An accelerator or startup accelerator is defined as fixed-term programs that look to foster investment, connections, sales, and education to kindle growth in a project.
Most commonly this effort constitutes a public pitch event, demos, and other forms of marketing.
Startup accelerators are most commonly associated with Silicon Valley, a global hub for investing and fintech.
Startup accelerators however are a global phenomenon that privately funded as an investment fund. This nature of investing helps extend equity style investing to a wide range of industries.
Different Types of Startup Accelerators
There are multiple types of accelerators, which have evolved to reflect a new form of investing assistance to entrepreneurs.
This includes hardware accelerators, AI accelerators, Biotech accelerators, and China cross-border accelerators.
Of note, startup accelerators do differ from incubators, which are another component of the fintech lifecycle.
In particular, the application process is open to anyone for startup accelerators, though very competitive.
Furthermore, the focus for startup accelerators is on small teams not an individual founder. The rational for this is that a singular individual is not sufficient to handle this entire volume of work.
Seed investments in the startups are also made in exchange for equity, starting as low as $20,000 in some instances.
Finally, startup accelerators are usually given a rigid deadline, usually targeting upwards of three months.
This time is associated with intensive mentoring and training, and as the name suggests, an accelerated evolution of the program.
Startup accelerators are not even obligated to occupy a physical space, though it is common for them to.