On your pursuit to entrepreneurship, you have may have considered a variety of options:
- If your business is fairly low cost and time, then great, you can work on it in your own time.
- However, if you’re business idea is more complicated, then you may need some investment.
As well as money, you may need some help and guidance. This is where accelerators come in:
Accelerators are intensive entrepreneurial programmes that provide you with networking, mentorship, and finance over a short time period to help develop your early stage business.
Its purpose is to quickly build your idea and team so that you’re ready to pitch for funding.
In this blog, I talk about all the different types of accelerator programmes that are available.
I also talk about the positives and negatives associated with these accelerator programmes.
By the end of the blog, you’ll know which type of accelerator program, if any, is right for you.
Accelerator Programmes: An Overview
There are hundreds, if not thousands, of accelerator programmes for you to join worldwide.
They usually run multiple cohorts during the year depending on their duration. For example, a 3 month accelerator will run multiple cohorts a year, compared to a 12 month accelerator.
The main thing to note about accelerators is that they are usually a ‘full time commitment’.
That’s right, that would mean quitting your job in order to join an accelerator programme.
Their idea is that starting a business is a full time job, not something you do in your free time.
As a result, in order to continue living, they do pay you a stipend of around $2000/month.
It’s not much, especially if you were on a higher salary, but its only supposed to be temporary.
What this does is that it allows you to focus on your business without worrying about money so when you come to pitch your business to investors, you can secure much more funding.
Accelerator Programmes: Pros/Cons
Accelerators have a lot of advantages, but they also come with a few disadvantages.
For example, they’re a great entry way for those that want to become full time entrepreneurs.
Nothing is more rewarding then being able to dedicate all your time working on your business.
As well as that, you get to be part of a community of like-minded entrepreneurs and mentors.
You get to build a founding team for your business and even get to pitch to future investors.
As for the disadvantages, they are hard to get into unless you have some business experience.
This is also not something that you can do part time, which means quitting your job. Even though they pay you during the programme, there is no guarantee you will get funding from investors afterwards, which means you either go back to work again or seek other investment.
If you do get funding, you can expect investors to take around a 10% equity in your business.
Idea Based Accelerators: Explanation
The main type of accelerator programme that you will come across is idea-based accelerators.
As the name suggests, you must already have an existing business idea to join the programme.
An example of this is Techstars, one of the largest tech accelerators with a global presence.
To join this accelerator, it is expected that you already have some business already set up.
These type of accelerators tend to range from 3-6 months, depending on the programme.
The reason why they are so short is because you’re not still coming up with a business idea.
You may already have a team with you also and are therefore getting it ready to be investable.
These type of accelerators are a full time commitment, for not just you but your team also.
As a result they will pay you a stipend to cover living expenses for you and your business team.
By the end of the programme, you are in a better position to pitch your business to investors.
Idea Based Accelerators: Pros/Cons
The main pro with this type of accelerator is that it’s the main type of accelerator worldwide.
So if you already have a business idea, and are looking for funding, you have a lot of options.
These programmes are much shorter, 3-6 months, because they bypass the ‘ideation’ stage.
The premise is that you are in the ‘validation’ stage, not still having to come up with an idea.
As well as that, these programmes are easier to get into because you already have a business.
The main con with this accelerator type is that it’s only for those that already have a business.
If you are a budding entrepreneur but don’t have your own idea, you won’t be able to join.
Because this is the main type of accelerator, you will struggle to find a pre-idea accelerator.
As well as that, these type of accelerators tend to cater more for high technology companies.
Unless you’re developing an app or AI software, you’ll struggle to join this type of accelerator.
Talent Based Accelerators: Explanation
The least common type of accelerator (but getting more popular) is talent based accelerators.
These type of accelerators don’t require you to have a business idea in order for you to join.
An example of this is Entrepreneur First, an international accelerator with cohorts worldwide.
Entrepreneur First really set the popularity for more talent based accelerator programmes.
The idea with these programmes is that you just come as yourself; no existing idea or team.
During the cohort, usually 3-6 months, the first step is to find cofounder for your business.
The idea is that if you are technical, they pair you up with a business person, and vice versa.
From there you then come up with potential ideas that match your skills and areas of interest.
These are full time programmes also, which means they will also pay you during its duration.
At the end of the programme, you and your cofounder pitch your idea to potential investors.
