Invstment accelerator, as a new emerging business growth model, has drawn great attention recently. It can tremendously boost the whole process of a startup, from idea conceiving, team assembling,product development, user acquisition to financing and scaling. The core process of a investment accelerator includes: solidify business ideas, optimize product-market fit, assemble talents, iterate and pivot, acquire first customers, complete first fundraising. Accelerators like Y-combinator has nurtured thousands of unicorn startups like Airbnb, Dropbox, Cruise Automation, etc. The strong power of accelerator model on scaling up startups worth deeper look.
idea solidification: from coarse conception to solid business plan
The beginning process of an accelerator involves idea solidification, which transfers a coarse startup conception into solid business plan and model. This process contains competitive analysis, market survey, product feature drafting, financial forecast, etc. Accelerators usually set up mentor teams with different field experts to help startup teams clarify and enrich their initial thoughts. Also, they will assign homework about business planning and model canvas for teams to think through every critical components carefully. With the help of accelerators, startup teams can swiftly turn raw ideas into well-prepared business plans and models.
product development: from business plan to real product
After establishing solid business plan, an accelerator will then lead and facilitate startups to develop real products or services, which is the next critical process.Accelerators have resources to support rapid prototyping, agile development, UX design, etc. Also, they will keep pushing startups iterating products over and over again for optimization. Startups under accelerators can quickly walk through every cycles of designing, implementing, testing and improving, benefiting from accelerator’s structured product development process. The intensive product development support during the accelerator process enables startups transform business plan into high-quality product efficiently.
user acquisition: get product-market fit via promotion
Gaining product-market fit is pivotal for a startup before scaling up. Accelerator will leverage its reputation and alumni network to help startups acquire initial users and get market validation for the products. Public launch events, roadshows, media exposures organized by accelerator offer great opportunities for startups to get their products in front of right audiences. Accelerator mentors are experienced in viral marketing, growth hacking and other low-cost promotion means, which they will teach and guide startups to acquire users and drive growth. With accelerator’s help on user acquisition, startups can swiftly get market feedback, iterate products, and achieve product-market fit.
financing: get funded by demo day for scaling up
The most important process of accelerator comes at the end – demo day, during which startups pitch in front of numerous investors to raise their first funding. The intensive coaching and training on pitch skills, business planning, financial modeling from accelerator mentors get startups fully prepared for the demo day. Investors participate demo day are usually accelerator’s network of VC firms, angel investors and corporate partners. Startups meet them during the batch too. The demo day organized by top accelerators are proven to be hugely effective for startups to acquire seed or series A investment, which offers essential financial fuel for startups’ next stage of growth and scaling up.
In summary, investment accelerators like Y-combinator turbo charge startups to swiftly complete pivotal early processes: solidifying ideas into business plans, developing products iteratively, acquiring first users for validation, securing critical early funding. With the structured model and intensive mentoring of accelerators, startups can speed through obstacles faced in early stage, and get fully equipped and funded to scale up business.