Startup acceleration is a tool for entrepreneurs to gain a competitive advantage in an increasingly competitive and crowded ecosystem. Consider Newton’s first law of motion – “An object in motion remains in motion at constant speed unless acted on by an unbalanced force.”
Unless acted upon by an external force (accelerator program), many startups don’t see the rapid success and return on investment they initially hoped for. Acceleration programs act as a catalyst, a jolt, a foreign force to shift startups from slow progression to rapid escalation.
For this reason, startup acceleration programs have become a popular option for startups to differentiate themselves from the crowd. In this article, we will explore what a startup accelerator program is, how they differ from incubators, what percentage of equity they take, and what their benefits are. We will also discuss how our accelerator (Leaplab) has real long-lasting benefits to help your startup succeed.
Table of Contents
What are startup accelerators?
Starting with the basics, startup accelerators are programs that help early-stage startups grow and scale their businesses. Accelerators are cohort-based and usually run for a three-to-six-month period. They are often led by experienced entrepreneurs, investors, and industry experts who provide guidance and support to the startups in the program.
In return for acceleration services, startups must:
- Be established and in their early phase (preferably having already completed pre-seed to seed fundraising status),
- Have a minimum viable product (MVP),
- Be scalable, and
- Have a collaborative and coachable team.
What startup accelerators really do
The goal is in the name: startup accelerators exist to accelerate your startup’s growth. Because of their notably short durations, startup accelerators allow entrepreneurs to take what normally takes years worth of learning and work and streamline it into just a few months with an emphasis on learning by doing.
In short, startup accelerators provide:
- Piloting: Real-scale testing and validation of solutions.
- Expert support: Mentoring, educational resources, and services, etc.
- Industry engagement: Engagement with industry leaders and other stakeholders.
- Networking & resources: Networking opportunities with other entrepreneurs, investment, partnership/collaboration agreements, etc.
Accelerators vs. Incubators
While startup accelerators and incubators are often used interchangeably, they are actually quite different.
Incubators work with newly launched startups to develop their product or service and business model from the ground up. They help startups with product development, establishing and refining their business plans, and tend to be longer in duration, lasting anywhere from one to a few years since they help entrepreneurs essentially build their businesses from scratch.
On the other hand, accelerators work with early-stage startups with existing business models and products already validated in the market. The startups participating in these types of programs have a solid foundation, which allows efforts to be centered entirely on growth. As a result, they have a shorter duration, from one to six months. Sometimes accelerators provide seed investment to the participating startups, which is rarely done in incubators.
What percentage of equity do accelerators take?
Not all accelerators take a percentage of equity (such as the Leaplab Acceleration Program), however, some may take a percentage of equity in the startups they work with in exchange for seed funding and/or the resources and support they provide. This percentage can vary depending on the program; however, some programs negotiate other discounts should the startup and accelerator program host decide to enter into a commercial agreement.
While this may be a sensitive topic to some entrepreneurs, it’s important to remember that the resources and support provided by accelerators can be invaluable to the long-term success of early-stage startups.
Are startup accelerators worth it?
You might be weighing the pros and cons of joining a startup accelerator program. On the one hand, accelerators can provide startups with a range of resources and support that can help them grow and scale their businesses. On the other hand, the equity that accelerators take can be a drawback for some.
Let the facts speak for themselves. Startup accelerators have a proven success rate and can help you grow in several different areas:
- Business model & strategy
- Leadership & team
- User-centered design
- Technology
- Compliance
- Relational capital
- Networking
Why do you need an accelerator?
Startup accelerators offer numerous benefits for both startups and corporations, making them a valuable investment and collaboration opportunity.
Here are some key reasons why they are worth it for both parties:
For startups
- Access to expertise: Accelerators provide startups with access to a network of experienced mentors, industry experts, and successful entrepreneurs. These experts offer guidance, feedback, and valuable insights to help startups refine their business strategies and navigate challenges effectively.
- Funding opportunities: Many accelerators offer seed funding or connections to investors, which can be crucial for startups to scale their operations and bring their ideas to life.
- Validation & credibility: Participation in a reputable accelerator program can enhance a startup’s credibility and market reputation, making it more attractive to potential customers, partners, and investors.
- Networking: Accelerator cohorts bring together a diverse group of startups and mentors, fostering valuable networking opportunities and potential collaborations that can lead to long-term business partnerships.
- Intensive learning environment: Accelerators often organize workshops, seminars, and boot camps to accelerate learning and equip startups with essential skills in areas like marketing, product development, and sales.
For corporations
- Open innovation: Startup accelerators offer corporations a streamlined approach to identify and collaborate with innovative startups that can potentially address their industry challenges or complement existing product/service offerings.
- Access to emerging technologies: Partnering with startups can provide corporations access to cutting-edge technologies and solutions that can enhance their products, services, or internal processes.
- Company culture: Interacting with startups and their entrepreneurial culture can infuse corporations with a fresh perspective, encouraging more agile, innovative thinking within their own teams.
- Investment opportunities: Startup accelerators serve as a talent pool for potential investment targets, enabling corporations to gain a competitive advantage and diversify their business portfolio.
We are the accelerator your startup needs to succeed
Not all programs are the same. The best startup accelerators for one startup may not be the same for another. For high-potential disruptive startups with applications in the construction industry, we urge you to join one of the sector’s top startup accelerators.
At Cemex Ventures Leaplab, we are committed to helping early-stage startups grow and scale their businesses so we can foster the construction industry revolution together.
Our program offering includes:
- Real-scale co-financed pilot
- Solution enhancement
- Mentoring from industry experts
- Networking expansion
- Scalability insights
Our program runs for 14 weeks, culminating in a Demo Day where startups present their pilots directly to Cemex’s Executive Committee.
Cemex is looking to engage in long-term relationships with successful startups in each cohort whose pilot results show positive and strategic value. Therefore, while we DO NOT TAKE A PERCENTAGE OF EQUITY, in consideration of Cemex’s devotion of significant resources to the program, should Cemex Ventures (Cemex’s corporate venture capital) decide to participate in a financial round of investment or enter into a service agreement with a participant, Cemex will be entitled to a discount based on the total contribution made to such participant during the program.
Want to know what kind of startups we’ve worked with in the past? Meet the Cemex Ventures Leaplab 2022 cohort and learn more about their successful pilot outcomes here.
Want to learn more about Acceleration Services?
We are confident that our program can help your startup succeed, which is why we encourage you to take a leap with us.
If you’re interested in learning more, read about our acceleration services or contact us today.
