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Is a startup accelerator program a good choice for me?

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startup accelerator

Absolutely! If accepted into the right program, there is no better way for an early-stage startup to scale and find the best investors. But you may wonder how to go about it. Since 2005, accelerator programs have become a trend in the investment sector. Globally, there are close to 200 active startup accelerators today. In this sea, how to choose the right fit? Let’s begin with the basics.

What is a startup accelerator?

Startup accelerators are intensive mentorship programs. They help startups crunch 3-5 years of the growth process into 3 – 6 months. Yes. You heard that right. This is why they are called ‘Accelerators’. Most of them provide a seed fund of $10K – $25K in exchange for 0 – 10% equity in graduating startups. But accelerator programs are best known for their ‘Demo Day’, the final day at the end of the program when startups pitch their accelerated, scaled-up pitch decks to potential investors. That is the moment of truth. Apart from these, there are upcoming programs that offer a longer engagement.

Broadly, based on their operating structure, startup accelerators are of three types:

  1. Venture funded: These are driven by Venture Capitalists with the sole aim of profits. They look for quick and massive ROI over a short period. The startups they choose to fund must show a promise of higher returns over a 3-5 yr period when compared to regular investment instruments.
  1. Government funded: These accelerators have a broader goal beyond short-term profits. They nurture startups with a potential for the greater good such as job creation, reviving local economies, creating applications for government projects, staying ahead in the global competition for tech innovations, and the likes.
  1. Corporate funded: Corporate-sponsored startup accelerators nurture new ideas usually to further their business vision. For example, giants like Microsoft, Google, Facebook run accelerator programs to support innovations. If it fits, they might end up acquiring some of them.

Beyond these, startup accelerator programs have defined goals. Their operating industry, funding structure, mentor network, skill development programs, course duration, on-site requirements, investor network, alumni support, and geographies are well defined. So make sure you thoroughly research various accelerator programs before choosing the right one.

First startup accelerator – Y Combinator 

This is where the accelerator story began. In 2005, Paul Graham, Jessica Livingston, Robert Morris, and Trevor Blackwell founded a 12-week on-site program for early-stage startups. Their flagship program based in Mountain View, California accepts two batches a year focusing on finance, impact investing, and virtual currency industries. They have a special focus on black/African, American-led, and women-founded startups.

Over the years, Y Combinator has diversified its accelerator programs to suit various geographies. They excel not only in their on-site curriculum but alumni support as well. Startups graduating out of Y Combinator become part of an elite network of entrepreneurs, investors, and industry experts. Y Combinator also runs an online Startup school that is accessible from anywhere in the world. As of 2019, they have made 4000 odd investments valued close to the US $155B. Today, Y Combinator is the most successful startup accelerator program in the world.

What do startup accelerators provide for startups?

Startup accelerators provide the best growth opportunities. Besides the mentorship, networking, and the basic seed fund, they do not promise success but the best shot at it. Here are some of the opportunities you can expect from a startup accelerator:

  • One-on-one meetings with industry experts and mentors
  • Cohort-based co-working opportunities with fellow founders
  • Progress monitoring and evaluation
  • Capacity building of the Startup business process
  • Possible connections with early adopters and channel partners
  • Focused, goal-driven work culture
  • Cross-learning and problem solving
  • Experiential learning
  • Access to potential investors on demo day, extended network

Pros and cons of startup accelerator

As an idea, accelerator programs are great. But if you are not ready for the fast ride, these programs can set you back massively. Time is the most precious resource in a startup journey. Before committing to an accelerator program that usually demands the presence of at least one founder and the core team for the entire duration of the course, it is best to analyze all aspects of it. Here are some of them:

Benefits of startup accelerators:

  • Focused training to raise funds from top investors in the industry
  • Assured seed fund at graduation
  • The startup journey can be lonely. Accelerator programs create cohorts for founders across various industries to brainstorm and learn from each other
  • Build strong relationships with mentors, industry experts, and alumni
  • Social validation. Graduating from top startup accelerator programs lends a unique identity to new startups in the market. Investors tend to rely more on their capabilities compared to other companies trying to make it on their own.

Problems of Startup Accelerators:

  • Demands 100% presence. This is a non-negotiable term with most startup accelerators.
  • Demanding schedules. Accelerator programs run on tight schedules. They facilitate ‘learn on the go’. So there is learning and immediate application.
  • Equity dilution. Every accelerator demands equity in exchange for its services and a basic seed fund. A dilution at the seed stage will only magnify the possibilities of higher dilution in the subsequent funding rounds.
  • Relocation. Most accelerator programs are on-site. The core startup team has to relocate to the accelerator location and live around the premises for 2 – 3 months.

