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Web3 Startups Are Getting Second Wind in Accelerator Programs as the Bullish Cycle Unfolds

Web3 startups are turning to accelerators amid a renewed interest in crypto  

Web3 startups are increasingly turning to accelerator programs to gain a competitive edge. San Francisco-based Y Combinator, celebrated for propelling crypto giants like Coinbase and OpenSea to success, exemplifies the sought-after mentorship and guidance in exchange for early equity. Amidst a backdrop of burgeoning crypto enthusiasm, a16z, a forefront tech VC fund, has unveiled its spring 2024 cohort for the crypto startup accelerator. 

The selected 25 startups, embarking on a ten-week mentorship in London, range from Farcaster infrastructure to decentralized food delivery, and even zero-knowledge passport authentication, under the a16z crypto team's guidance.

Jason Rosenthal, an operating partner at a16z, disclosed: 

"Startups in a16z crypto’s accelerator receive $500K from a16z for 7% equity," 

This initiative not only highlights a16z's commitment to nurturing the next wave of crypto endeavors but also spotlights the vital role accelerators play in shaping the landscape of digital currency and blockchain technology.

Venture capital and crypto accelerators: a growing trend

The landscape of venture capital within the cryptosphere is witnessing a significant resurgence, particularly in Web3 gaming, where investment activity has seen an uptick in both scale and frequency. For instance, 0G Labs successfully closed a $35 million pre-seed funding round on March 25, with over 40 crypto-native institutions, including Hack VC and Blockchain Builders Fund, showcasing the robust appetite for innovative Web3 gaming ventures.

Sam Lehman, principal at Symbolic Capital, sheds light on the unfolding trend of crypto accelerators. He highlights their essential role in fostering a sense of community among founders in the network-centric Web3 domain. Lehman warns, however, of the double-edged sword accelerators represent, stating:

“Some accelerators are using the early stage at which they invest plus their proposed ‘value-add’ to come in and take extremely big positions in companies immediately. Founders should definitely think twice about whether the terms they’d accept from an accelerator are worth what they’d receive in return.”

This insightful observation underscores the careful consideration required by Web3 startups when navigating the accelerator landscape.