An oversimplification of the incubator/accelerator space is to classify them as either a Y-Combinator (YC) or a TechStars (TS). If you really look at the booming world of incubators for high tech startups you see a model that either based on education and peers that is driven by a strong personality (YC) or a model that is more institutional, mentor driven, follows a script, and feels less personal but is more in line with how VC’s work (TS) (right in the middle is where I would place 500 Startups – which is arguably representative of a third type). There is plenty to be found about the differences but here is a bit of a deeper exploration into the differences.

Startup lifecycle

Startups have a number of key phases in development that is best outlined in Fred Destin’s presentation on startup lifecycle.

1. Start
2. Launch
3. Build
4. Chasm
5. Scale

With the 12-14 week cohort models, like YCombinator and TechStars, the focus should be on moving through starting and on to launch phase. There may be some that get into a build phase. The incubator or accelerator hopes that once they are done a 12-14 week program the startup will be in a much better position to move quickly through the build stage and at least take on the chasm phase.

Where I see the key difference between YC and TS is that YC seems to be able to get companies to go through stage 1 to 3 and they accept companies mainly in the start phase. TS seems to not attract a cluster of companies in a particular phase or not care about what phase a company is in.

The basics of an incubator/accelerator (whatever you want to call it)

Within the execution of any incubator or accelerator program there are, in my mind, 4 core stages in a typical cycle:

• Recruitment
• Onboarding
• In the program
• After the program

Within each of these of these stages there are a number of specific activities that all incubators do but in general they aren’t all that different.

Recruitment

YC currently leads the thought leadership with Hacker News, Paul Graham’s (PG) blog, and it’s success. Applicants fill out a form and once told they have an interview, travel to YC in Mountain View for an interview. They get just 15 min with a small panel and the panel does a bunch of tricks to the founders like carrying on side conversations – there are a lot of blog posts about that.

TechStars has adopted a more consistent process over it’s many affiliated programs (it appears) but they lack YC’s Hacker News or thought leadership (although they would claim otherwise). With Techstars there appears to be an affiliation with the Kauffman Foundation and the role they are taking in promoting the incubator model in general they have made themselves an authority in the space. From people I know that have been in the program it is a fairly standard process similar to raising Angel capital.

Onboarding

I am not sure on TS on-boarding but YC has a very short interview to decision to start of program window. YC has a little book that is like a long Wikipedia article written by Paul Graham that offers insights and baseline knowledge. From what I have been told the YC machine is pretty much immediately available to you when they say “you are in” — startups decide when to tell others. What is really interesting is that YC doesn’t announce it. They generally let a company know they are YC funded on the interview day but they don’t make a big announcement or anything.

Not having a big incubator announcement is a key difference here. I will assume that with TS it is just like YC in that they have decided to fund you, they are now available to you. However, TechStars (it appears) doesn’t approach announcing the cohort in the same way as YC — they announce them ahead of the program. For a startup this little difference could be a big one if you are concerned about managing expectations of outside investors as you go through the program.

In the program: peer mentorship, startup culture

Each program runs for roughly 3 months, 12-14 weeks, where mentorship, various events, and a demo day to close it off normally occur. Each week is important given that each team only has 3 months. Over three months there are phases you can generally identify:

• Teams becoming familiar with each other, their mentors, and what they need to do (first 2 weeks).
• The heads down getting stuff done phase (8-10 weeks).
• Funding mode going into Demo Day (2 weeks).

Other incubator programs are fairly similar with any given week involving office hours (optional or required) and a speaker/dinner. The office hours are used to check in and place goals on the teams. Throughout the term there are demo nights, which are used by YC as a way to put peer pressure on other teams that might not be moving as fast as others.

Where they differ here is in the education of the founder(s). From everyone I have talked to that has gone through YC it seems to me it is a very challenging but rewarding relationship for a certain type of founder. That would make sense as a certain personality type will work best with Paul Graham’s way of doing things and will excel. I am not entirely sure it is simply a hacker/coder persona as most assume. I think it is a personality and learning style that goes a bit deeper.

TechStars has a co-working model with parts very similar to YC. The key difference is that TS doesn’t have the Paul Graham approach to educating founders so you will get very different details depending on who is running the program. The character of the TS program can vary because it is so mentor driven and puts the onus on the startup to engage those mentors. There is a big plus to this approach as you are more likely to find a good fit in the large mentor pool for you and your company. TS also gives the startups a place to work where YC leaves them to find a house and work out of it.

