Earlier this week I met with two co-founders who had recently completed a startup acceleration program. They were pre-launch and hadn’t raised any outside money (except for the money from the accelerator). In a word they are ‘early‘. One of the co-founders said they were going to miss the acceleration program and as a result it occurred to me that they might be at the perfect stage to join a second accelerator – one that focused on their space and was about to start a new class this summer. The founders had made great headway and in my view joining another program would help them keep up the momentum.
Despite what you may think, it is never too late to take advantage of an accelerator – even if you’ve raised hundreds of millions of dollars. Just last year, Silicon Valley based Quora, announced they were going join the 2014 Y Combinator batch despite the fact that the company wasn’t early stage at all. In fact, Quora had just raised their Series C of $80M at a valuation of $900M. The founder of Quora, Adam D’Angelo, explained that he joined Y Combinator to gain access to the accelerator’s partners, mentors, alumni and other resources.
- Joining a second accelerator would be too expensive in terms of equity. Most founders don’t realize that the amount and valuation of the money raised from an accelerator are negotiable. In Quora’s case, they allowed Y Combinator to invest alongside Tiger at the same valuation (i.e. $900M). When we joined an accelerator we allowed them to invest in our convertible note instead of accepting their ‘standard’ deal. Hopefully, after finishing your first acceleration program you’ve increased the valuation of your company and the second accelerator is willing to pay a higher price. At the end of the day, take a look at the value of the program and the cost of the money and make a smart decision.
- The first accelerator would be offended if you joined a second accelerator. This is absurd. Princeton doesn’t get upset when their students attend Harvard. In fact your first accelerator has a vested interest in your success and if you think a second accelerator can help you they will happily support your decision. Afterward you’ll have two groups helping you get the support and resources you need for success. Accelerators are a lot like college – you get out what you put in.
- Joining a second accelerator is a bad signal. Getting into an accelerator is a competitive exercise, in fact it is easier to get into Harvard than some accelerators. Getting into two is a pretty rare accomplishment. Don’t get me wrong, most of the startups coming out of accelerators are better off NOT joining a second accelerator, but in some cases it is clear the company needs more time to bake – accelerators are a great place to cook. If anything, joining a second accelerator is a positive signal.
If your first demo day went well and you need a little more time and a little more help seriously consider joining a second program. Two heads are always better than one. Good luck.