Techstars, a nearly 20-year-old startup accelerator, announced new terms for startups that enter its three-month program. The organization will now invest $220,000, which is $100,000 more than it offered previously, in companies starting with its fall 2025 batch.
The capital will be divided into two components. The group is offering companies $20,000 in exchange for 5% ownership in the business. Startups will also receive $200,000 in the form of an uncapped SAFE note with a “most favored nation” clause. Put more simply, Techstars percentage ownership of its $200,000 SAFE will depend on the company’s subsequent valuations. For example, if the startup’s next financing “prices” it at $10 million, Techstars will receive 2% equity on the SAFE component for a total of 7% ownership.
Techstars’ new terms now closely mirror those of Y Combinator. The famed Silicon Valley accelerator increased its funding to startups three years ago by adding a $375,000 SAFE note to its standard deal of $125,000 for 7% of the startup’s equity.
So, which accelerator is offering a better deal for startups? The answer largely depends on the company’s capital needs. Compared to Techstars, startups going through YC get more than double the funding but give up more equity.
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