The Startup Factories

In the last few years a new kind of early stage business support programme has been attracting attention. Known as an 'accelerator programme,' examples include Y-Combinator and Techstars in the United States and Seedcamp and Springboard in Europe. This new model has become an important part of the startup ecosystem and the number of startups taking this route in their early days has grown exponentially for the past 5 years.

Accelerators differ from the sometimes maligned incubators of the first dot-com boom in that they are often time limited programmes, provide pre-seed investment rather than asking companies to pay and rely heavily on collaboration and peer support between founders and mentors from existing technology businesses.

In June 2011, NESTA published a report on business accelerators to address how the strategies and processes for helping innovative new businesses to grow have changed in the decade since the dot com boom and bust.

Questions addressed included:

• Are the new models more successful than old ones?
• Are existing incubators adapting to the new models?
• Are incubators challenging business schools as a method of business education?
• What motivates the people creating new incubators?
• Are the new models suited to other high tech industry sectors?
• Would accelerators represent a worthwhile investment for public money?
• Can accelerators create a new wave of tech start ups that will power economic growth?

The project was conducted by Kirsten Bound and Paul Miller.

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