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Archive for April, 2014

Yet Another Startup Accelerator?

Startup Sauna Accelerator
Startup Sauna Accelerator

Back in 2013 when I launched the StartUp42 accelerator in Paris, I received so many “oh, another accelerator” comments that I was really wondering if I wasn’t too late in that space.

Since then, TheFamily, 50Partners and Microsoft Ventures launched, the city of Paris opened new incubators and Xavier Niel, France’s telecom mogul, announced 1000startups, the soon to be largest startup incubator in the world.

Corporates like media company Canal Plus or telecom giant Orange also opened their own incubators. Even the French government announced a 200M€ investment plan for private accelerators throughout France.

Are we in an accelerator bubble?

Olivier Ezratty, a long-time and well respected commentator of the French startup ecosystem seems to think so, based on his recent article (in French) about our ecosystem being overheated. And, apparently, this is not just in France.  Silicon Valley entrepreneur and strategy consultant, Sramana Mitra, also recently wondered about being in an accelerator bubble. I’m not even talking about bloggers like Craftsmanfounder’s Lucas Carlson with his “incubators are bullshit” piece. And more are coming.

While the exact number of accelerators is unknown, f6s.com, a website that provides services to accelerators (including us at StartUp42), lists more than 2,000 worldwide. In a HBR article, Sramana Mitra even talked about 7,500 business incubators globally. In Paris, the city hall’s MyStartupInParis lists 44 incubators as of today and I’m coming across individuals and corporations who want to launch their own startup program literally every day. So no questions asked here: we are definitely in an accelerator bubble.

Is it a bad thing?

Question: can you tell me which of the two pictures below is a startup accelerator?

Startup Office 2Startup Office1            None but anyway you wouldn’t know just by looking at the pictures. The main problem with having too many startup programs is that entrepreneurs don’t know which one to choose, especially if they decide to give away equity to the program. It’s like choosing a university after high school.

Each accelerator has its own model (non-profit/for profit, equity based or not, investing or not investing), its value added and it’s rather difficult to judge for organisations that mostly did not exist 3 years ago. The problem when it’s difficult to judge the quality of an accelerator is that entrepreneurs might lose some precious time (and sometimes equity) in a program that does not bring enough long-time value.

Without disrespecting some programs, I clearly see the difference between programs that are entrepreneur-friendly, mentorship driven and focused on results, compared to others that offer glorified office space and mentorship that look like (and sometimes is) McKinsey style consulting session.

But this is hard to see from the outside. This is clearly one of the reasons that pushed us to be a member of the Global Accelerator Network, which ensures that all its accelerator members fall into their vision (which I share) of acceleration.

Do we need startup accelerators?

Happy Startup SchoolBusiness schools emerged in the second half of the 19th century to meet an educational need not provided for by other institutions. Accelerators are trying to fill a similar gap today. So, while b-schools train future corporate leaders, accelerators train current entrepreneurial leaders. Accelerators are today’s e-schools. By providing hands-on advices from experienced mentors and networking opportunities to founders, especially those not very familiar with business topics (like technical founders), accelerators really fulfil this “educational” mission.

Accelerators are also a great way to shake up an ecosystem and help emulate  entrepreneurial vocations. But, on top of that, what I’ve found most valuable for the founders we’ve helped so far, is endorsement. Entrepreneurship is hard. You make a lot of sacrifices, especially social ones. Being selected in a renowned program, even if you’re still not making money, is already a great sign sent to your family and friends that you’re not doing all this for nothing.

Will it stay the same?

I think we’re going to see more and more accelerators in the short run. Driven by startup hype (and probably bubble) and growing interest from corporations (see this good piece by @jd on the subject), startups will now have more and more options in terms of support. Their success in the long run will depend on their business model.

Equity-based accelerators will need to have several successful exits to sustain their growth and convince LPs to keep investing (there will always be investors) while, for other models (like non-profit), it will really depend on the accelerator’s capacity to show value to their sponsors (or customers) over time. As of corporate accelerators, I doubt most of them will still exist in the next 3 years as they’re usually considered a cost and their existence is almost always tied to one executive sponsor internally (that will eventually leave).

As of StartUp42, our sustainability is tied to our ability to select and help future successful startups that will in return help the organisation, while at the same keep convincing sponsors that our position in the ecosystem (especially developers’ groups) is still relevant over the years.

Growth Hacking MooC

Growth HackingI’m currently working with my pal Pierre Conreaux, on a Growth Hacking MooC that will be available to french-speaking students and professionals on May 12th, 2014. This course will be my first real online course and one of IONIS Digital Learning‘s first classes.

Growth Hacking, you said?

Yes, growth hacking is one of these new  buzzwords that any self-respecting startuper and innovator has to use, together with design thinking, lean startup and customer development. But growth hacking is more than just a fancy name. It symbolises the profound impact that Internet has made on traditional marketing. Growth Hacking is 21st century marketing.

What’s a growth hacker?

A growth hacker is a person whose true north is growth. Everything they do is scrutinised by its potential impact on scalable growth. But growth hackers are also obsessed with metrics. Having scalable growth is great but understanding very accurately what actions led to the growth is better. That’s the hacker’s part of growth hacking.

Can I know more?

Yes! Just wait until May 12th for the course. Also, if you feel like helping out in the construction of the course, don’t hesitate to shoot me an email on daniel [at] qanubin [dot] come

Inspiration of the day #8

David Heinemeier Hansson on stage at RailsConf 2010 in Baltimore MD.Unlearn your MBA

In this great video from Stanford University’s Entrepreneurship corner, David Heineimeier Hansson, the creator of Ruby on Rails and partner at Basecamp (formerly 37signals), says that planning is guessing, and for a start-up, the focus must be on today and not on tomorrow.

He argues that constraints–fiscal, temporal, or otherwise–drive innovation and effective problem-solving.

The most important thing, Hansson believes, is to make a dent in the universe with your company.

Inspiration of the day #7

The Other Side of InnovationThe Other Side of Innovation

Companies can’t survive without innovating. But most put far more emphasis on generating Big Ideas than on executing them—turning ideas into actual breakthrough products, services, and process improvements.

That’s because “ideating” is energising and glamorous. By contrast, execution seems like humdrum, behind-the-scenes dirty work. But without execution, Big Ideas go nowhere.

In The Other Side of Innovation, Vijay Govindarajan and Chris Trimble reveal how to execute an innovation initiative—whether a simple project or a grand, gutsy gamble..

Practical and provocative, this book takes you step-by-step through the innovation execution process—so your Big Ideas deliver their full promise.

Inspiration of the day #6

Elon MuskElon Musk, the real-life Tony Stark.

This great interview of Elon Musk by Google Ventures’ Kevin Rose, as part of the Foundation series, disclose some of Musk’s ambitions and goals in his two current ventures SpaceX and Tesla. Great watch.