By Ryan Shuken, a growth-hacking Expert in Residence at Chinaccelerator
Choosing an accelerator is an important decision you will make in your company journey. Here are some of the lessons I learned during my journey going from participating in an accelerator to running one as the Program Director.
You need to think about your expected return as an opportunity cost as well as the long-term benefit to your success. Not only are you making an extremely risky bet with your time and your energy, but you’re doing it with people who all make similar promises. They promise to help you build your company and solve your problems in exchange for equity. How you approach this decision can make or break your company. Breaking your company, or your own assumptions, is actually one of the qualities of a good accelerator program. An accelerator will want to push your team so you find what fails fast and pivot when you have the resources needed for success. This may mean you will find your entire business thesis is wrong, but it’s better to fail fast than it is to slowly die and fade away.
As you approach an accelerator, it may feel incredibly intimidating because you’re honestly opening yourself up to mentors and advisors to help build your dream. For our startup, we were looking for rapid growth with a partner who we could trust — someone with experience in the market, and someone who also aligned with our goals. This process is incredibly important and vital to the next stage your business, as you cannot risk making a wrong decision here.
For our startup, I knew that the opportunity required us to be in China, but the issue was that we didn’t have any network. In 2013 we started our search to join an accelerator program. Accelerators were still a new concept, and fundamentally different than incubators. The difference became defined in the program design: it’s like a boot camp for startups or a condensed MBA. Many offer 3 to 6 month programs. We started by identifying our biggest known unknowns, and searched for a program fit based on three criteria.
- People —
- Network —
- Resources —
A VC will vet your idea, your team, your numbers and your potential, but most of all your people. Why shouldn’t you do the same? Look at the people who run the program. Who are they? What are their experiences? How incentivized are they to give you everything they can to help you? Are you a data point or are you a partner? We found that larger programs had so many teams in each batch that we didn’t believe it was likely to connect completely with the program team. We opted for a smaller batch program. We also found a program where everyone who worked at the program got some shared carry. This was incredibly important to us because we knew that it wasn’t just the Director that was getting carry — the entire staff was incentivized towards our success.
A program with a proven track record and a credible network was a requirement for us. We knew that we knew nearly nothing about the perils that we could possibly face in the China market. We needed advisors who had conquered and excelled in this environment. An accelerator’s mentor network is a window into it’s experience, it’s story, and what opportunities it can bring you. How specific in skill, or vast in life experience is the accelerator’s network? That’s what speaks to the possible value you can gain. Warm introductions to the perfect mentor can drastically change the future of your company for the better. Out of the 260+ mentors in the Chinaccelerator community, we identified perfect matches for our startup before we applied. Those mentors can even turn into key investors and life advisors when things get tough. Like in any network, you get out what you put in, but you can think of it as a numbers game. The largest most qualified network for your startup is best — for us we went with Chinaccelerator.
This is one of the most important factors in not only deciding if you should join an accelerator, but if they should accept you. Does the program have the ability to give you what you need? In short, is the fit right? After I transitioned from participating in an accelerator to now running one, I learned this lesson firsthand. For my accelerator program, MOX, we focus on fit. Can our ecosystem, our network, and our experience help give you an unfair advantage? If we can’t, I highly recommend you find the program that does. At the end of the program, you becoming investable as a company is one of the most important goals. The investor network and investment track record at the end of the program is a key focus for any startup.
Analyzing your own “known unknowns” and focusing on what program gives you the best unfair advantage is the key to choosing the right program for your startup. I hope this perspective can help startups succeed in any program.
Originally published at sosv.com on April 18, 2017.