In 2019, 23% of life science and healthcare startups that had raised at least $4 million in the previous 2 years were involved with a life science accelerator or startup.
Quite simply, that’s because accelerators and incubators drive new growth and help emerging companies gain the knowledge they need to succeed. But they’re not all created the same.
In this article, we’ll take a look at what a life science accelerator is (and how it’s different from an incubator); the top life accelerators in the medical and healthcare industry now; and finally, the next steps for companies after they’ve been launched by an accelerator.
Although both accelerators and incubators help new companies get off the ground by providing key support, they function in very different ways. An incubator operates more like a coworking space, providing a startup with physical space and a coworking environment that may include other entrepreneurs, investors, and mentors. An accelerator, on the other hand, works on a schedule with specific startups, providing them seed money and mentorship in exchange for an equity stake.
One of the core advantages, of course, of working with an accelerator or an incubator is that it helps new companies raise the first round of funding they need. In 2017-2018, 33% of all US startups that successfully raised Series A funding went through an accelerator or incubator.
While partnering with both types of organizations can be extremely beneficial, working with an accelerator can offer companies unique advantages: In an accelerator, companies work on a scheduled program to help them strategically progress through the different states of funding–from idea to pitch to actual funding. Secondly, accelerators aim to equip emerging companies with valuable business knowledge, while incubators focus more on networking and support. In theory, an emerging company should finish a program with an accelerator with a strategic business plan that will help them succeed in the long-term.
As an emerging company in the bio-pharma/biotech space, you certainly have a fair share of accelerators to explore and potentially pursue. As mentioned above, however, not all accelerators are created equal; certain accelerators offer a track record, depth of experience and expertise, and unique resources that make them especially strong candidates.
Here are five of the top life science accelerators as of Q2 2020.
A New York-based accelerator with 336 companies under its umbrella, StartUp Health was established in 2011 with a remarkable goal: help companies successfully achieve so-called “health moonshots.”
A health moonshot a long-term (30-year) goal to impact health on a global scale. StartUp Health’s mission is to work with so-called “Health Transformers” to achieve these radical goals, including expanding healthcare access to every human; ending cancer; adding 50 years to the lifespan of every human; and “unlocking the mysteries of the brain to improve health.”
The majority of StartUp Health’s current network includes companies from the digital health/AI space (309 out of 336), although they’ve also hosted 16 medical device companies, 8 bio-tech companies, and 2 diagnostics companies.
San Diego-based JLABS (Johnson & Johnson Innovation) is technically more of an incubator than an accelerator, with a global network of labs across the healthcare spectrum, including pharmaceutical, medical device, health tech, and consumer health. JLABS is the largest life science incubator, partnering with 657 companies in the healthcare space.
Drawing on the formidable backing of Johnson & Johnson’s network and resources, JLABS aims to help companies partner with major industry players and investors. As a result, companies get to benefit from JLABS’ connections while continuing to innovate and keep their intellectual property.
Out of JLABS’ 657 companies, 451 of them are in pharmaceuticals; 73, consumer health; 133, medical devices; and 78, cross-sector. Some of JLABS’ most well-known partners include BridgeBio Pharma (developing groundbreaking work in genetic disease), Black Diamond Therapeutics (developing treatments for genetically defined cancers), and Alector LLC (developing therapeutics for neurodegenerative diseases).
Established in 2005, Y Combinator was the first accelerator founded in the United States. Having partnered with over 2,000 startups since its inception, Y Combinator was one of the first to recognize that the biotech industry was poised for a transformation, as lowered costs and reduced cycle times mean that it’s now easier than ever to start a biotech company. In fact, part of Y Combinator’s vision is a future where scientists start companies early in their careers and continue to maintain control of those companies.
Y Combinator’s partners include 117 biotech companies, 115 digital/AI companies, 40 medical device companies, and 12 diagnostic companies. Some of their past partners include medical device startup Zenflow (which has developed an approach to treating an enlarged prostate) and Verge Genomics (focusing on the discovery of drugs for treating neurodegenerative diseases).
MedTech Innovator is a non-profit accelerator that specializes in medical devices, with 180 out of its 238 companies in the device space. The remaining companies are in the digital health/AI (33), biotech (18), and diagnostics spaces (6).
Perhaps the most unique aspect about MedTech Innovator is that it offers a virtual accelerator, a 4-month program that resources companies with mentorship and equipping they need to help them succeed in the marketplace.
TMCx is Texas Medical Center’s innovation and acceleration program, specializing in medical device and other emerging healthtech companies. TMCx offers several tracks for companies, including a program for advancing new cancer therapies and a program for early-stage companies.
One of the most significant advantages of working with TMCx is that it offers its partners access to resources from Texas Medical Center–the largest medical center in the world, with 10 million patient encounters each year, 50 million square feet, and over 106,000 employees.
Working with a life science accelerator is certainly a strategic path to gaining traction with funding and acquiring key business knowledge. In a 1-3 month program with an accelerator, you’ll achieve some key milestones–but you’ll typically still have some major gaps in knowledge and expertise. How, for example, do you plan on progressing through FDA approval? How will your company actually be paid by insurance companies?
That being said, an accelerator is not necessarily a solution that will help get you from A to Z in terms of getting your product to market.
Proxima is a CRO that works with emerging companies in the biotech and pharmaceutical space to help pick up where accelerators leave off. By offering:
….Proxima can help you get your product to market cost-effectively and efficiently. If you’d like to learn more about Proxima CRO, click here.