Karma Samdup, partner at law firm MJ Hudson, discussed the effectiveness, and the challenges of running accelerators and identifying disruptive innovation with a panel of entrepreneurs and heads of corporate accelerators today at the Global Corporate Venturing Symposium.
The panel comprised Zack Weisfeld, general manager of Microsoft Ventures, the early-stage innovation subsidiary of software producer Microsoft; Andy Shannon, head of global operations for accelerator Startupbootcamp; John Mcintyre, managing director of software company Citrix’s Citrix Start-up Accelerator; and Peter Cowley, entrepreneur and investment director for Martlet, a corporate angel initiative run by auto parts provider Marshall of Cambridge.
Weisfeld said: “If you run an accelerator properly, you can see disruption before it happens,” adding that Microsoft Ventures receives applications from around 8,000 entrepreneurs a year, of which about 2% are accepted.
“You can see signals, in terms of new business models, new areas of business and new technology.”
The combined number of applications received by Microsoft Ventures and the Citrix Start-up Accelerator would be 20,000, Shannon said, stating: “You can analyse those in a smart way in order to understand how to position yourself to invest in two or three years’ time.”
Mcintyre said that a new trend in corporate venturing and corporate development was to look for signals, though setting up accelerator programmes around the world can be difficult and expensive.
Finding and incentivising mentors was an issue, added Shannon, while Weisfeld said each region had its challenges, such as the challenge of being able to hire quickly enough in China.
On average, Cowley said, he reckoned that an accelerator could improve a startup, “even if it accelerates the startup to failure, bcause then the entrepreneur will go on to something else.”
However, he said that valuations at the end of acceleration processes tended to be very “toppy,” at least in London.
Asked how he dealt with the large number of applicants, Shannon said that success for accelerators “depends on the calls they make, not take,” adding: “The days of being able to sit back and cherry pick are over.”