Accelerating startup success
One of the many ways in which CIIE supports entrepreneurs is through its various ‘startup accelerator’ programs, most of which are focused on startups working in a particular sector like ICT (information and communications technology) — we had in fact, launched India’s first ever accelerator program for ICT startups — iAccelerator — back in 2009. This program was modelled on the Y Combinator program, and heralded an era of startups accelerators in the country. We followed iAccelerator with more sector-focused accelerators in areas like cleantech, cleanweb, food and agri-tech, water tech, sustainable mobility, and most recently healthcare. CIIE also runs sector-agnostic programs like the large-scale Power of Ideas program in partnership with the Department of Science and Technology, Govt. of India, and the Economic Times. Aside from sector-focused and sector-agnostic programs, CIIE runs a regional accelerator called the Gujarat Accelerator for startups from Gujarat, which are working in ICT- or tech-enabled areas.
Accelerators are programs that enable startups to go from an ‘idea’ or ‘prototype’ stage to the ‘product’ (or ‘market’) stage, usually over a fixed time period and as a group (often called ‘cohort’). This is usually accomplished through intensive ‘mentoring’ and other in-kind support, and often includes early-stage seed funding. Over this time period, these programs build a community of like-minded startup teams, who work individually on their respective businesses and culminate in a ‘demo day’ or similar pitch event. The goal is to “validate” an unvalidated business opportunity or idea through capacity building, industry connects, customer development, etc.
Many accelerators require teams to physically share a common workspace during this time, but most have regular events and activities that are mandatory for the teams to attend. Usual durations of accelerators vary from 3 to 6 months period but could be longer, particularly for hardware startups. Many accelerators themselves provide some or all of their startups with initial ‘seed funding’, the amounts varying greatly across accelerators and geographies. There is also variation in the time of disbursement of these funds, i.e., some provide it at the beginning of the program, some at the end, or some much later after the demo day, and after a comprehensive due diligence process. But more importantly, the time that a startup team spends in an accelerator should largely improve its chances of raising venture capital from investors, towards the end, or after it graduates from the program.
Mentorship and advisory support could be coming from professionals or entrepreneurs that have domain, sector or functional expertise, depending on the type of accelerator. Usually, successful startup cofounders (including from previous cohorts of the same accelerator) actively mentor the teams.
Top accelerators usually have the following characteristics:
A highly competitive selection system that includes an open application process.
A core management team (for the accelerator) with significant domain, sector or functional expertise, ideally with prior entrepreneurial experience.
Access to seed funding, usually in exchange for equity.
Cohorts or ‘classes’ of startups, each with a core team of at least 2–3 members
Startup teams need to be made up of individuals with complementary skillsets.
Time-limited support comprising of various capacity building events and intensive mentoring (through both talks and face-to-face meetings with experts).
A Demo Day culminating the program, where startups pitch to investors for further funding.
CIIE is currently working on a couple of whitepapers on “accelerators” — where we will profile some of the world’s leading accelerator programs, and offer our learnings. Stay tuned to us for updates!