After the program: Alumni network

The key value any incubator or accelerator provides after the program is the alumni network of companies that are now a few steps ahead (depending on the age of the incubator there could be alumni with very large companies) of the current cohort in the program. Over time these alumni are your best mentors and connectors.

It is at this phase where the greatest value is for the startup, I believe. You now have access to what the old folks call a big rolodex (social graph) that will open many doors which essentially leaves it up to the entrepreneur whether their company will succeed or not. There are few to no barriers, generally speaking.

Any alumni of YC or Techstars still have contact with the folks in their cohort and all cohorts along with Hacker News. Techstars Network is so big they have a conference just for alumni while YC taps its alumni for all kinds of things. Also, founders seems to find going through the program a second time is different but just as valuable. These massive networks of successful alumni with a flock of high profile admirers is very similar to that of Higher Education alumni networks, so much so it convinces me that this entire process is a form of higher education.

Programs that work copy YCombinator, even TechStars did

The current culture of education focused incubators started with YCombinator (started in 2005). I believe what we are seeing with the success of YC and TS is new take on graduate school. Both are different, both work, and people can have strong opinions either way. They feed a need that I don’t think people outside of incubators or startups fully understand yet, learning to be a founder is really hard. Being a successful founder is even harder. The bet is that if you help young founders focus on what is important they will see success earlier or just simply see what success looks like.

If you are looking at an incubator anywhere (there are lots of great programs out there) you need to understand that the money is secondary. You need to find a program that will fit with the way you learn and has companies that you want to work with. It is just like how you picked your University or College except this time it can cost you a lot more (in equity) if you are successful.

If 2012 is anything like 2011 for me I better get ready for a wild ride. The year started off with a pilgrimage to Lambeau Field to see the Packers defeat the Bears and enter the playoffs (thanks @tsand), then lots of good things:

• my third kid was born in time to watch the rematch of the Packers and the Bears on tv for the NFC championship (then they won the Superbowl!),
• my startup (TribeHR) went from a project to a business over a couple months then to a VC backed business ($1 Million) by mid-year,
• raised a $1 Million donation to the University of Waterloo’s VeloCity program from a 23 yr old in March with another $1 Million from the Ontario Centre’s of Excellence in July,
• the 3-pitch softball team I am on actually won a game and had a great season overall! go #abat!
• put a plan in motion for VeloCity’s workspace program to go from 1000 sq ft to 6700 sq ft (opens this winter),
• helped dozens of startups get off the ground,
• taught my son how to skate and decided to help coach with the hockey fundamentals program he is in which meant getting back on skates for the first time in a very long time,
• in November VeloCity was recognized with a Tech Impact Award from Communitech which is something I held as a big goal — building VeloCity into something that has a big impact on the local tech community is something I am very proud of,
• TribeHR was awarded Entrepreneur of the Year at the 2011 Junior Business Spirit Awards as well as earning Judge’s choice at Under the Radar in Mountain View,
• and finally my co-founder was on stage at the Canadian Innovation Exchange with TribeHR being one of Canada’s most Innovative companies.

None of the above list would have been possible without my family, the people in the community – startup and otherwise, and the amazing people I have had the pleasure to work with. Thank you all for the awesome year.

The oddest thing that happened was when a car leapt off of the road and tried to enter my dining room only to flip over and land on my friends Jeep. The pictures are just crazy.

A sad point was leaving the University of Waterloo after just over 10 years there (started there the end of May 2001 in the Information and Public Affairs department) and recognizing just how burned out the last year or so has left me. After all that time in one place (go back to 1997 if you count my student time with a short break working with small businesses and the web in 2000) it will likely be more difficult than I think it will to mentally break away from that identity but it is a healthy thing for me to do.

2011 was a year of learning, change, and growth… 2012 will be about my family and what to do with all the knowledge and experience I have gained personally and professionally. Specific goal of the year: be happy.

In closing… the fun part of having a blog for a long time is the old posts. A look back 5 years ago brings back a lot of good memories.

