I Joined 2 Startup Accelerators. Here’s What Happened (Part 1: Startup Chile)
Are they worth it?
“It is impossible for a man to learn what he thinks he already knows.” ― Epictetus
Every time I visit a new culture and talk to people from a different country than mine, I open a big and bright smile. Living abroad is many people’s dream. I’m from Brazil, and I had the opportunity to do that twice because of my gaming company.
If you have a startup, you probably already heard something about the world of startup accelerators. They help with working spaces, mentoring, and money.
Usually, when you are a first-time entrepreneur, you don’t have any money and are barely qualified to run a company. Having mentors guiding you is very helpful. It is also excellent not to pay for working space and get money to pay yourself and invest in your company.
Startup accelerators may sound like a dream for most entrepreneurs.
I had the opportunity to participate in two of these programs. Without them, my company wouldn’t become profitable the way it did, and we wouldn’t have grown at the same velocity as we did.
In this story, I will share how my experience was through the first accelerator program I did.
Application
The Startup Chile is an initiative from the Chilean government. It helps companies with US$40,000 (equity-free), working spaces, and mentoring. I learned about this program when I was doing mentoring in Silicon Valley that I paid.
At that time, I worked with three employees and they counted on me to keep the company alive. They had families to support, and I paid them less money than they made before joining my company. They believed in me. I had a few months of runaway, and I was desperate to get cash for my company.
I scratched my head more times than I could count while filling out the Startup Chile program’s unfinishable application. I had to answer many questions, record a 3-minute pitch video, and get references from other entrepreneurs. Luckily, at this point in my entrepreneurial career, I have built my network and practiced pitching.
It took me many days to finish everything, and I bet on the program to keep my company alive. After a few weeks of sending the application, I received an email back. My eyes were wide open, and my heart probably skipped a beat when I read what it said. They selected my company to join the program. I had an opportunity to transform my company into a profitable one. As we worked 100% remote, I shared the news with my team typing so loudly that my neighbor could hear the sound of my old wireless keyboard.
I had two months to buy airplane tickets, get an apartment in Chile, send all the paperwork necessary to get a Visa (I had to go to the Chilean counsel several times), and go to the doctor to do some exams they requested. I was out of breath every night during these two months. I lived far from everything. I faced heavy traffic besides my daily work of many hours.
Bureaucracy
I moved to Chile in November, but the program did start in December. The first month's goal was to solve all the bureaucratic stuff. It was easy to walk 10,000 steps a day as there wasn’t Uber yet, and I didn’t have money to pay for a taxi or subway. I signed a lot of papers and open a bank account to get the money. I didn’t know exactly when I would get it, but I was expecting that sooner than later.
My first month in Chile was something to remember for life. Food was my only expense, as I already had paid for the rent of the apartment. As I didn’t take too much money with me, I could not have any fancy expenses. I dreamt about the different foods I saw in the supermarket. I ate the cheapest meals possible.
After almost a month in Chile, I got a credit card from my new bank. With that in my hands, I went to the supermarket to buy tasteful food. I bought a kind of salami I enjoy. It wasn’t anything expensive, but it was something different that I’ve been eating for the past couple of weeks. I took a big bite while I closed my eyes and slowly chewed the food. I tried to remember this moment every time I complain about eating.
I lived 20 minutes by foot from the two buildings of the program. I choose to work at my apartment after spending a day in the working space. While my batch started, there was another one finishing. Many startups shared the area, which led to an agglomerate of noisy voices in more languages than I could understand. I believed it would be better for me to focus on my apartment and go to the working space when I needed to participate in one activity.
I lived in a tiny apartment two minutes by the supermarket, the subway, and the gym. I was close to everything that I needed. I could walk no more than ten steps inside where I stayed. Besides the bathroom, I had a small room with a bed, a dining table where I worked, and a small kitchen behind where I sat.
I took a deep and long breath when I got the first half of the money from the program. It was January, and I had a big responsibility for it. The second half I got just in June, as I was packing my bags to come home to Brazil. It was another small victory after everything I went through.
Pitching and mentoring
The program did start in December. None of the activities were mandatory, but I choose to participate in as much as I could.
One of the activities of the program was the pitch training. I could join sessions every week, and that’s what I did. It was challenging for me at the beginning to pitch in English, as it is not my primary language. I was already used to pitch in Portuguese, and most of the feedback I got was about not rushing through my presentation and when to pause to improve my message. I also repeatedly trained at my apartment and recorded myself speaking to see how I could improve.
