For years now, cutting-edge startups have been shaping entire industries, introducing new technologies, leaner business models and out-of-the-box offerings that customers love. This isn’t just a fleeting trend; it’s a fundamental shift in the way our business landscape works, where being the first to seize new growth opportunities can make or break a business.
In response, companies all over the world are building their own corporate accelerators as a way to tap into the external startup ecosystem to access:
- Disruptive concepts
- Innovative business models
- Cutting-edge technologies
and more - all with unprecedented speed and reduced risk. Sound intriguing? Keep reading! We’re about to walk you through the 10 key steps that will make your corporate accelerator a success.
But first, let’s start things off with some context.
What is a corporate accelerator?
In a nutshell, corporate accelerators are programs that support the development of growth-stage startups by providing resources like mentoring, expertise, access to partners, office space, funding and more. These resources can significantly boost a startup's development, enabling it to mature faster, refine its business model, and gain a competitive edge in its market.
Accelerator programs are typically time-bound, lasting anywhere between three to six months, although the duration can vary based on the specific goals and structure of the program. During that time, selected startups are exposed to intensive mentorship, workshops, networking opportunities, and various other resources, all aimed at accelerating their development.
What are the benefits of a corporate accelerator?
We’ve already touched on some of the key benefits of corporate accelerators, but here are a few more examples:
1. They facilitate the discovery and expansion into new markets
Startups operate at the forefront of emerging trends and consumer preferences. Corporations can tap into this knowledge and leverage it to gain a competitive edge and create new revenue.
2. They fast-track your time to market and reduce risk
Startups are nimble and agile, allowing them to test and iterate new products or business models quickly. Corporations can leverage this lean approach to explore new markets or business models with reduced risk.
3. They help create and nurture a pipeline of cutting-edge ventures
Startups have the capacity to quickly prototype and test new concepts, enabling them to outpace traditional corporate product development processes. This rapid innovation cycle can fuel a constant pipeline of cutting-edge offerings for the parent company.
4. They help you capitalise on existing assets and expertise
By collaborating with startups, corporations can leverage their existing assets to co-create innovative solutions that can lead to new growth and revenue.
5. They foster an entrepreneurial mindset within the corporation
The disruptive nature of startups can challenge conventional corporate norms, inspiring employees to push boundaries and embrace risk. This interaction can stimulate a more innovative, entrepreneurial culture within the corporation.
6. They help you attract top entrepreneurial talent
Corporate accelerators enable employees to work on groundbreaking projects, like launching a new product or technology. Such an environment can act as a magnet for individuals with entrepreneurial talent.
Corporate incubators vs accelerators: What’s the difference?
Although the terms “incubator” and “accelerator” are often used interchangeably, they do different things. In a nutshell:
- Incubators turn concepts into working businesses.
- Accelerators help early-stage startups “accelerate” their development.
Here are few other key differences:
Purpose: Incubators nurture disruptive ideas and turn them into working businesses with a solid business model.
Programming: Programs are typically flexible and on-demand, adjusting to the rapidly changing needs of a young company that is still finding its footing.
Duration: The incubation process typically lasts 1 to 3 years, concluding when the new company is ready to be pitched to investors or consumers.
Return: Corporate incubators usually maintain full ownership of the venture.
Purpose: Accelerators help growth-stage companies expedite their development and scale their existing business models.
Programming: Programs are fixed and highly structured, focusing on scaling a business model, which is a comparatively more straightforward task.
Duration: The acceleration process typically lasts 3 to 6 months, concluding when the company has achieved its predetermined development and scaling objectives.
Return: Accelerators tend to establish partnerships or secure some form of equity in the venture.
Now that we’ve covered the basics, let’s take a closer look at the key steps that’ll help make your corporate accelerator a success.
10 key steps to making your corporate accelerator a success
Step 1: Define your value spaces and ROI goals
The first step towards building a successful corporate accelerator is defining the value spaces you want to tackle. Start by prioritising them based on both their strategic fit and portfolio fit, e.g.,
- To what extent does this value space fit with our corporate strategy?
