20,000 for a percentage of equity in your business. That could range from as little as 5% all the way up to 12%. I’ve seen them in all different flavors.
The form or the structure of the investment is, for the most part, going to come in a convertible note or on a safe note. What that means is that investment that they’re giving you is not coming with a percentage, or let’s say an equity or a valuation.
The next part is learning. When you attain one of those programs, it is an amazing network of experts and other founders that have also been super successful. What you want to do here is tap into those experts that have that expertise or knowledge specifically to what you’re doing and get their help on either the product and achieving product/market fit or understanding internal processes or understanding who you need to hire and how you can get in front of these people. That’s essentially what you’re going to be doing.
The next part is the network. The network is a massive component here because there are a lot of accelerator programs out there, and there’s a lot of noise. There are only probably two or three that are the best program, and those are the ones that you want to take a look at. Those are like YCombinator, Techstars, AngelHack is great, but there is a lot of noise, and you really need to be able to filter because the network is everything.
So, that network is really fantastic, how those founders are coming in and helping each other out, and I think that network is what you want to go after. Also, that network includes investors like angel investors or venture capital firms, so you want to make sure that you understand and that you’re asking who is part of their network and how they can help you on achieving the milestones that you need.
The next thing is the Demo Day. When it comes to the Demo Day, that means you’ve already done your three or six months already as part of the cohort of that batch of the accelerator. You’ve already done your progress. You’re ready to showcase your product, your service, whatever that is, and have everything in a pitch deck in that 15 to 25 slides where you’re presenting your story. And by the way, you can download the pitch deck template below.
You want to be very careful here. The best accelerator programs are the ones where on Demo Day, they bring qualified investors and top-tier investors. However, not the other accelerator programs where most of the time, what you see is a bunch of service providers that ultimately are going to waste your time.
Ultimately, you need to ask yourself: is a startup accelerator something that you want to do? Are you going to be okay giving away equity of your business?
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