In recent years the fashion of incubating companies in physical spaces (desk, Wifi, funding combinations) has faded in favour of The Accelerator. These are typically a programme of a few weeks combined with teaching, networking and funding. In the UK we’ve seen Seedcamp, then SpringBoard then The Oxygen Accelerator appear, among others. Today another joins the pack, The Accelerator Academy, out of London. This time, however, it’s attempting to up the accelerator ‘arms race’ with only post-exit mentors, although it’s charging model is unconventional for something that bills itself as an accelerator (see update below).
Billing itself as a new ‘training, mentoring and investment programme’ for innovative start-ups and early stage, high growth businesses in Tech/Media/Telecoms it’s aimed at pre-launch or first year businesses. The 12 week part time syllabus aims to cover all the bases of product development, market strategies, investor readiness etc, the list goes on.
At present its not a formal fund, its a syndicate, moving to a seed fund of up to £10m in April, under the new BASIS seed investment tax incentives (extension of EIS scheme). Companies sell 3-5% in paid options to the Mentors and Academy (3% if trading, 5% if pre-revenue). The valuation is linked to the valuation of the next fundraising.
By comparison Seedcamp takes an 8-10% cut, Springboard a 6% cut, along the Ycombinator model. Meanwhile there are rumours Springboard plans to launch in London later this year.
Accelerator Academy is slightly different however. Whereas you will meet mentors from a range of backgrounds at other events, the Academy people are restricting their mentors only to people who have successfully exited at least one TMT business. Mentors also have the right to “buy in” to the businesses that are developed, something which happens less on other programmes where terms can be more restrictive. The Accelerator Academy is aiming to help create up to 100 companies per year.
And they have the approval of Mayor of London Boris Johnson, who, in statement, said: “The Accelerator Academy represents exactly the type of investment in London’s future businesses that will secure our position as Europe’s digital capital.” Well, he would say that, admittedly.
Ian Merricks, founder of the Accelerator Academy and Managing Partner at TMT investment advisors White Horse Capital says “We see 500 businesses a year looking for investment. It’s a competitive process, and frankly most are not of sufficient quality to be successful… The Accelerator Academy was created to educate emerging entrepreneurs, with training around growth issues for start-ups, delivered by successful entrepreneurs as mentors, and supported by access to appropriate seed capital or “smart money”.”
Sponsoring the launch of the Academy are NatWest and haysmacintyre Accountants.
Personally I think the more the merrier and given that White Horse Capital has a verifiable track record in this area I see no reason why entrepreneurs should kick the tyres on this new entrant and see what they have to offer before making a decision.
Looking down the list of speakers I recognised Simon Campbell of SoDash and the Sandpit as a mentor so that’s a decent badge of recognition for me at least.
UPDATE: We just confirmed there is a course fee, subsidised by sponsors. This is £695 for the 12 weeks (£55 a week). No other costs. Frankly it’s not an ideal scenario given entrepreneurs are already giving away part of their company, though it may appeal to some depending on their circumstances and how attractive the programme is. However, it is a quality filter. In addition the companies are not giving up the options, they are selling them to the mentors, attracting them as seed angels. So this is quite close to an organised Angel club, with a programme attached. I guess we will have to assess this when some companies start to emerge from it.