Changes in the Accelerator Landscape After COVID-19
This article was machine-translated from Japanese by AI (Claude). It may contain errors. Read the original Japanese article.
I believe that the changes brought by the coronavirus and the infectious disease it causes, COVID-19, will alter parts of the startup world and its surrounding ecosystem.
Of course, I think many things will stay the same, and many will change once and then return to how they were. But let me list a few of the changes now underway that seem likely to affect me personally and to take hold or have an impact for some time.
The Rise of Online Accelerators
I think the number of online-only accelerators will increase from here on.
For example, there were already accelerators that were remote-only from the start, such as https://pioneer.app/. With the forced shift to online caused by COVID-19, I suspect many operators have come to feel firsthand that, at least when it comes to delivering a program, parts of it can be done online. As a result, won't online-centered accelerators increase from now on, both in Japan and around the world? Y Combinator and others have also been steadily adding online content.
For entrepreneurs, it is a very good change that even if they are in Japan, they can take part in a remote accelerator (if they can speak English or another language). On the other hand, from the perspective of those running accelerators, it means having competitors all over the world. Whether to win that competition, or, if they would rather not be drawn into it, how to bring out the unique value of being local or offline, seems likely to be the key point.
A Decline in the Number of Startups
From what I hear, the number of entrepreneurs is declining. In fact, around April and July I did not hear much of that kind of talk. Recently, however, I have started hearing that deal flow is shrinking.
The reason the number of entrepreneurs did not drop right away during the spread of the infection may be that many of them had already made their preparations. But I think that pool may be running dry. For example, I have heard that during the financial crisis of 2007–2008 as well, it took about six months for the effects to show clearly in business. If there is a similar delay this time, the moment is about to arrive.
On the other hand, what differs from the economic environment of 2008 is that the real economy has been damaged, that there is no prominent trend like smartphones, and that being unable to meet people makes it harder to find ideas and co-founders. In short, it is a somewhat difficult environment in which to start something new.
Even if someone does start a business, working remotely does not seem well suited to exploring new ideas, and looking at contests and the like, I feel that the quality of ideas has declined relatively compared with last year and earlier. I suspect this is largely because people can no longer bounce ideas off one another in an offline setting.
Of course, I think that where connections already exist, or in a phase of exploitation rather than exploration, a certain amount of progress can be made even remotely. But at the stage of solidifying an idea, or in a situation where one has to pivot many times, remote work will be difficult.
Conversely, I think money will flow more easily to truly good startups. As a result, the number of startups going through accelerators may perhaps decrease.
With That in Mind
Anticipating these changes, I feel that those of us on the support side have to think carefully about what our real value was. I cannot yet see the answer, but I intend to keep thinking about it.