Thus there are many aspects to a startup accelerator program. If approached with sufficient preparation, the pros might outweigh the cons. As a startup founder, you cannot deny the gravity and timing of investments. Startup accelerators provide access to just that and much more. Then how should you approach this? What is the right time to consider an accelerator program?

When should I choose a startup accelerator program?

When you are ready. As a founder, make sure to ask yourself if you and the company are ready for an accelerator program. It is a myth that an accelerator guarantees success. As if it was a formula to become a unicorn overnight. In fact, it is the other way round. Accelerators need you to be at your best. Else it is a wasted opportunity. These programs are highly competitive with an acceptance rate of 1 – 3% only. So make sure you make the best of it. Here are some pointers to determine your ‘readiness’ for an accelerator program. You are ready when:

  • Startup has reached the early-seed or seed stage
  • Startup has a co-founder
  • Startup has an MVP
  • Startup has sufficient market research data to establish the viability of the prototype
  • Startup has a business plan
  • Startup ready for a growth spurt
  • Startup has a core team of experts who can learn and deliver under high pressure, portray leadership skills
  • Startup team  can commit 100% time to the accelerator program beyond managing the company on a day-to-day basis
  • Startup ready to part with 5 – 10% equity in exchange for the deliverables of the accelerator program
  • Startup ready to part with an additional 10 – 20% equity for the seed round on Demo Day
  • Startup core team ready to relocate to accelerator site
  • Startup has all legal documents in place
  • Startup has a minimal error process to update and maintain cap tables

Once you have checked all these boxes, you can rest assured that an accelerator program will work in your favor. But this is only one side of the story. What about the merit of an accelerator program? If you have worked so hard to create a credible company, shouldn’t you check the potential of the ones choosing you? Will they do justice to your time and efforts? Here is how you can approach this situation.

  • Do a thorough background check of the accelerator program. Check with their alumni and market feedback
  • Do their goals align with your company? With 5 – 10% equity they will become your shareholder. Ensure you are allowing management access to the right people
  • Check their curriculum. It should include courses that strengthen your fundamentals in startup operations such as legal, business model, finance model, equity management, due diligence, and the likes
  • Check how they monitor progress and performance. Do these metrics suit your business?
  • Visit their premises and check facilities
  • Verify their engagement levels. Ensure their goals are pragmatic
  • Verify mentor profiles. Ensure they are seasoned entrepreneurs with real industry experience
  • Verify investor network. Research their Demo Days. Who participates? What is their credibility? Transparency in financial transactions, etc.
  • What happens after you pass out of the program? How is the alumni support?

Popular startup accelerators 

There are more than 100 startup accelerators and the number keeps growing by the day. To get you started, we have compiled a list of the top 10 based on the amount of seed capital raised:

Y Combinator

Duration: 3 months

Headquarter: Mountain View, California

Companies launched: 1801

Seed fund: $39,839,695,289

Track record: 4000+ investments, 354 exits

Top brands:

Stripe, Airbnb, Cruise, Automation, DoorDash, Coinbase, Instacart, Dropbox, Twitch, Reddit

Techstars

Duration: 3 months

Headquarter: Boulder, Colorado

Companies launched: 1336

Seed fund: $8,664,791,204

Track record: 3,300+ investments, 310 exits

Top brands: Bench, Digital Ocean, FullContact, SendGrid, and Zagster

500 Startups

Duration: 4 months

Headquarter: San Francisco, California

Companies launched: 686

Seed fund: $3,195,638,016

Track record: 2,600+ investments, 288 exits

Top brands: Twilio, Credit Karma, SendGrid, Grab, GitLab, Bukalapak, Canva, Udemy, TalkDesk, Intercom, Ipsy, MakerBot, Wildfire, and Viki

AngelPad

Duration: 3 months

Headquarter: San Francisco, California

Companies launched: 153

Seed fund: $2,234,261,983

Track record: 175+ investments, 36 exits

Top brands:

Buffer, CoverHound, MoPub, Postmates, Astrid, Drone Deploy, Ribbon, Pipedrive, Rolepoint, and Vungle.

