Last September, Dave McClure’s incubator/seed fund 500 Startups began accepting open applications for its accelerator program with the help of AngelList. Prior to that, potential startups had to be referred. The results of the experiment and the caliber of the applicants, says partner Christine Tsai, were so impressive that now it’s doing it again.
As of today, 500 Startups is accepting applications for its seventh accelerator class. Applications will be open for one month and the class will commence in early October. The accelerator is wasting no time, with the demo days for its last batch of companies starting next week.
Over its three-year history, what continually sets 500 Startups apart from other accelerators is its huge international focus. Tsai says 25 percent of its companies hail from outside the United States. And the last two times it announced a new batch of companies, PandoDaily literally mapped it out.
“It’s challenging,” says Tsai. “A lot of people don’t have the interest or ability to invest internationally. You really need to be there to understand things about the market that are out of your hands.”
But while 500 Startups has boots on the ground in many locales, including Brazil, Mexico, and India, it can’t be everywhere. That’s why the open application process is so key to its success. For example, its last batch of companies included two startups from Jordan, Dakwak and Tamatem, that weren’t on the accelerator’s radar until they applied out of the blue.
For this round of companies, 500 Startups is looking to expand its presence in the Middle East, and to focus more on female founders. And while Tsai says any category is on the table, the accelerator is looking for strong candidates working in video, particularly companies like Virool that specialize in targeted video advertising.
“A lot of people have been burned by (video) in the past. Monetization was very difficult. But now, the platforms are more established, monetization is getting a little easier and so is distribution.”
Already, other incubators are following in 500’s footsteps. Just yesterday, AOL’s Fishbowl Labs announced it’s turning to AngelList for its next round of applicants. Moves like these are part of a larger disruptive trend in how VCs and Angels find and invest in startups, one that a number of our PandoMonthly guests including Fred Wilson and Josh Kopelman have observed. But Tsai still emphasizes the importance of old-fashioned networking and hitting the pavement.
“We just had our first company from Africa, Dropifi. It was serendipitous,” Tsai says. McClure met the Ghana-based entrepreneurs at a conference in Rio de Janeiro.