USA still holds the number one position for the world’s top startup hub with good funding and excellent accelerator programs and incubator. When looked at it state wise, Silicon Valley or California tops the charts. But New York state is not far behind. New York holds the second position following California for the best accelerators. However, New York beat out California for the top spot in funding applications across USA with a 22% increase in Q1 2015. The New York startup scene is filled with resources for training, mentorship, funding and workspaces in the form of New York startup incubator and accelerator programs. With access to large amount of capital, highly experienced investors and a healthy ecosystem, New York is a very attractive location for companies to launch.
Accelerators are designed to take in startups and put them on a solid course to shape them and turn them into a full-fledged companies, and getting them well prepared to face and pitch in front of a room with potential investors. The accelerators in general, offer seed money in exchange for certain percentage of equity, free office space during the due course of the program, mentorship and other perks that includes free legal advice/banking.
Accelerators in New York are endless but looking at their programs, funding and the success rate of the graduated companies, we have listed few who top the charts.
*Entrepreneurs Roundtable Accelerators (ER Accelerators):
Founded in 2011, Entrepreneurs Roundtable Accelerator is an early-stage seed fund and technology accelerator built by the New Yorkers for New York. Born out of Entrepreneurs Roundtable, it focuses on assisting startups that revolves around technology and helps in building next generation of great New York technology companies. It was founded by Murat Aktihanoglu and Charlie Kemper who were part of the Entrepreneurs Roundtable association and accommodates startups that operate in NYC area only.
ERA offers four-month program which brings together hands-on help, seed capital, a great co-working location and expert leadership to help the startup move to the next level. With just 10 per batch, it allows the startups to get needed exposure to investors, collaborate with each other and have fun with various events like poker nights and karaoke competitions. At the end of the four-month program, the accelerator ensures the startup is ready to present its business in front of the investors at the Demo Day. It runs two programs a year which is Winter and Summer program.
Selecting more of software-related startups, ERA offers $40K for every company at the end of the program as seed funding. On return, it holds 8% equity stake of the company. It has built quite a track record with the companies that have graduated from the program since its founding in 2011. Among the lot, few are Appy Couple, Seamless Docs, Admitted.ly, BespokePost, Centzy, Pricing Engine, Wizpert.
Founded in 2009, NYC-Poly accelerator/incubator is the first business incubator to have stated inside the New York University campus. It integrated the next-generation technology with highly adaptable business models. The members selected for the program makes use of the abundant global talent found in New York City to help the entrepreneurs. They help the companies to transform their business ideas into a feasible business model and highly valuable products/ services.
NYU-Poly and CIty of New York teamed together to launch Varick Street Incubator as part of Mayor Bloomberg’s Five Borough Economic Opportunity Plan in July 2009. The incubator’s core philosophy is invention, innovation and entrepreneurship.
Based in New York city, NYC SeedStart is an annual startup accelerator founded and operated by some leading venture capital firms, mentors and partners in NYC. It takes in startups from various verticals and offers different program to each. Each program is targeted toward a specific industry in order to meet the needs of the early stage companies. The accelerator allows to put in place the place the pieces to allow talented entrepreneurs working on important enterprise trends and products to be in NYC and launch their ventures.
NYC SeedStart program are very intensive and goes on for 12 weeks to help young businessmen focused on the next-generation of enterprise software (B2B) to launch new ventures in New York City. Until 2013, it was taking in companies from different sectors. Then considering the importance of enterprise software companies in the NYC ecosystem, they shifted their core. The program does not take in more than 10 per program to offer better attention to their needs. Rather than having same mentor for every batch, the organization looks out for the mentor that is absolutely perfect for each of the startup. The mentors are allotted based on the needs of the startup. As all other accelerators, the startups are prepared for the presentation on the Demo Day at the end of the program.
Every startup that is selected for the program are offered $20,000 as seed investment at the end of the program and on return takes 5% equity stake of the company. Apart from investment, it also offers free collaborative office space in NYC’s Greenwich Village. The NYC SeedStart accelerator program series strongly aligns with the NYCREDC’s economic development strategy. For which, NYC SeedStart was awarded with $550,000 grant from Empire State Development to support six 12-week business accelerator programs to boost the growth of startups in New York City in the year 2013.
*New York Digital Health Accelerator:
Founded in 2012, the New York Digital Health Accelerator is a program run by the non-profit New York eHealth Collaborative and the New York City Investment fund for early and growth-stage digital health companies. The mission of the accelerator is very clear and focused, answering the needs of the state and health care providers. To be part of the accelerator program, the startups need to have a product that addresses care coordination, patient engagement, analytics or message alerts.
The program runs for a due course of five months and during that time, the selected startups receive mentorship, attend workshops and all the advises needed to shape their business. The startups receive mentorship from senior-level executives at more than 20 of New York State’s leading healthcare provider organizations. The selected startups also get access to the NYeC-led EHR/HIE Interoperability Workgroup network of providers, states and vendors from across the country.
At the end of the five-month program, every selected companies would receive upfront $100,000 in capital investment in a return of 2% equity stake. While it not a simple work to develop health related companies with enduring value, the Digital Health Accelerator has already made a strong impact on healthcare in New York State. The 15 companies that graduated from last two programs have raised a total of $40 million post-program completion, driving growth and drastically expanding their customer base. Within 6 months of graduating from the program, two companies Avado and Remedy Systems were acquired by big concerns. Other sucessful companies graduated from this program are Noom, Covertix, CipherHealth.
*FinTech Innovation Lab:
Founded in 2011, FinTech Innovation Lab is an annual accelerator program run by the New York City Investment Fund and Accenture. The program is open for early stage startups that are developing cutting edge technology products targeted at financial services customers. It takes in six startups per batch who are then offered chance to refine their business model and beta test financial technology products in New York City.
The accelerator program runs for 12-week time period in which the selected startups undergo leadership program, panel discussions and mentoring sessions and ends with Demo Day. The accelerator has teamed up with 15 financial institutions that includes American Express, Bank of America and Goldman Sachs, all of which offer mentorship and guidance to startups in the program. The lab assist the entrepreneur in meeting with financial services decision-makers who not only give critical feedback but also become their customers.
Apart from New York, it also operates in London and Hong Kong where it offers funding and workspaces in NY. This year, the program has added AIG to the list of institutional partners which the company says that insurers are starting to understand the value of working with fintech startups. At the end of the program, each company is funded with $25,000 in the form of a convertible note which is optional and independent of the common stock warrants. On return, the program takes less than 1% equity in the form of common stock warrants. Since the inception, 31 companies have raised a total of $175 in venture financing and four have been acquired including Standard Treasury and BillGuard.
*Kaplan EdTech Accelerator:
Founded in 2013, the Kaplan EdTech Accelerator is powered by TechStars and focuses on tech-powered startup that deals with education. It targets at the startups who are looking to change education for better. The selected startups will get access to topnotch industry mentors, resources and round-the-clock and the chance to pitch to angel investors and venture capitalists at the end of the program.
The intensive program of Kaplan EdTech Accelerator runs for three months when the startup gets to enjoy all the benefits offered by the program. The program is being held on-site in New York, NY for the selected ten edutech startups. At the end of every program each startup is given $20,000 as seed capital with the return of 6% equity stake in the startup. Every startup would get access to market insight and a feedback loop from its base of one million active students and 10,000+ instructors and the ability to interface with decision-makers as part of Kaplan’s relationship with 300+ US school districts and 20+ university partners.