How can you use accelerators and incubators to raise capital?

To maximize the incubator/accelerator experience, an entrepreneur’s mindset going in should be to leverage the program to become “investment ready.” This means building a solid market analysis, identifying your business differentiators, and mapping out a path to revenue growth & probability.

Accelerators and Incubators for me, are the first stepping stone to growth. For first time entrepreneurs, it’s an absolute must to get with them. They are the pioneers who build effective solid systems in the initial years, only to help the startups to grow rapidly in the later years. Think of them as the perfect landing spots, which guide you to the best journeys ahead.

Both accelerator and incubator programs can be fantastic resources for growing your network and enriching your knowledge of the entrepreneurial ecosystem. The relationships you'll build, and the mentoring you'll receive are invaluable. The right coaches, mentors, and advisors will help elevate your work to the next level, and as you grow and reach milestones, you'll also lay the groundwork for taking your startup to the next level with investor funding. Don't simply go into these programs with an eye to fundraising. Of course it is important to plan for raising funds, but these programs are really here to set you up for success in the long term, and that is incredibly valuable.

Use accelerators and incubators to build your community. Lean into mentors, ask questions, and listen. Show up and participate. B2B relationships are as valuable as those with your customers. You’ll get what you give, and you never know where the next opportunity will blossom. Good things happen when you talk to people.

Incubators and accelerators can be extremely useful, especially for first-time founders. One highly effective approach is to leverage incubators and accelerators, which provide not only funding but also invaluable mentorship and resources. The key to using incubators and accelerators to raise capital is to start with a solid foundation, build a strong network, and accelerate growth. By doing so, you'll not only attract investors but also ensure that you're well-prepared to make the most of the capital you raise. Warning: Be cautious with the accelerators that ask for too much equity(5%- 10% is the usual range). If it's more than that, ask them what's the extra unique value they bring compared to the other programs.

Consider how many women sit within the accelerator program. Women bring distinct types of innovation and creativity to problem-solving because they directly experience the impact of challenges that must be addressed. Involving women in your mentoring and decision-making positions is the secret to unlocking better social, environmental, and economic benefits for all. #TheXXEdge

Attend events, workshops, and networking sessions within the accelerator or incubator. Connect with other founders, program alumni, and industry experts. A strong network can lead to valuable investor introductions.

Thinking outside the box can be very fruitful when choosing programs like accelerators and incubators. At times, you may stumble across a program that doesn’t seem to be aligned with your intended goals; however, it could be that very incubator or accelerator that propels your business because you got a new experience and diverse viewpoints.

Agree. These must be aligned to the organisation's vision and then climb down the ladder. The reason is because the Director or CEO signs off on these. If they view it as a misalignment to their values, a significant cost, risk, or question the ROI, these programs are less likely to take shape -- further affecting a NFP's potential to grow. If they realise it, they've tapped it. For example, UNICEF and Charity Water.

Selecting an appropriate accelerator is pivotal, as it must be a good match for both you and your business. Here’s how I approached this decision: Research Vertical Alignment: Ensure the accelerator specializes in your startup's industry / segment / geography. Assess Alumni Success: Investigate their alumni. Program Offerings vs. Business Needs: Match the accelerator's resources, such as mentorship styles, investment power, and networking opportunities, against your venture's current requirements. Community and Support: Look for a program that promises enduring support, not just during the accelerator period but beyond as well.

When it comes to preparing for the application and selection process, there are two things that are an absolute must: (1) Reach out to other founders that went through the program. Founders always want to help each other, so in addition to giving you the inside scoop on their experience (and whether the accelerator was worth their time!) they can also provide insights on how to write a successful application. (2) Attend any office hours or webinars about the accelerator. Beyond learning valuable information about the accelerator experience, these sessions will allow you to make a personal connection with the team running the accelerator. No doubt, them knowing who you are will help with the application process!

Pitch, value proposition, team etc. are all important. But the best way to get into any accelerator are former participants / alumni. So focus your energy there.

Programs invest in success, not in aspiration. When you apply for your program, you need to clearly set apart any language in your presentation that sounds dreamy, and make sure that every word rings of a plan in motion, not mere hopes. The program you are selecting wants to hear that you are on a track record for success, and how they, through their existing tools, can empower your company to move more efficiently in the right direction. In your statement, put your current situation, and clearly state how your current needs align with the programs abilities, and ensure that you already answer any questions that might follow, should you partner.

I would always start with YC. They are the definite gold standard and they put all their documents out there. Here are my favorite questions from YC -Describe what your company does in 50 characters or less. -How long have the founders known one another and how did you meet? Have any of the founders not met in person? -How far along are you?, Are people using your product? -Why did you pick this idea to work on? Do you have domain expertise in this area? How do you know people need what you're making? -Who are your competitors? What do you understand about your business that they don't? -How do or will you make money? How much could you make? -Where will most of your initial users be located? -Which category best applies to your company?

Create a comprehensive business plan that outlines your business model, market opportunity, competitive advantage, and financial projections. Investors want to see a well-thought-out plan for their investment.

