Specialization and the evolution of the seed accelerators

There is a tremendous amount of money flowing into new models for venture backed corporate development. The explosion of incubators, accelerators, angels, super-angels, AngelList, seed funds, startup camps, startup crawls, etc. have created new rules around piles of money available to entrepreneurs.

• There are social rules, like those AngelList applies to identifying and filtering startups for angel-investors.
• There are co-working rules, like those applied by Y Combinator to relocate businesses into rich mentorship networks.
• There are financial rules, like those applied by Capital Factory to simplify and standardize the earliest stages of venture financing.
• There are also thematic rules, like those applied by 500Startups – “startups are born from usable design, customer-focused metrics, and online distribution.”

Each of these programs has had a profound impact – at least in their respective locales, or, in many cases, domestically or globally. And, there are many others like them.

One of the themes I believe we will see develop more rapidly as these programs mature is specialization. There will be specialization around industry, specialization around investment thesis (even at these smaller investment sizes), specialization around business genre (ie: geo-local, fin-tech, etc.), and others.

We are a specialized accelerator – we engineer outcomes for targeted investments. We’ve spent 5 years building a tightly integrated network of financiers and distribution partners. It’s composed of Fortune 50 executives, VC firms with like-minded philosophies and high-net wealth investors that are motivated by our thesis and trust our ability to execute our model. Our model, specifically, is to invest our dollars and team members deeply into our portoflio companies and integrate them immediately into a massive network of the largest distribution partners in the world that sit atop the most valuable ecosystem our customer can impact. We work with our capital partners (the Thinktiventures Network) and distribution partners to engineer a winning outcome for our portfolio company from the earliest stages of its development. It’s become effective enough, that for the right business, which aligns with the financing and distribution networks we’ve built, its outcome is nearly pre-ordained. This explains our specialization, it’s our network of experience building businesses targeted explicitly at our financing and distribution network. Not every business is right for our model, because our financing and distribution network is targeted.

It’s been amazing to watch this mature over the last 3 years, as we’ve focused so heavily on building these networks. What we’re trying to achieve is to enable our portfolio companies to break away from the chains of ‘failing fast.’ We don’t believe that’s a mandatory cultural or operational component of an early stage business. We’d much rather engineer a winning outcome from the start by aligning strategic financial capital, premiere talent, disruptive technology and world-class distribution. When we’ve done this successfully, we’ve generated massive businesses in short time periods.

In my next post, I hope to discuss some specific characteristics of our financing and distribution network to illustrate where I believe our strengths and opportunities for growth are.