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Accelerators V1.0 - Betting against the odds

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A brief summary of accelerator operations and best practices from Silicon Valley.

Publicado en: PYMES y liderazgo
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Accelerators V1.0 - Betting against the odds

  1. 1. ACCELERATORS V1.0A SUMMARY OF BEST PRACTICES FOR ACCELERATORS 1
  2. 2. Disclaimer This slide deck is not sponsored by any organizations and is a in essence an informal, non- comprehensive document that aims provide and organize common questions for myself and the communities around the startup ecosystem globally. Opinions and writings expressed in the slide deck are solely my own with inspiration and lessons from my experience of operating and learning from startup accelerators. Please use this slide deck at your own will and risk. 2
  3. 3. MY EXPERIENCE Hi my name is Dylan Ler and my experiences in the VC and accelerator space includes the following: 3
  4. 4. INVESTMENT THESIS An accelerator’s main function is to invest in startups that they believe in. Your investment thesis is your bread and butter of your accelerator, it is your TRUE NORTH when things gets tough and the seas starts raging. It will guide you back to your original path. Whether your accelerator invests in startups through monetary means or providing resources, every accelerator should form a strong investment thesis to maintain unity in operations. 4
  5. 5. WHY HAVE AN INVESTMENT THESIS? 1. Competition is fierce: there are a lot of accelerators out there. 2. You need a distinguished feature that makes you unique. 3. It generates the right deal flow to your accelerator—you want the right startups coming into your accelerator. 4. It will set everyone in your team on the same page to achieve ONE same goal. 5
  6. 6. What sets you apart? (examples) Accelerators Investment Focus Known-for’s 500 Startups Marketing & Growth Investing in startups BEFORE product-market fit, double down AFTER to focus on growth Y Combinator Product Focuses on startups with a solid product—always create something that people love. Boost VC Blockchain/VR Investing in startups in Block chain and Virtual Reality Industry. Disney Accelerator Consumer Having strong go-to-market & consumer based expertise thus portfolio consists of startups that can utilize this advantage. 6
  7. 7. How to stand out? 1. Have a value proposition (your unique power) & repeat it as often as you can. 2. Be founder friendly. Be Upfront & Transparent—founders have enough on their plate. 3. Look into your data—see what the market is lacking and provide that. Your FOUNDERS will be your best marketers. Treat them well, collect feedback and trust them. Example: Provide GOLDEN TICKETS to your founders. Founders from previous batch can refer another startup that has a guarantee shot for an interview. 7
  8. 8. Accelerator Focus 1. What stage do you want to FOCUS on? Early stage? Growth Stage? 2. Are you focusing on a SPECIFIC vertical? Can you provide industry support? Go-to-market initiatives? 8
  9. 9. MARKETING Launch applications early and set a deadline. It is a lot like selling tickets, people will wait till the last minute to apply. 1. Content Marketing 2. Network Referrals 3. Angel List 4. Remarketing 5. Roadshows 6. Hold impromptu office hours in conferences 7. Mentor at co-working spaces and boot camps. 9
  10. 10. THE ART OF FOMO FOMO stands for Fear of Missing Out. Conduct social events Every time your accelerator is doing a social event, portray your speakers, show that your founders are having a good time. Photography virality Good photography can boost the sharability of your social media post. Small cost, great returns! Nudge your founders to tweet and talk about your accelerator. They are part of your accelerator family! Make them feel like it! Sell your founders. Post founder’s profiles, features, blogs, head shots, etc. 10
  11. 11. MARKETING TO INVESTORS 1. Invite them earlier on. 2. Don’t put pressure on them to invest. Ask them to be a mentor first. 3. Be clear and transparent about your startup’s performance. 11
  12. 12. ACCELERATOR INSIGHTS 1. Tracking Metrics 2. Designing Your Curriculum 3. Mentorship & Community 4. Accelerator Law 5. Accelerator Finance 6. Generating Deal Flow 7. Downstream Capital 12
  13. 13. TRACKING METRICS What are your KPIs for your accelerator? DURING Examples POST Examples Metrics for portfolio Users, Revenue, Profit, Signups, Downloads, Growth, etc. Program Breakeven Can you financially survive next batch? Number of Investors Number of potential investors on your list Downstream Rounds 10% of portfolio raised $500K @ $5M Valuation Mentors Engagement Number of mentors committing to the program Portfolio Returns 3X in 1 year, 20% IRR 13
  14. 14. BEST PRACTICES (QUALITATIVE KPIs) Examples Conduct Case Studies Case studies of companies that doubled their revenue in the program— learnings from here. Build Communities Bring in mentors/speakers to the program. Mentors -> Investors. Generate content Put out open source content like legal documents, financial documents, guides, slide decks, etc. (Good PR & Community Engagement) Instill inclusivity and reward Create hashtags of your program, batch-specific activities, staff retreat. Knowledge Transfer Train & educate staff and community for future programs Promote Diversity Get more diverse companies from different regions around the world 14
  15. 15. CURRICULUM DESIGN Questions to ask Follow up What stage are your companies at? Design your curriculum to fit the majority of your companies Is this a learning or a doing program? Is the program more of a “here’s the resources, go make progress!” or a summer school? Buffet style or mandatory? Deciding whether workshops/sessions in the program to be mandatory or buffet “pick what you need” style. How large is your batch? Large batch requires more point of contacts for better communications. Who do companies report to? Appoint Point of Contacts/Account Managers that handles 5-10 companies. What is success after the program? Plan it out—success for the companies & your accelerator. 15