In my experience, being part of multiple different accelerators throughout the years, one of your biggest goals should be growing your network and knowing how that network can strategically help you scale, as well as raise. Many people get accepted into an accelerator but then don't show up and put the work in. If you really want the program to benefit your company, you need to consistently show up and not expect the program to just magically work for you. With the network and connections made through the accelerator, you should be able to reach out to the right people when you are raising and ask for introductions to investors they think would be a fit. It's all about people, and warm intros from the right ones go a long way when raising.

Working with other founders in the program and learning from each other can make the experience better on multiple fronts too.

Business is war, and unless startups make traction, they fall behind, and eventually starve. On of the top reasons that startups fail are lack of market fit and lack of funds. Without knowledge and traction, you are doomed to slow down. If you have chosen the right program, consisting of experts in your field with previous experience and several successful startups under their belt, you have the right information available to gain traction. The startup nation, Israel, has an expression. Its 'Chutzpah', it means to be bold and push for your goals. Israelis some times come off as rude, but in the startup world, they get what they want, because they know what to ask for and they aren't afraid to ask. Have some chutzpah.

Many accelerators and incubators have investor days or demo days where you can showcase your startup to a room full of potential investors. Be prepared to answer questions and follow up with interested investors.

In my experience, I've seen community being a valuable resource in getting the skills, knowledge, and networks for Founders to successfully fundraise. As entrepreneurs rise up the ladder, their networks become even more valuable.

As you achieve significant milestones or reach key performance indicators (KPIs), share these successes with potential investors. It demonstrates your progress and commitment.

If you have set your company up for success by finding a solution/product with a great market fit, and you have enough funds to survive for as long as possible, you have all the cards in your hand to make a good deal with your next investor. Accelerators and incubators should be seen as strategic investor, and as with any investor, an investment is a business deal. Since you will gain a strategic investor, they will most likely have a say in how you do business. You need to make sure that you set yourself up for success by playing hardball to keep as much equity on your end when you make a deal, and to get as much out of the accelerator/incubator as possible.

Every business is different and their business moat, market opportunities investment requirements are as well. But always remember investors don't invest in stunning pitch decks but in bankable and sustainable projects. From my professional experience I can tell usually early-stage investors look for a. A Solid Business Plan b. Kickass Founders c. Product-Market Fit d. Low Competition & Big Market Opportunity e. Clear Path to Sustainability & Profitability f. Justifiable Valuation & Achievable Targets as Future Projections. Never miss to explain your go-to-market strategy and fund utilization properly. And focus on developing a better discussion than just presenting a business. Best of luck!

Incubators usually don't invest. Look for accelerators for that. At first $100,000 feels like a massive amount, it's not. The value of these programs are actually the networks and access to a new market/industry they provide. Think one step ahead, what was the success rate of the alumni to raise a good Seed round, fast. Rank your programs based on this criterion.

Developing a great pitch tailored to various audiences is paramount. That being said, the numbers and figures must make sense. Investors aren’t generally willing to take risks. Show them that you have a history of success through your sales, programs, etc. Finally, it’s essential that you include realistic asks, a clear business plan, and a compelling story in your pitch deck.

It's so crucial to stay in touch with your contacts from the accelerators you are part of. These people should really become long-lasting friends of your company and for us, some have even become official advisors. Be sure to add they key players you built relationships with throughout the program to your monthly or quarterly updates and also schedule a call with them from time-to-time. Just because the program is over, does not mean your relationship is and you wouldn't believe the opportunities that have come to us years after we graduated from an accelerator. Email. Linkedin. Call. Zoom. If you have built a relationship with people who run the accelerator, you must nurture it well after the the program is done for you.

After initial interactions with potential investors, be persistent in your follow-up. Many investors appreciate entrepreneurs who are proactive in keeping them updated and informed.

I would emphasize that you keep people updated on your achievements and milestones. Doing this using newsletters and update emails will ensure that your partners are in the loop and can support you where needed. I have also seen that supporting the growth of a network or community through sharing your skills and knowledge also places you at an advantage because you become top-of-mind.

You are a busy person. However, keep a journal throughout the process. Not only will you be able to look back on your experience to gain perspective on how far you have come, but when you are wildly successful, your biographer will appreciate it!

In my experience incubators are effective vehicles to get MVP to move in the right direction. Presently two incubators ate running with exciting potential. I will keep you posted with the process.

Something to keep in mind is to always ask for help when you need it. I have seen entrepreneurs struggling with challenges that could have been easily solved by someone within their networks if they had asked for help early enough.

After securing investments, maintain a positive and professional relationship with your investors. Regular updates on your progress and challenges can help build trust and keep them engaged in your business. Accelerators and incubators can serve as a valuable launchpad for raising capital, but it's essential to approach them strategically and make the most of the resources and opportunities they offer.

Accelerators offer a vast network for funding opportunities. It is the responsibility of the startups to leverage this resource effectively. I mentor cohorts in the US and Europe at Techstars, and one piece of advice I offer my mentees is to actively engage with the organisers. I encourage them to request the sharing of investor lists, review these lists to identify investors who investing in their startup's vertical, and then ask the organisers for warm introductions to those investors. While demo days are beneficial for interacting with investors, not all investors can participate due to conflicting schedules or different locations.