Which opportunities do accelerators in the US offer to Central Eurasian startups

02 June, 2022


The Global Startup Ecosystem 2021 analysis ranks Silicon Valley and New York as the first and second most favourable regions for startups. The good news is that acceleration programmes in the United States are available to startups from all over the world. In this report we highlight 3 best US programmes and opportunities available to Central Eurasian innovators without a condition to move to the US.

Y Combinator

Y Combinator, Silicon Valley's main accelerator, remains the leader in the US accelerator market year after year. Each year 300-400 startups go through it, and some graduates of the program later become unicorns, such as Airbnb, Dropbox and Reddit. 

Y Combinator offers projects $500,000 in exchange for a 7% stake. Projects at the seed or later stages can take part in the programme. The program lasts three months.

Funders from any region may participate in the Y Combinator accelerator. Moreover, it is not necessary to come to the USA anymore. There are, however, some conditions. Startups from Central Eurasia whose company is not registered in the US, Canada, Singapore or the Cayman Islands must set up a parent company in one of these jurisdictions to participate in YC. The existing company will then become a subsidiary of the new parent company.

The Y Combinator business incubator team regularly consult startups. For example, YC points out that as a company grows, there are many distractions, such as conferences and meetings with venture capitalists. However, the most important tasks for a startup at an early stage are to "write code and communicate with users". The following pattern should be followed.

1) Launch the product.

2) Contact customers and find out if the startup meets their needs.

3) Collect feedback.

4) Repeat the cycle.

One of the most difficult aspects of building a startup is to form an action strategy. It is important at a very early stage to select one or two key metrics to measure success. Then you need to define a strategy with the impact each step will have on those metrics.

TechStars

Another leader in US accelerators is TechStars. It runs dozens of local acceleration programmes throughout the year in different parts of the world – Europe, North America, Australia, Asia – along with corporate partners. One important advantage of the programme is that a graduate gets lifelong access to Techstars resources.

Unlike the more universal YC, this accelerator focuses primarily on IT projects. Participation in the accelerator will "cost" the company 6%, in exchange for which the startup receives $20k. Techstars will request its share of the profit from the startup just before the next round of funding in the amount of at least $250k.

Today, the accelerator offers programmes both entirely online and offline. It includes free consultations on the development of the company's positioning strategy and strategic communication plan. TechStars is invested in by over 50 venture capital funds and hundreds of prominent business angels. 

The Techstars program runs for 3 months. The first month is devoted to networking: during this time, the 10 companies in each program will typically meet with around 100 mentors from the Techstars network, each with extensive networking and expertise in their respective fields.

During the second phase, founders identify the most important KPIs and work with their mentors: they create a prototype and the next phases of the product, and find their first customers. In the third month, startups create a pitch presentation and prepare materials for investors. 

500 Startups

The top three is 500 Startups, which also runs a large number of acceleration programs around the world.  It's a global accelerator and venture capital fund that manages investment projects in more than 75 countries. 500 Startups runs short seed programmes of four months.

In Central Eurasia, it has a presence in Georgia, Russia and Azerbaijan. It may soon open a representative office in Uzbekistan as well, as IT Uzbekistan is in talks with it. 

500 Georgia is an accelerator programme that has been supporting talent in Georgia and the Central Eurasia region since 2020. It is supported by the World Bank, the Georgian Innovation and Technology Agency and the Bank of Georgia. The first programme lasted 16 months and graduated about 30 early-stage technology companies. 

Although the accelerator does not provide direct funding, it offers working tools to scale up and get investment in future stages. Moreover, the company sends the best startups to San Francisco for 4 weeks to gain experience and network in Silicon Valley.

500 Startups has recently appeared in Azerbaijan as well. In 2021, the company signed an agreement with the Azerbaijani Innovation Centre and launched the first stream. It is worth noting that the Azerbaijan 500 ASAN Startup Global programme is not actually an accelerator and is intended for newcomers. 

Azerbaijan 500 ASAN Startup Global is an online course of 4 stages to be completed within certain timeframes. First, participants learn the basics of business and the principles of team building. Then they are immersed in the details of startup entrepreneurship. In the third stage, startups get practical guidance on how to develop and test the initial product and business model. The final stage is prototype development (MVP).

Sources: Rusbase, Startup Genome, Investor.ge. Photo: Y Combinator