Let's review concepts and theoretical foundations of startup accelerators.
This post represents a series of articles related to a research and dissertation called “Are corporate accelerators springboards for startups: a performance analysis of the Microsoft’s and Google’s accelerated.
Introduction
Startup accelerators have become known in the entrepreneurial landscape and gained relevance, fostering emerging technologies and providing support to early-stage startups. These programs offer mentorship for startups (which new companies usually lack experience), opportunities via funding, networking of likeminded entrepreneurs and other people in similar or complementing industries, ultimately improving their momentum and boosting their growth. Corporate accelerators (CAs), in particular, have emerged as considerable and important players, leveraging corporate resources to aid and integrate potential startups into their respective business ecosystems (Kohler, 2016). This section explores the theoretical foundations for the rest of the dissertation about startup accelerators and related in the field of study, distinguishing between independent and corporate models while highlighting their challenges.
Definition of Accelerators
The concept of startup accelerators originated in the mid-2000s with the rise of programs such as Y Combinator and Techstars, which provided a structured environment for startup accelerators to development a standardised model:
- A competitive selection process.
- A fixed-term, cohort-based o batch-like mentorship program.
- Initial seed funding in exchange for equity or many more during the period that the accelerator lasts.
- A Demo Day where startups pitch to investors, offering their assets as investing opportunities (Hallen et al., 2022).
Accelerators evolved eventually into different models like public, associated with universities, and programs backed up by corporations. These models led to the establishment of corporate accelerators, where large enterprises invest in and mentor startups with the goal of aligning emerging technologies with corporate innovation strategies (Seitz et al., 2023).
Types of Startup Accelerators
There are three primary types of startup accelerators, each with their own characteristics and strategic ambitions:
Independent (Traditional) Accelerators
Typically managed by private investors and venture capital firms, they target their support on early-stage startups across multiple industries. These accelerators provide equity-based funding and structured mentorship programs designed to prepare startups for growth and momentum. Examples from these models are Y Combinator, Techstars, and 500 Startups (Mishigragchaa, 2017).
Public and University-Associated Accelerators
They are run by state agencies (therefore public) or academic institutions, with the goal of promote startups in targeted sectors. Unlike independent accelerators just mentioned before, they often provide non-dilutive funding, such as grants, rather than taking equity. These programs aim to foster entrepreneurial ecosystems locally, as seen with Start-Up Chile and MIT Delta V (Woolley & Macgregor, 2022).
Corporate Accelerators (CAs)
These are funded and managed by established corporations with renown (such as the two mentioned in the title of this dissertation) that have interest in strategic assets in emerging startups. Acting as channels for open innovation, they enable corporations to explore and integrate new technologies. These accelerators provide startups with access to proprietary tools, strategic partnerships, cross-industry networking and industry-specific knowledge. Prominent examples include Google for Startups Accelerator, Microsoft for Startups, and Airbus BizLab (LO VERSO, 2022).
Corporate Accelerators vs. Independent Accelerators
While traditional accelerators primarily focus on investment returns, corporate accelerators pursue a dual mission (Canovas-Saiz et al., 2021):
- Innovation by integrating emerging technologies into established corporate ecosystems.
- Key partnerships that align with the corporation's long-term agenda.
In other words, they invest not for “middle-term” profit, but to increase their strategic competitiveness and expand their reach in new and complementary markets.
Key Differences:
| Feature | Independent Accelerators | Corporate Accelerators |
|---|---|---|
| Funding Model | Equity-based, venture capital-driven | Corporate-funded, strategic investment |
| Primary Goal | Startup growth & investor returns | Innovation & industry expansion |
| Resources Provided | Seed funding, mentorship or coaching | Market access, proprietary tech, networking |
| Exit Strategy | IPO, acquisition | Integration into corporate operations or partnership deals |
Corporate accelerators are particularly dominant in technology-driven industries, where rapid innovation cycles are crucial to remain relevant (Fehder, 2023). For example, Google’s accelerator programs focus on AI, cloud computing, and machine learning, while Microsoft’s initiatives emphasize enterprise software and cloud solutions.
