Most accelerator deals are standard documents offered to every company on the same terms, and most are fair for what they are. A few are not, and the problems are usually in the details: a fee that eats the investment, a stake that grows when you raise, a right that puts off your next investor. This guide starts with what a standard deal looks like, then sets out the red flags in the money, in the rights and in the process, and ends with a short checklist.
Start with what a standard deal looks like
You can only spot an unusual term if you know the usual ones. Three public reference points, all read on 18 October 2026:
- Y Combinator invests US$500,000: US$125,000 on a post-money SAFE for 7%, and US$375,000 on an uncapped SAFE with a most favoured nation (MFN) clause. Its deal page also says YC charges companies no fees to take part.
- Techstars invests US$220,000: US$20,000 through a post-money convertible equity agreement for 5% in common stock, and US$200,000 on an uncapped MFN SAFE. Its investment terms page says a side letter sets pro rata, digital-asset and drag-along rights.
- The SAFE itself is public. Y Combinator’s SAFE page publishes the standard forms, including a separate pro rata side letter, and states the rule for reading one: the ownership you sell equals the investment divided by the post-money valuation cap.
The SEC’s small business glossary, dated 2 February 2024, describes accelerators as working with businesses for a shorter time than incubators, such as three to six months, and notes that they commonly invest in equity in the companies they work with. So an equity stake is normal. What matters is how much, for what, and what comes with it.
The deal terms table lists every programme on this site that publishes what it invests and the equity it takes. If an offer is far outside that range, ask why.
Red flags in the money
These terms change what the deal costs you.
- A fee that eats the investment. Some programmes charge a fee alongside the investment, or take it out of the cheque. Startup Wise Guys, for example, lists a programme cost of €35,000 alongside its investment of up to €100,000, according to its listing. A fee is not automatically a problem, but the money that matters is the investment minus the fee. Compare that net figure with the stake.
- Equity for little or no cash. Divide the cash by the stake to find the valuation the deal implies. US$125,000 for 7% implies about US$1.79 million; 10% for US$20,000 implies US$200,000. A programme that takes equity for services alone is buying in at a valuation you would never accept from an investor.
- A stake that tops up. Some deals protect the programme’s percentage, so that it receives extra shares when you raise. The SEC glossary lists anti-dilution protection among the rights preferred investors can hold. On an early, small investment, it can cost founders far more than the headline stake suggests.
- A floating SAFE you have not priced. An uncapped MFN SAFE is standard at Y Combinator and Techstars, but its cost depends on the cap of your next SAFE round. YC’s deal page gives an illustration: US$375,000 converting at a US$15 million cap is 2.5%. At a lower cap it is more.
- Several instruments at once. A fixed stake, a SAFE and a note together are hard to compare. Turn each one into a percentage at your expected next round before you decide.
The accelerator dilution calculator follows a stake through later rounds, and the SAFE calculator shows what any SAFE converts into.
Red flags in the rights
These terms change what you can do later. Several are normal in moderation; read how far each one goes.
- Pro rata beyond the ordinary. A pro rata right lets an investor keep its percentage by buying into later rounds. Y Combinator’s SAFE page describes it as optional and kept in a standard side letter. A right to buy more than its percentage, or to take a fixed share of every round, can crowd out your lead investor.
- First refusal on your next round or a sale. A right to match any offer for the company, or to invest first in your next round, can put off buyers and investors who do not want to do the work only to be matched.
- Control rights. A board seat, vetoes over hiring, spending or fundraising, or approval rights over a sale are unusual for an accelerator’s small stake. Ask why the programme needs them.
- Drag-along and voting agreements. Techstars’ side letter includes drag-along rights, which oblige a shareholder to join a sale the majority approves. That is common; check whose majority it is.
- Liquidation preferences. The SEC glossary explains a liquidation preference as a right to be paid before other investors when the company is sold. Common stock, like the 5% in Techstars’ deal, carries none. Preferred shares often do, including the shares a SAFE usually converts into, so check the multiple each round sets.
- Intellectual property and exclusivity. Any clause that assigns IP to the programme, limits who you can sell to or bars you from other programmes deserves a lawyer’s reading.
Rights in side letters are as binding as rights in the main agreement. Ask for every side letter before you accept.
Red flags in the process, and a checklist
How a programme sells its deal tells you a lot about the deal.
- Pressure to sign quickly. A short deadline to accept is common at large programmes, but you should still have the documents in full before the clock starts.
- No documents in advance. A programme with standard terms can share them, and many publish them. Refusing to show the paperwork before you commit is a warning.
- No alumni to talk to. Ask for the founders of the last two cohorts. If none will speak to you, find out why.
- Fees for access. Paying for investor introductions or a place on a pitch stage is different from an accelerator investing in you. Ask exactly what the fee buys and what the last cohort received.
- Vague answers about who runs it. You should know who the partners are, where the money comes from and how long the programme has run.
Before you sign any accelerator deal:
- Get every document, including side letters, and read them all.
- Work out the implied valuation and the stake after your next round.
- Compare the offer with published terms in the accelerators section and the deal terms table.
- Talk to at least two founders from recent cohorts.
- Have a lawyer who works with startups review the documents.
Most deals will pass. The ones that do not are the reason to check every time.
Sources
Each page was read on the date shown. Figures in this guide carry the date the source gives them.
- Y Combinator: The Y Combinator standard deal. Undated page. Read 18 October 2026.
- Y Combinator: The SAFE: documents and how ownership is calculated. Undated page. Read 18 October 2026.
- Techstars: Techstars investment terms. Undated page. Read 18 October 2026.
- US Securities and Exchange Commission, small business resources: Glossary. Dated 2 February 2024. Read 18 October 2026.