Editor’s note: This post was initially a comment in response to a TechCabal article

Fora just joined one of Canada’s top accelerators (Extreme Ventures) and they have done pretty well for us. We gave them a 6% stake and we are being pushed fucking hard.

I hardly have time for my usual bullshit (even this, but I thought it was important). I just have a few points of advice for fellow founders looking at accelerators

Don’t be a guinea pig.

If you can, WAIT and talk to the first group of founders that graduate from these accelerators. They will tell you the good, the bad and the ugly. These accelerators will invariably make mistakes with the first set of companies and the type of mistakes they make will tell you whether you want to risk your baby with them or not.

It isn’t wise to work with an accelerator that wishes to own 20% of your company

Leadpath, I’m looking at you. An accelerator is supposed to get you started. Your series A which should come immediately after the accelerator will take another 30%. So just when you are starting to hit your stride, 50% of your company is gone. Harsh. How will you stay motivated? (You won’t). Personally I think 10% is a lot set but given this is Africa, I think it makes sense to stick with accelerators that will take below 15%.

It is all about the demo day

An accelerator is supposed to be a high leverage moment in the life of your startup. You literally have 3 months to create the most value you can because you are in the spotlight and everyone is watching. Every move you make matters. But no matter how hard you work in an accelerator, it will not matter if the right people are not there at demo day. That is just the fact. “If a tree falls in a forest and no one is around to hear it, does it make a sound?”. Your accelerator needs to be able to get top investors (not prospectors) to come to your demo day otherwise your 3 months of handwork will just be a fucking waste.

Accelerator owners might not want to be straight with you about their investment connections but there are a few ways to find out if they have serious connections to growth money or not:

Ask who their LPs are

If their LPs are funds, they probably have good connections with them. I think Savannah can be trusted in this regard.

Find out who is in their mentor network for startups

If an accelerator owner thinks he can teach you everything about your business without reaching out to subject matter experts, he is a joker. Accelerator owners with good mentor networks will be able to connect you to money.

Are they operators?

Accelerator owners who are operators that have raised and successfully exited from a previous company are much better than a bunch of ex-bankers thinking an accelerator can make them a quick buck. The previous have the backing of investors they have made money for before and who trust their judgement. The latter are useless to you until you IPO (which is a long way away).

There are a lot more key things to note for those looking to join accelerators but this is all I have for now.

Key thing to remember is that whether you accelerate or not in an accelerator is largely in your hand. Remember that an accelerator is the highest leverage period of your startup’s history – it will make or mar your startup. You can take advantage of it and build a quantum of value in a short period or you can waste your time and go slow for the rest of your life.

Your decision.

Photo Credit: G@ttoGiallo via Compfight cc

Iyinoluwa Aboyeji Author

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