Recently, this post about our evolution came out from Techstars. Of course, as Chairman, I know of, and strongly support, the strategic changes that are happening at Techstars. We are strengthening our ability to invest in more startups and their founders than any other company in the world. And helping founders be successful has always been our goal.
I also knew that people would be sad about us no longer running accelerators in certain markets. I was personally absolutely super sad about closing the original Techstars accelerator location in Boulder after this next class, as well as Seattle (another of the original locations.) The most common reaction that I heard was that people were bummed or sad about it, but understood that business decisions get made. But people were trying to understand the “why” behind the business decisions.
This leads to the second most common thing I heard, namely that people didn’t really like the messaging, partly because it didn’t satisfactorily address the “why.” I know the team has taken that feedback constructively. For those of you in Boulder or Seattle that interpreted the communications as a disparagement of the startup community and its impact – that was definitely not the intent. We’re sorry for that.
So… the question remains, why close certain accelerator locations?
First it is important to note that different Techstars locations also have different funding sources. We’re only proactively shutting down some of the program locations that are funded by our Techstars Accelerator Fund (TSA), which historically has funded programs in a dozen cities. Instead, going forward, TSA will concentrate on funding a larger number of companies through programs in four primary cities. The separately funded partner accelerator programs which operate in more than 30 locations worldwide are unchanged. So in 2024 we will still run more than 50 cohorts in 30+ locations globally and into the foreseeable future.
Second I’ll refer you back to our original post on this which is a better source of information than social media, which says:
“We know that founders are more likely to succeed when they are plugged into a thriving ecosystem — because no one succeeds alone. So we’re doubling-down on running in-person programs in the largest tech ecosystems so entrepreneurs can be surrounded by the highest concentration of VCs, startups, talent, mentors, and support.”
By expanding our presence in these top markets (SF, NY, Boston, LA), we can better support all of our portfolio companies for the coming decades. This might feel like a departure from our roots of starting programs in a large number of startup communities, but over the last 17 years, the world has changed. More business is being done virtually, communities are more interconnected, and a physical accelerator in a particular city is less important than building the best possible support for founders located there. Ultimately, if founders from everywhere and anywhere are going to succeed, we need to help plug them into these larger ecosystems with the most vibrant and robust VC communities, largest talent pools, and significant numbers of other early and late stage startups.
In addition, as Techstars continues to become more efficient operationally, we decided to consolidate our Colorado activity in Denver rather than running operations in both Denver and Boulder. We recently opened a new office in downtown Denver where we will operate our Colorado-based Workforce Development accelerator and it will serve as an in-person hub for more than 65+ Denver/Boulder employees. They are not being asked to move or relocate. We did however change our Headquarters: our primary mailing address and office is now NYC instead of Boulder. Most of our executive team and more than 50 employees are in that region. New York is the second largest VC ecosystem in the world and officially making it our HQ connects Techstars with more sources of capital, other VCs, founders, talent and market-reach.
I expect that new opportunities will fill the gap to support founders and their startups in places like Boulder and Seattle. These places have grown and evolved in the last 17 years also. I’m excited to see who steps up and what they accomplish. Techstars also hopes and intends to continue to play a role in this evolution – just not primarily through accelerator programs. We will continue to support and invest in our existing portfolio companies in these locations and will continue to source and fund new companies in these locations also.
I want to thank the large number of you that texted, called, or sent incredibly constructive notes to me or to the team, asking questions, seeking clarification, giving the benefit of the doubt, or privately expressing frustration. That stuff is so useful and appreciated, and I know it can be hard to do. The Techstars community is made up of incredible, well-meaning, and outstanding people who consistently take the high road, and, with a few exceptions, everyone did exactly that. It’s humbling and appreciated.
I also want to thank those of you who contributed to these particular startup communities over so many years as mentors, service providers, founders, investors, employees, and more. While our support in some communities is changing shape in some cases, it’s certainly not going away. Nor is our appreciation for you. We hope you will continue engaging with Techstars via our virtual programs, local community events, or the dozens of accelerator programs active in other locations.
Techstars is evolving, and looking at 17 years of data, across 4,000+ startups we’ve invested in. Brad Feld, myself, and David Brown (3 of the founders) are still active as board members. Our objective in evolving the business is the same as it’s always been, to help more founders succeed. That’s why we’re evolving, changing, growing. But that can be hard sometimes, and mistakes can be made. I love Nicole Glaros’s analogy that it’s like her kid going off to college – it can be sad, but they too are growing and evolving.
Comments are open, and I’m happy to answer any questions you have. If you want to talk, just let me know!
