David Cohen wrote a check as part of the angel round for Uber [1]. The "$80 Billion in value created" seems to include companies which may not have directly been part of the Techstars Accelerator program like Uber [2]. I am not sure if all the others were part of Techstars.
"Join our network of amazing mentors and portfolio companies such as Sphero, Digital Ocean, Localytics, SendGrid, Occipital, Next Big Sound, ClassPass, Simply Measured, FullContact, Realty Mogul, GrabCAD, Placester, Scopely, DataRobot, Remitly, LeanPlum, Synack, Tap Influence, Bluecore, Outreach, Cloudability, Distil Networks, Pilot, Yesware, Bellhops, Twilio, Spothero, Bench, Uber, GoSpotCheck, Ginger.io, Threat Stack, Timehop, PillPack, Plated and GameTime."
Having said that, I love the transparency that Techstars provides on each batch of investments and status (acquired / failed / active) etc. I wish every investor provided this level of transparency on failure rates.
It is indeed misleading to say that $80b in value was created, because Uber and Twilio were not Techstars companies.
"The market cap on Techstars website is $7.5B, whereas YC’s portfolio was valued at $30B in 2014" [1]
A more interesting days point (that ignores outliers) is the number of startups that raised a Series A round; and using that metric, you can rightfully claim Techstars to be #1 [2]
It's not a question of ignoring outliers; the point he's making is that these investments were never a part of the Techstars portfolio to begin with but were independent investments by people affiliated with Techstars.
Normally we edit a title when people complain that it's misleading, but if I do that in this case, people will accuse us of censoring because of YC. Since the HN principle is to moderate less when YC's interests are involved (albeit indirectly in this case) I've simply put the title in quotes instead. That's an option we sometimes use when commenters are complaining about a title but we don't have a better one handy.
It's funny that your second metric appears to be one that many might disagree with. I think PG once said something along the lines of - if every company accepted into YC is raising we aren't taking enough chances on longshots.
Basically, they want more Airbnb longshots along with what look like safer bets, and often those longshots have a hard time raising cause it seems so far fetched.
There's something else I would like to say about Techstars. I have a lot of respect for Brad Feld and some of the managers running local Techstars operations, but they have also had some questionable people running the show in certain cities.
"At the end of the day, you're trying to look at somebody and ask, 'Are you the type of person I could foresee building a $500 million company?'... It's pretty clear in 20 seconds whether that person has it in them or not."
"It's not that we're giving certain companies an advantage for no reason ... They've earned the advantage by either knowing us or knowing people who know us."
I met the head of another local TS program who made it pretty clear if you didn't have a salesperson/evangelist/consummate networker type leading your team, you wouldn't get far.
- The people behind, from top to down feel uninspired and could work at any random corporation; they just do not fit or appear entrepreneurial at all
- Their white labeling/partnering with corporations is super strange: weird corporations, awkward demos days with even weirder people running around having absolutely no relation to the actual ecosystem; I guess they get a lot of money for creating those joint accelerators and that's the point: it doesn't feel like proper seed investing what they do but rather like a too expensive event management service for clueless corporations
- No clear positioning; for what do they stand? Being just another accelerator shouldn't let you raise any money in 2017
The value they add it limited at best. The worst mistake they made was broadening the program past NYC and Boulder to take money from corporations and dilute the mentor/partner pool. My advice to other founders is to stay far away.
IMO, the technical teams with very little or no understanding of sales & marketing are the ones who would get the most value out of startup accelerators. They're not gonna help you build a better a product, but they're gonna help you find resources to sustain your product development before hitting profitability.
We're currently going through TechStars with a very technical product and no experience in doing enterprise sales, marketing, and fundraising. They have helped us a lot in figuring out who to target in big companies, how to put together sales pitches, how to close pilots, how to price our product, how to get follow-up sales meetings, how to talk to investors, how to pitch a very technical product in a way that non-technical people can understand, etc.
If we end up succeeding, I'd say TechStars played a very large part in taking us from being a bunch programmers who could build stuff to being a real company with a real business model. Before Techstars when we were on our own, we would make 10 wrong decisions per each right decision we made. Having access to mentors who have been in our shoes before that can help us avoid making mistakes is very valuable.
People in this thread are hating on how TechStars programs each have a few corporate partners, but I have found them to be super helpful in getting some early traction going. They're all very open to working and adapting the products developed by teams in the cohort.
The associates, mentors, and the managing director in our cohort are all amazing and have been super helpful to us. I would highly recommend TechStars to anyone who's building a B2B company.
Biggest difference between YC and TS (from what I hear) is that TS spends much more time hands-on mentoring.
I had the honor to have ~60 1on1 meetings with very respectable entrepreneurs and investors during the program. In addition to very high quality workshops and inspiring talks almost every day. Compare that to the weekly office hours at YC (again, through multiple grapevine branches).
I personally deem the TS experience the most accelerating for my personal career, as well as our start-up.
Biggest outlier is Uber, and they aren't even a Techstars company. They just invested in their seed round, never was part of the accelerator that is Techstars. YC probably comes out on top if you just remove Uber.
Can you guys believe these numbers? Every day, people are throwing around these incomprehensibly large valuations like it's normal. It's feeling more and more like the early days of the 2000s.
We went through Techstars NYC with getstream.io. Alex Iskold the managing directors was awesome. He has a strong tech background, started a few companies and actually had experience with building feed technology from his last startup. (Stream is an API for building feeds and activity streams) So for us the experience was super relevant. Raising funding after the program was easy. Now, 2 years later, Alex still helps us out with anything we ask for. We're very happy, but I think to some extend it also depends on the managing director that runs your program.
