When capital is overflowing, aspiring founders evaluate the value of a startup accelerator and whether it will move them closer to their goal or waste their time and equity. From my perspective, it depends on the mindset of the team.
The first time our company applied to an accelerator, we were rejected. Although our team had a deep background in chat and messaging technologies, we were building a consumer product with a team of Korean dads and single men trying to market a social media platform to moms in the U.S. and Korea. As good as the concept and technology were, it didn’t take the accelerator long to point out that we were probably not the right people to make this product a commercial success—especially in the U.S. market.
With a gut-wrenching result, we learned from that experience, and the company evolved. A year later, we submitted a new application after our big pivot to B2B software specializing in messaging technology. We were accepted.
Joining the accelerator marked a key milestone in the company’s growth. We’ve come a long way since that first meeting with the accelerator leadership, and we now support more than 90 million monthly active chat users worldwide. We also recently announced our $102 million series B round.
Although it positively changed the trajectory of our company, it doesn’t mean the accelerator experience works for everyone. If you are debating whether or not you should apply to an accelerator, answer the following questions honestly with your team.
There are three key areas an early stage startup should assess: the problem you’re trying to solve/market opportunity, the solution and its underlying technology, and the team. Have you identified a clear problem for which people genuinely want a solution, or are you building a company on a “nice to have” idea? Also, how much value does your offering create? How is it distinct in approach or capability from what already exists? Is it defensible over a long period of time? For us, this was the foundational element of our company. We had a defensible technology — even if there was a bit of uncertainty initially on how best to productize and sell it.
In terms of the team, do you have the right people, not only to build and market the product, but to fully understand the audience and its problems as the company evolves? We had a clear deficiency in this area, which was remedied as we homed in on what people wanted based on how they actually used the technology compared to our original intent. We parlayed this information into a product that is in close alignment with our respective skill sets and knowledge bases.
Where do you need help?
What are your greatest needs? Many founders — especially first-time founders — don’t always know what they don’t know: how to get to the initial product-market fit, hacking the way to growth instead of focusing on the core business. They look for shortcuts into fundraising — anything to go faster. Contrary to what aspiring entrepreneurs may think, startup accelerators are not there to help them hack through the journey.
Accelerators should give you the right advice on how to build a great and sustainable business, focusing on the right things and providing the right network to speed your learning. In our case, we wanted to be a global company but were unsure about the best way to make it happen. We’d never built a global startup at scale and needed to learn all aspects of product-market fit before scaling the go-to-market engine systematically. Additionally, because we were based in Korea, we had few connections to U.S.-based investors, customers and partners. Startup accelerators can provide a shorter path to these resources and lessons.
Can you shut out the noise and focus on the product?
Having the ability to shut off everything except the core—talking to customers and building the product—is often the most difficult thing for startup founders to do. Founders are exposed to many opportunities that can simultaneously pull them in different directions—fundraising, networking events, sales, product, media, etc. For our startup, the real value of the accelerator was that it took those pressures off and removed distractions. This forced us to spend time truly refining our product and talking to customers to deliver something necessary, usable and embraced.
Are you willing to learn?
It’s important to believe in your own capabilities and remain authentic and open-minded going through a startup accelerator because everything you think you know will be challenged and debated. Instead of resisting, ask questions and jump into office hours to extract as much value as possible. If you don’t, takeaways will be limited. The people affiliated with accelerators are some of the best resources you’ll find. Leverage them to make your company better, stronger and faster.
Will you pivot for the greater good?
Some companies pivot during their life cycle. We made ours shortly before starting with the accelerator, and it allowed us to soak up everything. Others pivot during the accelerator experience based on what they learn or by being able to spend unfettered time on the product, discovering what it is and is not capable of. Changes in market dynamics and other forces also can drive pivots.
Those companies that go through the motions to collect a check at demo day before reverting back to the idea they really want to pursue should avoid accelerators. There are enough sources of funding today that you don’t need to try to game an accelerator. Most of the time, partners will sense a lack of authenticity very early on.
If you believe the accelerator experience is right for you, go for it. From my experience, what you get in return is an amazing network of some of the smartest people on the planet with an opportunity to accelerate your learnings. Take advantage of the knowledge and connections available to you. You may get much further, faster through the support of those around you.