We held an AMA with Cody Simms, Greg Rogers (Executive Directors) and Nicole Glaros (Chief Product Officer) of Techstars where they answered questions from founders about applying to an accelerator. This post includes a transcript of their answers to these question in this AMA. To sign up for our next AMA, check out the schedule here!
How many active users are needed on a live running website/app to be considered by an accelerator program?
Cody: There is no answer to that question, at least when it comes to Techstars. I assume a lot of other programs are looking at things the same way. The most important thing we are looking for when you are applying and when we are looking at companies that are looking into a program is an awesome team.
We are looking for founders who have a killer drive toward the idea that they are looking to do, as well as founders that show that they can execute.
That is sort of in line with how many active users need to be on a site, but not specifically. We also look for founders who have really great chemistry and complement each other as a team. So, the team dynamic is by far the most important thing we are looking for.
One of the things that I think is really important: when it comes time to showing signs of execution, that doesn’t mean you need to be at 10,000, 100,000 or 1 million daily active users, but the more you are showing that people want your product, the better.
What I always look for are signs that you, as a founder, know how to test hypotheses in your business and can come back with the answers – showing that you are making progress along those lines. So you may still even be pre-product, but you are showing signs that you know how to understand what the market wants about your product, whether that’s running small experiments, doing user studies, etc.
As long as you are out there actually talking to customers or putting something in front of customers and getting feedback, as well as being able to prove that with each one of those your business is getting better.
Nicole: To expand on that, at Techstars we talk about a bunch of things that we look for in our application. We look for team, team, team, market traction and idea. Notice the traction part was second to last and that the idea part was last.
To walk you through the team, team, team part quickly, we are looking for teams that are passionate about what they do, that are well-formed (it doesn’t have to mean that they have been together for a long time, it means they can communicate well, they can execute together, they can work through difficult times together, etc.) and that they can execute. Those are the most important things that we look for at Techstars.
The second thing after that is markets. We have to be interested in the market that you are in, and then comes traction.
But really, at the heart of all of this – if I had to summarize one thing, and this would be true for probably any accelerator or investor you go after, would be belief.
Do we believe that you guys are capable of pulling off the thing you are trying to pull off in a way that is going to give us, as an accelerator or an investor, the returns that they are going to need to be successful? There are a lot of things that feed into that belief. One of them, naturally, is traction. One of them is active users, that is an element that feeds into that, but that is only one of many elements.
There isn’t any one thing that is going to make or break you, it’s a bunch of little things that tell a story about our ability to believe if you are able to execute on the thing that you are trying to do and be successful, and that we can make money from it, because that’s our jobs.
Greg: I remember Brad Feld telling us as MDs something really interesting the last time we got together with him. If you don’t know who Brad Feld is, he is a very prominent venture capitalist in Boulder, Colorado.
We asked him, “Brad, you’re an amazing investor. How do you choose which companies to invest in? How do you know when the founding team is the right founding team?” (As Nicole and Cody have said, this is such an important criteria for us).
Brad responded with a simple answer (the great thing about Brad is that he distills things into very simple answers for complex topics). He said, “Well, really what I do is I look at the founding team and I ask myself one thing, were they born to solve this problem? Were they put on this earth to solve this problem and are they so obsessed by it that they can’t take a shower, can’t get dressed, they can’t have a conversation without thinking about this problem because it obsesses them.”
As you think about your applications, and you think about your entrepreneurial journey, I would ask yourself that question. If you can say yes to that question, then you know you are ready for the journey.
The journey, as I know many of you have probably heard, is like a rollercoaster. It is incredibly joyful but it might be the most masochistic thing that anyone can put themselves through. You have to be obsessed.
I remember going to go watch an author do a book reading, and being a writer is a very creative, very joyful, very painful experience, similar to being an entrepreneur. Somebody in the audience asked this really famous author, “Why do you do what you do if it is so painful and so lonely?”
She responded, very simply, “I do it because I have no other choice. It is what I was born to do.” That’s something you really want to ask yourself, because it is a really interesting journey and can be really painful one, so you want to be ready for that.