Despite the widespread popularity of startup accelerators, new research suggests that most programs may be doing more harm than good for the companies they claim to help. A recent working paper by Youn Baek and Deepak Hegde of NYU Stern, published through the National Bureau of Economic Research, analyzed nearly 750,000 American startups and found that the majority of accelerators fail to deliver on their promises of increased survival rates and growth.
Questioning the Accelerator Model
The study challenges the prevailing narrative around accelerators, which typically offer startups a mix of capital, mentorship, networking opportunities, and intensive support over a three-month period. While these programs are designed to significantly improve a startup's odds of success, the data indicates that many do not live up to expectations. In fact, some accelerators may even negatively impact a company's trajectory, particularly when they fail to provide tailored support or when startups are mismatched with the program's resources.
What Makes a Good Accelerator?
However, not all accelerators are created equal. The research points to a subset of programs that do deliver measurable benefits. These successful accelerators tend to focus on strategic mentorship, industry-specific expertise, and high-quality networks that align with the startup's goals. They also emphasize the importance of matching startups with the right resources, rather than offering a one-size-fits-all approach. According to the authors, the key lies in program design and the ability to customize support based on a startup’s unique needs and stage of development.
Implications for Entrepreneurs
For entrepreneurs evaluating accelerator programs, this study serves as a cautionary note. It underscores the importance of due diligence when choosing a program—considering not just the name or reputation of the accelerator, but also the quality of mentorship, the relevance of the network, and how well the program aligns with the startup’s business model and growth strategy.
The findings suggest that while accelerators can be valuable, their effectiveness is highly dependent on execution. For startups seeking support, the right program may be the difference between thriving and merely surviving.