The idea of burnout is not something far from people’s minds as we enter the final push before the holidays. This is a stressful time of year where people joke about shopping or family fatigue. That makes burnout particularly newsworthy this month as well. For example:

• High levels of burnout in drone pilots
• Burnout in athletes mentioned more than once.
• Canadian Mounties in BC are burning themselves out
• Nurses and other medical professionals are showing signs of burnout
• Researcher takes on ‘empathy fatigue’ in the workplace

What makes the problem a very complicated one is that Doctors don’t think they can diagnose burnout. It could be the diversity in how burnout shows itself that leads to the inability to recognize it in themselves or others. Upon some self-reflection I believe I might have some personal experience to offer that may help others.

Recognizing burnout in myself

Over the last 4 months I have struggled to come to terms with why I was so unhappy given I have so many positive things in my life. In general I could see some odd things that I didn’t like about myself:

• I didn’t remember the last time I had a dream that I could remember. I was sleeping so badly that I don’t think I did dream.
• Short tempered.
• I didn’t take care of my house – I really use to enjoy working around the house, keeping the back yard clean, growing tomatoes, etc.
• I didn’t go fishing hardly at all last summer, I haven’t been snowboarding in years!
• I never felt like I was getting anything done even though I managed to attract some significant capital to the two projects close to my heart and see steady growth in both.
• I didn’t believe anyone thought what I was doing mattered or that anyone cared.
• Overall I was a grump.

I knew something was up in August of this year but I struggled to find a way to deal with it. My first thought was to just step back a little, look forward to bringing on some amazing new staff, and try to start a new term with a new attitude. What I failed to realize was that I was circling around the total burnout toilet bowl.

The first self-realization moment of things needing to change was when my son started hockey; he couldn’t skate and he didn’t want to learn. As a Canadian and a parent I felt like I failed my son as I didn’t take the time to teach him how to skate and have fun while doing it. I decided there and then to buy skates, helmet, and a stick. I then found any open ice time I could and took him out. My kids had to be more important than any work I felt I needed to do. The boy now loves hockey and the fun we have on Saturday mornings at the rink is something I truly cherish.

Around the same time something happened to a good friend and my co-founder (startup spouse): his wife gave birth to his son at 26 weeks in San Jose while on a business trip. At first it had an impact but then in mid-October I went down to see how they were doing and see if I could help. At that point nothing else mattered but the health of that tiny baby that was fighting to some day face burnout himself. He is doing really well now.

Those situations, along with my family and a number of conversations with people I deeply respect helped me start to realign my priorities and thinking. It wasn’t an instant fix. It is something I need to work on. I am lucky though, I didn’t collapse and hit a debilitating stage of burnout.

Looking back and times of high stress

In the last 10 years I can think of three different occasions when I was in a similar situation. The first time I started doing my Msc to find value and purpose in my work. The second time I had a very different kind of manager that recognized the signs early and did something about it. I also had a ton of positive re-enforcement from my family and the community to bounce back. This third time though, I let myself be isolated from coworkers and others for close to the last year. I thought that if I stopped doing the things I enjoyed but were time-consuming (like participating in the community) it would help, it didn’t. It made it far worse.

Next time (and there could be a next time although I am going to put more effort in to avoid it), I need to keep my perspective and make sure I find joy in what I am doing. I also need to take more time for the people in both my personal and professional life. Throwing myself at my work does result in achieving amazing things but at the same time, balance is needed in order to enjoy those accomplishments.

In trying to understand burnout my message to entrepreneurs is that you need to recognize when your behaviour or attitude changes. No one is immune to it and just because you haven’t hit physical exhaustion yet you might be reaching the point of mental exhaustion. Encourage feedback from your friends and family just like you would from customers or advisors on your startup. Listen, adjust based on the feedback, and grow.

Further reading

How to avoid or deal with burnout, collection of articles that are worth a read.

The Kitchener Conestoga Rotary Club believes every family should have a special Christmas Dinner, including a turkey. Five years ago, the Club decided to help make that a reality and has since raised $732,000 in support House of Friendship’s Christmas Hamper Program, which shares the gift of food with local families in need at Christmas time.

What are the facts?

This Christmas, House of Friendship anticipates the need for turkeys and Christmas Hampers will increase – that means 3,500 turkeys and 4,000 food hampers to feed over 10,000 people!

What will that cost?

The Kitchener Conestoga Rotary Club’s 2011 Turkey Drive goal is $275,000 to purchase turkeys and food products. We know this is a big goal, but we believe if we all pitch in a little, we will reach this goal, and more importantly reach thousands of local families. For as little as $20 you can sponsor a turkey. Or you may choose to sponsor a food hamper with a turkey for $80. All donations over $20 will receive an official income tax receipt. How many turkeys and hampers will you sponsor?

