Some Web3 startups are turning to accelerator programs as crypto enters a new bull market and investors look to get involved.
Accelerator programs offer mentorship and guidance in exchange for early-stage capital. For example, U.S.-based Y Combinator counts among its alumni several crypto companies, including Coinbase and OpenSea.
On March 26, Andreessen Horowitz (a16z) unveiled the list of its crypto accelerator program for spring 2024. The 25 startups will undergo a 10-week mentorship program in London led by a16z’s crypto team.
Operating partner Jason Rosenthal shared a list with projects including Farcaster infrastructure, decentralized food delivery, and zero-knowledge passport authentication. Startups in the a16z accelerator receive $500,000 from the company in exchange for a 7% stake. Alumni include Flashbots and Phantom.
On November 9, the Avalanche Foundation and Ava Labs unveiled the first group of startups from their accelerator,Codebase. The program will feature investments of between $500,000 and $1 million for startups.
Helika, a Web3 gaming infrastructure company, revealed its collaboration with Pantera Capital, Spartan Capital, Sfermion, and other venture capital firms to allocate up to $50 million to startups participating in its new Web3 gaming accelerator, Helika Accelerate.
The crypto sphere has seen a resurgence of venture capital activity as the bull market accelerates. Crypto-native venture firm 1kx recently revealed an oversubscribed $75 million fundraising round, while Hack VC finalized a $150 million round in February.
Sam Lehman, director of Symbolic Capital, stressed in an article published on March 26 in X that crypto accelerators play a vital role in fostering community among founders within the network-centric Web3 sphere.
Lehman highlighted the rise of new fund-driven crypto accelerators that aim to boost its brand and deploy capital quickly. However, he warned of possible predatory practices among some accelerators:
“Some accelerators take advantage of the initial phase in which they invest and their ‘value-added’ proposition to immediately enter and take large positions in companies. Founders should think twice about whether the terms they would accept from an accelerator are worth what they would receive in return.”
Investing activity in Web3 gaming has also recently increased steadily. 0G Labs closed a $35 million pre-seed funding round on March 25, with participation from more than 40 crypto-native institutions, including Hack VC and the Blockchain Builders Fund.