  16. 16. Sample Weekly Curriculum Monday Tuesday Wednesday Thursday Friday Fundraising workshop Customer Acquisition Product Market Fit Fundraising workshop Term Sheets Speaker session Speaker session Speaker session Speaker session Speaker session Pitching Practice Pitching Practice Pitching Practice Pitching Practice Pitching Practice E-commerce Markets SaaS Markets B2B vs B2C Content Marketing Social Media Marketing 16
  17. 17. BEST PRACTICES (CURRICULUM DESIGN) Examples Allow curriculum to be buffet style Let companies attend sessions that they think will be most helpful to them Design based on application pool If application pool has significant biotech companies, design curriculum to fit that (get industry experts, FDA approvals, etc.) Set Expectations Let founders know how the program operates from the start—hands on or hands off Cut out non-essential workshops Collect feedback and only focus on game-changing workshops. Choosing great speakers Ask speakers to record video of themselves. Otherwise, fireside chats work great for experts who are bad at speaking. Involve everyone Let your POCs (point of contacts)/ Account Managers give their opinion when it comes to designing the curriculum. They are after all the ones spending the most time with the startups. 17
  18. 18. COMMUNITY Why is it important? Community generates deal flow to your accelerator Why does it matter? Community and network make founders want to be part of it. Internal loop feedback—getting genuine product feedback from your internal community. Conduct Internal beta launches. Emotional support, technical expertise, mentorship, distribution help and etc. 18
  19. 19. Cultivating Community Batch Founders Previous Batch Founders Mentor Network 19
  20. 20. BEST PRACTICES (COMMUNITY) Examples Getting AWESOME mentors Ask your companies “who is the one person that is most helpful?” The best mentors want to feel like a community and learn from the experience themselves. Red Flag: mentors who wants to take equity. Use grass-root Communications Facebook Groups, WhatsApp, Text—whatever it takes to communicate actively with your community Create community experiments Community services, retreats, internal company day, etc. 20
  21. 21. BEST PRACTICES (MENTORSHIP) Examples Implementing Office Hours Let mentors decide when to come in themselves. Set up office hours Red Flag: mentors who wants to take equity. Use grass-root Communications Facebook Groups, WhatsApp, Text—whatever it takes to communicate actively with your community Create community experiments Community services, retreats, internal company day, etc. 21
  22. 22. BEST PRACTICES (ACCELERATOR LAW) Actions Reasoning Standardization is key If every company asks for a different investing structure, it will just be a mess. You use your own documents, no legal fees. Less overhead time Be upfront & transparent Let founders know what they are getting into. Minimize negotiations So that there is no discrepancies between companies and no complaints of unfair biasedness to certain companies. Do not offer legal advice to companies You will be held liable if something wrong happens 22
  23. 23. ACCELERATOR FINANCE Questions to consider Follow-ups How do you remain sustainable? Will you charge a program fee? What other income will help sustain the accelerator? Do you want to operate at loss? Are you here for the long run and betting on the long term profit? Can you wait 5-10 years for liquidity events in your portfolio? Will the accelerator survive after 10 years? Can you make it that far? What is special about your program? What investment structure attracts founders? What is the cost of running an accelerator? Rent, staffs, professional fees, marketing, etc. What is your investment deal? Example: $100k for 5% with $20K going into program fees 23
  24. 24. BEST PRACTICES (FINANCE) Actions Reasoning Standardization is key If every company asks for a different investing structure, it will just be a mess. You use your own documents, no legal fees. Less overhead time Be upfront & transparent Let founders know what they are getting into. Minimize negotiations So that there is no discrepancies between companies and no complaints of unfair biasedness to certain companies. Do not offer legal advice to companies You will be held liable if something wrong happens 24
  25. 25. DEAL FLOW Things you can do to generate deal flow organically Notes Speaking at conferences (later stage) as long as it justifies a win-win situation. Conduct road shows/free office hour be genuine and honest in these. Mentoring at other accelerator might seem counter intuitive to help competitors but genuine help goes a long way to generate good deal flows. Founder referral promote internal trust + get good deal flows. Win- win! Investor referral scout larger VCs and ask them to refer companies that are “too early” to you. Build reputation do not exaggerate your startups’ situation to investors. Be honest & upfront. Get your selection process right Reiterate your interview process. Balanced team, traction, industry, coachability etc. 25
  26. 26. DOWNSTREAM CAPITAL How to drive down stream capital Notes Mock investor interviews Conduct mock investor interviews to help startups understand how to do an investor centric pitch. Create investor urgency Invite investors in often to create a sense of competition and urgency. Coach startups on fundraising Train startups to fund raise and be well versed in fundraising jargons like equity, convertible notes, term sheets, vesting & clipping, etc. Build relationships with investors Build networks with later stage VCs 26
  27. 27. BONUSES For government programs or Non-Profits, everything would be applicable except KPIs. KPIs for government programs might include: 1. Number of jobs created from startups. 2. Startup ecosystem building—increased number of technology startups in the country. 3. Country’s ranking for startup ecosystem globally. 4. Number of environmentally friendly startups created. 5. Number of startups created that are operating as social enterprises. 27
  28. 28. LAST BUT NOT LEAST REITERATE, REITERATE, REITERATE. 28

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