Startups and early-stage business owners looking for intense entrepreneurial training that could lead to exponential growth should consider participating in a venture incubator/accelerator. These programs usually require a full-time commitment at a facility for several months in exchange for aggressive business plan coaching, entrepreneurial mentoring, networking, and for some eventually an equity stake in the company, usually somewhere between 4% and 8%.
At the end of the program, many of these venture accelerators have a “demo day” when companies pitch to a room full of angel investors and venture capitalists. A number of startups and early-stage companies have secured seed money ranging anywhere from $50,000 to $5 million as a result of their participation in an accelerator program.
“One benefit of being part of an accelerator is connecting with a community of entrepreneurs who are in the same stage you are,” says William Crowder of Dream It Ventures, a Philadelphia-based startup accelerator. “Through the networks you’ll build at an accelerator, you’ll connect with partners in the venture community and tap into potential customers you’d never have access to otherwise.” While incubators and accelerators can propel businesses growth, they may not be for everyone, adds Crowder. “Going through an accelerator does not guarantee success.”
DreamIt Ventures is one of 25 startup incubators in the U.S. and around the world featured on SmallBizTrends.com. Out of that pack, here’s our top five picks of venture incubators and accelerators for startups.
1. DreamIt Ventures (www.dreamitventures.com) – This startup accelerator gives companies up to $25,000 in funding in exchange for a 6% equity stake. DreamIt also offers coaching and mentoring as well as a chance for entrepreneurs to pitch their businesses to angel investors and venture capitalists.
2. Entrepreneurs Roundtable Accelerator (http://eranyc.com/) —ERA’s four-month accelerator program consists of seed funding opportunities, hands-on help and collaboration with other startups in the program. The New York City-based company specializes in early-stage tech-based startups. Accepted startups receive an initial $40,000 investment and shared office space.
3. StartFast Venture Accelerator (www.startfast.net) – This venture accelerator offers a three-month to startups from around the world that couples cash (up to $18,000) with mentors, access to talent, and support from StartFast’s entrepreneurial community.
4. TechStars (www.techstars.com) – This selective startup accelerator has locations in five major U.S. cities. Just 10 companies are chosen per site. TechStars invests $118,000 in each business through a combination of seed funding and convertible debt. It also offers mentoring and an opportunity to pitch angel investors and venture capitalists.
5. Y Combinator (www.ycombinator.com) - Seed funding accelerator with emphasis on Web/mobile applications. It provides up to $20,000 in seed money in exchange for 2% to 10% stake in the company. The incubator has funded over 550 startups to date, including big names like Reddit, Airbnb, and Dropbox.
To see SmallBizTrends.com’s listing of 25 diverse startup incubators, click here.