We are undoubtedly experiencing a worldwide startup accelerator bubble. There are over 9 accelerators in Brazil alone. Surely this must be good thing? Well not really. Nearly every new accelerator follows the Y-combinator model which has worked well in Silicon Valley but has been largely unsuccessful elsewhere. So what are the problems?
- Competition for the best startups – Current accelerator models require a sizable cohort to be built before programme kick-off. This presents the real challenge of finding enough quality startups at the time the accelerator is scheduled to start.
- Over-rigid programmes – A typical accelerator runs a 10-12 week programme. This is a massive commitment to a startup that may be ready to scale. Founders should be able to get follow on funding when they are ready, not at the end of a programme
- Inflexible start dates – Startups also require flexibility of start date. Missing the enrollment of a programme can lead to a high potential startup having to wait half a year to join the next cohort.
- Lack of perfomance monitoring – there is little subjective monitoring of progress on most accelerator programmes.
- Low valuations – accelerators provide small amounts of seed capital for a relatively high equity share in the startup. This can cause real challenges at later funding stages.
What is the answer? New accelerator models will use technology to attract, assess and monitor programme entrants. It will provide flexible support as and when it is required. It will drive the startup to achieve distinct milestones such as building an MVP or proving product market fit. Finally, it will use sophisticated valuation techniques to ensure that the programme adds significant value to the startup process. We are building out the Dreamstake platform to deliver these attributes.
Dreamstake provides end-to-end support for entrepreneurs wishing to get a startup funded in the shortest possible time. The startup rating system allows entrepreneurs and investors to monitor progress.Dreamstake Academy provides guidance on how to create a successful startup. Dreamstake will link startups with suitable mentors and professional advisors.
Startups that have successfully achieved an acceptable rating will be given the opportunity to feature at monthly demo days and investor pitching events.