Corporate accelerators: design and startup performance

Abstract Corporate accelerators (CAs) have emerged as a key component of entrepreneurship ecosystems, offering startups corporate guidance, industry connections, and resources for accelerated venture creation. Although their proliferation is evident, we still know little about the value they produce for startups across different contexts. This study investigates the organizational setup and program design of 15 CAs in Germany using a unique and hand-collected dataset of 223 alumni startups. Our findings reveal a tradeoff: Specialized and integrated programs positively impact startups’ speed to market and growth, while specialization and rising corporate control may hinder follow-up venture capital financing. This research contributes to our understanding of CAs and the startup acceleration process and provides insights for corporate and accelerator managers and startups alike. Startups can use these findings to identify the most suitable CA for their needs. Program managers and designers gain insights into the strategic orientation and organizational setup that positively impact startup acceleration. @Plain English Summary: While corporate accelerators (CAs) have become a major trend, we still know little about their effectiveness, how they work, and what outcomes they produce for the involved parties. This research examines how CA program designs relate to the performance of accelerated startups after their graduation. Based on an analysis of 223 graduated startups from 15 CAs based in Germany, we observe that their specialization matters, but there is a trade-off. Therefore, while CA programs selecting startups with a strong “strategical fit” to the operations of the sponsoring corporate mother produce high growth rates for the accelerated startups, they have downsides for startups when searching for future investors. Moreover, we find support that organizational integration and linkages are important. The accelerators’ management plays an especially essential role. Therefore, we observe that CAs managed by former entrepreneurs are better at accelerating both the financial and strategic outcomes for graduated startups than programs managed by professionals with strong corporate backgrounds. Our study contributes to the emerging literature on CAs by addressing a gap in the research. By employing a data-driven approach, our findings highlight the need for a nuanced understanding of the value of CAs for startup performance. Consequently, our study provides important insights for corporations in designing their accelerator programs and also assists startup teams in making informed decisions about joining CAs.