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Accelerating Success: A Study of Seed Accelerators

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Accelerating Success: A Study of Seed Accelerators

  1. 1. Accelerating Success A Study of Seed Accelerators and Their Defining Characteristics May 15th, 2012 - Gothenburg, Sweden Accelerating Success - Intro - acceleratorstudy.com
  2. 2. Dropbox - an Accelerated Success • Participated in Y Combinator in 2007 • Now valued at over $5 billion Accelerating Success - Intro - acceleratorstudy.com
  3. 3. Outline of Presentation • Background to thesis and accelerators • Research question • Method and research design • Case studies of accelerators • Findings from research – Stakeholder Perspective – Organization Perspective – Process Perspective • Conclusion Accelerating Success - Intro - acceleratorstudy.com
  4. 4. Why Study Accelerators? • Explore a new phenomena – little has been written about accelerators • Chalmers Innovation, our stakeholder, interested in the accelerator model Accelerating Success - Background - acceleratorstudy.com
  5. 5. Chalmers Innovation • A business incubator and seed fund in Gothenburg, started in 1999 • Picking up new trends from Silicon Valley, Lean Startup and accelerators • Startup Spring Camp 2012 • Interest in further developing their activities related to early-stage software startups Accelerating Success - Background - acceleratorstudy.com
  6. 6. Software Startups in the Past • Boo.com – an internet clothing retailer • Burnt over $125 million of venture capital in 18 months • 8 offices and over 400 employees • Launched in 18 countries simultaneously in November 1999, bankrupt in May 2000 Accelerating Success - Background - acceleratorstudy.com
  7. 7. Incubators – the Predecessor of Accelerators • First incubator established in 1959 • Provides basic necessities for operating, such as office space and administrative aid • In some cases also provides access to advisors and investors Accelerating Success - Background - acceleratorstudy.com
  8. 8. New Methodologies Customer Development Lean Startup Accelerating Success - Background - acceleratorstudy.com
  9. 9. Decreasing Costs for Starting New Ventures • Cloud services enable instant scalability • Open source software provides cheap ready-made solutions • The huge venture capital investments not necessary at the early stage anymore Accelerating Success - Background - acceleratorstudy.com
  10. 10. The First Accelerator: Y Combinator • Founded in 2005 in Silicon Valley • Today over 200 different accelerators world- wide Accelerating Success - Background - acceleratorstudy.com
  11. 11. Characteristics of an Accelerator from Startup Factories • An application process that is open yet highly competitive. • Provision of pre-seed investment, usually in exchange for equity. • A focus on small teams not individuals. • Time-limited support comprising programmed events and intensive mentoring. • Startups supported in cohort batches or ‘classes’. Accelerating Success - Background - acceleratorstudy.com
  12. 12. Research Question What defines a seed accelerator and which aspects are useful for Chalmers Innovation? Accelerating Success - Research Question - acceleratorstudy.com
  13. 13. Method Used for Thesis • Roadmap created using secondary information from articles and blogs • Built theory from case studies on accelerators in Europe and the US • Collected material was used to form the analysis consisting of three perspectives Accelerating Success - Method - acceleratorstudy.com
  14. 14. Iterative Method Used Accelerating Success - Method - acceleratorstudy.com
  15. 15. Case Studies of Accelerators • American: Y Combinator and TechStars, data collected from secondary sources • European: The German Silicon Valley Accelerator, Springboard, Startupbootcamp, Nordic Startups, betaFACTORY and Startup Sauna, data collected from interviews Accelerating Success - Case Studies - acceleratorstudy.com
  16. 16. Y Combinator and TechStars • Two of the first accelerators, now defining the standard of an accelerator Founded in 2005 Founded in 2007 Mountain View, California (Silicon Boulder, Colorado Valley) 6% equity 2-10% equity 6 000-18 000 USD funding 11 000 – 20 000 USD funding 9-12 teams in each batch 65 teams in last batch Accelerating Success - Case Studies - acceleratorstudy.com
  17. 17. European Accelerators Founded in 2012 Founded in 2009 Founded in 2010 Berlin, Germany Cambridge, UK Copenhagen, Denmark No equity 6% equity 8% equity No seed funding £5 000 - £15 000 funding 15 000 € funding 6 teams in each batch 10 teams in each batch 10 teams in each batch Founded in 2011 Founded in 2011 Founded in 2010 Stockholm, Sweden Oslo, Norway Helsinki, Finland Not operational 6-8% equity No equity 5000 – 15 000 € funding 1500 € funding 5 teams in first batch 15 teams in each batch Accelerating Success - Case Studies - acceleratorstudy.com
  18. 18. Analysis of Accelerators • The collected data was analyzed and common themes in the accelerators was triangulated • These were summed up in three perspectives – Stakeholder – Organizational – Process Accelerating Success - Analysis - acceleratorstudy.com
  19. 19. Stakeholder Perspective • Startups: contact with mentors and investors, quality assurance • Investors: due diligence, deal flow • Mentors: pay-it-forward, keeping up-to-date, meet with interesting people • Society: innovative environment, job creation Accelerating Success - Analysis - acceleratorstudy.com
  20. 20. Stakeholder Pyramid Accelerating Success - Analysis - acceleratorstudy.com
  21. 21. Organizational Perspective • Few employees in the organization • Mentors work for free • Business model differs, often equity-based with private investors but sometimes government or universities Accelerating Success - Analysis - acceleratorstudy.com
  22. 22. Process Perspective Accelerating Success - Analysis - acceleratorstudy.com
  23. 23. Conclusion Reached in Thesis • An accelerator act as a hub, connecting the three main stakeholders: mentors, investors and startups. • The accelerator organization consists of a few employees that run the day-to-day operations and facilitate the interaction between the stakeholders. Mentors do not receive monetary compensation from the accelerator. • The processes in an accelerator can be divided into five distinct phases; awareness, application, program, Demo day and post Demo day. • The accelerator accept teams based on the composition of the teams rather than their idea. • The teams in an accelerator are small consisting of two or three people and the team is at an early stage that require intensive mentoring and iteration of their idea. • An accelerator can be seen as a service provided to investors Accelerating Success - Conclusion - acceleratorstudy.com
  24. 24. Thank you! Download a copy at www.acceleratorstudy.com Accelerating Success - The End - acceleratorstudy.com

