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Startup Accelerators Decelerating?

Posted by: Mark Marich on November 25, 2013 Source: Policy Dialogue on Entrepreneurship

Following persistent speculation that a startup accelerator bubble was forming — fueled by the exploding popularity of bootcamps, hackathons, co-working spaces and all-things-startup — a new report on TechCrunch suggests the trend may be losing steam.

Although 2013 will see a record number of accelerators and incubators — currently 170 — the number of funded startups emerging from them looks to have leveled off (and may even drop slightly). 

Using data from CrunchBase, author Mark Lannan also explores the number of accelerated startups by continent / region. Europe and Asia continue to make positive strides while South America and the Middle East scaled back. Of course, North America accounts for roughly twice as much as all other regions combined — and that looks to drop considerably in 2013 (the first time it has ever dropped).

So while there may be more SparkLabs (Seoul) or  H-Farms (Venice), there will be fewer gener8tors (Milwaukee) and Pipas (Rio de Janiero). 

According to Lannan:

The growth of accelerators and incubators is clearly one reason for the record number of angel and seed investments in 2012 which we explored earlier. Just as the number of angel deals in 2013 likely will not reach the 2012 peak of 1,520, it looks equally unlikely the number of companies funded by accelerators will surpass 2012 levels. Although there are now more accelerators and incubators than ever, the total size of their portfolios appears to have leveled off in 2013. We can speculate that the proliferation of accelerators has reached a tipping point where there are now not enough quality founders and startups to justify continuing to expand their portfolios.

But don’t take Lannan’s word for it. He suggests readers download the October 2013 Data Export from CrunchBase and see what they find.

Category:  General  Tags:  TechCrunch, SparkLabs, H-Farm, gener8tor, Pipa,

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