Massachusetts is home to the top five NIH-funded research hospitals in the United States and one-fifth of the nation’s biotech venture capital investment, making it one of the most important life sciences clusters in the world.
It’s no wonder that we have access to a growing number of accelerators, incubators, and mentoring programs in this city. These programs can help entrepreneurs gain the skills and expertise necessary in founding, building, and scaling their health-tech startups. But many programs only admit company applicants who fall within certain parameters – like a specific life science industry focus or a certain stage of company development. And each entrepreneur must consider how their venture will benefit relative to the time and, more importantly, in light of the possible obligation to sign away equity to the program.
This story is the beginning of my guide to the hugely powerful but often confusing world of healthcare accelerators and incubators in the Greater Boston area. Over the course of several months, I’ll bring you interviews with the founders of top accelerators and incubators, conversations with entrepreneurs who’ve used these resources successfully, and tips and tricks for picking the best program for your venture.
First, let me tell you my own story. I understand the power of mentoring first-hand because back in 2012, I was involved with a patient monitoring startup with two co-founders. We set out to solve the problem of improving therapy adherence for people who suffer with chronic lung diseases like cystic fibrosis. Right away, we were fortunate to be accepted into the MassBio MassCONNECT mentorship program, where we were matched with top industry experts from key functional biotechnology areas.
Over eight weeks we met each Monday at 8am at the MassBio offices in Kendall Square with our mentoring team and an assigned MBA student intern. MassBio itself is an amazing organization and the MassCONNECT program utilizes their strong network of experts from across virtually every health function to help evaluate and commercialize ideas. These mentors devote their time to helping entrepreneurs on the phone and in-person. After only eight weeks of this program, we had formed our market strategy and were ready to pitch to a closed group of prominent biotech investors and industry advocates at a showcase event. We were also selected for the Startup Showcase portion of O’Reilly Media’s StrataRx conference, which focused on big data in healthcare.
Even beyond the business mentorship we received, I benefited personally from these sessions – especially when it came to my own professional development. The program accelerated my healthcare business acumen and I learned from seasoned professionals at organizations like Massachusetts General Hospital, Johnson & Johnson, Merck, and Genzyme. Despite the benefits my startup received, one differentiating and surprising feature of the program for us was that MassBio, a non-profit, does not take any equity for their MassCONNECT program. Free mentorship is central to MassCONNECT’s strong value proposition.
I quickly learned this during my time at MassBio. Programs like accelerators and incubators both increase the chances of startup companies being successful. But beyond that, they exist for different reasons and provide different benefits.
An accelerator takes a small equity slice from the mentee company and usually accepts startups developed outside of their organization. These startups participate in a structured program that usually lasts between three and four months. Accelerators often offer a lot of mentorship and a small amount of capital, as well as some sort of operating workspace for the founders. The overarching goal of an accelerator is to help companies get financing.
Some examples of accelerators available to Boston healthcare and biotech entrepreneurs are Healthbox, Northeastern University’s idea program, Rock Health, MassChallenge (the largest accelerator in the world), UMass-Boston’s Venture Development Center, and the super competitive TechStars program. There’s also been a recent surge of niche accelerator programs with big sponsors: Elevar Labs in partnership with Blue Cross Blue Shield of Massachusetts; athenahealth’s More Disruption Please program; TechStars’s SprintAccelerator, and the Village Capital Healthcare Accelerator.
The dynamics of an incubator are very different. In an incubator, there’s no definitive end-date for the program. Startups are usually given a physical office space, and the operators can often take a larger portion of equity in the companies that are developed under their roof. The idea of the incubator model is to support companies in developing business models, eventually allowing them to move out of the incubator space.
There are many healthcare and biomedical incubators available to Boston area entrepreneurs. Some mainstream incubators include PayPal’s Start Tank, Cambridge Innovation Center (CIC), and the Massachusetts Medical Device Development Center (M2D2) at UMass-Lowell. Others include Koa Labs in Harvard Square, the MD Idea Lab at UMass-Boston’s Venture Development Center, HMS Center for Primary Care’s InciteHealth, and Sky Ventures in Natick. From these incubators, an entrepreneur can expect an informal application process often initiated through a referral from a trusted colleague who vets the startup for consideration.
Don’t worry – this is just the tip of the iceberg. Stay tuned for more trade secrets, insider tips and best practices in the coming months.
Robert Schultz has an MBA in Information Systems from University of Massachusetts-Boston and a BS in International Business from Northeastern University, where he served as Business Manager for the university’s largest student publication, The Northeastern News. Schultz is an experienced healthcare technology startup enthusiast who was involved with the patient monitoring company Aware Engineering through the MassBio MassCONNECT program.
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