Are accelerator programs worth it?

Short answer: it depends. It depends on what the accelerator actually does, what stage you're at, and what you're giving up to do it. I never went through an accelerator myself. I built Managed by Q, scaled it to a team of nearly 1,000 people, and sold the company to WeWork in 2019 without ever pitching a demo day. After that I spent a few years as an active angel investor, backing more than 100 early-stage companies, before James Gettinger and I started Gutter Capital in 2021 and later built our own accelerator, Elbow Grease. As a founder who skipped it, as an investor who works with dozens of founders who skipped it, and as a partner now running one, I’ll do my best to give you an honest answer.

Here's the case for accelerators, the case against them, and how to tell which one applies to you.

What an accelerator actually is

Strip away the branding and an accelerator does three things: it gives you a small amount of capital, it puts you in a room with other founders and operators for a fixed period of time, and it takes equity in exchange. Everything else, the mentors, the demo day, the programming, is packaging around that trade.

The trade only makes sense if what you get is worth more than the equity you give up. That's the whole question. Founders overcomplicate this by asking whether accelerators are good in the abstract. The better question is whether this program, at this stage of your company, is worth this price.

Not all accelerators are solving the same problem

This is where founders get confused, because the word "accelerator" covers a lot of very different businesses.

Mega accelerators run 100 to 200 companies through a cohort at once. You get a brand name, a large peer network, and a system built for scale. What you don't get, almost by definition, is much individual attention. With that many companies in a batch, the returns are going to be driven by the top two or three, and nobody knows in advance which ones those will be.  These programs happily fund competitive companies, and let them fight it out.

Small-batch programs take a handful of companies at a time. Elbow Grease is an example of that. We ran our first cohort with eight companies earlier this year and are targeting a maximum of 15 for our second. The trade-off runs the other way: you have a more concentrated network, but you get partners who actually know your business and can spend real hours on it.

University and corporate accelerators offer resources, credibility, and sometimes non-dilutive funding, but usually with significantly less operating firepower behind them.  These programs usually have something interesting to add, like access to customers or research, but they are rarely run by people who have actually built a company before.

None of these are strictly better. They're built for different problems. A pre-idea founder who needs a crash course and a huge alumni network wants something different than a founder with a product and a first customer who needs help finding GTM fit and hiring their first engineer.

When an accelerator is worth it

Based on what I've seen, first as an angel investor in more than 100 companies, lead investor and Board director at 15 companies through Series B, and now running Elbow Grease, an accelerator earns its equity when a few things are true.

You need the right people around you.  The biggest lesson that I learned from my experience as a founder is that talent is destiny.  It takes a village to build a startup, and the best thing an accelerator can offer you is a jump start on developing the right network and support system to accomplish your goals.  If you join the right accelerator, you will wake up every day excited to work shoulder to shoulder with founders that inspire you, you’ll be paired with mentors that you can learn from, and you’ll have the opportunity to meet leaders in the industry that would have taken you years to access on your own.  Great accelerators bring the network to you, but if you manage your time well you keep it for the rest of your life and career.  In my opinion, that can transform your business and your life and is worth the equity you give up to join.

You're missing a specific, nameable skill. Founder-led sales. Recruiting. Pricing. Product Design. Good accelerators bring in operators who've done the specific thing you haven't done before. Not generic advice from an investor perspective, but someone who has hired a first salesperson and can tell you exactly what mistake to avoid.

The relationships compound. A mentor who is still checking in a year after your program ended is worth more than the initial check. A mentor you never hear from again after demo day is worth roughly the hour they spent with you.

You're solving a big, unglamorous problem you understand cold. The founders we want most are the ones who've found a piece of the economy nobody else wants to touch and who are already working on it full time, with or without us. An accelerator can accelerate that. It can't manufacture conviction that isn't there.

When it's probably not worth it

I'd be lying if I told you every founder should do an accelerator program. This is when I’d discourage a founder from joining a program:

You already have the network. If you've got a strong lead investor, warm intros to the customers and hires you need, and a board that's genuinely useful, an accelerator's core value of access is something you already own. Paying for it twice doesn't make sense.

