With the recent Thanksgiving holiday here in The States we took some time to reflect on why we are thankful for startup accelerators and why we’re so excited to be working with them.
If it weren’t for the modern day accelerator many interesting companies would die on the vine. The capital provides critical support at the most important time of the company life cycle, early product market fit. You don’t need a ton of money to do customer discovery, but you do need a small stipend to build an MVP. In most cases you can build that first product for as little as $20,000. Though, $40 — $50K is more reasonable if you are outsourcing.
The guidance provided by accelerators both internally and through their mentor ecosystem provides founders with valuable experience and insights they otherwise may not have had. These resources help startups find opportunities faster and avoid mistakes that may set them back in both time and money.
Because accelerators mostly bring people in to cohorts or batches at the same time founders are able to develop meaningful relationships within the local business ecosystem and beyond. These relationships help teams in hiring, finding customers, developing new ideas and in many other ways. Founders will often find that the relationships developed during their time at the accelerator help their business more than anything else.
Accelerators help teams build a legitimate business. This hasn’t always been the case, but as accelerators mature they are producing companies which solve real problems, not companies solely seeking a larger funding round. Attending a well known accelerator program, in many cases, offers startups enhanced credibility. They can use this credibility to win over new customers and hire better talent. You could almost call the credibility a currency that startups use to barter their way to success.
Many times startups focus on just building something, anything. Unfortunately, this is the wrong strategy. Accelerators help their companies focus on developing competitive advantages from the outset by encouraging and guiding companies to thorough and ongoing customer discovery throughout the entire company lifecycle. This customer centric focus helps startups understand exactly what they need to build and exactly what is going to give them that sustainable competitive advantage.
When it’s all said and done the right accelerators are offering so much to startups at such a discounted price it makes more and more sense to consider an accelerator program for your earliest stages. If nothing else, the application process alone makes teams think through a myriad of tough questions about their actual business.
This time of year is fun to sit back and reflect. The more we think about accelerators and what we’re building at Outset to champion your cause, the more excited we get. Accelerators are truly at a historic turning point in innovation. One day in the not too distant future people will look back and acknowledge that accelerators played a pivotal role in the new innovation landscape.
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