It’s all in the name — accelerators. Startup accelerators guide early-stage companies through education, mentorship, and financing, in a network-friendly environment that’s designed to accelerate the growth of your startup.
My company, Swing Education, was part of the ed-tech accelerator Imagine K12 which merged with Y Combinator in 2016. The experience as part of that accelerator was an integral part of catapulting Swing Education’s growth. But how do you know if an accelerator track is right for you? And, how do you stand out in a crowd of other startups to be accepted into an accelerator? Here are five pieces of advice:
Do Your Research
Accelerators are public about their application processes, so this part is fairly easy. They share details on what they offer their participants, and who they have helped in the past. Make sure the accelerators you are considering focus on your startup’s areas of need to help you get to the next level. Look closely at their board members and think about how their expertise could benefit your business.
Accelerators also offer you membership into a community that helps and supports each other. This is especially true in Silicon Valley. It is remarkable how much other company founders are willing to share. If you find an accelerator you like, reach out to some of their alums to ask for references. Find out how they benefited from being in the accelerator, and what they wished they had done differently while in it.
Believe in Yourself and Show It
Once you have decided on which accelerators to apply to, your next step is to believe in yourself more than anyone else. At the same time, seek to understand how others will form opinions about your business. This second step can be a little trickier than the first. Very few investors were actually operators themselves, but when it comes to the education space, many people believe they understand the market. This is a common theme — everyone has been to school, so everyone thinks they know what education needs. It is very much like the restaurant business — everyone eats at restaurants, so everyone thinks they know what can make a restaurant successful. Understanding these opinions will help you to strengthen your pitches in the future.
It is also important to know how your business aligns with what the accelerator is looking for. For instance, if NewSchools Venture Fund believes there is a shortage of products serving the English/Language Arts (ELA) or computer science curriculum, then the companies serving those areas will get priority from the accelerator. When pitching yourself to an accelerator, you have to be able to express in real terms why your idea exists and why customers are going to want it, as well as how your business fits into their interest areas.
Push Forward, Even Without Additional Funding
Don’t underestimate how much progress you can make without extra dollars. Entrepreneurs often say, “If I had the money, I would be able to do X, Y, Z.” While this is sometimes true, there are things startups can do even without money. For example, talk to your potential customers to better understanding their pain points. It’s free and can help you communicate the need for your product. Then focus on determining whether participating in an accelerator is really the best way to access funding for your company, and start by figuring out how much money you really need.
Show Them How You Operate
I often see entrepreneurs make the mistake of pricing a product based on what it costs them to produce it. Instead, you have to determine what people are willing to pay for your product. Y Combinator talks a lot about how to build something people want. If you have good usage metrics, in addition to revenue metrics, it can help others see how beneficial your product is. You will stop any investor in their tracks if you can provide revenue numbers that are larger than they expect. You also need to show them how you are going to make this your full-time job. They want to see that you are completely committed to making the business a success.
Listen to Advice
One of the worst things you can do while in an accelerator is to get advice, then ignore it. People might tell you that what you’re doing doesn’t work 9-out-of-10 times, but are you really going to count on being that 1-out-of-10 exception? Their advice typically comes from pattern matching (the best accelerator programs have seen a lot of both successful companies and unsuccessful companies.) The value in advice, even negative advice, is to make you stop and think. If you find yourself saying they are wrong, and they don’t understand the context of your product, then maybe you are wrong.
Accelerators are a great way to learn from those who came before you. When looking at the equity they want versus the money they provide, the real thing to look at is how much you will gain. If the accelerator takes 7 percent and you are even 10 percent better off after participating in the accelerator, then it is worth it.
If you have any comments or questions about this post, or if there’s any topic you’d like me to cover in the future, please find me on @edumiketeng or firstname.lastname@example.org!