerators.<ref>{{cite web |url=http://techcrunch.com/2014/08/25/corporate-accelerators-are-an-oxymoron/ |title=Corporate Accelerators Are An Oxymoron |last=Crichton |first=Danny |date=2014-08-25 |access-date=2015-06-17 }}</ref>

==Distinctive qualities==

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# Seed [[equity investment|investment]] in [[Startup company|startups]] is usually made, in exchange for equity. Typically, the investment is between {{US$|20000}} to {{US$|50000}} in the US, or {{GBP|10000}} to {{GBP|50000}} in Europe.<ref name="accelerating-studies" />

# The focus is on small teams, not on individual founders. Accelerators generally consider that one person is insufficient to handle all the work associated with a startup.

# 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 "''Demodemo Day''day", where the startups present to investors.<ref name="gilani21">{{cite web|last=Gilani|first=Aziz|title=Incubators in US and Europe - Speed and scale in capital formation|url=http://www.slideshare.net/dgiluz/accellerators-in-us-and-europe/21|publisher=Kauffman Fellow Program|access-date=14 September 2012|author2=Dettori, Gianluca |date=Jul 16, 2011|page=21}}</ref>

# Startups are accepted and supported in cohort batches or classes (the accelerator isn't an on-demand resource<ref>{{cite web|last=Christiansen|first=Jed|title=Seed Accelerator Definition|url=http://www.seed-db.com/about/view?page=definition|access-date=14 September 2012}}</ref>). 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.

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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.<ref name="accelerating-studies">{{cite book|title=Accelerating Success: A Study of Seed Accelerators and Their Defining Characteristics|date=May 2012|___location=Gothenburg, Sweden|url=http://acceleratorstudy.com/|author=Lisa Barrehag|author2=Alexander Fornell |author3=Gustav Larsson |author4=Viktor Mårdström |author5=Victor Westergård |author6=Samuel Wrackefeldt |access-date=14 September 2012|publisher=[[Chalmers University of Technology]]}}</ref>

Accelerators provide enough funding to get a company to ‘Demodemo Dayday,’ from which point the startup is on its own.<ref>{{Cite web|last=Kronenberger|first=Craig|date=2021-03-29|title=What Startup Model is Right for You?|url=https://medium.com/startup-studio-insider/startup-studios-vs-accelerators-82b8545aba0a|access-date=2021-05-07|website=Medium|language=en}}</ref>

==History==

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*[[Business incubator]]

*[[Corporate accelerator]]

*[[:Category:Startup accelerators|List of Startupstartup Acceleratorsaccelerators]]

== References ==