Seed Camp

Duration: Customized to suit shortlisted candidates

Headquarter: Shoreditch, London

Companies launched: 118

Seed fund: $1,124,789,400

Track record: 400+ investments, 43 exits

Top brands: UiPath, TransferWise, Revolut, Hopin, Wefox, Grover, Viz.ai, Sorare, and Trestle

The Alchemist Accelerator

Duration: 6 months

Headquarter: San Francisco, California

Companies launched: 344

Seed fund: $1,036,045,522

Track record: 540+ investments, 37 exits

Top brands: LaunchDarkly, Rigetti Quantum Computing, mPharma, Matternet, and Mightyhive

DreamIT Ventures

Duration: In 4 phases, distributed over a year

Headquarter: Greater New York Area, East Coast, and Northeastern US

Companies launched: 197

Seed fund: $1,032,491,096

Track record: 370+ investments, 38 exits

Top brands: LevelUp, Trendkite, SeatGeek, HouseParty, Adaptly, Wellth, Biomeme, Tissue Analytics, Redox, Eko Devices, Raxar, Cylera, and Elevate

Amplify. LA

Duration: 4 months

Headquarter: Venice, California

Companies launched: 36

Seed fund: $689,256,760

Track record: 140+ investments, 17 exits

Top brands: Tapcart, Candid Wholesale, Carpay, Lantern, Abstract, Strike Graph, Return logic, Good fair, Stack Commerce, RadPad, Bitium, Mover, and Mapsense.

Mucker Lab

Duration: Phased over 1 yr

Headquarter: Santa Monica, California

Companies launched: 27

Seed fund: $628,025,626

Track record: 9 investments, 3 diversity investments

Top brands: Alcatraz, Artful, Bambee, BloomNation, Butter, Citruslabs, Cloverleaf, Emailage, GoFor, Hologram, Honey, Leaselock, Papaya, ShipHawk, TrunkClub, and Workfast.

FounderFuel

Duration: 4 months

Headquarter: Canada

Companies launched: 69

Seed fund: $596,485,083

Track record: 94 investments, 13 exits

Top brands: Sonder, Transit, Mejuri, Bus.com, Unsplash, XpertSea, LoginRadius, BenchSci, and Ready Education

Conclusion

Since the launch of Y Combinator in 2005, startup accelerators have become a trend. To nurture and launch startups for a small percentage of ownership in their companies has become a profitable investment strategy. They promise higher returns when compared to traditional investment instruments. Hosting a startup accelerator program and graduating out of one is a symbol of market leadership today. As a startup founder make sure to weigh all the pros and cons before embarking on this journey.

Sarath C P is a Digital Strategy Consultant at IncParadise (www.incparadise.net). He is a part-time blogger and his favourite hobby is traveling and listening music.

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How Is 3D Scanning Revolutionizing the Apparel Industry?

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How Is 3D Scanning Revolutionizing the Apparel Industry?

Sizing issues are a significant challenge for fashion retailers — especially when customers are shopping online. In general, both parties have come to expect that occasionally buying the wrong size is just part of the e-commerce experience.

However, a new technology may help companies find the perfect fit for their customers. 3D body scanning allows consumers to provide retailers with their precise body measurements — allowing for highly accurate sizing when they shop online. Here’s how this tech has advanced to the point where it can benefit companies and shoppers alike and potentially disrupt the fashion industry.

Product Fit and Returns Remain a Major Challenge for Online Fashion Retailers

Finding the right fit can be challenging, especially when shopping online. Customers can use the sizing information retailers provide. Still, it can be challenging to select the right size or visualize how a particular garment will fit without trying on the garment in real life.

As a result, many customers find that the apparel they buy online doesn’t fit well or match their style once they see it in person. Some customers even plan to receive items that don’t fit. They will use “bracketing” — or the practice of ordering the same thing in multiple sizes and returning what doesn’t fit well — to ensure something will work.

Even if every other aspect of the customer’s experience is positive, receiving a garment that does not fit can leave a bad impression. This can ultimately lead them not to shop with a brand in the future.

According to research from Morgan Stanley, product fit and returns are two of the biggest barriers for online fashion shoppers. However, online shopping has become more important for retailers of all kinds in a post-COVID world.

Companies can manage this challenge with a robust return program, but these offerings can significantly cut into profit margins. Free returns require retailers to budget for frequent round-trip shipping to ensure customers will eventually receive a garment that fits properly.

Ongoing supply chain woes and shortages of essential raw materials can make returns hit retailers even harder. Managing reverse logistics becomes even more painful when it’s more difficult to ship goods to customers at all.

How 3D Scanning Can Help Retailers Find the Perfect Fit

3D scanning apps allow customers to use cameras and lasers to capture their precise body measurements. This technology has been around for 30 years, but it’s become much more accessible.

