If you haven’t already raised a large amount of funding or you're not generating consistent cash flow, joining a startup incubator or accelerator could be the perfect option to help you grow your business.
But what are the differences between the two? Which one should you join? These are very common questions which we hear all the time, so we thought we'd explain this further.
Startup Accelerators generally operate over a shorter defined time period, ranging from as little as three weeks to three months. Most startups which go through accelerator programmes are typically in their early stages and are looking to optimize their validated business model, build traction, and then scale their ideas.
What the accelerator receives, in return for joining the programme, typically varies. Some require you to give up equity straight away, some provide you with funding via a SAFE note, some ask for a fee, while some don’t ask for anything at all. But be aware, if they're not asking for anything at all, think about how they're actually benefitting from it.
However, the overall structure and goals of accelerators remain the same. They look to mentor you through an intensive programme, and then position your startup so that you can raise further funding when the programme ends, usually during a “demo / pitch day”.
Having access to experienced mentors and industry experts, can be one of the main benefits of an accelerator programme. The mentors you’re provided with, generally have successfully built similar companies to yours, so they can provide first-hand experience and guidance on how to solve the challenges you’re currently facing.
Most accelerators tend to have a defined industry or vertical which they focus on, such as Fintech or Artificial Intelligence, while some focus on a specific region, instead.
The application process for accelerators is generally quite straightforward. They will typically set a launch date for the programme, and then open applications for a couple of months beforehand. Once applications close, applicants will be shortlisted, and then invited to pitch their ideas to the decision making team of the accelerator, who will then make the final call.
Incubators have slightly different characteristics compared to accelerators. Firstly, the time scale you’ll be working together, will generally be a lot longer. Typically, you’ll be working together for at least 1-2 years, if everything goes smoothly.
Incubators tend to provide a physical office space and offer their domain expertise (technical development, digital marketing, user experience, etc.) in return for either equity or a fee.
And as their name implies, incubators aim to slowly nurture and build your startup. While accelerators, as their name applies, aim for faster and more explosive growth, to help get your product to market ASAP.
Incubators provide a controlled and protective environment to help their startups develop their idea, figure out their target market, and carefully build their team. The aim is to provide a solid foundation to help the startup grow and build a longer term partnership.
The application process for incubators varies depending on their internal capacity of man-power and office space. Typically, there won’t be a formal or advertised application process, unlike accelerators. So you’ll need to reach out to the management team directly to set up a meeting, and explore if you’d be a good fit for each other.
Which one is best for you?
Deciding whether to join an incubator or accelerator, entirely depends on your current situation. You have to analyse your startup’s short to mid-term goals, and then see if they match the benefits which the accelerator / incubator provides.
Do you need technical development expertise and execution? Are you looking for a long-term partnership and stability? Are you looking to validate your idea and slowly build traction? If so, an incubator would be the better option.
Are you looking to get your validated product to market ASAP? Are you short of cash flow and need funding? Are you looking for mentorship from experienced entrepreneurs and industry experts? If so, joining an accelerator would be the better fit. Especially, if you’ve already developed some traction and built a solid team.
Do you think Betatron would be a good fit for you? Do you want to position your business to raise a further round of funding? Do you want to accelerate your business growth with experienced mentor support?
If so, click here to apply. Applications close on 25th November.