Many people today do not know what the business acceleration program is? The following article will provide some basic information about accelerators as well as the advantages and disadvantages of Accelerators that startups should keep in mind.

What is Business Accelerator?

Accelerator is a program that supports startups to grow faster, more effectively and attract investment. Accelerators often provide startups with a small amount of money, a co-working space, training sessions, mentoring, and connections with investors. Accelerators usually last from 3 to 6 months and end with an event called Demo Day, where startups present their products to potential investors.

How does a acceleration program work?

A business accelerator program is a program to support businesses, especially startups in the early stages of development. This program typically lasts 3-6 months, providing startups with the resources and support needed to grow their business.

Business accelerators are often established by universities, corporations, venture capital funds, or non-profit organizations. Below are some specific activities that business promotion organizations often carry out:

• Selecting startups: Business promotion organizations will select startups to participate in their programs based on criteria such as: business idea, founding team, development potential, etc.
• Coaching and training: Startups will participate in training courses on important business areas. The training is often taught by business experts, venture capitalists, or successful entrepreneurs.
• Networking support: Business promotion organizations will organize networking events between startups and experts, investors, or other businesses.
• Financial support: Some accelerator programs can provide startups with a small financial investment to dealing with startup costs and help them grow their business.

Distinguishing between Accelerator and Incubator

Accelerator vs. Incubator (Business Incubator) are both startup support programs, but there are some basic differences as follows:

Support time

Accelerators usually last from 3-6 months, focusing on helping startups grow quickly in a short time. Incubator usually lasts 1-2 years, focusing on helping startups develop sustainably in the long term.

Support goals

Accelerator aims to help startups develop products and services, and accelerate revenue growth. Incubator aims to help startups develop business models, build teams, and prepare for capital raising.

Selection criteria

Accelerators often select startups with viable business ideas, experienced founding teams, and high growth potential. Incubator often selects startups with creative start ideas, a founding team with passion and the ability to learn.

Support

Accelerator provides support such as: training, consulting, connections, and a small financial investment. Meanwhile, Incubator provides support such as: workspace, training, consulting, and connection.

Support object

Accelerators often support startups in the early stage. Incubator often supports startups in the seed stage and early stage.
Thus, Accelerator and Incubator are two startup support programs with different goals and support. Startups need to choose a program that suits the development stage of their business and their support needs.

Advantages & Disadvantages of Accelerators

Advantages of Accelerators

• Improve business knowledge and skills: Startups will have the opportunity to learn from business experts, venture capitalists, or successful entrepreneurs. Startups will be trained in important business areas such as marketing, finance, legal…
• Expand your network of connections: Startups will have the opportunity to connect with experts, investors, or other businesses. This is an important opportunity for startups to learn from predecessors, seek cooperation opportunities, or raise capital.
• Improve the ability to raise capital: Startups will have the opportunity to approach venture investors. This is an important opportunity for startups to mobilize capital to develop their businesses.

Disadvantages of Accelerators

Besides many advantages, Accelerators also have some disadvantages such as:

• High requirements: Accelerator programs often have high requirements for the quality of the business idea and founding team. Startups need to prepare carefully before participating in the program to be able to take full advantage of the benefits the program brings.
• Short duration: Business accelerator programs usually last 3-6 months. This is a short period of time for startups to develop their businesses.
• Cost: Some accelerator programs require startups to pay a participation fee.

See also: Why startups fail and how implement business ideas successfully

Accelerators can bring many benefits to startups, but startups also need to pay attention to the requirements and disadvantages of this program. Startups need to prepare carefully before participating in the program to be able to take full advantage of the benefits the program brings.