Even though the program was in Chile, all its communication was in English. We had founders from countries all over the world. However, outside the program (at the bank, gym, and supermarket), I had to speak in Spanish. I had studied both languages when I was a teenager, and it was an incredible opportunity to practice this knowledge. Attending Startup Chile helped me become fluent in both English and Spanish.
We also had several presentations to watch from other successful entrepreneurs. They were mostly about product development, customer discovery, raising money, team building, etc. Everything to help a startup make money, which was what I was looking for in the program. We could schedule time with those people to get mentorship for our startups. My goal was to finish the program with a profitable company. Otherwise, we would die.
Demo Day
Usually, every accelerator program for startups ends with a Demo Day. That is when all entrepreneurs do a 3-minute pitch presentation in front of many investors that the program invites.
I could meet some previous batch entrepreneurs. They were at the ending of their time in Chile, and I could get some advice for my startup. I also could watch their Demo Day and get some thoughts on how I could improve my presentation, as I was going to do one a few months later.
During the program, I had the opportunity to talk to other investors before Demo Day. It was an opportunity to try to get money and to improve my presentation. I didn’t get any money, but I met many investors and made many connections.
As the Startup Chile program batches had about 50 startups, we had two preliminary days for the real Demo Day. My presentation was on the first day. I have prepared tirelessly for this moment. My heartbeat was fast, and my hand shook when I was about to go up to speak. After saying the first words, I got control over my thoughts again and did an excellent job presenting. I asked for another entrepreneur to record me so I could watch me later. I was thrilled with my performance.
After the two days of presentation, many entrepreneurs told me that mine had been one of the best of the batch. I was delighted with the feedback. A few days later, the program shared the ten companies that were going to pitch in the Demo Day. I read several times the names of all startups while I taped my foot on the floor repeatedly. I wasn’t on the list.
I was sad at first, and then I talked to one of the program organizers. He told me that my presentation had been one of the best from my batch, but the jury that rated all of them, which was formed by other entrepreneurs, didn’t believe in the games industry, and because of that, they grade me poorly. It wasn’t the first time I saw other entrepreneurs’ preconceptions because I worked in the games industry. There was nothing I could do. As my goal was to finish the program as a profitable company, the only thing I could was to keep working to achieve it.
More bureaucracy
I couldn’t spend the money any way I wanted. I had to follow many rules on how to spend it, and I should justify everything. I could pay a small amount to cover my basic expenses in Chile. That may not look very encouraging, but that incentivized us to spend money wisely in our companies.
During two full days, while I organized documents and spreadsheets with everything I spent, my face was like eating something disgusting. Before using any money, we should confirm if it was ok to spend on what we wanted. All I could think was that I wasn’t working on my company’s products. It was a very bureaucratic process, but as I didn’t have any money before, it was necessary for my company’s survival.
Besides justifying how I used all the money, I had to give some free presentations at different universities. As the program was an initiative from the Chilean government, those presentations intended to incentivize entrepreneurship through the country. It wasn’t something I would like to do if I could, as it took much time to organize everything, and I still didn’t have a company making money. However, as I had this obligation, it was an excellent experience to talk to a younger audience about entrepreneurship.
The end
Accelerators are useful, but you have to play your part. They will not make anything happen for you if you do not ask them. If you want something, you have to say it. Be clear about what are your goals and how they could help you. Otherwise, you will spend time in the program and will not fully enjoy its benefits.
As we got to the last month of the program, we decided to try something different. We would run out of money if our games didn’t start to generate enough cash. We still had some money that we would use to pay the next month’s salaries of my three employees. We decided to change our marketing focus from Latin America to the US and bet the rest of our money on advertising. Our traction had improved a lot during the past six months. The main problem we had was that the Latin American players didn’t like to spend money on games on Facebook. Betting all of our money on advertising was risky, but we believed that the US players would spend money.
Fortunately, our bet worked. We started to make much more money, and we ended up becoming a profitable company. We had money to pay for all of our bills. We achieved our goal of finishing the program by being a profitable company.
One year later, after finishing the program, I saw that Startup Chile had created a new initiative focused on profitable startups that already have been through the program. This time it would help with USD $100 thousand (free equity again). I had to go through a lot of bureaucracy for the first stage of the Startup Chile program. I imagined that the same would happen for this second stage, and I would have to move again to Chile. As we were already making money with our games, we decided we wouldn’t join this new initiative. We didn’t need the extra cash to survive.
Based on what we were going through in 2014 and 2015, going through the Startup Chile was worth it for my startup. We weren’t still a profitable company, and we needed the money to survive. As entrepreneurs, we need to understand what is best for our company. You don’t need to join an accelerator program just because they seem cool to be part of.
