So… Accelerator or Incubator?
As a startup founder trying to get your venture off the ground, you might consider finding ways to ramp up your progress. During your googling session, you’ll most likely come across both incubators and accelerators as possible options. Every founder has differing beginnings so this question requires an honest evaluation of what you’ve accomplished and your rate of progress. While some incubators and accelerators have a high cost of entry or have requirements you may not meet, don’t be discouraged, you just haven’t found the right fit yet. If you are currently in a place where you know you can implement outside help it’s time to find out what will benefit your venture the most – incubator or accelerator?
First, let’s break down the difference between an incubator and accelerator. To keep it simple, incubators give resources for you to do the work yourself while accelerators do the work with you. Ventures whom choose to enter incubators typically “graduate” to accelerators, once they’re ready to scale. Incubators assist with the beginning stages of guiding the idea into an actual project. Accelerators take the project you have already concisely developed and “accelerate” the progress to gaining capital more efficiently.
If you’ve seen HBO’s hit show Silicon Valley, you may have a pretty good, albeit, somewhat over-the-top idea of what incubators do for startups. If you haven’t seen the show, maybe you have heard of popular incubators such as SEED SPOT in Arizona. They accept startups in the very early stages of their lifecycle, typically just after the ideation stage, to start gaining traction.
What to expect from an incubator:
- Provides resources and tools you may need to build out your minimum viable product
- Guidance from a network of mentors and professionals who are adept at nurturing ideas through earliest phases of development
- Coworking space with other founders will actively be working on their projects
- Free coffee, maybe a ping pong table if you’re lucky
Much of this is given in exchange for a piece of your company and an upfront fee. Similarly to the show Silicon Valley, depending on the incubator and the prospective valuation behind the idea, incubators may even pay for living expenses or office space. The amount of time a startup spends in the incubation phase can vary drastically, depending on how far along you are in the development of your concept. This is where the honest evaluation of your current startup progress comes in.
Startup accelerators accept applicants who have proof of concept and are ready to scale. Accelerators make the most of everyone’s time with direct consulting and mentorship in order to do the work of a 2-year business plan in a span of months. Popular national accelerators you most likely have heard of include Y Combinator, Techstars, and 500 Startups.
What to expect from an accelerator:
- Large mentorship network consisting of entrepreneurs to VCs eager to assist younger startups through the accelerator process
- Hands-on consulting
- Events, fundraising, demo day, etc.
- Workshops and mentor meetings
- More direct assistance in increasing the valuation of your company
- Specialized service providers in each stage of raising capital
So is an accelerator or an incubator most fitting for you? If you are still in need of perfecting the original idea into practicality, maybe working alongside other entrepreneurs in the same position as you is the best route right now. On the other hand, if you have taken your “aha” moment to the next step and created a proof of concept, it might be time to look into an accelerator.
If you are looking for the accelerator route, finding the right one for you is the next step. Note that accelerators only accept certain ventures, so it is important to research where you want to be accepted and where you realistically can be accepted. Startup accelerators can vary in size and quality and can be industry-focused. For example, Cedars-Sinai created an accelerator to support the growth rate of healthcare innovations. In Arizona alone, there are over 20 accelerators offering diverse amenities. Research into the accelerator and connect with the people within the program itself. As you will be communicating back and forth with these people on a daily basis, you should probably make sure these are the people you want to be working with.
Aha To Exit’s Cloud Accelerator
Our company, Aha To Exit, offers its own affordable cloud accelerator known as The Reef ™ – Cloud Accelerator. The Reef isn’t the most orthodox accelerator; it is known for being a “cloud” accelerator. In addition to being cloud-based, The Reef™ is also a hybrid between an accelerator and incubator program. This means we take the current status of your idea and immediately start working on it with you, providing everything needed for foundational, validation, growth and operational IP, all online not dependant on your venture’s current stage. The Reef helps build the IP inside the company that will increase valuation drastically and decreases failure through each step of the Startup Roadmap.
Aha To Exit’s Startup Roadmap was created by the CEO, Aram Chavez. Chavez is widely known for being rated as one of the top professors at the #1 university for innovation in the country, specializing in entrepreneurship and entrepreneurial finance. He is just one of the outstanding mentors within Aha To Exit’s cloud accelerator program.
As Arizona’s startup community is exponentially growing, I encourage you to get involved as well. Aha To Exit hosts monthly events that welcome anyone and everyone and can be found on our Facebook page. These events are open to the public and give founders the opportunity to chat with other entrepreneurs and interact with the Aha To Exit team. Feel free to chat with one of our team members and check out the Aha To Exit website and The Reef – Cloud Accelerator website to familiarize yourself with our local startup program.