Smartphones have become advanced enough to support fairly accurate body scanning technology. Most offer sophisticated cameras, and a handful of available phones use lasers to provide features like facial recognition.

Several 3D body scanning apps are available, allowing any customer with a smartphone to take advantage of the technology. People can also take advantage of businesses or body scanning tools that have arrived on the market over the past few years.

Using 3D Scanning to Streamline Online Fashion Shopping

Customers could export their measurements and body scans to e-commerce sites while shopping for clothes. Retailers could use this information to ensure buyers always receive clothes that fit.

For example, retailers could design online storefronts that either accept these measurements or integrate directly with body scanning apps, then provide filters based on a customer’s unique physique. The storefront could display only the clothes that are likely to fit.

In addition to providing customers with more accurate fit information, these 3D body scans could effectively allow retailers to create virtual dressing rooms. For example, some retailers already use body scanning in product development. This can support design techniques like body mapping, which designers use to construct a garment in line with how the body moves.

These retailers may already have digitized 3D versions of the garments they sell. They could provide tools that overlay these clothes on a model that uses the customer’s measurements, allowing them to see roughly how an appropriately sized item will fit them in real life.

These measurements and 3D models could also allow customers to virtually try on new clothes and visualize how a particular garment would fit.

In practice, virtual dressing rooms that take advantage of body scans, customer photos and garment models could solve the return and fit problem of online fashion shopping.

3D Scanning Could Improve Fashion’s Bottom Line

Even modest reductions in the return rate on apparel purchases could significantly increase a company’s profit margin. According to Morgan Stanley, just a “5% reduction in the rate of product returns could double earnings before income and taxes for an online apparel retailer, all else equal.”

3D body scanning technology could also support offerings like remote tailoring. This allows businesses to personalize the sizing of garments over the web based on information provided by a customer. For example, someone may submit their measurements and speak with a tailor over the web who will adapt apparel to their specific size or style requirements.

It may even be possible to automate this resizing process in some cases. One example is Sizer’s partnership with bra brand Wacoal America. The two companies teamed up during the pandemic to develop an AI-powered app that helps customers find the right bra size within just a few minutes.

Several other companies are also experimenting with virtual sizing and try-on apps that allow customers to visualize a garment’s fit before committing to a purchase.

3D Scanning May Help Fashion Tackle Its Return Problem

Experts predict that online shopping will continue to grow quickly over the next few years. Even as customers return to shopping in person, e-commerce will continue to become more important to the fashion industry at large. As a result, retailers will need to contend with the difficulty of properly sizing garments when shopping online. Tools like 3D body scanners can be a powerful way for businesses to ensure customers receive clothes that fit well.

Some retailers have already started to develop virtual sizing and try-on apps for their customers. Combining these apps with 3D body scanning technology could help fashion solve its product fit and return problems.

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Why Company Vehicles Are Important

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Why Company Vehicles Are Important

Every penny counts when you run a business, so the last thing you’ll want to do is pay for something you don’t need. This is why it’s so important to weigh up the pros and cons of each buying decision to ensure that what you are spending money on is worth it.

When it comes to company vehicles, this decision-making process is crucial. You might already know that you absolutely need some vehicles to make deliveries or get to clients’ addresses, for example, but if you’re unsure because you like the idea of providing your team with vehicles but don’t know whether the cost is justified, read on; here are some reasons why company vehicles are important.

Cost-Effective

One of the reasons you might not be sure about running a company vehicle (or multiple company vehicles) is the cost. Not only will it cost you money to purchase or lease the vehicles in the first place, but there are also ongoing costs, such as tax, maintenance, and fuel. This can all add up to a lot and might even mean that investing in company vehicles is prohibitive at the moment.

Yet if your budget can withstand the outlay, there are many ways to make owning or leasing company cars more cost-effective. For one thing, you can use them to offset tax costs throughout the business (an accountant will be able to help you with this if you’re unsure what to do). Plus, if you have good fleet solutions in Texas, you’ll already be able to discover plenty of cost-saving exercises. So, although buying company vehicles might seem expensive at first, there are many things you can to do to mitigate those costs.

Attract Employees

If you want to have a successful business, having the best employees is a crucial component. If your team is substandard, the work you produce will be as well. This is why you need to do everything you can to attract excellent employees. There are a number of ways to do this, but the best thing you can do is offer them a variety of benefits and incentives to work for you. Among these ideas is the company car.

