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LetsAccelerate Unplugged | Managing Acceleration Portfolios

The LA Unplugged series kickstarted on May 28 with a webinar on ‘The Art of Curation & Management of Accelerators‘ with Bala Girisaballa (President, Techstars), Ganapathy Venugopal (CEO, Axilor Ventures), and Abhishek Gupta (Managing Partner, TVentures).

While moderating the session, Ganapathy spoke about the primary objectives of any accelerator programme. Bala and Abhishek, on the other hand, spoke about the various types of accelerator programmes, metrics that can help track the success of accelerators, and the relation between the programme design of accelerators and the startups in the cohort.

Watch the video here:

What should be the objectives of an accelerator by VG Ganapathy, Axilor 

When we look at accelerator programs and ask ourselves the question, ‘Who is the customer?’ – the customer is the startup and therefore the program must deliver on three things: 

  1. For most early-stage startups, funding is an important criterion. Many of them have raised money from family or friends and they are looking at early-stage capital to move to the next stage. At Axilor, when I look at the data for the 91 startups that have gone through the last 5 programs, 50% of them have been funded and half of these would be institutional funding. 
  2. What happens to the growth of the startup? When they come into the program – what is the baseline and when they exit, what kind of momentum have they achieved? Multiples of 5 to 10x represent a healthy startup
  3. Startups in the early stages are just founders, core team, and maybe a few interns. They obviously don’t have any support in building out a large team; so, what kind of access does the program really bring in terms of investors and other founders

What are the types of accelerators & metrics to analyze their success by Abhishek Gupta, T Ventures

There are multiple definitions of incubators and accelerators. I would be talking mostly about commercial accelerators where there are LPs and they invest in startups and expect some IRR. Then, there are corporate accelerators who may do it for strategic purposes or for financial purposes. T Labs, and now T Ventures was in the first bucket. We were a part of a corporate and also funded by a corporate but we pretty much thought of ourselves as a commercial accelerator as we funded companies in multiple domains. The third category I would call out is incubators that are essentially a part of an educational institution and they don’t necessarily have a commercial output to measure; the expectation is probably the creation of successful companies that are profitable and create jobs. 

The metrics that I am going to talk about pretty much align well with commercial accelerators. There are three large metrics that we track:

  1. The number of active companies in the portfolio that are doing any kind of a business. For us 60 to 65% of companies are active
  2. The number of companies that have raised money from investors and angel groups as well. 
  3. Companies also getting acquired or acqui-hired. Acquisition by either money or stock is a decent outcome 

The relationship between the structure of accelerator programmes & startups in the cohort by Bala Girisaballa of Techstars. 

My experience has been that you need to match the programme design with the stage of the startup that you are trying to bring in. I have often been asked, ‘Do residential programs work or not?’ – I think the answer lies in the stage of startup you are servicing. 

In Microsoft, when we started the accelerator we were working with very early stage startups. Early stage startups are highly coachable and they need to see you every day, they have questions all the time and therefore a residential program works very well for them. 

Next, try to bring in a cohort where startups are not competing but are in a similar type of industry. A lot of peer learning happens in such a case. They crave for a lot of peer learning, they crave for ‘how do I do things right and how do I get to the product-market fit?’ Now there are no prescriptions here but often the help comes from just saying what not to do and letting them figure out what will work. So, there are lots of workshops and founder stories, and all of that makes it very important for us to bring them in at least for three months in a residential program. After three months they go back to their offices but those months are important as there is very complex learning taking place. 

Watch the full webinar here:
Click here to register for the other webinars in the LetsAccelerate Unplugged series!

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