We recently held AMA sessions about applying to an accelerator program. To help answer questions, we had Jenny Fielding, managing director of Techstars IoT in New York City, and Ted Serbinski, managing director for Techstars Mobility in Detroit. We often get asked about how startups can talk about traction when applying for an accelerator program. We asked Jenny and Ted to weigh in with their advice.
How important is traction when selecting a startup?
Jenny: We want to see passionate founders that are working on a life mission, and probably that they haven’t founded the company two days ago. We really want to see some data points. There isn’t one metric in terms of traction, it’s just that you have been executing whatever you said you were going to be executing. If you were going to get a website up, you were going to get some utility or transaction in that, and you did all those things. Then you’ve moved onto the next stage, you’ve gained some early customers. All of these things are considered traction. There really isn’t one answer to the traction question. It’s really that you’re moving on in the journey, and that you’re not just talking about it. Watch the answer here.
Ted: There’s definitely no one size fits all to traction. One of my best performing companies came into the program with very little traction, but it was clear that they could build something, and they demonstrated that. I’ve also seen companies with lots of traction and real revenue struggle, too. So the traction doesn’t mean good or bad, but at this point it’s a data point to give more understanding around that company.
We’re looking for companies that can execute and really build something that can create value. In the 90-day period of Techstars, you don’t create diamonds without a lot of pressure.
If you put a lot of pressure on these companies and they can’t execute or build anything, and they can’t get traction, they’re going to have a hard time outside of the program. If this is pre-program with a lot less pressure and they still can’t execute, there’s going to be a lot more pressure in the program. One size does not fit all, but traction does help us understand if the team can execute at large. Watch the answer here.