The Accelerator Conundrum: 1Mby1M vs Other African Accelerators

Gemini: Give me an overview of the startup accelerators in Africa and how they compare with 1Mby1M.

Africa’s startup ecosystem is experiencing a remarkable boom, driven by a young, tech-savvy population, increasing access to mobile technology, and a growing pool of local and international investors. Accelerators play a crucial role in nurturing this growth, often addressing unique challenges such as access to early-stage capital, market fragmentation, and navigating diverse regulatory environments.

Overview of Startup Accelerators in Africa

Key Characteristics and Examples:

1. Major Hubs: Key cities across the continent serve as magnets for startup activity:
   • Lagos, Nigeria: A powerhouse for FinTech, e-commerce, and logistics, with a large and active consumer market. Examples include ARM Labs Lagos Techstars Accelerator, Co-creation Hub (CcHUB), and various corporate accelerators.
   • Nairobi, Kenya: Strong in AgriTech, FinTech, and cleantech, often benefiting from early mobile money adoption. Accelerators like The Baobab Network, MEST Africa, and Antler Kenya are prominent.
   • Cape Town & Johannesburg, South Africa: Diverse sectors including FinTech, HealthTech, and enterprise software. Examples include Startupbootcamp AfriTech, MEST Africa, and local incubators.
   • Cairo, Egypt: A growing hub, particularly for FinTech and e-commerce. Flat6Labs Cairo and Falak Startups are notable.
   • Accra, Ghana: Home to MEST Africa (Meltwater Entrepreneurial School of Technology), which has a unique model of training and incubation.
2. Diverse Funding Models:
   • Equity-for-Investment: This is the most common model, where accelerators provide seed funding (ranging from $20K to $100K+, with some even going higher like Katapult Africa’s $150K-$500K) in exchange for an equity stake (typically 5-15%). Examples: The Baobab Network, Techstars, 500 Global (which recently scaled back its direct accelerator presence in Africa but still invests).
   • Equity-Free Funding: Growing in popularity, often supported by large tech companies or foundations. Google for Startups Accelerator Africa is a prime example, providing equity-free funding along with extensive mentorship and resources. MassChallenge Impulse Accelerator also operates on a zero-equity model.
   • Blended Finance: Some programs might combine grants with optional equity investments.
   • Venture Builders/Studios: Entities like Founders Factory Africa (a spin-off of the UK-based Founders Factory) often co-found and build companies from scratch, providing operational support and capital.
3. Sector Specialization & Impact Focus:
   • Many accelerators are generalist, but a significant number focus on sectors with high impact potential in Africa: FinTech (driven by financial inclusion needs), AgriTech (improving agricultural productivity), HealthTech (bridging healthcare gaps), EdTech (improving access to quality education), Renewable Energy/Climate Tech, and Logistics/E-commerce.
   • A strong emphasis on “impact investing” is also visible, with accelerators (e.g., Katapult Africa) specifically targeting startups that address social and environmental challenges.
4. Corporate and Development Partner Involvement:
   • Large African and international corporations frequently partner with or run accelerators to drive innovation and identify potential partners or acquisitions.
   • Development finance institutions (DFIs) and international development organizations play a crucial role in supporting the ecosystem, sometimes providing grants or technical assistance to accelerators.

How African Accelerators Compare with 1Mby1M

1Mby1M offers a distinct value proposition that contrasts with many of the prevailing models in Africa, particularly regarding funding and program structure.

1. Equity vs. Non-Equity:

• 1Mby1M: Non-equity. It is subscription-based, allowing founders to retain 100% of their company for its core program.
• African Accelerators (General):
  • Equity-taking is dominant: The vast majority of well-known, intensive accelerators in Africa (e.g., The Baobab Network, Techstars, Antler, Flat6Labs, Startupbootcamp AfriTech) provide direct seed funding in exchange for an equity stake.
  • Growing Non-Equity Options: Programs like Google for Startups Accelerator Africa and MassChallenge Impulse Accelerator are significant exceptions, offering equity-free support. This trend is growing, often fueled by large corporate CSR initiatives or philanthropic capital.