- To what extent does this value space fit with our desired portfolio goals?
This will make it easier for you to determine the specific areas where collaboration with a startup can bring the most value. Use the insights to build a prioritised list of value spaces based on how well they align with your corporation's goals and capabilities. This list will serve as a guidepost, helping you focus your efforts on the areas that will deliver the greatest impact.
Once that’s done, you can start defining the type of ROI you’re aiming to achieve. ROI can take various forms, including:
- Financial returns: e.g. increased revenue, reduced costs, or improved profitability.
- Strategic returns: e.g. access to new markets, technologies, or talent.
- Innovation returns: e.g. access to disruptive technologies, VPs, or business models.
- Brand returns: e.g. brand perception, industry recognition, or thought leadership.
- Social and environmental returns: e.g. social or ethical initiatives that further your corporate social responsibility (CSR) goals.
Make sure the type(s) of ROI you pursue aligns with your selected value spaces and overall corporate strategy.
Google for Startups’ “AI First” program focuses on AI and Machine Learning startups, aligning with Google's strategic focus on these areas. The program specifically targets strategic and innovation ROI within these value spaces.
Step 2: Determine the scope of your accelerator
To optimise the effectiveness of your accelerator, it's essential to determine the scope (e.g. how far you want to branch out from your core business). A good way to start is by figuring out what type of innovation you’re looking to achieve e.g.,
- Radical innovation: Disrupt the market by developing new products or services that don’t exist yet.
- Adjacent innovation: Entering a new market by leveraging your company’s existing expertise.
- Core Innovation: Optimising existing products for existing customers.
This will help ensure your collaborations align with your business goals and risk appetite, increasing your chances of success.
Disney Accelerator has backed startups from different sectors like AR/VR, AI, robotics, media and entertainment. This demonstrates a scope that extends beyond Disney's core business.
Step 3: Secure corporate leadership buy-in
Buy-in and support from corporate leadership are crucial to the success of your accelerator. The leadership team can provide the necessary resources and help align the accelerator's goals with the broader corporate strategy.
Positioning your accelerator this way will also help you bypass long chains of command and expedite your approvals. Remember, no matter how brilliant your ventures are, they run the risk of being delayed or even phased out if you don’t have the right positioning, connections and internal support.
In a Forbes interview, VP and General Manager of Intel Ignite, Tzahi "Zack" Weisfeld explains that part of the success of the accelerator program is due to the support it has gotten from corporate leadership. It was established back in 2019 by a former CEO and is now sponsored by the company’s CTO.
Step 4: Identify the right talent and expertise
Now that you have an idea of the value spaces, ROI and scope you’ll be aiming for, the next step is to figure out the type of talent and expertise you’ll need to make it a reality. For example:
- Do you have the knowledge base you need within your corporation?
- If not, what type of profiles are you missing?
- Will your accelerator consist of internal intrapreneurs? External profiles or both?
The profiles you’ll need will vary depending on how you structure and operate your accelerator, but in most cases, they include industry experts, mentors, designers, investment analysts and marketers.
Techstars, an accelerator that operates in partnership with corporations, places a strong emphasis on selecting experienced mentors with industry expertise and entrepreneurial experience. This enables them to attract top-notch startups.
Step 5. Leverage your existing corporate assets
New ventures need resources to get up and running, and it takes a lot more than just money to make it all happen. Make careful decisions about which resources will be allocated to strengthen your new partnerships, e.g.,
- Which departments will be involved (e.g. legal, engineering, I.T., marketing, etc.)?
- What type of monetary resources do you have available?
- What type of office space and equipment will you be using?
- Does your accelerator program need any additional services (e.g. entrepreneur or startup networks, advisory boards)?
- What industry assets or expertise can you leverage to boost the growth of your startups?
