(PillPack signing term sheet in May 2015.)
In 2019, three of Boston’s earliest startup programs celebrated a significant milestone: ten years of operations and growth in service to the entrepreneur community.
From 2009 to 2019, TechStars, MassChallenge and the Venture Development Center contributed to the resurgence of Boston’s innovation ecosystem, through providing over 2,500 startups access to experienced mentors and a network for capital, business development, and recruitment.
TechStars was one of the first in a line of investor driven accelerators like hack/reduce, Dogpatch, Bolt and others. The university-based Venture Development Center was followed by the iLab at Harvard and the Innovation Initiative at MIT. MassChallenge was instrumental in increasing collaboration across the startup ecosystem.
There are many ways startup programs like these try to add value to companies – validating a business model, providing a physical location, creating a network, etc. But follow-on funding is the one thing almost all startups want in their early stages.
The ten year announcements of TechStars, MassChallenge and the Venture Development Center included information about the numbers of companies which participated and their total fundraising results. We used this information to compute the average company investment for each program.
|TechStars||MassChallenge||Venture Development Center|
Note that there are differences in the types of companies supported. In contrast to the Venture Development Center and MassChallenge, TechStars does not support life science companies, which raise larger funding rounds than tech companies.
And there is some program overlap, a good sign how founders can leverage different offerings in Boston to grow. SQZ Biotech for example, won the top prize in MassChallenge but launched at the Venture Development Center, which has laboratories, which MassChallenge does not have. SQZ grew from 3 to 25 employees at the Venture Development Center. PillPack started at TechStars and much later became a member of the Venture Development Center to get a visa facilitated for their rockstar engineer. That was instrumental in completing PharmacyOS which triggered Amazon’s acquisition of PillPack.
Applying to and participating in a startup program is a big decision for nascent companies. We wanted to arm you with as much information as we could about what the actual historical results have been.