Support is important—in business and in life.
For startups, the support you choose to obtain can have profound effects on the trajectory of your business. From high-speed high-stress trajectories towards rapid growth, to slow-and-steady sustainable objectives there are options available to you.
Startup accelerators and incubators are two popular options. They offer unique benefits and cater to different needs and stages of development.
Understanding these programs and what they bring to the table is essential before you commit to either.
In this post, we’ll explore what accelerators and incubators are, how they differ, and the key factors to consider when deciding between them. We’ve designed this guide to help you make an informed decision to propel your startup forward.
What is a startup accelerator?
A startup accelerator is a short-term, intensive program designed to fast-track early-stage startups. These programs typically last 3 to 6 months and provide startups with seed funding, mentorship, and access to valuable resources like coworking spaces and networks of investors and industry experts.
Accelerators focus on helping startups achieve rapid growth by refining their business models, scaling their operations, and preparing them to pitch to investors. Most programs culminate in a demo day, where founders present their progress to a room full of potential investors.
These programs are best suited for startups with some traction, a validated idea, or a minimum viable product (MVP). They are designed to create momentum and help founders overcome early-stage challenges by connecting them with seasoned mentors and key players in their industry.
Accelerators are not for the faint-hearted; they come with a fast-paced, results-driven environment designed for startups aiming to grow quickly and secure additional funding. That additional funding is often venture capital funding which mirrors the high growth focus that is characteristic of accelerators.
Is a startup incubator different from an accelerator?
In short, yes. But to be more clear we first have to look at what a startup incubator is.
Startup incubator defined
A startup incubator is a program that supports early-stage startups or entrepreneurs by providing resources like office space, mentorship, and tools to develop and validate your ideas. The focus is on helping founders refine their concepts and build a strong foundation for their business, often without requiring equity or providing direct funding.
The main differences between business accelerators and business incubators
While both accelerators and incubators aim to support startups, they cater to different stages of the entrepreneurial journey and to different objectives of the desired outcome. Understanding these differences can help you determine which program aligns best with your startup's current needs and future ambitions.
Accelerators are designed for startups with a validated idea or product looking to scale quickly. They offer seed funding, structured mentorship, and a results-driven environment focused on preparing founders to secure additional investment. Programs are fast-paced, with a focus on rapid growth, networking, and preparing for market success.
Incubators, on the other hand, support startups at the ideation or very early stages, helping founders refine their business models and develop prototypes. These programs are often more flexible and emphasize foundational development over rapid scaling. Incubators typically provide resources like office space and mentorship without requiring equity or offering direct funding.
The primary areas where accelerators and incubators differ are:
Funding
Timeline and program structure
Equity requirements
Stage of startup development
Mentorship approach
Networking opportunities
End goals
Key considerations when comparing accelerators vs incubators
To get a clearer understanding and help you choose between an incubator and an accelerator, here’s a side-by-side comparison of 10 critical components that will shape the trajectory of your startup.
1. Funding
Accelerators: You’ll get seed funding in exchange for equity, which helps you scale quickly. They’re focused on getting you in front of investors to raise your next round.
Incubators: Don’t expect direct funding, but you’ll get resources like office space and tools to help you build. It’s about giving you a solid foundation while you work on securing funding yourself.
2. Mentorship and Guidance
Accelerators: You’ll have access to structured mentorship from seasoned entrepreneurs, investors, and industry leaders. Their focus is on helping you navigate rapid growth and prepare for scaling.
Incubators: You’ll get ongoing, hands-on guidance to refine your idea and build a strong foundation. It’s more about long-term support for developing your product and business model.
3. Program Length and Intensity
Accelerators: These programs are short and intense, usually lasting 3 to 6 months. They’re designed to push you toward rapid progress and often end with a demo day to showcase your startup to investors.
Incubators: Incubators offer a more flexible timeline, often lasting several months to a few years. They provide steady support without the same urgency, allowing you more time to develop your business at your own pace.
4. Equity Requirements
Accelerators: You’ll typically need to give up a small percentage of equity (usually 5-10%) in exchange for funding, mentorship, and access to resources. This trade-off is designed to align your success with theirs and motivate growth.