Impact of Accelerators on Startup Performance
The role of accelerators play in startup performance is debated and also subject of study of this dissertation. Some researchers argue that accelerators act as “springboards” (to increase their success rate) by providing early-stage startups with funding, mentorship, and networking that, otherwise, they wouldn't have them by their own. On the other hand, others support that participation in an accelerator does not promote long-term survival, as benefits may shrink or reduce after the program ends (Chowdhury & Audretsch, 2023).
Several studies have evaluated key performance indicators (KPIs) such as:
- Funding rounds & investment growth (Seitz et al., 2023).
- Survival rate & acquisition potential (Sarto et al., 2022).
- Technology adoption & innovation metrics (Assenova & Amit, 2024).
Corporate accelerators provide startups with advantages in some cases and circumstances that extend beyond financial support, such as access to high-profile coaches and industry expertise. However, critics to this business scheme argue that corporate accelerators can become “sand traps”, where startups depend heavily on corporate backing; in other words, they don't learn to walk by their own (Hallen et al., 2022).
Conclusion
Startup accelerators have evolved since its conception, from independent investor-backed programs to strategic initiatives from corporations. These in particular, have become mechanisms for open innovation, helping large enterprises stay ahead in the competition. However, not everyone argues that this programs benefits the startups as well. While these schemes offer considerable advantages, their actual impact on long-term startup success remains a debate subject of academic scrutiny and analysis. This dissertation will further explore the empirical performance of startups that participated in Google’s and Microsoft’s accelerator programs to determine if they are effective as launchpads or they present as a drag and have many limitations that hinder growth.
References
- Assenova, V., & Amit, R. (2024). The impact of accelerator participation on startup performance: An empirical assessment. Entrepreneurship Development Program.
- Canovas-Saiz, L., March-Chordà, I., & Yagüe-Perales, R. M. (2021). A quantitative-based model to assess seed accelerators’ performance. Entrepreneurship & Regional Development. https://doi.org/10.1080/08985626.2021.1872941
- Chowdhury, F., & Audretsch, D. B. (2023). Paradoxes of accelerator programs and new venture performance: Do varieties of experiences make a difference? Small Business Economics. https://doi.org/10.1007/s11187-023-00778-y
- Fehder, D. C. (2023). Coming from a good pond: The influence of a new venture’s founding ecosystem on accelerator performance. Administrative Science Quarterly. https://doi.org/10.1177/00018392231204839
- Hallen, B. L., Cohen, S. L., & Park, S. H. (2022). Are seed accelerators status springboards for startups? Or sand traps? Strategic Management Journal, 1-37. https://doi.org/10.1002/smj.3484
- LO VERSO, A. (2022). How do corporate accelerators influence startups' performance? An empirical analysis of vertical and horizontal corporate accelerators. Master’s Thesis, University of Palermo.
- Mishigragchaa, B. (2017). Accelerators as a tool to support startup ventures: Assessing their performance and success factors. Proceedings of the International Entrepreneurship Forum.
- Sarto, N. D., Cruz Cazares, C., & Di Minin, A. (2022). Startup accelerators as an open environment: The impact on startups’ innovative performance. Technovation, 113, 102425. https://doi.org/10.1016/j.technovation.2021.102425
- Seitz, N., Krieger, B., Mauer, R., & Brettel, M. (2023). Corporate accelerators: Design and startup performance. Small Business Economics. https://doi.org/10.1007/s11187-023-00732-y
- Woolley, J. L., & Macgregor, N. (2022). The influence of incubator and accelerator participation on nanotechnology venture success. Entrepreneurship Theory and Practice, 46(6), 1717–1755. https://doi.org/10.1177/10422587211024510
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