Why you should apply to a startup accelerator in 2012

Recently I heard some rants about startup accelerator programs.

As a big believer in the acceleration process, I had to explain why I recommend joining such a program.

First, the rant:

Here are some of the arguments against joining accelerators*:

1. If you are good enough to be chosen for the accelerator investment, it was likely Angels and VCs would have invested in you anyway. Just send them an Exec summary. You get the result you wanted, without giving 6-10% to an introducer.
2. It is time-consuming to apply - spend that time building product
3. If you are desperate for cash and think you have what it takes, go direct to Angels and VCs.
4. If you want PR, write a press release, email it to all the blogs and newspapers, and then tweet.
5. If your product isn’t ready, you know that already. You didn’t need an accelerator application process to tell you that. Customers will tell you that (you are talking to potential customers, right?)
6. For all those people with an ‘idea’, think about this: Can you execute the idea right now? No? Ok, can you execute the idea FULLY with $15k? Not likely. So your problem is you need to get to the stage where you are ready to execute. Either you need to learn to code, design or convince people who can that you and your idea is right. All things you cannot do in an accelerator (plus the accelerator would not consider you before you do these things anyway…) 

Here are my arguments in favour of accelerators:

1. In 3 months at an accelerator program, you will be able to achieve more work than you ever thought you can (around 3 times more than what you achieve regularly).
2. Accelerator is a due diligence for investors. Investors will more probably invest in your company and give higher valuation for accelerator graduates. After all, it’s harder to get into a top accelerator than into Harvard or Yale.
3. You have a brand behind your startup - it makes it easy to open doors in the future.
4. The heavy mentorship allow you to shape your product in the right way, instead of failing over and over again till you reach the right product or give up.
5. It’s not about the money, it’s about creating a better product and becoming a better entrepreneur.
6. The equity given is not an issue. The valuation is what really matters. So if for example the accelerator doubled the valuation of your company,  you can now give away half the equity for the same amount of capital.
7. Networking - you create a huge network of supporters and of connections that want you to succeed (mentors and other startups that participated). Your success is their success. So therefore they will work to make you successful.

My suggestion for 2012: Apply to one of the top accelerators, and give your startup a boost into space.

Nir

* Arguments against - based on Rayhan Omar

Four reasons why the 2011 Seedcamp USA Tour rocked our world (aka: why you should finish your Seedcamp application ASAP)

(EDIT 25/03/2011 - with the annoucement of the Seedcamp Facebook partnership this should now really be 5 reasons.)

Offset Options kind of stumbled across Seedcamp originally, we didn’t know who they were or what they really did. To be honest it was late in the day one afternoon just before submissions were due for Seedcamp Barcelona 2010 and I was leaning more towards meeting up with friends than finishing this random application form. Fortunately, I finished the application and to cut a longish story short ended up on the 2011 Seedcamp USA tour.

 

There were obviously a few stops in between, i.e. we were selected as one of the winners from Mini-Seedcamp Barcelona (along with rockstars Robot Media), invited to Seedcamp Week last fall and were a selected as a 2010 winner.

 

And getting to the point, here are the top reasons the Seedcamp USA tour rocked our world:

 

1. ACCESS

 

(on the NYSE trading floor for the ringing of the bell)

A quick list of some the companies whose offices we visited and some of the many more we met in mentoring / networking events / personal meetings etc.:

 

Foursquare, 500 Startups, LinkedIn, Twitter, IO Ventures, Amazon, Microsoft, Sequoia, Google, MassChallenge, Sermo, Atlas Ventures, Union Square Ventures, NYSE, MongoDB / 10gen, AOL, Sandbox, ERPLY, General assembly, plus many, many more.

And in the companies we visited, we had more than just a tour of HQ - we had ACCESS to the right people. There is access and there is ACCESS. For the majority of the meetings, we had senior staff available for us to explore any questions / partnerships / technical questions you can fire at them. I have to specifically admit Google, Facebook and Amazon blew me away with this. Such openness, engagement and support from companies that have big things on their plate right now. This is not normally possible when traveling on Biz Dev and Partnership trips, especially when you are an early stage company (even later stage companies would kill for this!).

