Here’s a question for you food tech startup CEOs out there: should you join a food tech accelerator just for the money?
Definitely not, at least according to Tessa Price of WeWork Food Labs and Peter Bodenheimer of Food-X.
Of course, funding is funding and can be hugely important for any startup’s growth, but there are more important reasons to join an accelerator say Price and Bodenheimer, both of whom joined me for a live conversation this week in what was our first Foodtech Fireside chat.
One of the main reasons a startup shouldn’t make funding the one and only reason to join an accelerator is the equity ask is going to be bigger than with other forms of funding.
“There’s cheaper money out on the street than accelerator money,” said Bodenheimer. “The deal structures in accelerators for investment typically are different from what you’ll see from just an investor not running an accelerator.”
And while it may seem obvious on its face, another important reason, quite simply, is in the name.
“They have potential to accelerate the growth of a startup in a very compact period of time,” said Price. “The value in the ecosystem is that accelerators provide a fairly safe environment to come together and access resources in a way they aren’t able to when they are dealing with a more traditional VC or angel investor.”
Then there’s also community and connections to the food tech ecosystem that come from spending two to three months in an accelerator.
“Having a density of entrepreneurs working in similar types of businesses, that leads to good things,” said Bodenheimer. “Having a support community is really important, and so is being able to leverage the network an accelerator can bring.”
Finally, food tech accelerators give startup CEOs a unique once-in-a-lifetime opportunity to step outside of the business and look at what they are doing through fresh eyes.
“There’s a saying: sometimes you’re too busy working in your business to work on your business,” said Bodenheimer. “An accelerator gives you an opportunity to work on your business with focused effort.”
We’ve turned the fireside into a podcast you can listen the full conversation with Tessa Price and Peter Bodenheimer on Apple Podcasts or by clicking play below, or you can also listen to and download the episode directly with this link.
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