Introduction to Accathon Capital
Founded in New York City in 2018, Accathon Capital is committed to helping entrepreneurs from U.S (and internationally) achieve global business success. Accathon Capital was founded in January of 2018 by Mamoon Ismail Khalid, John Lynn, Michael Zhu and other VC/Accelerator professionals and community/thought leaders in New York City. Since its inception, as the “entrepreneur behind entrepreneurs”, Accathon Capital and its related entities have always focused on investment opportunities in the four directions of industrial digitization, medical health/life sciences, consumer goods/services, and urban tech. The “Accathon Capital” brand enjoys an ambitious young firms’ reputation in the industry globally.
Dear All,
We are writing article this in order to put our values, mission, thesis and perspectives out there in the world. Since launching the new brand and entity (Accathon Capital) in January 2018, we have received a lot of questions about what we do and how we add value to start-ups. Hopefully this blog will serve to expedite the understanding curve of our cross-border services.
Who we are?
We are a stage-agnostic, cross-border group which helps companies from all over the U.S (and Internationally) enter the Asian markets through China. We do this by leveraging our cross-border acceleration program and our investment fund strategy.
“ De-risk before you invest ”
We de-risk companies that want to enter China through the accelerator before we make a decision to invest via our own capital strategy. The primary reason is that businesses fail in China for many different and sometimes unexpected reasons; and we understand what it takes to be successful in the Asian markets. So we want to see the traction that a particular business or start-up can generate in China ourselves before we can potentially invest in it.
How we do that?
Through our bi-annual cross-border acceleration programs, our investment strategy as well as our year round global pitch competitions. Our crown jewel is the Innovation Journey to China program — a 45 day hyper acceleration program that enables companies to navigate around the unique cultural and business challenges in China (and Asia at large); and find investors, manufacturers, corporate partners, joint venture partners, operational support, and all other services in between that might be needed to scale a early stage startup or a $500M, Series-D+ funded company. The network of corporations , investors and other stakeholders we work with is quite large and valuable to almost all industry/business categories.
By lending this network and support to the start-ups selected (purely on the basis of quality and product-market fit), we are able to gauge the real investment merits for each opportunity.
Cross border accelerator: Not a typical accelerator
We often get asked if we provide upfront cash in return for equity for our acceleration cohort. The answer is NO. Most typical accelerators provide a little cash (USD 50k to 250k) and provide strategic support and/or marketing resources etc. That is their value add to early stage companies. We provide value to the companies we work with by opening up in depth access to China. This alone is valuable to a lot (if not most) companies who would otherwise need to have a very expensive strategy and an even more difficult time expanding their business to China (and Asia at large).
- Our programs have zero equity requirement.
- Participation is highly competitive and based on quality and product market fit.
This model allows us to add value to both early-stage companies as well as later stage, well funded companies — making us different than the traditional accelerator model.
Investment Strategy
Simply put — we wish to invest in companies that can generate real revenues in China. Finding those companies capable of being successful in a new and foreign market is a difficult task. Add to that the local competition (which does not lack in quality by a big margin, unlike 20 years ago), and it makes it an even harder find. But those are the the kind of company we want to invest in. So we utilize the acceleration program to find “cross-border ready” companies . We add value to all companies we work with, of course. But we invest in only those select companies that demonstrate a solid traction-backed business case for China.
Why China? Why cross-border business acceleration?
China is an enigma to most businesses. We aim to solve that.
But first, some interesting excerpts from the article “What Sequoia’s Mike Moritz doesn’t understand about startups in China”:
- “Language, ecosystem differences, and regulations all put foreign entrepreneurs at a big disadvantage in China. They can’t operate at full capacity, which makes a first mover advantage insufficient. The speed often lost with reporting lines if the China branch is not autonomous (like a new startup) adds to the handicap.”
- Emerging markets can fill gaps and leapfrog:
China’s tech ecosystem — including its offline and online infrastructures — trailed behind the U.S. for a long time. As a result, the current opportunities in China are much larger than in the U.S. and attract many startups and investors. That’s the oft-touted benefits of emerging markets: They not only fill gaps but also leapfrog.
- For investments or acquisitions, Chinese companies benefit from huge P/E ratios, and China market access.
- China is now innovating and scaling startups at a fast clip, after its successes in:
- Mobile payments (e.g. WeChat and more)
- E-commerce
- Retail (e.g. BingoBox cashier-less stores)
- Hardware (e.g. HAX portfolio Makeblock STEM robots keep winning prizes and are even used in the U.S. at Zuckerberg-backed AltSchool)
So we discovered the potential for our cross-border program and decided to curate a program out of our existent network of large corporations, investors, reputable and sophisticated manufacturers, industrial design firms etc. etc. with the aim of helping those companies who have a desire, real application and a pragmatic business model to support the former two.
Who qualifies to for our programs?
We ideally want to develop a relationship with all companies who have a short term or long term interest in expanding to the Chinese market.