2. FEEDBACK

(vox.io & @davemcclure & Anil)

Being part of a supportive network is a fundamental element of Seedcamp. The mentoring, as always, was great. We had access to a few hundred exceptional mentors over the four sessions in NYC, Boston, San Francisco and Mountain View. This is particularly useful for early stage companies trying to work out how relevant the concept is to the US market.

3. INSPIRATION

(Seedcamp crew checking in @foursquare)

Meeting companies trying to change the world with amazing staff who can achieve the vision  is always a privilege. Sermo, Facebook and Google were all kind of mind-blowing in their own ways. All provided us a perspective that I didn’t expect. Sermo was so genuine, FB and Google so eager to engage.

4. ENTREPRENEURSHIP

(pitch training @blackboxmansion)

A key take away is also the shared entrepreneurship experience. Starting a company can be an isolating exercise. Being able to travel around the USA and be able to get to know the other SC teams and the SC team itself - who are also on an entrepreneurial journey - was a once in a lifetime opportunity and an invaluable boost of moral support.

To see the strengths of our colleagues, gain their feedback and have very impassioned chats about different parts of our growth (often over a beer or 4) as people trying to build companies is one of the most valuable outcomes. It is very hard to manufacture this experience and make it genuine - but we did it.

 

I believe the SC teams of 2010 & 2011 are now connected with a sense of common purpose and will be providing greater support and engagement with each other, as we all work to build significant companies.

Some other standouts and quick mentions

> Sermo

 

This is the most memorable company visit for me on the trip.

 

The self-awareness of the staff but particularly the CEO, Daniel Palestrant, was amazing. This in one of the events that really resonated with me, in trying to build a business on a much more personal level.

 

So much discussion naturally focuses on the sexy elements of entrepreneurship - financing, biz dev and tech. The area of creating and leading a company is an area we have covered less and Daniel’s articulation was particularly eloquent.

 

> 500 Startups

The 500 Startups event was a standout as there was a delightful cross over of early stage companies pitching and giving feedback to each other. This was an open session where we received many frank but useful comments. I believe a few of the presenters made a real transition with their pitches.

warning - A warning to anyone going to this in future – Seeing Reshma Sohoni and Dave McClure taking turns pushing around each other’s startups is a spectacle.

 

> mygengo.com

On a side note, while at 500 Startups, Dave mentioned GoGengo.com for translation services. I sent their details back to Offset Options HQ for review, my team came back two days later saying they are fast, cheap and high quality. So we will be working with them from now on and are loving their service. These guys are Japan-based so our thoughts are with them on a personal basis as well.

 

> The END @SXSW

Perfect way to wind down at the end of the trip. There is no better way to finish a tour of the USA than the chaos of nerds and free beer as far as the eye can see and a last bit of bonding between the teams before heading back Europe. There were infinite sessions - Seth Priebatsch’s Gamification keynote was the standout.

 

From Offset Options, we loved the rising focus on Environmental aspects of technology and how this is becoming core business for global companies.

We have to give a shout out to Chinwag for great food and generally providing great support to Seedcamp @SXSW

If you want more insight into how to deal with SXSW for those who have not been, or those who wish to get more out of the event check out our friends at CultureSlurp

> Carlos’ (@ceduardo) Movie Tour of NYC

If you are thinking bring it, I want some of this action, Seedcamp Berlin applications are still open until 27th March.

 

If you want to read more about the Seedcamp USA Trip 2011 check out the following:

• Tomaz from Vox.io Part 1
  
• Tomaz from Vox.io Part 2
  
• Seedcamp Team blog about the trip 
• List of teams on the tour

 

Cheers,

Luke & the Offset Options Team

@OffsetLuke

a little update

Wooohhooo… what a ride. Things move quickly lately. To give you a short update: we are now ‘zeitraum’ and we are very happy to join Seedcamp next week here in Berlin!