Welcome to The Startup Accelerator Survival Guide.
Before we get started, let’s talk a little about what exactly a startup accelerator is. Popularized in Silicon Valley, but replicated throughout the world, these are short-term programs focused on, you guessed it, accelerating a startup. This can mean different things but typically these programs pay some attention to helping a company scale its business metrics and secure funding after completing the program. This is not to be confused with an incubator, which is typically a longer-term program and an initiative with different goals. For example, a university will often have an incubator to develop student ideas or build technology that needs a lot more time and funding.
Although these two concepts are often interchanged I like to think about startup accelerators as educational, content-heavy, and hands-on programs occurring over 1-3 months, whereas incubators are much longer-term (sometimes taking place over years) and less hands-on. Let’s also not forget about startup labs, startup studios, corporate innovation programs, venture builders and so on. What can I say? We like to make up a lot of names in the tech industry. There’s nothing wrong with these other company builder models, but for the purpose of this book, we’ll be sticking primarily to the ‘traditional’ startup accelerator way of doing things.
Many of the ways startup accelerators work today can be traced back to the most well-known program, Y Combinator. To use techie developer speak, they are the ‘master branch’ and the rest of us are just a ‘fork’ of that branch. The humble origins of Y Combinator also reveal much about how accelerators took their current form, mimicking a summer school-like educational style format. The first batch was even named the Summer Founders Program and targeted students directly by offering the program (and investment) as a much better alternative to a boring summer job.
“Some friends and I have started Y Combinator, a new venture firm that specializes in funding very early stage startups. Our first project is the Summer Founders Program, an experimental replacement for the conventional summer job.
The SFP is like a summer job, except that instead of salary we give you seed funding to start your own company with your friends. If that sounds more exciting than spending the summer working in a cube farm, I encourage you to apply.”
- Paul Graham, Y Combinator Co-Founder March 2005
And with that announcement, Y Combinator was born. Paul Graham would later admit that they didn’t expect their first batch of companies to do very well. It was more for them to learn how to become good investors. Although there was one company in that first batch that has done fairly well. That company being Reddit, which has become one of the most visited websites in the world. However, through the course of that first batch, the Y Combinator founders learned something perhaps more important than how to become a good investor. They began to see the benefits of investing and working with multiple companies simultaneously, something that had never really been done before.
“Initially we didn’t have what turned out to be the most important idea: funding startups synchronously, instead of asynchronously as it had always been done before. Or rather we had the idea, but we didn’t realize its significance.”
- Paul Graham Y Combinator Co-Founder March 2012
Sometimes called a batch, or a cohort, this is the real essence of a startup accelerator program: A shared learning environment and the sense of community that it creates. It’s actually a very special feeling and perhaps the most important key to the success of your own program. If you can capture just an ounce of the excitement, pressure, and hard work found in programs like Y Combinator, then you’re probably running a decent program already.
That all being said, don’t feel you need to emulate Y Combinator or other leading programs to be successful. Learn from their experience but make sure to make your program your own. Don’t try to create ‘the Y Combinator of xyz’, instead create your own vision, investment thesis, and unique approach. This book will hopefully help guide you.