Most accelerators in India suck. Here’s how you can tell which ones are good

Can you tell the good from the bad? Photo credit: Moose477.

There’s growing skepticism about the startup sector in India. While it is debatable whether this is healthy or unwarranted, it’s bringing everything under the scanner, including the work of incubators and accelerators.

India has plenty of programs to nurture entrepreneurship. Some popular names include Microsoft Ventures, GSF, and Kyron.

In fact, if one were to keep counting, it would seem like a new one pops up each day, leaving many to observe the still nascent world of India’s startups and ask whether the accelerators are doing anything at all. So, what separates the wheat from the chaff, and what makes for a good startup program?

Different types of accelerators

Photo credit: Tracy

“We have a few ways to identify things,” explains Alex Prather of Unitus Seed Fund. Its recently launched Speed2Seed program provides incubator managers with support to make sure that their startups are ready for investments once they graduate. “First, there are hyper accelerators. These are the ones like Y-Combinator where startups that have raised series A actually go back to join these programs. They get a ton of great mentorship and a fat Rolodex out of it. Sometimes they even come up with products that they can use in their own businesses.”

“Then, there are those that fall into the zone where people are trying to raise series A. These are regular accelerators. They take mature startups and develop them. They generally look for a prototype, and even though some with just ideas get in, the general consensus is that they like to see some sort of revenue generation.”

“Lastly, there are incubators. These take early stage startups and help them grow. Of course, these aren’t the only three models but they are an easy way to describe the majority of what’s happening in that world.”

The Speed2Seed program’s thesis statement is that, of the three archetypes, incubators generally have the least success, meaning that early-stage startups are often lost at sea after completing a program.

In a study, Unitus found that of the 200 surveyed startups, 71 percent of hyper accelerator graduates received funding within six months. The number of those from the middle batch – accelerators – was significantly lower, with only 31 percent of those getting funded within six months. Among incubators, only 12 percent got funding within the same timeline.

These numbers aren’t to be taken at face value, however. As the report goes on to explain, it’s logical that a startup accepted to a “hyper accelerator” program will be more mature and likely to succeed. And, there’s often a blurry line between incubators and accelerators, leading some to nickname the hybrid as “inculators”.

Still, the low numbers are a warning that there is a fine-tuning that hyper-accelerators are managing to provide that earlier stage programs are not.

What’s the quality of mentors?

Does it have a sector focus?

Does it have a strong network?

Getting some structure