Having a clear idea of the resources you have available will enable you to more effectively allocate them to boost the growth of your startups.
Microsoft’s GrowthX accelerator leverages existing corporate assets like software, cloud services, and office spaces to provide a strong foundation for the startups in its accelerator program.
Step 6. Create clear criteria to select your startups
Establishing a solid selection process is a critical component to the success of your accelerator. It will ensure that the startups accepted into your program align with your business objectives and can help you hit your growth goals.
Factors to consider when deciding which criteria to use include:
Carefully evaluating these elements will better equip you to identify startups with the potential to deliver the desired impact.
Target Accelerators has clear selection criteria focusing on startups that are developing innovative technology solutions in retail and e-commerce.
Step 7: Set up clear timelines and milestones
Make sure you have a detailed plan for your acceleration program, taking into account things like the duration, process flows, and deliverables. Break down the project into smaller, manageable tasks and assign deadlines for each milestone.
Taking this step will help keep you focused on your goals and avoid unnecessary delays.
SAP.iO Foundries has clear start dates, locations and durations for each of its programs.
Step 8: Develop a framework to measure impact and success
Set tangible key performance indicators (KPIs) to evaluate the success of the accelerator. This can include things like:
- The number of startups in your program that go on to raise funding
- The number of successful exits
- The number of collaborations with your corporation
- The impact on your company’s market position, revenue or portfolio
Discover more about how to create an accurate and detailed venture metrics framework in this report.
Barclays Accelerator measures the impact of its startups using various KPIs including the number of successful collaborations and the level of technology adoption stemming from their partnerships.
Step 9: Promote your accelerator to attract top startups
Active promotion of your accelerator program is crucial to attracting top startups. A good way to start is by creating a comprehensive marketing strategy that highlights the benefits of joining your program, including things like access to mentorship, funding, and any other unique corporate assets you bring to the table.
Get the word out using some of the following channels:
Platforms like LinkedIn and Twitter have a vast audience reach that includes startup founders, investors, and potential partners. Sharing updates, success stories, and the benefits of your program can help engage and attract the right candidates.
Events like tech conferences, startup meetups, and industry-specific seminars are excellent venues to promote your accelerator. Presentations, networking, or sponsoring these events can raise your program’s visibility among relevant startups.
Use your existing relationships with clients, partners, suppliers, and other stakeholders to spread the word. Personal recommendations from trusted sources can carry significant weight.
Press and media
Reach out to relevant media outlets and trade publications to share news about your accelerator. Positive press coverage can enhance your credibility and reach.
Step 10: Plan past the initial collaboration phase
Decide on what happens when the collaboration reaches its initial goal. Consider the various potential scenarios that might occur after a startup has completed your accelerator program:
In some cases, an extended partnership might be beneficial for both parties. This could involve ongoing mentoring, further investment, or more concrete, long-term partnerships.
Successful startups could present attractive investment opportunities. Be prepared for potential funding rounds or equity investments in the startups that show significant promise.
If a startup aligns exceptionally well with your company and has proven its market potential, acquiring it could be a strategic move. This could bring innovative products, services, or technologies in-house.
By planning beyond the initial accelerator phase, you can continue to reap benefits from the relationships built during the program, potentially leading to long-term strategic advantages for your corporation.
Startup with IBM not only provides a six-month acceleration program but also explores opportunities for strategic investment and co-development after the acceleration phase.
When implemented the right way, corporate accelerators can unlock unprecedented growth quickly and with a reduced level of risk. They can be a game-changer for companies navigating today’s uncertain landscape or having trouble competing due to rapidly changing technologies, outdated business models or the arrival of new players in the market.
If you’re thinking of starting your own corporate accelerator, the steps we’ve listed above will serve as a compass, guiding you through the intricacies of the process and boosting your chances of success.
Looking to expand beyond your core, access game-changing startups, and boost your entrepreneurial capabilities? We can help you build your own corporate accelerator, leveraging your unique assets to hit your growth goals fast.