What makes a startup accelerator or incubator useful? Depending on the stage and specifics of the startups they support, it can be helping with establishing founders’/startup’s business or access to mentors, potential clients or investors, knowledge transfer, possibility to test the idea or product, etc. So anything that would boost the startup’s business or improve their business model. In this blog we will explore how to work with business models step by step.
Describing the business model
The first aspect is of course establishing the business model in the first place or prototyping or (even) innovating a business model using business modeling tools. This all depends on the startups in the program, so try to figure out which type of business modeling support would the teams need the most. The founders and pre-seed would probably need help with fine-tuning their idea and describing the first business model. The established startups should rather be challenged to innovate and make the business model scalable or more profitable or to design business model prototypes for testing.
Add the relevant business modeling sessions in your program and establish common tools for the teams to use. Herewith the visual thinking tools are the best for exploring and communicating the teams’ progress, as they enable teams to efficiently work together, make changes easily and experiment with different solutions,. For example, the Business Model Canvas is one of the most used frameworks for describing the elements of business models. Along with that, you may use the vision and context maps, and other tools depending on your program specifics.
Regular feedback to the business model
Once the baseline for the business models is set, the teams need to get regular feedback to the business model. The easiest way is to have dedicated people in your accelerator team follow the startups’ progress throughout the program and provide regularly feedback. It could be in the form of Friday morning (elevator) pitch sessions, where the startups present their concept and the other teams and your staff provide feedback and/or more focused individual feedback sessions, giving the startups the possibility to discuss their business model hurdles with your team.
Role of mentors
Getting feedback from mentors as experts of diferent backgrounds further increases the value of the process. When bringing the mentors into this process, you are covering a wide range of topics that could be useful for the startup teams. Using the info collected during your feedback sessions, match the teams with the specific mentors that you know could help the startup in addressing their specific challenges. It could be anything from revenue models or clients’ needs (think of mentors representing the startup’s client segments) to funding (those representing the appropriate funding institutions) to just structuring the business or a team (could be best addressed by those, who have had similar problems or have experience with relevant solutions).
Testing the business model
At the end of the day the ambition of any accelerator is helping their startups become successful businesses. This is why it is important to have them achieve real results based on the theoretical work on their business model. Do not let them lose time with endless planning and discussions, but make them face the real world. Get them out of their comfort zone and send them out there to test their business model with the potential clients and with the investors and other possible financers. You might also want to organise demo days, networking events and have corportes creating the challenges. After such an exercise, have them coming back to their business model canvas to analyse what works and what does not, creating, if needed, new business model prototypes.
A structured business model support throughout the program is not only something the startups would really benefit from, but also creates a competitive advantage for the accelerator. We look forward to your feedback on how you use business modeling in your program.