7 Ways Startup Accelerator Techstars Jump-started Our Business
By Mark Lawrence, CEO and Cofounder of SpotHero
When SpotHero was accepted to be a part of the 2012 class of startup accelerator Techstars Chicago, my co-founders and I were naive enough to think that we actually didn’t need their help and at first declined to participate. We didn’t think it was a good idea to give up a percentage of control over our company. But in reality, we didn’t know what we didn’t know.
Thankfully calls from Sam Yagan, CEO of the Match Group, and Troy Henikoff, Techstars Chicago’s managing director, forced us to think through all the possible outcomes of enrolling in the program versus passing on the opportunity. Imagining how those scenarios would play out over the next few years made the choice clear. We ended up saying yes and that choice forever changed the history of our company.
Through participation in Techstars, I’ve grown as an entrepreneur and learned invaluable lessons about growing a business, fundraising and thinking bigger. Here’s a retrospective on the 7 reasons why joining Techstars was one of the most important decisions of my life:
- Learned the importance of speed: It’s a common saying in the startup world that you need to move fast or someone else will eat your lunch. Techstars showed us that speed is the greatest asset a startup has. We learned how other successful companies bring products to market in a short amount of time. This reinforced that the sense of urgency and the ability to move fast and change quickly is what can allow a small company to seize an opportunity like no other.
- Focused on time management: In the early days of running our startup, my co-founder and I felt like there were never enough hours in the day to accomplish all of our work. I remember answering customer service calls in the Techstars shared office shortly after starting the program. One of the mentors asked me what I was doing and I explained that I was talking to customers. “Why haven’t you hired someone to do that?” he asked. Hiring someone had never even occurred to me! We learned to focus on the areas of the business where we could have the most impact and bring on people who were even more talented than us to manage those other important responsibilities.
- Built relationships with a wide range of high profile mentors: Mentorship might seem like an obvious part of an accelerator, but we were surprised by how many incredibly talented mentors we had access to during the program. From the founders of OpenTable, GrubHub and CDW to the CEOs of publicly traded companies, we spent time learning from some of the most successful people in the world. We met with about 100 mentors 1:1 so we could really get to know them better, pick their brains and learn from their experiences. Whether it was entrepreneurs, marketers, salespeople or lawyers, each one forced us to start thinking about how these different specialities come together to form a profitable business. We developed strong relationships and suddenly we had people, besides our families, who were invested in our success.
- Deepened knowledge of business finance: I will admit that before we enrolled in Techstars, we didn’t understand how to finance a company. Actually we didn’t even know that financing a business in order to grow it quickly was an option. We were profitable and expanding quickly from our own cash flows. We then learned about a whole host of options for financing which could make us grow even faster. Techstars helped us understand the ins and outs of bootstrapping, raising seed capital from angels, going the institutional route and courting VCs from around the world. We became smarter at raising capital by learning which types of investors seek certain types of deals, how they approached the process and what they need to hear from you.
- Exposed to investors: In addition to helping us better understand the investment process, Techstars provided us with the opportunity to pitch to our company to a wide range of investors, including some of the biggest VCs in the country and we gained great exposure.
- Became a part of a strong network: Techstars has been around for several years so we had access to hundreds of alumni who experienced every growing pain imaginable. We were able to leverage their learnings to quickly solve problems. The network will opened up doors, provided access to business partnerships, created exposure for recruiting and provided friends that we go to for advice. It is on you to leverage it.
- Provided a new way of thinking: Techstars really changed our way of thinking about how to get things done. Our mentors helped us figure out what was working with our company and encouraged us to do more of it. They helped us refine our focus and stick to that path.
Three years, three offices, 12 cities, 30+ employees and $7 million in funding later, I am incredibly grateful for all that Techstars has done for SpotHero. While Techstars was the best program for us, there are several other accelerators that might be the right choice for your business. If you do decide to pursue Techstars, they are accepting applications in most locations until the end of April.
On the fence about joining an accelerator? You should still apply because you need to get accepted before you have the luxury of turning it down. The application process alone is invaluable. It forces you to answer hard questions about your business and articulate things in a clear way. While we initially turned it down, I’m so glad we changed our minds. We thought we didn’t need it and the experience ended up changing the trajectories of our business and our lives.