merits and demerits of accelerator
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Answer:
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Explanation:
1.Accelerators are most helpful during fundraising season.
While this may be different than the official party line at most accelerators, my personal experience shows an accelerator’s impact on your business increases dramatically around the time when you start to think about fundraising for your startup.
Why? The simple answer is that most accelerators are structured to culminate in that massive demo day where their companies can pitch to many investors simultaneously. This represents a golden opportunity to jumpstart a seed funding round, but its benefit is lost on companies that do not care to raise funds.
The best accelerators have deep relationships with a wide network of investors. By plugging into one of those networks, your company can benefit from exposure to a range investors it otherwise would not have.
2. Accelerators can have a negative impact on your company.
As with most business decisions, there’s usually an upside and a downside to evaluate. Participating in an accelerator program can potentially have its downsides, too, such as:
Many (not all) accelerators offer unhelpful distractions. This can include requiring participation in multiple daily social events and forcing startups to meet with dozens of tangentially relevant “mentors” and “friends of the program.” While on the surface this seems really great, there is diminishing utility to these types of meetings and conversations. While you’re hustling to make sales, engineer your product, pitch investors and generally save your startup from extinction by the time demo day comes along, it can be a big time sink to deal with these types of mentor meetings and events.
Then there’s the aforementioned detail that accelerators are usually designed to help their startups fundraise. If your company is not ready to fundraise or is the type of business that will never need funding, you may still get caught up in the social pressure to pitch investors and try to fundraise at the wrong time. This can have a detrimental impact on your company’s focus and could lead you down a very dangerous path in the long run.
Thirdly, participating in an accelerator does take up valuable time in your company’s lifecycle. Programs often range from 10 to 16 weeks, and that is like an eternity in the fast-paced startup environment, where even a few days can mean the difference between your company’s survival or demise. If you do not capture enough value from your time at an accelerator, it could really result in a massive time loss for your company. For early-stage startups, that is often more devastating than a financial loss.
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