Should you do Techstars?
Growing up in Toledo, Ohio, I didn’t have the exposure to entrepreneurship or VC.
But I did know I liked selling things.
My first business was selling buttons - for every thing I sold, I should make enough money back to buy more things. I was “profitable” from day one thanks to the low overhead and free rent at my parents’ house.
I maintained this thought process as I leaned into business, graduated high school, and had my eyes set on “working for myself.”
I first had the idea for Aunt Flow at a Startup Weekend in Columbus, Ohio, powered by Techstars. While I didn’t know it at the time, Techstars would be a massive part of the continued growth and development for my company.
I leaned into this idea and started attending more “startup events” in the city - my favorite being Startup Week in Columbus, which, at the time, was powered by Chase and Techstars. I craved meeting other founders - I was 18-years-old and it was clear I didn’t have experience, but I did have the eagerness and hunger to learn from others. I enjoyed watching, listening, and participating in conversations.
As Aunt Flow slowly grew (for every thing I sold, I made money back), I started to read more headlines like “young founder raises $1mm for his gadget.” He had no revenue and just an idea. If he could do it… why couldn’t I?
Well, for one, when people talked about raising a “friends and family round” I looked around and thought “friends and family -who?” Investing in startups was not a natural thought for folks in Toledo and my network definitely did not include ‘accredited investors.’
I knew if I was going to take my company to the next stage, I needed a new network.
Techstars had been in my life since the beginning of Aunt Flow and I heard remarkable murmurs about the accelerator program. I started applying.
In 2017 I applied for LA, Chicago, and NYC Techstars Accelerators. I made it to a call with LA, final round with Chicago, and I didn’t even get a call back for NYC.
As I was interviewing, the question “who is your co-founder” was as natural as when I was graduating college and heard the question “where are you going to college.”
I didn’t have a co-founder and I never planned on having one.
Ultimately, I didn’t make it into LA or Chicago. But that didn’t stop me from applying again in 2018. This time around, I got a call-back for NYC, my dream. At the time, Alex Iskold was the managing director. I appreciated his thoughtfulness, while also being tough.
I moved to NYC for three months with my first team member.
Techstars provided me the opportunity to open my little Ohio-eyes to the world of VC, massive growth, and what building a billion dollar company could look like. Being surrounded by people who wanted to work, build, and grow was invigorating.
Now that I provided the background on how I got to Techstars, here is a run-down of my personal experience:
The Costs/Critiques
Techstars takes 7% for $20k with the idea that the real “value” comes from the 3 mo program. This offer is standard and doesn’t budge much. There is no way to say it lightly - Techstars is EXPENSIVE. In addition, they offer $100k at your next round (but it is tricky to unlock this $100k on high-priced rounds.)
At the end of the program, there is the notorious “demo-day.” When I went through the program in NYC, this was nixed and replaced with 1:1 meetings with investors that opted in. I truly believe it was these close conversations, rather than standing on a stage pitching, was the reason we closed our round of $1.5mm within 3 months of the program… So why is this a critique? ALL programs should end like this, but the standard is the demo day.
Going to a “general” Techstars Accelerator can be positive or negative. I run a hardware company with the only tech being a website. Given the incredibly different skillset required, compared to my cohort of ap developers and tech things, I didn’t receive the catered mentorship or support that I needed for building a hardware company. This problem could be circumvented by attending a Techstars that is focused on your industry (ie. Techstars Retail, Fintech, etc.)
Programming can be irrelevant. Aligned with the previous bullet, trying to create programming for all companies that are in different stages and different fields is hard. Thus, nearly all of the general programming was unhelpful.
Techstars touts incredible “perks.” These are coupons that can be unlocked using basic tools like Rakutan or Honey - Nothing seems created just for Techstars.
The brand is getting diluted. With more Techstars Accelerator programs popping up, the prestige of going through the program is lessening. Previously, if you went through Techstars, you would get funding for sure. Now, it is just a boost, not a guarantee.
The Benefits
We met our lead investor through Techstars. Harlem Capital.
Techstars is always 1 or 2 hops away from getting you the introduction.
I have built life-long friendships with others that went through Techstars. While not everyone was in my cohort, I built friendships with previous classes, just by walking around and networking and going to the NYC Techstars events.
Techstars doesn’t just preach diversity, but they are taking clear and visible action steps to include female and minority owned founders. My cohort (NYC 18’) was 50% female founders and 15% POC. (SEE PIC ON THE RIGHT WITH SOME OF THE BADASS FEMALE FOUNDERS FROM OUR COHORT)
I went to a program in a city that I wanted to spend more time in - NYC. After Techstars, I opted to stay in the city, now spending 50% of my time there. This has greatly grown my network because of the continued programming, networking events, and supporting the new companies.
The Critical Notes
It is ALL about the managing director. I was incredibly thankful to build a relationship with Alex Iskold, who is still someone I call for advice to this day. If you do not have a strong relationship with the managing direction, your program may not be as powerful.
I found the MOST value in-person. A few of our cohort members opted for remote and shared that they didn’t get as much out of it. Just like they say “you go to college to build your network,” Techstars is the same thing.
The key take away: Techstars was worth-it for me because I needed to build my network. It is critical to know WHY you want to go through a Techstars Accelerator because the cost is incredibly high.