An Accelerator & Incubator Guide for Social Entrepreneurs in Silicon Valley

What is an accelerator?

Accelerates the growth of an existing start-up and condenses multiple years’ worth of business building into just a few months. Frequently, accelerators last 3-4 months but can be as short as a few weeks, and as long as 8 months.

 
What is an incubator?

Incubates an idea so it can be eventually transformed into a business model. Incubators provide counselling and a shared workspace for flexible periods of time, 1+ years.

Main Features of an Accelerator

  • A set time frame; rigid structure
  • Access to: top mentors, services, space, networks, close mentorship, and likely investors
  • Extremely selective application process for the top programs
  • Seed investment, minimum $20,000. Generally, investment is in exchange for equity of 6-8%
  • Depending on the program, one or more team members will relocate to attend the program
  • A Demo Day where start-ups pitch ideas to investors and media
 

Main Features of an Incubator

  • No specific time frame; loose structure
  • Generally access to: counseling, services, space, networks, close mentorship, & likely investors
  • Extremely selective application process for the top programs
  • Generally ask for a stake in the company, 2-10%
  • Depending on the program, one or more team members will relocate to attend the program
  • A potential Demo Day where start-ups pitch ideas to investors and media

Sources: Techstar, BusinessNews

Is this right for your venture?

If you are certain your company will benefit from the exposure, mentorship, investment, and network provided by an incubator or accelerator, do thorough research on the expertise of the company, its values, program features, and mentors on board. Review a list of social impact incubators & accelerators.

What are the benefits?

  • Business development support
  • Office space in Silicon Valley or elsewhere
  • Network support
  • Financial support
  • Access to services
  • PR/Brand exposure
  • Challenge your perspective
  • Gain credibility to investors
 

What are the drawbacks?

  • The events, mentors and meetings can be distracting at a critical time for your venture development
  • Receiving advice from a variety of perspectives can be confusing and slow down decisions
  • Sharing space with other companies can affect internal communications and culture
  • Costs: application fee, travel, and housing, in addition to the equity in your venture

Sources: Aspen Institute, BusinessNews, Entrepreneur

How to Prepare to Apply for Accelerators or Incubators

  • Find the right program for you and know the program and investor criteria. With that information in hand, you can pitch your startup in a way that resonates with the incubator or accelerator
  • Keep in mind that you will need to convince investors of both the strength of your team and your business idea
  • Speak to alumni or program affiliates who may be able to give your application a boost
  • Rehearse well and speak with confidence for any video portions of the application

Additional Resources

  1. Incubators Vs. Accelerators
  2. Hitting the Nail on the Head: Applying to an Accelerator
  3. What Startup Accelerators Really Do
  4. Accelerators, Incubators & Angels
  5. Scaling Social Ventures