One thing they could improve is support for founders that are moving to the US. In the beginning all the tax, visa and legal issues drove me a little bit crazy at times. Having 1 person on their team dedicated to helping foreign startups navigate those challenges would be very helpful.
Had an amazing experience going through Techstars London, headed up by Joh Bradford and Jens Lapinski. Wouldn't recommend it to everyone, but certainly provided an insane amount of value.
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[ 5.4 ms ] story [ 80.5 ms ] thread"Join our network of amazing mentors and portfolio companies such as Sphero, Digital Ocean, Localytics, SendGrid, Occipital, Next Big Sound, ClassPass, Simply Measured, FullContact, Realty Mogul, GrabCAD, Placester, Scopely, DataRobot, Remitly, LeanPlum, Synack, Tap Influence, Bluecore, Outreach, Cloudability, Distil Networks, Pilot, Yesware, Bellhops, Twilio, Spothero, Bench, Uber, GoSpotCheck, Ginger.io, Threat Stack, Timehop, PillPack, Plated and GameTime."
Having said that, I love the transparency that Techstars provides on each batch of investments and status (acquired / failed / active) etc. I wish every investor provided this level of transparency on failure rates.
[1] http://davidgcohen.com/2014/07/14/the-ponys-lucky-horseshoe/
[2] http://www.techstars.com/companies/
"The market cap on Techstars website is $7.5B, whereas YC’s portfolio was valued at $30B in 2014" [1]
A more interesting days point (that ignores outliers) is the number of startups that raised a Series A round; and using that metric, you can rightfully claim Techstars to be #1 [2]
[1] https://blog.routific.com/which-startup-accelerator-is-right...
[2] https://mattermark.com/500-startups-accelerator-company/
Basically, they want more Airbnb longshots along with what look like safer bets, and often those longshots have a hard time raising cause it seems so far fetched.
There's something else I would like to say about Techstars. I have a lot of respect for Brad Feld and some of the managers running local Techstars operations, but they have also had some questionable people running the show in certain cities.
For instance, this Inc. article (https://www.inc.com/magazine/201204/max-chafkin/future-techs...) described the processes used by the former head of the NY program to select companies:
"At the end of the day, you're trying to look at somebody and ask, 'Are you the type of person I could foresee building a $500 million company?'... It's pretty clear in 20 seconds whether that person has it in them or not."
"It's not that we're giving certain companies an advantage for no reason ... They've earned the advantage by either knowing us or knowing people who know us."
I met the head of another local TS program who made it pretty clear if you didn't have a salesperson/evangelist/consummate networker type leading your team, you wouldn't get far.
- The people behind, from top to down feel uninspired and could work at any random corporation; they just do not fit or appear entrepreneurial at all
- Their white labeling/partnering with corporations is super strange: weird corporations, awkward demos days with even weirder people running around having absolutely no relation to the actual ecosystem; I guess they get a lot of money for creating those joint accelerators and that's the point: it doesn't feel like proper seed investing what they do but rather like a too expensive event management service for clueless corporations
- No clear positioning; for what do they stand? Being just another accelerator shouldn't let you raise any money in 2017
The value they add it limited at best. The worst mistake they made was broadening the program past NYC and Boulder to take money from corporations and dilute the mentor/partner pool. My advice to other founders is to stay far away.
1. find people that would be able to succeed in any environment
2. invite them to work for you under your accelerator. Don't do anything particularly special to help them
3. take credit for their success when they inevitably succeed (see #1)
We're currently going through TechStars with a very technical product and no experience in doing enterprise sales, marketing, and fundraising. They have helped us a lot in figuring out who to target in big companies, how to put together sales pitches, how to close pilots, how to price our product, how to get follow-up sales meetings, how to talk to investors, how to pitch a very technical product in a way that non-technical people can understand, etc.
If we end up succeeding, I'd say TechStars played a very large part in taking us from being a bunch programmers who could build stuff to being a real company with a real business model. Before Techstars when we were on our own, we would make 10 wrong decisions per each right decision we made. Having access to mentors who have been in our shoes before that can help us avoid making mistakes is very valuable.
People in this thread are hating on how TechStars programs each have a few corporate partners, but I have found them to be super helpful in getting some early traction going. They're all very open to working and adapting the products developed by teams in the cohort.
The associates, mentors, and the managing director in our cohort are all amazing and have been super helpful to us. I would highly recommend TechStars to anyone who's building a B2B company.
Best experience of my life.
Biggest difference between YC and TS (from what I hear) is that TS spends much more time hands-on mentoring.
I had the honor to have ~60 1on1 meetings with very respectable entrepreneurs and investors during the program. In addition to very high quality workshops and inspiring talks almost every day. Compare that to the weekly office hours at YC (again, through multiple grapevine branches).
I personally deem the TS experience the most accelerating for my personal career, as well as our start-up.
I wrote about my experience and my lessons learned here: http://www.techstars.com/content/accelerators/lessons-busine...
I have heard mixed stories from other Techstars chapters, especially the corporate sponsored ones. But I can vouch for Chicago :)
For serial entrepreneurs that are looking to raise heaps of money and be in SV, going big or go home, then YC is the better choice.
One thing they could improve is support for founders that are moving to the US. In the beginning all the tax, visa and legal issues drove me a little bit crazy at times. Having 1 person on their team dedicated to helping foreign startups navigate those challenges would be very helpful.