The startup ecosystem is growing rapidly in Southeast Asia and so are the different players in it. While the big ticket later stage VCs remain the biggest investors, under the canopy at the early stage lie some important players as well - like VC accelerators, incubators and venture builders.
So how can you tell the difference between all these ecosystem players? Let’s dive into a few questions that can help you tell what is what.
As the name suggests, incubators attract startups in the ideation stages. These startups do not have a product market fit, an MVP or at times even a team to build the product. Incubators help startups build the product or sometimes even a co-founding team to get the startup off the ground Venture builders are similar but to an incubator but a separate animal together and they help in building the startup from ground up by helping the startup with marketing, logistics, team development and anything under the sun that the startup might need.
Accelerators accept startups which are already beyond the incubator phase, in our case with operate at a slightly later stage - so our startups have some revenue and traction. = Accelerators are the next step for startups after they get incubated.
Venture builders generally do not have a typical length and help the startups for as long as they need. Incubator programs can run at different stages for different time periods depending on the maturity of the startup.
Accelerators are generally between 3-6 months or in the case of Accelerating Asia 100 days.
Generally, venture builders do not provide funding. Their expertise lies in building an idea from scratch and then guiding the idea till as late as an exit at times.
Incubators generally write smaller cheques than accelerators. Accelerators typically invest $100,000 and above
Generally startups need to pay a fee in cash to incubators, accelerators and venture builders. There is also an equity fee paid for the services of these ecosystem players or equity is given in return for investment. These terms vary from organisation to organisation and there is no particular standard that has to be followed.
All 3 organisations are generally well connected and provide startups with the mentorship they need. However, a startup might appreciate accelerators the most, as accelerators put them in contact with VCs and other private investors.
A venture builders program varies in length and the journey beyond the program depends on how long the program lasts for. The end of an incubator program is the beginning of an accelerator program. At the end of an accelerator program, startups generally look for VC investments. The incubator serves as a funnel for an accelerator and an accelerator serves as a funnel for VCs.
Venture builders help startups build their idea into a product - to make that idea on a napkin a reality. Incubators help startups build their idea into a viable product and help them gain some traction. An accelerator helps a startup refine their pitch, raise that first institutional cheque/fundraise, exponentially grow their sales and network with top tier VCs. A common ingredient that all ecosystem players share is access to mentors and connections in several industries.
This brings us to the question of how Accelerating Asia can help you. Accelerating Asia can supercharge your startup and give access to world class mentoring facilities along with access to leading regional Tier 1 VCs. We at Accelerating Asia serve as a funnel to leading VCs like KFC Ventures, D4V, SOSV to name a few. Since we work so closely with such Tier 1 VCs, we are able to give you access to such VC office hours which in turn help you refine your pitch, plug holes in your business models and get ready for the big seven digit cheque.
Accelerating Asia also helps you close a bridge round which can be vital for your startup to close a big VC cheque. Closing a deal with a VC requires time and we help you grow during that interval with a bridge round. That bridge round growth not only makes you more attractive to a VC but also lets you raise at a higher valuation. We help you startup domicile in Singapore which in turn allows you to access top quality resources and investors that Singapore has to offer.
Accelerating Asia can be your stepping stone towards getting your first big VC cheque.
Accelerating Asia invests in startups with scalable technology solutions and revenue generating business models that combine purpose with profit.
In making an investment decision, investors must rely on their own examination of startups and the terms of the investment including the merits and risks involved. Prospective investors should not construe this content as legal, tax, investment, financial or accounting advice.