The Young Entrepreneur Advantage
The Downside
Even so, hitching one's wagon to a large company's program may not always be the best move for an early stage start-up. Sowa urges entrepreneurs to consider the restrictions such an association may place on their companies, and to think long and hard before accepting capital.
"Some programs automatically have certain expectations for giving you a percentage of capital, and this means a certain percentage of equity goes back to that accelerator," she explains. "For entrepreneurs, giving away equity is a very serious decision to be made. Handled incorrectly, it can be the founder's downfall."
John Gallagher, associate professor at Boston College's Carroll School of Management, also cautions that an explosion of quantity could lead to a decline in quality. Being in an accelerator with poor-performing peers, inexperienced mentors, and no track record, he says, can hurt an entrepreneur.
"There are only so many really good mentors," he warns. "You might be better off going alone while being plugged into the community via meet-ups and other programs, than accept the branding of an inferior program."
