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- Just one in 12 startups succeed, with most failing between their second and fifth year of growth.
- Startup incubators can help startups learn how to succeed, and accelerators help early-stage businesses grow faster. On average, incubated businesses have an 87% survival rate over five years.
- We researched the industry to find 10 startup incubators and accelerators that can help you during and after the COVID-19 pandemic.
- Visit Business Insider’s homepage for more stories.
It’s natural to fear launching a business, given that only one in 12 succeed. A startup incubator — a space for businesses to learn new strategies, source seed funding, and collaborate with partners — can offer a lifeline, while accelerator programs help companies grow faster. Incubators are for groups with a new idea, whereas accelerators are for startups that already have a viable product.
The National Business Incubation Association has found that 87% of businesses that used incubators survived their first five years, compared with 44% that did not use them, and big brands like Airbnb and Dropbox were launched through incubator programs. 2016 research also shows that accelerators speed up early-stage growth.
With more than 7,000 incubators globally, it can be hard for any startup to narrow down their options and find the best fit. We researched the most popular ones to find those that are proven to add value to early-stage businesses, and created a list of 10 of the best incubators and startups, spread across the world. Read on to find out more.
Y Combinator is an international startup incubator that has funded 2,000 companies since 2005, with an average total outlay of more than $250,000 per year. The incubator hosts their program twice a year, and has an acceptance rate of 1.5%. It lasts three months, and founders, venture capitalists, and executives from successful companies, such as Salman Khan from education nonprofit Khan Academy, give talks, and connect businesses with Y Combinator partners and alumni.
Y Combinator carries on its help after businesses leave the incubator, too. After Y Combinator funds the startup, the founders have access to the partners and alumni who provide guidance on scaling. Some of the notable companies to have emerged from Y Combinator are Airbnb, Stripe, Doordash, Twitch, Dropbox, and Weebly. Its companies have a combined valuation of more than $100 billion.
A fast-growing incubator focused on promising people, rather than early-stage companies. Twice a year, Entrepreneur First (EF) invites 100 entrepreneurs to join one of its six European programs — the idea is that people in the cohort will connect, and together cofound companies.
Its big-name backers include the founders of LinkedIn, DeepMind, and PayPal. More than 300 companies have launched thanks to EF, and they have a combined value of $2 billion. Success stories include image processing startup Magic Pony Technology, which was bought by Twitter for $150m less than two years after its founders met on an EF programme.
Bridge for Billions
Bridge for Billions is an online-exclusive incubator open to startups globally, and it has already helped 1,500 entrepreneurs across 70 countries. It gets results: In 2019, 83% of entrepreneurs said they were satisfied with the quality of mentoring they received, and the majority of businesses in the program survive the years after the incubation. Bridge for Billions has developed training programs with Coca Cola, Unido, and other large firms.
The Startx incubator program is well-known for its exclusivity with Stanford-affiliated entrepreneurs. Its startups have a combined valuation of more than $25 billion, and include Life360, Patreon, Lime, and more. Unless you’re affiliated with Stanford or specifically invited to the program, you need not apply — but it’s beyond doubt that Startx has helped hundreds of global startups thrive. Out of the 700 startups it has funded since 2011, 92% of Startx’s companies are still growing or have been acquired.
StartupDevKit is a fully online incubator. Developed for aspiring entrepreneurs and international startups, it works with founders from their original idea to growth-stage, providing instructional resources throughout on how to effectively scale a startup. StartupDevKit has partnered with Hubspot for Startups, a training and software platform, to offer coaching videos, guides, and business templates to its startups. This incubator program also offers a 14-day free trial for all users.
Techstars is more of an accelerator than an incubator — it helps existing companies grow fast. It’s US-based, but it has a presence outside North America, too. It has helped more than 2,000 companies, including SendGrid and DigitalOcean, and ploughed more than $9.3 billion into early-stage businesses. It works with Microsoft, Google for Startups, and Hubspot for Startups to provide resources to its startups, and they work: 90% of Techstars companies are still growing or have been acquired.
500 Startups has invested in more than 2,400 startups in 75 countries. According to Pitchbook, it is the world’s most active global venture capital investor. It has produced ten unicorn companies — firms with a valuation of at least $1 billion — including Canva, Udemy, and GitLab. 500 Startups offers several accelerator and fund programs, and the content varies based on location. In 2018 alone, it funded more than 155 startups and committed $454 million in capital to companies.
FinTech Innovation Lab
FinTech Innovation Lab has invested more than $1.1 billion in its startups and has 184 alumni businesses. The accelerator has three primary locations: New York, London, and Asia Pacific. In each location, its 12-week programs end in a demo day where companies present their products to finance executives, journalists, and investors.
Throughout the course, startups receive mentoring from both fintech firms and VCs, and take part in workshops and mini-conferences — its impressive list of mentors include former Blackrock and Goldman Sachs execs. Its focus is banking and insurance, but its companies span the fintech industry: Its 2019 New York intake heavily featured AI, insuretech, and compliance startups.
Pioneer is one of the most open international startup accelerators — it is fully remote, and has worked with companies across the world, from Metacode in South Africa to ThisCodeWorks in Pakistan. It provides mentorships in fundraising, strategy, product, and growth. Pioneer also offers investments to select companies, and is funded by payments platform Stripe and American entrepreneur Marc Andreessen.
Entry is decided by winning a “tournament”: founders enter a project, and submit weekly updates which are voted on by experts. Those that reach the top 50 are reviewed further, and from those, a panel selects “Pioneers” for the program, who get a round-trip ticket to Silicon Valley and $100,000 each in Amazon Web Services and Google Cloud credits. Pioneers also get access to Pioneer Camp, where they are mentored, and the Pioneer Demo Livestream, where they present their products.
BoomStartup is another technology-based seed accelerator. There is no application process — you just register to receive a bespoke growth plan. BoomStartup has raised more than $55 million in seed capital, and amassed more than 400 mentors in its network. The companies that have come through its program include InScribe, Knowlocker, Rappi, and SuccessKit. BoomStartup has helped more than 170 companies and more than 70% have achieved funding of between $500,000 and $1.5 million.