Economy, Sci & Tech

Iran's Biggest Accelerator Takes in 17 Startups

Iran's Biggest Accelerator Takes in 17 StartupsIran's Biggest Accelerator Takes in 17 Startups

Avatech, one of Iran’s biggest startup accelerators has launched its pre-accelerator program with 17 teams for the first round in 2017.

 Called ‘Avacamp’, the program is designed to host business before they get picked by the startup accelerator for the full program in a few months.

The initial program will last two months, with each team expected to produce a minimum viable product (MVP) that must show the basics of any product offered by the company. If the groups fail to deliver a MVP, they won’t be considered for the later stage.

A MVP can be anything from the bare-bones software, website, app or even an electronic item. It is usually the first hurdle when a startup begins the process of creating a business.  

When the last of the pre-accelerator teams join Avacamp by the February 7 cut-off, they will go through the initial mentoring round, according to a local technology website.

Steps will include various workshops on topics such as lean canvas, MVP, UX/UI, customer interviews, marketing, delivered by some of Iran’s top startup gurus.  

The point of the pre-accelerator program, which runs on international recommendations, is to weed out the weaker startups before they enter the accelerator stage.

Previously, dozens of potentially million-dollar startups hit the buffers in the local market, due to a plethora of reasons, namely poor finances, product weakness and low camaraderie between founders.

 Failures in the Majority

One of the key issues reported by mentors is the continuity issue of the startup companies. On average, some 90% of startups in the United States fail in their first twelve months of operation. Another 80% fail in the second year according to some statistics.

In Iran, this figure is believed to be higher according to former business owners who went through accelerators in the past.

On average, according to Forbes, the biggest reason why new found businesses collapse is they make products no one wants. A survey of failed startups determined that 42% of them identified the “lack of a market need for their product” as the single biggest reason for their failure.

With this round, Avatech’s liability is reduced, and the firm’s cash investment is also at less risk if any of them fail to make the grade.

When the selected few do make it through the initial round, they will be offered investment packages depending on their needs. This offer differs from previous years when companies signed a one-size-fit-all offer.

Previously, Avatech would own a 15% share in the company by the end of the acceleration period. The new contract says Avatech’s share will vary from 8% to 15%, the local technology website reported last week.  

Coincidentally, the 8% ownership stake is closer to international norms of investing in startups.

Another change for this year includes a possible investment increase of up to 1 billion rials ($25,000), which is a leap forward from the standard investment of 250 million rials ($6,250).



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