How can YOU help?

You can sponsor turkeys and food hampers rather than Christmas or corporate gifts; honour your clients with a donation to the Turkey Drive. Sponsor turkeys and food hampers and encourage your family and friends to do the same. Better yet, ask them to volunteer with you to pack or deliver hampers and turkeys.

How can I talk turkey?

Donate securely online at www.turkeydrive.ca or drop me an email to jrodgers at uwaterloo.ca.

How many companies make it a big enough exit (assuming you need a $30 million exit per incubator) and in what time frame? In Canada there is a trend that shows some crazy growth in exits but how many are in that ‘big enough’ range or more that haven’t been around for 5-10 years or more? I think one maybe two. It isn’t just Canada though, how many exists are there in a year for any tech startup anywhere? Likely not enough to sustain the current number of incubators globally.

The talent pool is half empty

The limits on size, depth, and overall health of the talent pool is a problem for incubators if you assume that they simply tap the current talent base and help them be successful faster. If the number of exits isn’t currently there then you have to look at ratio of incubators to exits and figure out how many companies it takes to fill the gap (what is the current market and what do you have to create? Yup, it is basically a product you are creating). At a guess, the current level of incubators needs to create a lot of brand new entrepreneurs from those that would normally go work for someone.

There is talent out there but they aren’t being developed in any sort of formal educational process. A VC backed/run incubator might not be the best place for young guys and gals to receive this education for the first time. Not saying it couldn’t work, I think Y-Combinator was initially successful not because of the money or location but because an educator runs the program. In 2008, Mashable was claiming that “Y Combinator is the premier university of Internet startups.” I agree. What motivates YC though? Paul Graham’s comment on my post in StartupNorth offers a bit of insight as well (also with a bit more on why in his Why YC post).

When we started YC, the returns seemed completely unpredictable. (They still do actually.) What allowed us to do it was that we didn’t care if we made money.

An incubator that is about educated the ‘student’ is a lot like higher education and should not be about profit. That might be a values based statement but it is something I believe. If you are measured by the success of the student and not by the profit margin, the student has a better chance at success.

Herein lies the opportunity for Higher Education. Not unlike engineers or scientists, there is a demand for entrepreneurs (or if you are Richard Branson you want intrapreneurs). It isn’t good enough that students have the technical chops, they need to be creative and look at solutions to problems in a way that is willing to take more risks. This is soft skill development we are talking about — you can’t engineer an entrepreneurial process. Being entrepreneurial pretty much requires you laugh at the limitations or restrictions and find a way to succeed. You can engineer an education process that offers some perspective on that but that requires some entrepreneurial thinking to design and implement.

Higher Education needs to look outside of courses and modules, entrepreneurs shouldn’t be measured

Traditionally to address a skills gap in a student a course would be created and the student would receive a credit. This just increases the cost of education for students and if you have been paying attention, there is a bit of higher education bubble according to Peter Thiel. What I have seen from students is that they absolutely are against another course that is outside their specific discipline for various reasons. Enter the incubator model in higher education (or in VeloCity’s case the dormcubator).

Create an environment where innovation, networking, competition, and experience is shared as well as celebrated. Create it  outside of the traditional academic course model. Support it institutionally so the quality and knowledge is passed on (doesn’t disappear when students graduate). Then try to connect it back into the classroom. Leverage institutional Alumni networks for mentors and other forms of support. Don’t be afraid to fail a few times.

There is no set way to execute on this model but you need to try, iterate, and keep going. My belief that in order for higher education to remain relevant it needs to experiment with these different ways of learning. Students will not only appreciate it, I bet they will have a better experience and years later the institution will benefit by having them re-engaged.

Footnote: the incubator model

For those unfamiliar with an incubator or accelerator model, the easiest way to explain it: an incubator is where a group or individual provides resources (money, mentorship, space to work, expert services, a network of people) to an early stage company in exchange for equity or another arrangement. Generally it is always equity but in Canada we have publicly backed models (the Accelerator Centre for example) that charge rent for services or in the case of VeloCity you pay what you pay anyway to live in residence and it is a service offered to students.

The entire explanation of the VeloCity model is another post.

More on incubator in Higher Ed: To Be or Not To Be: University Incubators