Accelerators · Enterprise

Enterprise SaaS Accelerators - what's fair?

Sati Hillyer Looking to Hire a Ruby Engineer to join OneMob - 2015 Gartner Cool Vendor for CRM Sales

July 16th, 2014

I've been accepted to a couple different accelerators, they position themselves as Enterprise Accelerators focusing on helping B2B.

Our company and product is mobile and enterprise SaaS, targeting business professionals (not consumers). So these seem very relevant.

Essentially, they both want around 5% for $30K. The money is not that important (and not much help really), but I feel the connections and referrals will be huge. In fact, one already landed me a meeting with a fortune 100 CIO. I can probably negotiate the % down, for taking less money.

Do you think this is something to give up equity for? Any thoughts or comments? 
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Russ

July 16th, 2014

One solid introduction could be make it worthwhile.  The meeting you got with the Fortune 100 CIO from a trusted recommended source is potentially worth millions to your company.

Kate Hiscox

July 16th, 2014

Frankly, all accelerators are expensive if you look at them from a cash for equity perspective. Its their reputation, client introductions, free tools and discounts, relationships with investors and mentorship that commands the value. If you feel they have the right stuff to introduce you to the right people, help get you funded and guide you on how best to grow, its worth it. But reputation is a big thing. The lesser known accelerators might be easier to get into but then you lose some of the 'prestige' benefit. Who are the accelerators? I am curious?

Anonymous

July 16th, 2014

If you watch Shark Tank (which I did yesterday), you'll probably realize that negotiating by 5% increments (and not less) is pretty typical for investors.

Now, Shark Tank might not be the best example of sound financing (from the company's perspective I mean - they really are sharks), but it gives a good idea of how much negotiation private investors are willing to endure for early-stage companies.

Sati Hillyer Looking to Hire a Ruby Engineer to join OneMob - 2015 Gartner Cool Vendor for CRM Sales

July 16th, 2014

Thanks Russell - completely agree!

Thanks Jessica - right now we are piloting our beta, getting good response, but enterprise sales can take time to get the traction I think gets everyone excited. Hence my thinking the accelerator could help with that because of their connections.

Jessica Alter Entrepreneur & Advisor

July 16th, 2014

I guess it depends how much you think you can negotiate down and what that time is worth to you. Could you do it for 4%? Maybe, is 1% really that big a difference right now? And what else could you be doing with that time.
Unless you have significant traction I doubt you'll negotiate down far enough to matter/be worth it. And if you do have that traction I'd question doing an accelerator.