The program is really a fundraising bootcamp. A lot of accelerators are built around one outcome: teaching you to pitch well enough to raise money from someone else at the end. If that's the entire model, ask yourself what you're paying for. A polished deck and a room full of investors on demo day is not the same as an investor who is still working with you eighteen months later.

The program is run by people who have never built and sold a company.  This one should be obvious, but there are plenty of people in the venture industry that are willing to give you unqualified advice.  If you’re looking to build a business, you should focus on getting advice and counsel from people who’ve done it before and can explain what worked and what didn’t.

Your business needs capital the accelerator can't provide. If you're pre-revenue and in a capital-intensive space, such as hardware, regulated industries, or anything with a long, expensive path to a first sale, then a small check and ten weeks of workshops may not move the needle relative to what you actually need.

You're doing it for the logo. If the reason you want to join an accelerator is to update your LinkedIn bio, you're solving a marketing problem, not a company-building problem. There are cheaper and more effective ways to do that.

The questions worth asking before you say yes

Whatever program you're evaluating, ask these before you sign anything:

• What specifically will change about my business in the next 10 weeks that wouldn't change otherwise?

• Who exactly will I be working with, how often, and what have they actually built?

• What happens after the program ends? Is there a next check, or does the relationship end at demo day?

• What is the program optimizing for: helping me raise from someone else or building the business directly?

• What's the effective valuation implied by the check size and the equity, and does that feel fair for where my company actually is?

If a program can't answer these clearly, that tells you something.

Why we built Elbow Grease the way we did

I'll be direct about our own bias here: we think most accelerators are built to graduate you to a demo day and then hand you off. We built Elbow Grease to do the opposite. We take a small number of companies at a time, not hundreds. We work out of the same office in Chinatown as our portfolio companies, from seed through Series B and beyond. Our goal at the end of the ten weeks isn't a room full of strangers with checkbooks, it's getting a company to the milestones that let us keep investing ourselves, ideally through the Series A.  If everything goes to plan, we want to be working with you for the next 10 years, not just the next 10 weeks.

The venture market right now is unusually consensus-driven. In the first quarter of this year, roughly three-quarters of all venture dollars went to just five firms. Consensus funds chase consensus founders into consensus markets. We built Elbow Grease to do the opposite: work with unusually driven founders, at the earliest stage, before consensus has formed.

That model isn't right for every founder. If what you want is a huge brand name and the widest possible investor network, a mega accelerator may serve you better. If what you need is a small number of people working alongside you, in the same room, on the actual business, that's the problem we built Elbow Grease to solve.

The bottom line

An accelerator is worth it when the people and the specific gaps it fills are worth more to your company than the equity you're trading for them. It's not worth it when you're paying for a brand, a logo, or a fundraising bootcamp you could replicate more cheaply on your own. Do the trade consciously. Most founders don't, and it's the single most avoidable mistake I see.

FAQ

Do accelerators take equity?

Most do, in exchange for a cash investment. Read the implied valuation carefully, the check size relative to the equity taken tells you what the program thinks your company is worth today.

What's the difference between an accelerator and an incubator?

An accelerator works with existing, independently founded companies over a fixed program, usually in exchange for equity. An incubator typically helps generate and build the company idea itself, often in-house, and may not follow a fixed cohort structure.

How long do most accelerator programs last?

Most run 8 to 14 weeks. Elbow Grease runs 10 weeks on-site in New York City.

Should a pre-seed founder do an accelerator?

It depends on what's missing. If the gap is people, specific operating skills, or credible relationships, a good program can close that gap faster than doing it alone. If the gap is capital for a business that's expensive to build, or you already have strong investors and a network, the math is less obvious.

Can you do more than one accelerator?

Nothing stops you legally, but it's rarely a good use of dilution or time. Pick the one whose specific strengths match what your company actually needs right now.


Elbow Grease's second cohort is now accepting applications through July 31. Learn more at elbowgrease.cc and apply at https://forms.gutter.cc/eg0002-application