According to Bloomberg, 8 out of 10 new businesses don’t survive their first 18 months. The hype around startups and business ideas is so great in today’s world, that often, there is no follow-up as to where these startups stand some months, a year and many years after the idea was formed. The big names stick around but many diminish, the same way that everyone knows the college dropouts who became billionaires but no one has a clue where the other thousands of them ended up in life.
Punjab Information Technology Board (PITB) is mending the incubator/accelerator landscape in the country though PlanX – an accelerator for mid-stage tech startups. After the success of Plan 9, an incubator for fresh startups, this government agency has stepped up its game even further and anticipated and filled this need for supporting mid-stage tech startups, many of which came out from the entrepreneurship ecosystem that they help set up.
What’s the difference?
While new startups and mid-stage startups might need some of the same things – such as funding, mentorship and international exposure – they need it in a different way. New startups would be hungry for all three, but mid-stage businesses might need one more than the other in order to make up for what has been lacking in their time so far. While startups need to focus on designing a great product service, mid-stage companies need to expand their connections and outreach. Once the first steps are completed, the issues are new and completely different – operational efficiency, managing distribution, finding new markets, launching new versions etc.
The Next Steps
Such support would also be helpful for tech companies that have had a successful first step with their origin product/service but are not sure what to do next. Working in a sustainable manner towards long-term gains is a strategy that does not come naturally. This is where the support and advice of industry veterans will be useful. If executed properly, participant in Plan X’s program can avoid mistakes commonly made by mid-stage tech startups.
From Plan X’s perspective, the job might seem to be easier than guiding fresh startups. When we talk about mid-stage companies, these are ideas and products that have survived the first round and therefore are the fresh startups which showed extraordinary promise. However, as mentioned above, the game changes in this new stage and new challenges need to be overcome for continued success.
According to Plan X’s team, their offer for mid-stage tech companies is rather unique: “What sets PlanX apart from its contemporaries globally is the project policy of not charging any percentage of the equity from its accelerated companies. We provide our inducted companies with a work space complete with state of the art facilities, specialized mentoring programs and assist them in establishing a strong brand identity for the startup and its individual members.”
This sounds like a selfless thing to do, but it might also take away the motivation that accelerators have when their returns are linked with the success of their program and participants. As long as the quality of Plan X’s accelerator services is not negatively affected, this unique offer adds to the reasons-to-join for mid-stage tech startups.
The Program and Selection Process
Plan X plans to provide support to inducted companies for 6 months – with 10 companies inducted at a time. While the selection criteria is not explained, the application eligibility criteria includes registration with the Securities and Exchange Commission of Pakistan (SECP), a sizeable customer base, well-rounded team, product in its beta version and a tech component. The application aims to understand the business and the team from different perspectives by asking for information such as the company’s competitive advantage, 5-year plan, and expectations from Plan X, financing details and the product.
Current participants in the acceleration program include BookMe, Baby Planet, Travly, xGear and Appography.
As with startups, it would be interesting to see where Plan X stands in a few years time and which tech firms end up benefiting from this program. The intentions are positive and this could be the much-needed support that has been missing from the entrepreneurship ecosystem in Pakistan.