We keep trying to reinvent startup accelerators – TechCrunch

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Criticizing the value of a startup accelerator and demo days has been a decades-long conversation in the tech world. The programs promise napkin-stage founders to help with everything from finding their co-founders to finding the right product for the market to collecting that first pivotal check. Led by global programs like Y Combinator, Techstars, and the Global 500, start-up accelerators have spawned multi-billion dollar companies like Coinbase and Stripe and become synonymous with the promise of activation energy.

Yet every few months, entrepreneurs ask themselves the same questions: Is it worth tapping into a network of precious capital? Is the true value of the program just an esteemed stamp of approval? Are demo days obsolete? Is the best outcome for founders within an accelerator simply a new round of funding? Is YC’s lot size too big to stand out?

We keep trying to reinvent startup accelerators, and that in itself tells me that the institution is still relevant, albeit imperfect. After all, asking questions is the first step in changing the way things are done.

In January, I wrote an article about how boot throttles are overdue for an update how they think about value-added services. Days later, Y Combinator announced that he was increasing the size of his check at $500,000, up from $125,000 before. With Y Combinator Winter 2022 Demo Day next week, we’ll see the first cohort affected by these changes, with YC becoming more remote, more international, and more ambitious about the impact you want to have.

This year, as you’ll all see, we’re changing the way we cover Demo Day to better reflect what we believe to be the most important part of accelerators: a way to see how a large cohort of startups is thinking directionally about the biggest problems in a certain subsector. It seems that demo days have completely departed from a traditional presentation and pitch to investors, and more so offer a snapshot of a new company and the growing personality more of its early days.

More next week, but in the rest of this newsletter we’ll talk about the atypical world of fintech, an Instacart discount, and a non-profit cryptocurrency overlay. As always, you can support me by forwarding this newsletter to a friend, following me on twitter or subscribing to my personal blog.

deal of the week

Rampa confirmed that he has raised, once again, but this time with a valuation of 8,100 million dollars. The next decacorn valuation comes after the company achieved unicorn status less than a year ago from less than a year ago. God.

Here’s why it’s important: Ramp, and fintech in general, feels like an outlier of the market turmoil we’ve been reporting on over the past quarter. Is the financial services sector protected from a broader corporate pullback or valuation correction? At Equity this week, Alex and Mary Ann came to a key takeaway: It’s a fintech world, and we’re just living in it.

Honorable mentions:

Image credits: Bryce Durbin/TechCrunch

Instacart’s biggest discount yet

Instacart is cutting its valuation almost 40%, giving us another data point in largest market correction succeeding many success stories of the pandemic era.

Here’s why it’s important: as Alex Wilhelm points out, DoorDash, another food delivery company, has seen its price-to-sales ratio fall from the highs of the previous year, while Uber hopes to scale its food delivery service. Instacart, still private, lowering its paper valuation ahead of its stock market debut may spare it an otherwise bumpy backlash.

I guess eggs and ham aren’t so green:

  • I like Instacart’s growth plan
  • Mary Ann’s weekly fintech newsletter is coming soon! Register here to receive it in your inbox.
  • Evergreen reminder to take advantage of the code “EQUITY” when subscribing to TechCrunch+ for a great discount and gratitude.
Blank sale tag on white background.

Image credits: jayk7 (Opens in a new window) / fake images

Why are the web3 rich donating crypto instead of cash?

Crypto reporter Anita Ramaswamy analyzed the tendency of the web3 rich to donate in crypto, rather than cash. The story specifically explores how a flood of crypto donations to support Ukraine this month can spark broader interest in the community to support causes through coins.

Here’s why it’s important: Beyond the cultural overlap in donations and crypto’s vision of a more democratic way to support causes, there is a technical benefit. Change founder Sonia Nigam, who is building a donation API with Amar Shah, explained the difference between traditional philanthropy and creator utility:

Smart contract technology allows the impact to reside in the product itself and then yield in perpetuity… we will see NFT collections kick off and set a target; [for example] that of all secondary sales, 2% goes to combat climate change for life. Now, with every resale, the original intent of the creator is never lost, which is what really excites them. And for nonprofits, unlocking recurring channels to donate is always the number one goal.

Chain reaction

cryptocurrency donations

Image credits: Bryce Durbin

over week

We can hang out in person! Soon! TechCrunch Early Stage 2022 is April 14, aka right around the corner, and it’s in San Francisco. Join us for a one day founders summit with Terri Burns from GV, Glen Evans from Greylock and Aydin Sekut from Felicis. The TC crew has been itching to get back in person, so don’t be surprised if the panels are a bit racier than usual.

Here is the full scheduleand Get your launch tickets here.

Follow our new senior crypto reporter: Jacquelyn Melineck! She’s already asking the big questions, on the stage and in the place.

Finally, if you missed last week’s Startups Weeklyread it here: “Failure is complex, especially in the world of startups.”

Spotted on TechCrunch

Alphabet just spun off its quantum tech group, launching it as an independent company

Musk reveals plan to scale Tesla to ‘extreme size’

Sequoia launches Arc, a London/SV program to find and mentor atypical startups, backing each with $1 million

Okta says hundreds of companies were affected by a security breach

Spotted on TechCrunch+

The product-driven growth playbook

Despite declines, the value of crypto assets in DeFi protocols has increased 3x from a year ago

Time to hold investors accountable and abolish proration

Dear Sophie, How long does it take to get international business parole?

Until next time,

North

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