Accelerator

Definition

An accelerator is a temporary program in which start-ups are supported in building their company through intensive coaching and mentoring. The aim of an accelerator program is to accelerate the growth of an existing business model and to develop a market-ready product or service together with the start-up as quickly as possible. This distinguishes an accelerator from an incubator, which initially focuses on developing the business idea. Due to the short duration of an accelerator program, usually three to six months, an accelerator has a certain "boot camp" character. Within a very short period of time, several start-ups are usually coached and supported together in order to create a market-ready product after a few labor-intensive weeks. The accelerator acts as a growth accelerator here. At the end of the program, there is usually a so-called "Demo Day", where the participating start-ups are given the opportunity to present their now market-ready product or service to investors and corporates and make valuable contacts.

Function of an accelerator

Mentoring and support

The primary purpose of an accelerator is to support young start-ups in the development of their company. To this end, participating start-ups are provided with a network of experts and mentors with whom they can work together to build a successful business model.

Financing

Financing is less of a priority in an accelerator; instead of money, it is knowledge that flows here. However, there are still some accelerator programs that provide start-ups with initial funding. It is also particularly common to finance the founders' salaries, which cannot usually be paid without the accelerator due to a lack of sales. The financing sums usually range between €20,000 and €100,000.

Provision of resources

In addition to money and, above all, professional support, participating start-ups are often also provided with a workplace with existing infrastructure and other work equipment. These are often co-working spaces where the start-ups within the program are provided with a workplace in an innovative and creative working environment together with other start-ups.

Who is suitable for participating in an accelerator?

Compared to incubators, accelerators are primarily aimed at start-ups that already have a business model. The accelerator supports these start-ups and helps them to successfully expand their business model by providing suitable coaching and resources, resulting in a market-ready product. The Accelerator is therefore aimed at start-ups that are already beyond the initial brainstorming stage and are ready to conquer the market with their business model. The Accelerator acts as a kind of growth accelerator. However, if you are looking for start-up capital, you should rather turn to an incubator, as accelerator programs focus on advice and knowledge exchange, not capital.

Process of an accelerator program

At the beginning of each accelerator program, there is of course the application phase for start-ups. Those start-ups that are interested in participating should apply to the program of their choice with a convincing pitch deck and, if applicable, a business plan or MVP (depending on the accelerator). After a pre-selection process, the start-ups are usually presented to a jury, which decides on their participation. Once a start-up has been accepted onto the program, the three to six-month mentoring phase begins. During this time, the business model is developed with the help of various coaching sessions so that a market-ready product or service is created at the end.

Most accelerator programs culminate in a "demo day" after an intensive development and coaching phase. This gives the participating start-ups the opportunity to present their product or service to potential investors and establish contacts with relevant players.

Tips for successful participation

Set goals

To ensure that participation in an accelerator program is worthwhile, you should definitely think about what your goals are beforehand. At the beginning of your participation, set priorities that you want to work on and validate how well you have achieved these goals at the end.

Allow sufficient time

An accelerator program is usually limited in time, so you should be prepared for very work-intensive months during the program and plan enough time for this.

Implement results consistently

After participating, you should consistently implement the results of the accelerator program in your start-up.

Where can I find the right accelerator?

There are a number of accelerators; which one is right for you usually depends on the focus of the accelerator. The programs often differ according to industry and company phase. Most accelerators focus on very young start-ups, but they often have different requirements as to how far you need to have progressed in your product and business development. There are various ways to find the ideal accelerator for your start-up:

1) Startbase database

If you are looking for a suitable accelerator, you should definitely take a look at our database. We have listed over 100 accelerators across Germany here: /accelerators/.

2) Large corporations

Another way to find an accelerator is to research large corporations. There are often industry-specific programs offered by the respective companies. The companies hope to find innovative start-ups with new business ideas and you can certainly learn a lot from their expertise and industry know-how.

3) Universities & public institutions

Of course, it is also possible to find a suitable accelerator via universities or other public institutions. A wide-ranging search is recommended here.

Differentiation from the incubator

Company phase

As already mentioned, the two funding programs of the accelerator and incubator are similar in some respects, but there are also major differences and demarcations. For example, an incubator is aimed at very young start-ups that are at the beginning of their founding phase and need support in developing a business idea. Accelerators, on the other hand, support start-ups that have already developed a business idea and an initial business model.

Financing

The two programs also differ in terms of financing. While an incubator usually provides start-up financing for the start-up within a range of €25,000 - €250,000, financing is less common in accelerator programs. If financing is provided here, it is usually between €20,000 and €100,000. For this, founders have to give up around 5 - 20 % of their company shares.

Time limit

However, one of the most significant differences between these two programs is the time component. While the duration of an accelerator program is usually limited to a short period of time and the program therefore has a tight schedule, incubators tend to focus on longer-term support, in which the start-ups are supported over a long period of time and can develop their ideas at their own pace.