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Techstars, a well-established startup accelerator, has just announced updated terms for its upcoming program. Starting with the fall 2025 batch, the organization will be investing $220,000 in selected startups, a significant increase from its previous offer.
The funding will be split into two parts. Companies will receive $20,000 in exchange for a 5% stake in their business, as well as $200,000 through an uncapped SAFE note with a “most favored nation” clause. This means that Techstars’ ownership share of the $200,000 SAFE will adjust based on the startup’s future valuations. For example, if the company’s next funding round values it at $10 million, Techstars will end up with a 7% ownership stake.
These new terms from Techstars closely resemble those of Y Combinator, another renowned accelerator in Silicon Valley. YC raised its funding for startups three years ago, offering a $375,000 SAFE note alongside the standard $125,000 for 7% equity.
So, which accelerator provides a better deal for startups? The answer ultimately depends on the specific capital requirements of each company. While Y Combinator offers more funding, it also demands a higher equity share compared to Techstars.