We are Geography, Stage, and Industry agnostic.
However we have separate offerings and value-add channels for companies based on their stage, category etc.
1. Stage: Early vs. Late
We have different incentives to work with both.
While our accelerator enables both early stage and late stage companies to achieve a lot, the best outcomes we look to achieve are different.
In the case of early stage companies, we work to ensure that that plethora of curated meetings and introductions to relevant industry decision makers, end with either one or more of these outcomes:
- Partnerships (Strategic, Manufacturing, Corporate / Industrial pilot tests, MoU’s etc.)
- Investments (from our network of capital groups like IDG Capital, Sequoia China, ZhenFund, China Growth Capital etc.)
- Incorporation and operational expansion (start-up pursues long term expansion plan in China as a result of this program’s resources)
- Acquisitions
In the case of late stage companies, we work to achieve the following outcomes:
- Partnerships (Strategic, Manufacturing, Corporate, Industrial , MoU’s etc.)
- Joint Ventures
2. Geography:
We have been often asked if we just work with U.S. based companies. We would like to correct that for once and for all. We are a global firm, with a focus on China. While we help companies enter the China market, we also have programs that enable Chinese start-ups to enter the U.S. market, by leveraging the network, resources and innovation in New York City. This offering is the only U.S. specific offering we have.
The countries we have deal sourcing channels from are:
- U.S
- China
- Israel
- India
- Spain
- U.K
- Pakistan
- U.A.E.
- Brazil
- and a few more.
Needless to say, we are opening more corridors of interacting with quality entrepreneurs in international entrepreneurial eco-systems. We welcome everyone who has an interest in China to reach out to us and join our growing network of start-up founders and seasoned business executives, advisors and mentors around the world — all interested in some capacity in cross-border innovation and the ecosystem of resources in U.S. and China.
3. Industry/Category
Finally, this section is to illustrate the type of companies we are looking to work with. While there is no way of universally defining our industry/category preferences, we can try to outline the kind of companies we wish to work with.
- A company with frontier innovation that solves industrial and corporate digitization challenges — by either allowing better data aggregation, sophisticated business intelligence, new revenue creation, allows costs to be cut down, adds long term planning and strategic value etc.
- A company/team with a strong desire to pursue the China market — Our Founding Partner set this firm up with the vision of enabling access to the China market (which has been posing challenges to businesses for a long time) for quality entrepreneurs and innovative groups. Desire and application fit go hand-in-hand. But both are equally important in our world view to be successful in China.
- A company which is planning major operational expansion — aka. Joint Venture Partners — in China market to navigate challenges around policy, culture, business realities etc.
- An early stage company with a tremendous potential for high investment return rate in China.
- A late stage company with proven traction and a validated, resource-backed plan to enter China market (Asia at large)
While that outlines the type of companies we wish to work with, below is a list of ideas/industries/concepts/technologies we wish to see enabled globally.
Ideas / Technologies we absolutely want to enable globally:
- A.I, Computer Vision, Deep-learning — SaaS companies geared at B2B Revenue models
- Robotics, Drones/UAV’s, Supply Chain innovation
- Clean Energy, Electric Vehicles, Battery Technology
- Next-gen Urban tech
- Intelligent Transportation, Construction technology, Automotive innovation, Logistics tech etc.
- AR/VR for enterprise (retail) and industrial needs (oil and gas, agriculture, manufacturing, real estate etc.)
- Sophisticated IoT solutions
- Healthcare/Life sciences (genomics, medical devices, software etc.),
- Fin-tech (low latency / high fidelity trading softwares, blockchain technology for financial services firms, micro-finance and personal saving solutions etc.)
What to expect in 2019?
- Summer 2019 Cross-border Acceleration program
- Winter 2019 Cross-border Acceleration program
- LKK Supply Chain Accelerator in NYC (http://www.lkkinnovation.com/) Dates to be announced
- Global pitch competitions
- and much more!!
Application Process
All our upcoming programs can be applied for using our new application portal — found at: (www.accathon.com/apply)
Our new application is A.I powered and analyzes the responses to the basic questions we ask. The output of the A.I software is a “prioritized” list of the applied companies with the relevant information compiled in a form that enables us to better make decisions. The criteria for “prioritization” is loosely defined as:
“How good of a fit are you for the China market?”
Our 2019 programs applications are now open. We are already collecting applications for the round of early decisions — which will be announced around the first or second week of January. We will begin screening and shortlisting in November, conduct due-diligence rounds and interviews in December before we announce the selected companies in January.
Application specific information:
- Once you apply you are automatically subscribed for all our future program notifications and events in U.S.
- Once you apply, you can edit your previous entry by submitting a new entry with the same COMPANY NAME
- We encourage all companies who are interested in China to apply; even if you are not ready for an expansion in 2019. We want to build a relationship with all founders with a global vision for their product/service and a real desire to expand to China.
Contact and further information
For more information on what we do and how we can work with your company, please feel to contact me at mamoon@accathon.com
About us:
