Accelerators & Incubators: what has happened in the last decade?
by Timothy O’ Connell from H-FARM Innovation
Accelerators and incubators have played an important role the last decade in fostering entrepreneurial culture and helping early-phase projects to take off. Often these actors have been the first partner for startups looking for guidance, connections and funding support. According to Harvard Business Review, accelerators:
❝ support early-stage, growth-driven companies through education, mentorship, and financing. Startups enter accelerators for a fixed-period of time, and as part of a cohort of companies. The accelerator experience is a process of intense, rapid, and immersive education aimed at accelerating the life cycle of young innovative companies, compressing years’ worth of learning-by-doing into just a few months.❞
This definition reflects the result of changes and evolutions in the accelerator model we assisted over the past 12 years. The pioneer accelerator program was Y Combinator, founded in Cambridge Massachusetts in 2005 and later moved to Silicon Valley by Paul Graham.
We used a venture incubator model, a hybrid solution for providing both seed cash (venture capital path) and resources (incubation path), to attract and support new entrepreneurs in an emerging eco-system. During this period, other pioneers emerged in the US and Europe, including Techstars, Startupbootcamp, 500 Startups and Seedcamp. Each group was experimenting with new methods and processes for selecting, developing and investing in early stage startups.
In 2012, we invited over 50 leading accelerators from 23 countries on 5 continents to a two day event in Venice called the Global Accelerator Meeting (GAM). The goal of the meeting was to establish a structured playbook on how to design and run an accelerator program. The selected participants, including accelerator directors and startup investors, attended workgroup sessions to exchange successes and failures in order to come up with a shared acceleration methodology. The GAM events were repeated in 2013 and 2014 and today have been replaced by the GAN, which includes more than 70 accelerators from more than 100 cities.
Over the past 5 years, hundreds of accelerators have emerged around the world. One of the key success factors for these new programs is the presence of a “viable ecosystem” that can generate good deal flow on one side (i.e. great startups) and a respectable network of mentors and investors to support these team. During this period, our accelerator program shifted its focus to startups operating in the “Made In Italy” sectors (Food, Fashion, Design…) in order increase the quality of applicants, find great and qualified mentors, better match the Italian investors’ strategies and to attract the interest of leading corporate brands.