Startup accelerators are by their very nature exclusive. Programs begin with a selective application process; with few startups accepted, most will get rejected. Demand is usually higher than supply.
What if it didn’t have to be that way?
In 2018 Y-Combinator, which has a lower acceptance rate than Harvard, accidentally accepted 15,000 entrepreneurs to their “Startup School”. They ended up reformatting their programming into a massive open online course. It opened people’s eyes to the idea that technology could democratize access to entrepreneur support.
Our team has always been conscious of the fact that our accelerator programs are more exclusive than we’d like. We can only directly support a limited number of founders – currently about 120 a year – because of the cost of logistics, staffing and the tailored mentor support we provide by bringing founders to key cities around the world.
Last year we set out to explore how we could go from working directly with 1,100 founders in our first decade to reaching 50,000 in our second. That means reaching founders who sit in the blind spots of traditional accelerator programs, ours included: local founders vs. expat founders in emerging markets, Black and Latinx founders in the US, founders in nascent ecosystems, and always, founders solving “real world” problems, not “my world” problems.
So we started to ask the question: how could we improve access to our core accelerator programs while improving the unit economics of delivery? We formed a working group and began to explore the idea of hybrid online and virtual programming.
Then the global pandemic forced our hand.
In the past four months our team at Village Capital has made the transition to fully a virtual accelerator. And we’re not just talking about a copy and paste of our workshops over to Zoom. We spent this spring adapting the 45 hours of our traditional curriculum into virtual format, building a learning management platform, and developing a video series that founders can watch at their own pace.
Throughout the process, we kept as our north star the value of inclusion – that any changes we make should help us reach more founders who sit in the blind spots of traditional accelerators. We’ve learned some lessons that can be relevant for any organization that supports entrepreneurs.
1) Virtual accelerators offer more flexibility for founders
It’s impossible to fully know where a founder is in their personal lives. Over the years we’ve had founders drop out of programs because they needed to care for a family member, or for those who hadn’t yet made the leap to building their companies full-time, because they couldn’t afford to take time off from their day jobs.
And let’s be frank, this is a roadblock that disproportionately impacts female founders’ ability to participate in accelerators, as women are more likely to be in caretaking roles.
Virtual programming is far more flexible for entrepreneurs. Last month during our inaugural virtual program, NextGen Africa, one of the members of the cohort had a young child – she told us that if it wasn’t for the virtual format, she doubted she would have been able to attend at all: “Virtual programming allowed me to pop in and out as needed.”
2) Virtual accelerators open up the pool of mentors – and investors
One problem we’ve run into in the past is the limited pool of mentors available for any given in-person workshop. We typically run workshops in three different cities over the course of an accelerator to reach as many strategic mentors as possible, but that still limits our mentor pool to those three cities.
Virtual programming has freed us up to engage world-class mentors from anywhere, including mentors that bring enormous technical, business and market knowledge as well as speak the language of the startups in our cohort – culturally and literally.
For instance, several members of our NextGen Africa cohort are from Francophone Africa. We were initially planning to hold in-person workshops in some of the larger cities in East Africa, and we were concerned about finding French-speaking mentors. With the virtual format, we were able to Zoom in several investors and consultants from Francophone countries like Senegal and Mali.
This ease of access can also help mitigate “local bias”. A classic study found that nearly half of venture capital investments are located within 250 miles of the investor’s homes. Capital concentrates in Silicon Valley and New York City because so many investors live there; but if there was ever a time to change that dynamic, it would be now.
3) Online or hybrid accelerators are far more cost-effective
Running an accelerator can be very expensive. As we outlined in our report Unlocking Pipeline, many accelerators, especially those targeting underserved communities, are essentially startups themselves.
When we surveyed emerging market accelerators and incubators about their biggest challenge, their number one response was “raising capital”. This is true in the United States as well – the leaders of the recently-launched Black Innovation Alliance argue that Black-owned tech hubs are “chronically under-appreciated, under-supported, underestimated, and underfunded.”
Online or hybrid (online + limited in-person) programming can be a more cost-effective business and operational model for accelerators still getting their footing. We have been able to cut down on the costs of in-person event production, and spend our resources where they matter most: delivering value to entrepreneurs looking to scale their business.
Virtual programming certainly has its downsides – and while we’re bullish about how these online interactions increase access, there are elements of our programming that are hard to fully replicate in person, including true community building, peer to peer interaction and trust-building.
But all these sudden changes have a silver lining. We’re already planning for what our programs might look like when things go back to “normal”, and our initial sketches look like a hybrid model that maintains the flexibility, scaleability and access of online formats with more intentional in-person support.
Virtual programming is not going away; we’re leaning into this new opportunity to make it better than it’s ever been as we work to build a more inclusive entrepreneurial ecosystem.
Allie Burns is CEO of Village Capital; Emily Edwards is Platform Lead at Village Capital and led the internal working group to transition to virtual accelerators