2. Virtual vs. Physical:

• 1Mby1M: Fully Virtual. This makes it highly accessible to founders across the vast African continent, overcoming geographical barriers and visa challenges.
• African Accelerators (General): A mixed but evolving landscape.
  • Historically, many had a strong physical presence in key hubs (Lagos, Nairobi, Cape Town) to foster local community and in-person mentorship.
  • However, with improved internet penetration and the global shift accelerated by the pandemic, hybrid and fully virtual models are becoming increasingly common, allowing accelerators to reach founders in diverse regions of Africa and connect them to a global network.

3. Exclusive vs. Inclusive:

• 1Mby1M: Generally Inclusive through its subscription model, aiming to make strategic guidance accessible to a broad range of entrepreneurs globally.
• African Accelerators (General):
  • The top-tier, equity-taking and well-funded non-equity programs are typically highly exclusive, with very competitive application processes due to the high demand for funding and structured support.
  • Some government or community-led incubators might be more inclusive at the very early stages.

4. Global vs. Local/Specific Category:

• 1Mby1M: Global. Its curriculum and network are designed to be applicable and accessible to entrepreneurs worldwide.
• African Accelerators (General):
  • Many have a Pan-African reach for applications, seeking out talent across multiple countries (e.g., The Baobab Network, MEST Africa, Antler, Google for Startups Accelerator Africa).
  • Others are country-specific or focused on particular cities within Africa (e.g., Flat6Labs in Egypt, Tunisia; specific Techstars city programs).
  • Some are tied to specific industries relevant to the African context (e.g., AgriTech, FinTech for financial inclusion).

5. Sector Focus:

• 1Mby1M: Broad/Agnostic. Focuses on universal principles of building a revenue-generating business applicable to any tech or tech-enabled startup.
• African Accelerators (General): While many are broad, there’s a significant emphasis on sector specialization driven by the continent’s unique challenges and opportunities (e.g., FinTech, AgriTech, HealthTech, EdTech, cleantech, logistics). Impact-focused accelerators are also particularly strong.

6. Demo Day vs. No Demo Day:

• 1Mby1M: No formal Demo Day. Investor introductions are personalized and occur when a company is truly ready for funding based on its metrics.
• African Accelerators (General): Most structured, cohort-based accelerators (The Baobab Network, Techstars, Antler, Flat6Labs, Startupbootcamp AfriTech) culminate in a Demo Day or Investor Showcase event to present their cohort to potential investors and partners.

7. Long-Term Mentorship vs. Short-Term Sprint:

• 1Mby1M: Long-term mentorship/continuous engagement. It’s designed for sustained strategic guidance over a year-long (or longer) period.
• African Accelerators (General): The majority are short-term, intensive sprints (typically 3-6 months), focusing on rapid growth and achieving key milestones. While alumni support is often provided, the core acceleration phase is time-bound and highly demanding. Some, like MEST, offer longer incubation periods following training.

8. Funding, Investor Introductions, or Just Education/Networking:

• 1Mby1M: Primarily Education, mentoring and strategic consulting, with investor introductions when founders are prepared. It does not provide direct funding.
• African Accelerators (General):
  • Direct Funding (Equity-based) + Mentorship + Introductions: The most common model for private accelerators.
  • Non-Dilutive Funding + Mentorship + Resources: Programs like Google for Startups provide equity-free cash and extensive resources.
  • Corporate Partnerships + Pilots: Many corporate accelerators prioritize pilots, integration, and mentorship.
  • Incubation + Training: Some organizations, like MEST, focus heavily on training and incubation, with internal seed funds.

In summary, Africa’s accelerator landscape is dynamic, with a growing number of diverse programs addressing the continent’s unique context. While many follow traditional equity-for-investment models, the presence of significant non-equity programs and a strong focus on impact-driven solutions are notable. 

1Mby1M offers a distinct, globally accessible, virtual, and equity-free alternative for African founders who prioritize long-term strategic guidance and sustainable, revenue-driven growth. The best leverage of the program for African entrepreneurs could be to combine with local resources. 

The level of expertise provided by 1Mby1M in building tech-enabled businesses is also off-the-charts superior to anything accessible through most local programs.

Photo Credit: WikiImages from Pixabay

This segment is a part in the series : The Accelerator Conundrum