Incubators: Most incubators are fee-based and don’t take equity, focusing instead on providing resources and guidance. They’re often backed by universities, corporations, or governments, so their goals are less tied to immediate financial returns.
5. Access to Resources
Accelerators: You’ll get access to high-value resources like coworking spaces, specialized tools, and connections to investors and partners. These resources are tailored to help you move fast and hit growth milestones.
Incubators: Incubators provide essential resources like office space, equipment, and support services, often at little to no cost. The focus is on giving you the basics needed to develop your idea without the pressure to scale immediately.
6. Networking Opportunities
Accelerators: You’ll join a tight-knit cohort of startups and gain access to a broad network of investors, industry leaders, and successful alumni. This network is designed to help you form partnerships, raise funds, and scale quickly.
Incubators: You’ll connect with mentors, local entrepreneurs, and other early-stage founders in a more casual setting. The networking is focused on long-term relationship building rather than immediate results.
7. Market Readiness and Focus
Accelerators: Accelerators are best suited for startups with a clear product-market fit or at least a validated idea. The focus is on scaling quickly and preparing you to pitch to investors.
Incubators: Incubators are ideal for very early-stage startups or founders with just an idea. They help you refine your concept, develop a prototype, and validate the foundation of your business.
8. Application Process and Entry Requirements
Accelerators: Getting into an accelerator is highly competitive, with rigorous application processes and a focus on startups with high growth potential. They typically look for traction, a strong team, and a scalable idea.
Incubators: Incubators tend to have a more open and accessible application process. They’re often willing to work with founders at earlier stages, even if you’re still refining your idea.
9. End Goal
Accelerators: The end goal is to help you secure funding and prepare for rapid scaling. By the time you finish, you should be ready to pitch to investors and take your startup to the next level.
Incubators: The focus is on helping you build a strong foundation for your business. When you leave, you’ll have a validated idea, a prototype, or an early-stage product ready to develop further.
10. Program Structure
Accelerators: Programs are cohort-based, meaning you’ll join a group of startups and progress through a structured timeline together. This creates a sense of urgency and collaboration with other founders.
Incubators: Incubators often follow an open-ended structure, allowing you to join and progress at your own pace. The flexible format focuses on providing ongoing support rather than adhering to a fixed schedule.
Making the final call
If you're still on the fence as to which direction is right for you, here's a summary of the key pros and cons of accelerators and incubators.
Accelerators
Provide seed funding to help you scale quickly. ✅
Offer structured mentorship from top experts. ✅
Focus on rapid progress within a short timeframe. ✅
Include access to a strong network of investors and alumni. ✅
Require equity in exchange for funding and resources. ❌
Are highly competitive with rigorous entry requirements. ❌
Best suited for startups with a validated idea or some traction. ❌
Incubators
Offer resources like workspace and tools at little to no cost. ✅
Provide hands-on guidance and support for early-stage ideas. ✅
Flexible timelines allow you to work at your own pace. ✅
Great for founders in the early stages or refining their concept. ✅
Don’t typically provide funding, leaving you to secure it yourself. ❌
Networking opportunities are less extensive than accelerators. ❌
May lack the sense of urgency and structured timelines found in accelerators. ❌
Whether you choose an accelerator or incubator, you still need a winning product
No matter which path you take—accelerator or incubator—success hinges on one key factor: your product.
A great startup isn’t just about funding or mentorship; it’s about creating a product that solves real problems, resonates with your audience, and stands out in the market. While the right partnerships can guide and support you, building a winning product remains the cornerstone of your startup’s success.
If your reason for exploring accelerators or incubators is to create a successful product consider partnering with DevSquad. We specialize in helping founders transform ideas into market-ready software through strategic planning, expert development, and ongoing support.
If you’re an expert building a vertical in your field, an entrepreneur is a “boring” field, or have a fresh take on a stale category, you should also check out RaiseIQ—part of the DevSquad ecosystem. RaiseIQ is an accelerator specifically designed to help you build a profitable SaaS business on your terms (be it rapid growth or slow and steady).
Building a SaaS startup? Learn more about our SaaS development process.
