Wednesday, April 24, 2024

How Innovation Accelerators Are Shaping the Future of Business

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The globalized digital economy creates constant opportunities and requirements for startups. Unfortunately, the business environment that encourages the birth of startups immediately subjects them to a ruthless evolutionary process. Depending on who you ask, up to 90% of startups fail. Only 1% will make it to the big league to compete with unicorns like Uber, Zoom and other financial success case studies.

Most startups that achieve initial seeding fail to raise a second round of capital. One solution to dramatically increase your chances of success is to enter an innovation accelerator and forge a strategic partnership with a major corporation.

Innovation accelerators exist on a quid pro quo basis. In exchange for a small percentage of equity, they provide startup founders with a safe harbor in which to develop their new business. Innovation accelerators are structured programs, usually specializing in a particular field or sector. Entrepreneurs receive mentorship, resources and help from a powerful partner who has a direct interest in seeing them succeed. Innovation accelerators definitely work, but there can be drawbacks. You might be signing over a share of your business, and you’ll be expected to play by the innovation accelerator’s rules — and the initial admission process could be exhaustive and time-consuming.

Related: 12 Reasons You Should Join an Accelerator to Advance Your Startup

Innovation accelerators are bridging the gap

Despite the devastating attrition rates, there’s no doubt that startups are shaping the future of business and are the single most dynamic vehicle for channeling new tech innovation into the digital economy. Major companies (at least the smart ones) recognize the potential of new startups and are keen to either integrate their new technologies into their own operations or to profit from them as investors.

Since 2005, we’ve seen a growing enthusiasm for corporate innovation accelerators that can simultaneously nurture and supercharge new startups. Founders can bring their new businesses into accelerator programs, either at a concept level or close to market, and benefit from the resources, expertise and professional networks that programs have access to. This may also include actual cash investments. Most founders are mature and experienced enough to welcome the professional assistance — and increased peace of mind — that accelerators deliver.

Innovation accelerators subject applicants to some fairly rigorous and detailed scrutiny, but the best programs are open to unconventional ideas and disruptive concepts. Every startup is essentially a business experiment. Accelerator programs try to create laboratory conditions that will allow stakeholders to adapt the experiment, explore new directions and reinforce success — before the product goes to market. For viable products, time to market and development and marketing costs can be substantially reduced.

3 leading innovation accelerators

There are about over 8,000 accelerator programs worldwide, more than half of which were founded between 2014 and 2020. The programs are competing to identify profitable startups and gain privileged access to technological innovations or products that can deliver shortcuts to market dominance. Even niche technologies that adapt or optimize existing processes can deliver a worthwhile return on investment.

Companies and organizations across the entire financial and industrial spectrum are investing in their own programs and enabling thousands of new businesses annually. Three fascinating innovation accelerators in 2024 are featured here. They’re not necessarily the biggest programs, but they offer valuable insights into what makes an accelerator punch above its weight.

Related: Accelerator vs. Incubator: Which Is Right for You?

1. Microsoft for Startups Founders Hub

The multi-billion dollar Microsoft corporation began life in 1972 as a small high-tech startup. Today, the Microsoft for Startups Founders Hub is providing a unique innovation accelerator platform for a new generation of software entrepreneurs. The Microsoft Hub is highly egalitarian and focuses on initial accessibility. Anybody can apply to the Hub via an online form and expect a fast response.

From then on, the platform is meritocratic and startups can progress through its stages, acquiring packages of the latest Microsoft technologies and development tools, including access to AI services, Azure credits and 1:1 mentorship with Microsoft experts. The Microsoft Hub represents an almost democratic approach to entrepreneurship and can be ideal for low-budget — or even no-budget — ventures.

2. ICL Group’s BIG

ICL Group is a leading global specialty minerals company and one of the largest fertilizer manufacturers in the world. ICL’s BIG (Business Innovation for Growth) internal accelerator has received more than 4,000 submitted ideas that have been converted so far into over 1,500 projects, with their revolutionary approach to promoting internal innovation and encouraging employee-initiated projects and excellence, and with a special focus on employee engagement and recognition.

BIG is built on three main concepts: enhancing ideation, accelerating execution and improving collaboration, and has flourished since its creation, making it a very successful business model.

3. Google for Startups

Google for Startups targets an entirely different segment of the new business spectrum. The program is focused on top growth-stage startups and offers a range of accelerators that specialize in overcoming specific technical challenges. The accelerators give founders access to Google’s vast technological resources and expertise.

Each Google accelerator accommodates between 10-15 startups and connects them to mentors and advisors, both from Google itself and from industry. Google’s entry criteria are demanding and the program requires a commitment for ongoing technical engagement at a high level.

Related: Everything You Need to Know Before Working With Accelerator Programs

Accelerators shape corporate culture

The skill and experience of each accelerator team and other stakeholders, the scale of their professional networks and the depth of their resources have a direct influence on the future structure of any startup that they mentor and nurture. Additionally, the culture of individual innovation accelerators inevitably becomes part of the DNA and ethos of each startup that makes the transition to a functioning growth enterprise. Accelerators that drive startups in 2024 have a unique opportunity to shape the wider corporate landscape and working environment a decade from now.



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