Talent Based Accelerators: Pros/Cons
The first pro with these programmes is they help get your foot in the entrepreneurial door.
If you want to be an entrepreneur, but don’t have an idea, this type of accelerator is for you.
As well as that, you get to create a team from among a group of like-minded entrepreneurs.
Not only that, but you get to pick and choose until you find someone who is a right fit for you.
As a result, you get to come up with an idea together, rather than you having to on your own.
The main con with these type of programmes is that they are extremely difficult to get into.
Because you are not coming with an idea, these accelerators are taking on quite a big risk.
Therefore these programmes look for certain skillsets in your applications before accepting.
As well as that, you have to work with a cofounder, even if you don’t get on with any of them.
I’ve heard people spending a lot of time finding a cofounder instead of working on the idea.
Mission Based Accelerators: Explanation
Another emerging type of accelerator is mission driven/problem led accelerator programmes.
These type of accelerators are for people that want to work on a specific problem they specify.
An example of this is Zinc, a mission driven venture builder accelerator located in London, UK.
Each year they specify their mission for cohort, which is usually based on emerging problems.
These type of accelerators tend to be longer in length, 6-12 months for most programmes.
Depending on the programme, you can either join with your idea if it matches the mission.
Or you can join as an individual, create a team, and come up with an idea that fits the mission.
The type of missions you tend to expect are the emerging topics that would hear day to day.
Sustainability, mental health, and climate change are some of the missions that come to mind.
These accelerators tend to find more investors if they focus their missions on these key areas.
Mission Based Accelerators: Pros/Cons
Mission based accelerators are great if you are passionate about the mission of the cohort.
If these missions really resonate with you, then you will have no issue in solving a problem.
Not only that, but get to work with like-minded people who also believe in the same mission.
If you already have an existing business that fits this mission then great, then even better.
Otherwise you and your team can come up with solutions to problems that fit the mission.
However, what if you aren’t particularly passionate about the mission, what do you do then?
Unfortunately there is nothing you can do, other than wait until another mission comes up.
You may have a great idea, but unless that idea is related to the mission, then it’s no good.
Now a days, investors are not only interested in profitable companies but those that do good.
it’s in your best interest to solve problems in the areas of sustainability, climate change, etc.
Part Time Accelerator: Explanation
This last type of accelerator isn’t really a traditional accelerator, but it has the same features.
This type of accelerator is for people that want to be able to work part time on their business.
An example of this is the Young Innovators Programme, a programme aimed at young people.
This programme is really the first of its kind, as I have not found any other accelerator like it.
The idea with this accelerator is you’re only required to work 15hrs/week on your business.
This is equivalent to 2 full working days, which you would be paid for by the programme.
The other 3 days of the work could be spent at your regular job, if you negotiate that option.
This accelerator is more for solopreneurs where you won’t be working to find a cofounder.
This programme is also a year in duration, full of training sessions, mentorship, and support.
During the year, you get your business idea ready so that you can pitch for funding at the end.
Part Time Accelerator: Pros/Cons
This accelerator type is great for those that don’t want to quit their jobs to join a programme.
It means that each week, you get to both work at your current job as well as on your business.
It’s also a big of a leap to go from working full time to part time, compared to quitting entirely.
It also gives people peace of mind that they still have their job should their business not work.
By the end of the programme, they have the option to go back to full time work if they choose.
The main con for type of accelerator is that its for those who are happy being solopreneurs.
Yes you get to meet your cohort, but not to create teams, as you each have your own idea.
That’s the other issue as well, you need to have your own ‘innovative’ idea that fits their brief.
Because this is a one-of-a-kind programme, you can imagine its quite difficult to be accepted.
Final Thoughts
I hope this blog gives you a good understanding of the world of accelerator programmes.
I hope you see the different types of accelerators and which, if any, are right for you.
Me personally, I like the idea of part time accelerators, so I don’t have to quit my job.
However I don’t like the fact that you need to have your own idea and get to work alone.
To learn more about accelerators, check out this book: Startup Accelerators: A Field Guide.
It’s a great in depth resource for those considering in joining an accelerator programme.
Overall, I think accelerators are a great way to achieve your goal of becoming a founder!
Do you have any experience with business accelerators? Please share in the comments below!
If you enjoyed reading, check out my blog: The Rise & fall of WeWork: what can we learn?
If you have any suggestions for future blog topics, please share in the comments below!
