In Our Thoughts

Two more thoughts on Demo Days:

1. Given the plethora of accelerators out there, the scheduling of the Demo Day is challenging because you don’t want to hold a Demo Day to close to another one. This is because you don’t want to overload investors in their time and attention to give the best chance for the startups to raise money – there is enough competition amongst the numbers in the class; you don’t want to add to the competition across accelerators!

However, they still do tend to clump together because the classes are generally held corresponding to the seasons or months in the calendar year.

The thing to note is that post-Demo Day, you really need to work as fast as possible to close funding because if you don’t, you could end up running up against another Demo Day which could take investors’ attention away from you.

For example, looking at the winter 2013 classes from earlier this year:

500startups Demo Day Winter 2013: February 6, 2013
Ycombinator Demo Day Winter 2013: March 26, 2013

A startup coming out of 500startups has effectively from February 6 to March 25, only about 2 months, before attention shifts to Ycombinator.

So work your magic on investors as fast, efficiently, and effectively as possible before the next Demo Day comes around!

2. This thought is related to Demo Days, but it more broadly has to do with optimizing Demo Day through which class you apply for.

In my previous post, Investment Pacing and The Timing of Fund Raising for Startups, I talked about the fact that the first half of the year is better for fund raising than the second. If this is true, then there are batches of accelerator classes that place you in the marketplace at the most optimal time for fund raising.

This means that the winter classes whose Demo Days end up in the early part of the calendar year have a longer period of time uninterrupted by investor seasonality than those who occur in the second half of the year. It means that the probability of you raising money is also greater if you have no interruptions due to other factors. So it may be worthwhile to work to get into winter classes than for a class in another part of the year.

Timing is everything – competition between accelerator classes and startups for limited investor time, attention, and money is fierce so optimize it wisely through timing.