Critiquing the value of a startup accelerator and demo days has been a decades-long conversation in the world of tech. The programs promise napkin-stage founders help with everything from finding their co-founders to hitting product-market fit to raising that pivotal first check. Led by worldwide programs like Y Combinator, Techstars and 500 Global, startup accelerators have birthed billion-dollar companies such as Coinbase and Stripe and become synonymous with the promise of activation energy.
Yet, every few months, entrepreneurs ask the same questions: Is precious equity worth access to a network? Is the true value of the program just an esteemed stamp of approval? Are demo days outdated? Is the best outcome for founders within an accelerator just a new round of financing? Is YC’s batch size just too big to stand out in?
We keep trying to reinvent startup accelerators, and that in and of itself tells me that the institution stays relevant, even if imperfect. Asking questions, after all, is the first step in changing the way things are done.
In January, I wrote a piece about how startup accelerators are overdue for a refresh in how they think about value add services. Days later, Y Combinator announced that it was increasing its check size to $500,000, up from $125,000 before. With Y Combinator Winter 2022 Demo Day happening next week, we’ll see the first cohort impacted by these changes — and that YC went more remote, more international and more ambitious on the impact it wants to have.
This year, as everyone will see, we’re changing the way we cover Demo Day to better reflect what we think is the most important part of accelerators: a way to see how a large cohort of startups is directionally thinking about the biggest problems in a certain subsector. Demo days, it feels like, have fully departed from a traditional presentation and pitch to investors, and more so offer a snapshot of a startup and the growth plus personality of its earliest days.
More next week, but in the rest of this newsletter we’ll talk about the outlier world of fintech, an Instacart discount and a cryptocurrency nonprofit overlap. As always, you can support me by forwarding this newsletter to a friend, following me on Twitter or subscribing to my personal blog.
|