Selection of Sustainability Startups for Acceleration: How Prior Access to Financing and Team Features Influence Accelerators’ Selection Decisions

Abstract

Accelerators are specially designed entrepreneurship programs that enable startups to scale up at a fast pace through mentoring, intense consulting, training, and provision of access to business networks. To cope with the challenges of the entrepreneurial process and to access resources to achieve a quick scale-up, sustainability startups need a great deal of support from intermediary organizations. In this study, we examined 7358 social-sustainability startups and 2671 environmental-sustainability startups to understand the factors that influence the probability of a sustainability startup being selected by accelerators. Our main research question was whether previous funding (in the form of equity funding or philanthropic support) received by sustainability startups affects the selection decisions of accelerators. We also investigated how team-related characteristics such as work experience diversity, female startup teams, a team’s passion or commitment, and entrepreneurial experience influence the chances of startups being selected by accelerators. Our data were drawn from the Global Accelerator Learning Initiative (GALI), which was cocreated by the Aspen Network of Development Entrepreneurs and Emory University. The data have been collected from entrepreneurs around the world since 2013. The wave we used included a dataset covering the years 2013–2019. Our results indicate that for both social-sustainability and environmental-sustainability startups, the amount of previous equity funding and philanthropic support received from external funding providers is of critical importance for the startup to be selected by accelerators. We also found that previous funding mediates the relationship between various team-related characteristics and the probability of a startup being selected by accelerators.