If there is a choice between working somewhere that offers someone a new company car and somewhere that doesn’t, it’s likely that the potential candidate will at least consider the company that offers them more and will often apply for the position. After all, although they will have to pay tax on that car, they can also save money on a vehicle in the long term. When you give employees a company car, you’ll have much more choice when it comes to who to employ, and you can find the very best without having to compromise.

Marketing

Marketing is a tricky thing to get right, and in many situations, it costs a lot of money. You need to be sure that what you’re spending money on is worthwhile and will work – you need to know that people are seeing your advertising.

One way to guarantee that your marketing efforts will be noticed is to have company vehicles that are wrapped in your marketing material. Whether that’s a full ad or simply the name and website of your business will depend on what you need to say, but the fact that these vehicles are driving around all day and will be seen by hundreds and potentially thousands of people mean they are the ideal marketing tool.

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7 Essentials For E-Learning Graphic Design

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7 Essentials For E-Learning Graphic Design

It’s becoming increasingly common for people to rely on e-learning. It can help with school or gain skills for career purposes. If you plan to take an online course, consider eLearning graphic design. With the available web resources, one can learn design on their own. This article will go over the basics of eLearning graphic design.

7 Essentials For E-Learning Graphic Design

  1. Research the client’s website and business.

Research is essential when designing graphics. Consider visiting both the client’s website and their social media pages. It will give you important information regarding their expectations. Check the type of content the business posts and how they present themselves.

After research, a design team should have an idea of the best approach. For instance, maybe the client’s website mainly uses the colors red, blue, and white. This could be related to their brand when it comes to audience perception. Therefore, mind this when trying to create a graphic design. To ensure consistency, you might not want to deviate from this main design theme.

  1. Look to current design trends for inspiration.

Every designer wants to take time to develop their own creative design. Yet, it is still recommended and encouraged to draw inspiration from current trends. By their nature, trends have been proven to work well with the public. However, when trying to draw inspiration, avoid outright copying another design. That would be the same as plagiarism for writing. You could prevent writing plagiarized content by using top essay writing sites for your articles. Their experts can create original papers for you. 

When it comes to design, stay authentic even when taking inspiration from trends. For instance, if a current trend includes video feedback, you might want to do something similar. You could design a webpage dedicated to customers’ reviews. Alternatively, you might decide to go further by combining both ideas. Go through several e-learning websites to get a good picture of what is trending.

  1. Discuss the needs of the project with the client.

For a graphic design project to be successful, it must align with the client’s needs. The way to ensure this is to initiate contact with the client. This could be done via a physical meeting or a Zoom call. 

Some clients finalize their requirements before contacting a graphics design team. However, some requirements can only be established during an interaction. The demands might be complex, but you can practice simplicity when visualizing them. Ask questions about the project to finalize all the requirements.

  1. Pay attention to color.

Color has been used historically to communicate messages. For instance, red is often associated with danger or aggression. Some brands have cultural or ideological restrictions when it comes to color. 

This is why it’s important to research the client’s website and establish their requirements.  Also, when choosing a color, consider how pleasant it is to the eye. For example, many colors on a website might make it look confusing and hard to look at. There are online courses on graphic design that teach proper coloristic.

  1. Choose good typography.

You want the audience to understand your design easily. To achieve this, you need to choose the right font. When your readers are going through your design, you don’t want any text you share to be confusing. Therefore, stick to a few chosen fonts on the website. 

You should consider the size of the fonts – it dictates readability. Most websites use an 11-16 size font. Finally, you should account for how your text will look on mobile devices and desktop computers alike.

  1. Create and share mockups.

You should create a mockup when you think you have created a good design. Share your mockup so that you can easily identify areas of improvement. Make sure that your client reviews your mockup regularly.

  1. Constantly lookout for feedback.

When working on any project, it can be helpful to ask for feedback, especially from the project’s stakeholders. At times, feedback might not be delivered professionally. However, if you’re able to separate the feedback from how it was delivered, you might be able to learn a thing or two. Aside from clients, you can also ask friends to share what they think about your progress. You could even reach out to members of your target audience to get some tips.

Final Things To Consider

As you create a website’s graphics design, paying attention to simplicity is important. You don’t want to overcomplicate your design. Avoid conflicting color schemes and unnecessary design elements. Your paragraphs should be short to maintain the interest of the reader. Make sure your design is original yet in line with current trends. Always ask for clients’ feedback as you work. Hopefully, the points shared in this article will help in your next design project!

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