The different types of startup accelerators in Europe and USA
After more than two years working with startups, I initially thought that basic information about accelerators is also common to everyone else.
It is not. When I talked to new founders, friends and former colleagues, our conversations sometimes switched to topics about accelerators and startups, and almost every time I was asked the same question: “What is an accelerator?”
“Accelerate” means move faster, go faster or increase in rate, amount or extent. Imagine you have a product and want to start a company, and you’re not sure how to take it from there. Or you somewhat know what you’re doing, but you want to speed up the process. That’s exactly what accelerators suppose to do for you: accelerating your learning and doing process.
There are few different types of accelerators. It’s are more straightforward in the US compared to Europe. In the US, accelerators are privately run and don’t have much affiliation with the US government.
In Europe, the accelerator model gets a bit more complicated due to the combination of many countries following their own rules and one European country governed by the EU. Many startup accelerators receive funding from EU on top of funds from private and institutional investors.
Then you throw into the mix with corporate-run accelerators, corporate-run accelerators supported by traditional private accelerators.
These accelerators offer startups access to seed money and potential follow-up investment, mentorship, connections, networking opportunities, in exchange for equity. The programs are usually intensive and last around three to four months.
The US invented the accelerator model and has some of the best accelerators in the world. Y Combinator is the first of its kind, followed by other brands like Techstars, Angelpad, MassChallenge, and 500Startups.
Europe soon caught on, and today, accelerators exist in every major city in Western and Central Europe. Some of them are Seedcamp (London, UK), Startupbootcamp (started in Copenhagen, Denmark and expanded to other big cities), Numa (Paris, France), StartupYard (Prague, Czech Republic), Startup Wise Guys (Tallinn, Estonia), STING Accelerate (Stockholm, Sweden), CylonLab (London, UK), EIT Digital.
CylonLab is probably one of very few accelerators in the world that specializes in only cyber security.
Techstars is a special case in the sense that it combines the characteristics of both American and European accelerators. Techstars was founded in Boulder, Colorado and followed a similar framework as Y Combinator, at least in the beginning. However, unlike Y Combinator and other American accelerators, Techstars doesn’t remain in one city. It has gone for global domination and grown a massive network of accelerator programs in many cities in US and Europe. Besides expanding geographically, Techstars partners with large corporations and creates industry-specific programs. (More on this later.)
Similar to Techstars, there are accelerators in Europe that go for quantity, in terms of the number of cities they operate and the specialized domains they target. Two such accelerators are Startupbootcamp and EIT Digital. Startupbootcamp focuses on IoT, Fintech and Cybersecurity, Digital Health, Smart Cities, and Smart Transport. EIT Digital focuses on Digital Industry, Health, Wellbeing, and Infrastructure.
MassChallenge is the only accelerator that doesn’t take equity from the startup companies.
Corporate-run accelerator and incubator
Don’t want to be left out, corporations jumped on this bandwagon. After all, they need to innovate but their sheer sizes, internal processes, and speed of operation make it difficult or impossible for them to do what agile startups and smaller companies can. So corporations create their own innovation and accelerator programs and run these programs on their own or partner with other corporations and private-run accelerators, described above.
Some programs are general and industry-agnostic while some focus on the specific vertical of the participating corporations.
Here are a few examples:
Accelerator + Corporate
Techstars is trailblazing in this area. Here are some of the programs they are running
- Alexa (focus on Mobility)
- Barclays accelerator (focus on Fintech)
- Comcast NBCUniversal LIFT Labs Accelerator (focus on new innovations in media, entertainment and connectivity)
Healthcare ( with Cedars-Sinai, Chicago)
- Internet of Things (New York)
- Retail (with Target, Minneapolis)
- SAP IO (focus on AI and machine learning)
- Virgin Media
- Music (with Sony Music Entertainment, Warner Music Group, and more)
- Bluelab (EDF)
- Challenge UP! (Intel, Cisco, hub:raum)
- Cisco Entrepreneurs in Residence (Cisco)
- Hub:raum (Deutsche Telekom)
- IDEALondon (Cisco, UC London, EDF)
- Microsoft Ventures (Microsoft)
To know more about corporate-run accelerator/incubator, read “Corporate-run startup accelerators: the good, the bad and the plain ugly.” The author of the article is the former MD of Techstars London, a program one of the startups I collaborated with participated in 2015.
There are additional accelerators and incubators that are non-profit, either funded by the governments or for-profit organizations.
When working in London, I learned about the Centre of Defense and Security Accelerator.
The Centre of Defense and Security Accelerator, a program initiated by the UK Ministry of Defence, and fund proof-of-concept research into novel, high-potential innovations that prove beneficial to the defence and national security of the UK.
I hope this article serves you in your preliminary research about startup ecosystems. There are more accelerators, incubators, startup-support networks out there which aren’t covered in this article.
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Cindy Dam is a behavioral investigator, motivation explorer and storyteller. She has worn many boots working in various industries and performing different functions including consulting, project management, marketing, and coaching. When she’s not working with startups, trying out new digital tools, or experimenting some life hacks, she hacks her way around the world to learn the code of people and their society.