(This is first in a series of 10 blog posts from my interview with Scott Gerber for the Inc.com Founders Forum. We discussed a bunch of topics including choosing an accelerator, mentoring, acquisitions and the tech talent shortage. You can watch all of the videos on Inc.com.)
Not every founding entrepreneur at the early stages should look for an accelerator. Only you can really make that determination. Here are a few guidelines for deciding if an accelerator is a good idea for you, and if so, how to select the right one.
Should you apply to an accelerator?
Here’s the video in full, and below are some of the highlights.
The biggest reason to apply to an accelerator is for the network. Most people aren’t doing Techstars for the $100K, they’re doing it for the people they get to surround themselves with and the deep connections they build. They’re doing it more for the $1B in follow on capital that has been aimed at Techstars companies. And for the amazing people in the network already. If you believe that a network can be additive not just for the company you’re working on, but for your entire career, then an accelerator can be an excellent choice.
If you’re truly open to honest feedback, and looking for new ideas, an accelerator is a great place to find that. You can get rapid fire feedback on what you’re doing from a community that wants you to win. You’re surrounded by 100 smart people who have done it before, and they have an opinion about what you’re doing. It doesn’t mean you’re wrong and they’re right, but you have to be open to other points of view. You get a lot of data points to help you figure out what you’re doing that makes sense and what doesn’t. If, on the other hand, you have tunnel vision and are positive that what you’re doing is right and nobody could possibly change your mind, an accelerator is probably not a good idea for you.
How do you choose an accelerator?
There are a lot of accelerators now, with new ones being created every day. Not every accelerator is right for every entrepreneur, and some may not be reputable. If you’re searching for a good fit, here are some things to consider:
- Look for something that is established and has funded some companies.
- Talk to founders who have been through it and get their honest opinions about the positives and negatives.
- Take a look at what’s provided by the accelerator.
- Look at the track record. What were the outcomes of the companies that have been through the program?
- Most importantly, look at the network around it.
Watch out for these red flags.
- Lack of transparency: If you try to research the above items and you can’t get any information, that indicates they have something to hide.
- Unreasonable terms: The accelerator takes 15 percent equity for a 25K investment.
- Wrong people at the helm: If the people running the program aren’t entrepreneurs with operational experience, they probably won’t provide much value.
For more thoughts on this topic, check out the next segment: How to Choose an Accelerator (coming soon).