c The changing faces of the UK accelerator academy market
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The changing face of the UK tech accelerator landscape

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The Accelerator Academy, London was set up to solve a problem, but now the market has matured and evolved. How should accelerators respond and adapt?

I am the Managing Partner of White Horse Capital, sitting on the investment committees of the Startup Funding Club and the Cabinet Office’s £10m Social Incubator Funds, and a co-founder of the Communication Partners media agency.

I also chair The Accelerator Network, encompassing the Accelerator Academy, which has supported 100+ high growth tech start ups, helping to prepare the companies to raise £25 million+ from private investors, seed funds, syndicates and corporates, creating over £200m of value in 3 years, and the EU-backed Fast Forward Pre-Accelerator Programme, uniting 18 accelerators and 3 chartered institutes to support hundreds of UK startups plus a series of bootcamps, hackathons and investor readiness programmes.


 

Back in 2011, I was responsible for the launch of the UK’s 3rd accelerator, the Accelerator Academy.

We were preceded by Seedcamp, with its respected, non-cohort based programme and Springboard Cambridge & London (now US-owned TechStars).

Accelerator Academy was backed by White Horse Capital, a later stage investor – and formed to address the growing number of high growth potential tech startups approaching the investment business for seed capital.

The recession forced innovation from previously employed industry professionals, matched with the perfect storm of lower costs of launching a tech startup, a rise in tax breaks for angel investors, and an increase in the “sexiness” of running a startup.

It seemed apparent though that many first time entrepreneurs would often overestimate how much capital they needed to raise, have ‘optimistic’ views on their company valuation – not informed by the realities of the marketplace – and additionally these startups would always benefit from being fast-tracked, with introductions to clients, partners, key hires and others at the Accelerator Academy.

As White Horse Capital considered the challenge of reducing risk, providing the necessary connections, support and capital for these startups, it appeared too time-intensive to do so on a case-by-case basis.

The issues faced by the startups, which included a need for training, a desire to benefit from the experience of other successful entrepreneurs, and the hope of expanding their networks, were common.

This led to the creation of the Accelerator Academy, and with my own background building a number of investment-backed media/digital businesses through to exit, I took the lead in building the pilot programme.

I researched different accelerator models in the UK, Europe and the US, and developed an accelerator academy suitable to the UK.

Attracting nearly 30 partners helped the launch to go successfully, and 10 startups were selected and supported, with 70 hours of training and mentoring from exited tech entrepreneurs and access to value-adding investors.

The pilot proved a great success, with the first cohort now having raised over £3m of funding.

Since then, the Accelerator Academy, and the wider accelerator space in general, has expanded extensively, and had a huge impact on the UK startup scene.

Along the way, some of the developments that have occurred included the launch of over 40 other accelerators, many nuanced to serve different verticals (adtech; The Bakery, retailtech; TrueStart, fintech; Level39, social ventures; Bethnal Green Ventures etc), as well as Corporate accelerator programmes (Telefonica’s Wayra, Microsoft Ventures, John Lewis Labs).

Over £80m of equity funding has been raised by startups in these accelerator programmes as the value-adding role of an accelerator has been accepted and welcomed by the UK Business Angel Association, the UKTI , the UK Government, and the EU, as well as the creation of a number of high quality seed funds.

The accelerator academy ‘market’, continues to adapt and evolve, in these exciting times.

Quality thresholds are actively debated, with a [necessary] focus on measurement of different programmes; their consistency, their ability to get startups to market and to drive revenue through initial and subsequent investment rounds, and ultimately to success.

There are also discussions around the quality of mentoring and introductions that an accelerator academy can provide.

So, where next?

Increasingly, the accelerator market is adapting to provide lifestage specific support for startups.

In April this year, I was proud to be involved in the launch of The Accelerator Network, to create a joined-up approach to life stage support for the UK’s most promising tech startups.

Beginning with pro-bono inspiration sessions for aspiring entrepreneurs, the Accelerator Network then moves on to run hackathons and corporate innovation challenges, which enable aspiring entrepreneurs to test their ideas against an industry or government challenge (recent examples include the DCMS / BIS commissioned CyberHackathon, and the Visa Europe Collab Agile Innovation Challenge).

These initiatives often include strong collaboration between accelerators.

As an example, the majority of UK accelerators have united to support the country’s 1st Pre-Accelerator programme; Fast Forward, which we backed, as it now annually sees 50-60 idea stage entrepreneurs complete a 6 week bootcamp to prepare business plans, to access the 18 UK’s leading accelerators, with support from 3 chartered institutes [BCS, CIM, ICAEW], 6 incubators, seed funds and Government grant providers.

The post-accelerator space is also hotting up.

An accelerator academy should ensure its alumni companies can raise funding and follow-on investment, with initiatives such as the Accelerator Funding Network providing investor readiness bootcamps for accelerator graduates (backed by UKTI and the EU), as well as one-to-one dinners, investor mixers and showcases.

Engagement with the wider startup support ecosystem is key in all of this, and we welcome on board a number of industry partners, to play their part in the acceleration of UK tech startups; ranging from NatWest, IBM’s Softlayer, Dell, Visa, CrowdCube and a raft of smart service providers keen to support the startups.

The next goal for The Accelerator Network and others is to continue to expand capacity for life stage specific support for promising tech startups across the UK, and beyond, with international roll out of formats and sharing of best practice with other governments, cities and multi-national companies.