A few weeks ago, I attended the ribbon-cutting ceremony for the new MassChallenge accelerator space. There were hundreds of people there, including the founders of TechSandBox, an accelerator in Hopkinton, MA, and Smarter in the City, an “inner city” accelerator in Roxbury. Foley & Lardner is, of course, deeply involved with many accelerators in Boston and elsewhere, including MassChallenge, LabCentral, Techstars and Plug and Play. We also work with companies at many other accelerators, including the PayPal Start Tank, the Canadian Technology Accelerator, the Hult International Business School accelerator, and so on. Many of these new accelerators focus on a particular niche, whether a specific industry, a specific location, or a particular business or financial model. Some take equity from each company, while others, such as MassChallenge, do not. Some offer space, connections and mentorships, while others also provide price money or seed capital. Of course, some of them deliver on that promise better than others.
It’s amazing that each of these accelerators is able to attract suitable companies. This is especially significant, given that accelerators must renew their portfolio of companies within a very short cycle: once or twice a year. In contrast, venture and angel funds hold onto their portfolio companies for a number of years.
I wonder. Can there be a sufficient “inventory” of startup and early stage companies to fill the pipeline for all of these accelerators? Are there enough sponsors and mentors to go around? Will the quality of mentorship suffer as quantity increases? Is there enough available financing, whether angel or venture, to provide the graduates of these accelerators with a reasonable path to success? Continue reading this entry