Editor's Notes

  • Hej hej Kort om acceleratorer: nytt sätt att investera I och utveckla IT-startups
  • Exempel på ett företag som gått igenom en accelerator Deltog I Y Combinator 2007 Pratas om värderingar på runt 5 miljarder dollar
  • Såhär ser vår presentation ut idag Jag ska prata lite om bakgrunden till acceleratorer och varför vi gör detta arbete – vilket leder fram till vår frågeställning Alexander ska berätta mer om vår metod och hur vi gick tillväga för att komma in på själva studien av ett antal acceleratorer Lisa tar vår analys och vilka slutsatser vi har kommit fram till
  • Men varför ska vi då studera acceleratorer? Först och främst är det ett nytt fenomen, väldigt lite akademiskt skrivet om dem. Vi bidrar åtminstone med 30 tusen ord och förhoppningsvis en gnutta insikter Vi har också vår externa intressent, Chalmers Innovation – KLICK -
  • De är alltså en inkubator kopplade till Chalmers, startades 1999 – sysslar framförallt med längre forskningsbaserade projekt Plockar upp nya trender från Silicon Valley – de nya sätten att bygga IT-startups på Pilotprojekt – Startup Spring Camp 2012 – Mini accelerator Intresserade av att fortsätta utveckla dessa – och möjligen starta en egen accelerator – därav detta kandidatarbete
  • Men för förstå vad det handlar om så tar vi ett steg tillbaka till IT-bubblan I slutet av 90-talet Boo.com försökte bygga en innovativ e-handel för kläder De lyckades bränna över 125 miljoner dollar av riskkapital på 18 månader För detta fick dom bland annat 8 stycken kontor och 400 anställda. Och detta var innan de sålt en enda produkt De lanserade sajten I 18 länder samtidigt I November 1999 och I Maj 2000 gick bolaget I konkurs Det som hände var att sajten dels inte fungerade för hälften av besökarna och dels var alldeles för krånglig,
  • En accelerator är en typ av en inkubator En vanlig inkubator tillhandahåller kontorsutrymme, telefon, och skrivare.
  • Olika trender – en trend är nya metodiker … Iterativa processer som bygger på att hitta kunder innan man bygger sin produkt och sedan lära utav det man bygger. Tvärt emot vad boo.com gjorde alltså.
  • En annan trend är de minskande utvecklingskostnader – skala upp – cloud – open source – summa summarum – jätte investeringar krävs inte längre I den inledande fasen
  • Dessa trender är vad som ledde fram till Y Combinator Tar in 65 startups på en och samma gång
  • En rapport som beskriver dessa karaktärsdrag
  • Upprepa RQ?
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