Barely a day goes by without news of some new accelerator program in Europe dropping onto my desk. In the last few days, for example, I’ve received notice of Poland’s Gamma Rebels (“a 3 month long program in Warsaw”) and Dutch group Rockstart (“intensive support to entrepreneurs for the successful start to their businesses during the first 100 days”). Recently I’ve written about a few others and spoken to a lot more: big accelerators, small accelerators, accelerators with international ambitions and accelerators focused on their home country.
Nearly all of them offer a Y Combinator-style experience: short bootcamps usually lasting two or three months in which entrepreneurs with an idea are given a little money, access to mentors, and the space and time to concentrate on building something. Several of them are part of wider accelerator networks spun out of successful programs, such as TechStars; some of them are closely related to larger venture capital companies, universities or government networks. All of them promise to take your startup and turn it into something bigger and better.
For a while now, I’ve been trying to wrap my head around the size and scale of this explosion. A few weeks ago I asked Twitter followers and readers to help compile a list of the increasing number of programs around Europe. With their help, we came up with a list of almost 50 current or recently active schemes that identify themselves as accelerators, accelerator-style incubators, or bootcamps focused on seed or pre-seed investment.
I’m sure there are more we could have included, too, and no doubt there are more coming. But still. Fifty!
Here’s a map to give you an idea.
View GigaOM’s European accelerator map in a larger map
On the surface, this is great news for all concerned. Entrepreneurs have more options when they’re getting started; big investors can pass the risk of seed funding on to somebody else; reporters like me have an easy pipeline of new companies to write about.
It works for everyone. Or does it?
While in public almost everyone is bullish about this sudden expansion, privately they are not all so sure. Several investors and have expressed concerns to me that the sudden influx of bootcamps is bringing down the overall quality of ideas.
Others question whether there are really enough high-quality mentors to support an ecosystem that is growing so rapidly. One entrepreneur — a young startup boss who worked through an accelerator program several years ago — spoke to me about the feeling that low-rent investors are using this system to prey on a whole generation of startups.
One particular concern is that many of these new accelerators are too focussed on their local market. Europe is a patchwork of countries and cultures, and there are accelerators with tight remits to support local entrepreneurs in nearly all of them… in France, in Estonia, in Ireland and elsewhere. If these local programs do not have quality mentors with broad international experience or ambitions, they ultimately lack vision; and that problem is easily exacerbated by backing from local universities, government organizations and investors who are not technology entrepreneurs themselves. We already know that Europe has a reputation for clones: it needs more entrepreneurs focused on becoming pan-European or global players, not just being the best Groupon clone in Germany.
And then, inevitably, there’s the question of money. There are a few horror stories about accelerators who take significant equity without delivering much serious benefit, or some that force entrepreneurs to sign terrible preferential terms that actually make it difficult for subsequent investors to come in. You can take a look at some of the terms offered by different programs on our spreadsheet.
Bringing in capital is already starting to prove a problem elsewhere — a few days ago on GigaOM, our very own Colleen Taylor wrote about the concerns that there is a crisis in Series B funding, with too little later stage venture money to support the number of companies that are coming through with seed rounds. And that’s in Silicon Valley, the heartland of venture capital: what happens in Europe, where the approach to funding is much more conservative?
So are there too many accelerators for the European market?
When I spoke to Mark Hales, a business guru who has come from outside the technology industry to kickstart Britain’s Oxygen Accelerator, he batted off my questions about the danger of over-saturation.
“In fact, the opposite’s true,” he said, suggesting that more accelerators were required to get the best businesses working. In fact, he said, competition and cooperation were important parts of this explosion. “We’re starting to share the mentor pool, to share and distribute our investor networks, to share and distribute actual applications. We’re not at a stage where we’ve hit saturation.”
Some other accelerator organizers backed up that position. Antti Ylimutka of the Aalto Entrepreneurship Society, which is involved in Startup Sauna and Summer of Startups in Finland, suggested that more is better.
“My personal opinion is that the explosion at least helps entrepreneurship emerge as a viable career option for a wide audience in Europe,” he told me. “Too long students have wanted to work for big corporations like Nokia. We need them too, but if we want to have more new Nokias, we simply need to have more startups.”
Perhaps you’d expect accelerators to say there’s no problem with this explosion. Nobody, after all, wants to sound bitter or angry at competitors — or undermine themselves. But who else is going to ask the question? Most of the investment community want to retain good relationships with these hothouses — since they worry about missing out on a great opportunity. Similarly, the European media (for the most part) prefers to enjoy the conveyor belt of stories that accelerators provide.
But there seems to be that right now we’re witnessing the quantity versus quality. ? This is not limited to Europe, of course. The accelerator explosion is happening everywhere. But in Europe, where the are more limited, it feels as if we are watching the formation of an accelerator cargo cult. Investors with spare cash — governments, universities, local businesses — seem to believe that if they build something that looks like an accelerator then, hey, what could go wrong?
A few people I spoke to hinted at an underlying problem. Roxanne Varza, who recently left Techcrunch France to join Startupbootcamp, told me that the number of programs was “definitely not the problem right now” but added that right now “every program is very different” and that entrepreneurs should pay close attention to issues such as transparency, terms and quality of the accelerators they approach.
And Aalto’s Kristo Ovasaka — another face behind Startup Sauna — suggested that there would, eventually, have to be some sort of reckoning.
“There is no school to learn how to build startups, and most of the universities fail in teaching, too,” he said. “I believe acclerators have an important role to play in educating first-time entrepreneurs.”
“On the other hand, we need clear rankings to be able to assess the quality. This will happen over time.”
If the assumption is that the market will correct itself, perhaps the real test for Europe’s accelerators — and of all accelerators in general — is whether that correction can happen fast enough to stop great companies and great entrepreneurs being torched on the bonfire.
After all, even the harshest critics of the programs aren’t saying that accelerators are a bad idea full stop. What they all seem to fear is that a bad accelerator program can kill off a great product and slow progress down.
And that, surely, is precisely the opposite of what they’re meant to achieve.
Photograph by ejcallow on Flickr, used under Creative Common license