We recently wrapped up a 12-week rollercoaster ride with Techstars Miami, and let me tell you, it was one hell of a journey. When we first got the acceptance email (less than 1% chance, mind you), I was pumped but also skeptical. I had a ton of questions swirling in my head. Was this going to be worth it? Would we get the support we needed? How would we handle Demo Day stress?
Here’s a rundown of the questions I had before diving into Techstars and how things panned out:
Doubts Before Joining Techstars
- Fair Valuation: They’re taking 9% of our company. Is it fair?
- Timing: Are we too early for this program?
- Acceptance Tips: How can we enhance our chances of getting in?
- Pace: Can we keep up with the weekly cadence without looking bad?
- Value Addition: How will Techstars add value to my startup?
- Maximizing the Program: How can we make the most of it?
- Demo Day Hype: Is the stress and anxiety build-up worth it?
These questions haunted me throughout the program, and here’s what I found out. If you’re a founder considering Techstars, I hope this helps you make an informed decision.
Fair Valuation from Techstars?
We were pre-product and pre-revenue, so the valuation was fair. For $120k, they take a 9% equity stake in common stock, which is actually favorable. VCs usually go for preferred stock with liquidation rights. You get $20k for 6% equity and another $100k at a $3M valuation. For a pre-revenue and pre-seed company, giving up 9% is a no-brainer. You gain access to mentors, free press, and a fresh perspective on your product.
In our case, we pivoted 50% of our product in the first week, which led us to early customers by the end of the program. Our initial product idea was an engineering analytics platform, we then pivoted to a full blow AI debugging automation platform, the anlytics part is now a part of the product packaging. We started with a fully built platform with no customer-facing features and realized our original idea wasn’t solving a significant problem. So, we pivoted, and the value created was undeniable. If you’re at the pre-seed stage, Techstars is a great value. If you’re past pre-seed with tens of thousands in MRR, reconsider the offer but don’t dismiss it outright.
Are We Too Early for Techstars?
I worried about this during the interview process (you’ll go through at least three interviews). Techstars invests at all stages, even idea stage. Your chances improve if you’ve shipped your BETA or have traction. Our cohort included a company with just an idea on paper and another operating for six years. So, apply even if you only have an idea. Pro tip: follow the managing director on Twitter, like, and comment on their tweets.
Tips for Getting Accepted
Here’s what worked for us:
- Passion: Show how passionate you are about your product.
- Real-Life Experience: Share any real-life experience that led you to solve this problem.
- Co-Founder Relationship: Strong co-founder relationships matter. If you’ve worked together before, highlight it.
- Engage Early: Engage with the managing director on social media.
- Updates: Keep them updated on your progress during the interview process.
- Sell the Dream: Pitch the big dream, even if it’s years away.
- Communication: Include your co-founders in all communications.
Be ready to answer tough questions like your contrarian point of view that competitors don’t yet see.
Keeping Pace with the Program
Once accepted, the first week is about introductions and workshops. The second week is “mentor madness” – you’ll meet over 10 mentors daily for five days. Weekly Ops reviews require you to fill out OKRs (goals and KPIs) and meet every Monday to share progress. The high pace keeps you on your toes, and you’ll want to share your excitement with other founders.
Adapting to the program’s cadence was crucial. One time-consuming but valuable task was scheduling customer discovery calls. I did over 70 calls, learning valuable lessons that shaped our product roadmap leading up to Demo Day.
How Techstars Adds Value
Techstars has invested in thousands of companies and has a wealth of data and systems to share. Just getting accepted is a big win, opening doors to investors and customers. Put the Techstars logo on your site – it shows you’ve been vetted. Use their founder and mentor network, and don’t hesitate to reach out for help. Some mentors may even invest in your startup.
For us, Techstars provided clarity and focus on what to build and prioritize. Without it, I’m not sure where we’d be, but we got our act together quickly. The saying goes, “Luck is when preparation meets opportunity.” Techstars sets you up for better luck, and we all need that.
Why Do Techstars Demo Day?
This is the best part. From the start, we were prepping for Demo Day, and it was crucial not to look bad in front of hundreds of people. This kept us on a tight cadence to ship key features. One of our key features was released just days before Demo Day, and I added the video showcasing it two days before.
Demo Day is a big deal for your company, the press, investors, and potential customers. Every founder should go through this stress to learn how to pitch, communicate, and sell your company. Overcoming these challenges prepares you for the inevitable hurdles in your startup journey. Demo Day was the highlight for me, shaping what we are today.
In conclusion, Techstars and its Demo Day experience were transformative. Every startup founder should go through it to understand the value of preparation, pitching, and the intense pace of progress. It’s stressful, but it’s worth it.
