Brycent (Bryce Johnson) interviewing Speedrun/A16Z’s Troy Kerwin and Andrew Lee.
What is Speedrun?
Speedrun is the brainchild of Andrew Lee. A16Z's version of a Y Combinator-style accelerator. But they do things a bit differently… (see chart below)
Y Combinator | Speedrun | |
|---|---|---|
Investment Amount | $500K in Total | $1M in Total |
Initial Structure | $125K SAFE for 7% | $500K Upfront SAFE 10% |
Follow on structure | $375K SAFE when you raise your next round | $500K conditional on raising next round in 18 months |
Batches per year | 4 (one per quarter) | 2 (one every six months) |
Companies per batch | 130+ | 50-60 |
It’s important to stack them up against their biggest competitor accelerator, Y Combinator. The chart above will provide you with additional context going into this newsletter.
Speedrun Demo Day (Breakdown)
Speedrun Demo Day surprised me. Going in, I was expecting a very well put together event. But the quality on all fronts is something that you can't really measure beforehand because they don't share information about the teams until they launch.
Speedrun companies launch openly in the week leading up to Demo Day.
Rork's CEO presenting at Speedrun Demo Day.
What I loved
1 → Startup Quality
There were some high-quality teams at Speedrun. Coming in, this had been a question mark. Previous batches were filled with gaming companies, some of which are no longer around and some of which are trying to find their footing at the intersection of gaming and crypto.
However, this batch marked a different direction for Speedrun. We saw less gaming and more AI, more focused on where consumer eyes are going. This gave off the feeling that previous batches were the Pokémon-like evolution from Speedrun 001 to now. I can confidently say Speedrun has arrived because the team quality with just 60 teams was very on the mark.
A couple of teams that stood out to me.
Quick Thesis:
Nexxa → Nexxa was the first company to pitch. Verticalized AI in heavy industries. One of the best pitches of the day. And in a sector in dire need of transformation. They were interesting.
Creed → My favorite startup of the day, even though the founders were a bit oblivious when I tried speaking with them. They're creating verticalized consumer AI for Christians. While also offering white-label solutions to churches. Even though I didn't get to chat with the team, I'm still incredibly bullish on this product.
Rork → The vibe coding mobile sector is heating up, and Rork has been absolutely crushing it. They grew from $0 to $1M ARR in just three months with 4 employees. They will be a formidable startup in this sector.
Anchr → These guys are building the AI operating system for food distributors. Another industry that is in desperate need of revolutionization. Their focus is on automating workflows across the supply chain. And even though this industry isn't my forte overall, I'm a fan of anyone doing verticalize AI.
YKB → You know Ball is the culmination of betting and bragging rights culture. Anyone who's ever been a fan of sports, has done pre-season predictions with their friends. The intersection of prediction markets, betting culture, makes this one very intriguing. I could see this becoming a betting play in the long run. But currently, they don't have a revenue generating business model. I see them potentially getting acquired by a company like Real Sports in the future.
2 → Approachability
Speedrun was an incredibly approachable accelerator. By approachable, I mean it was very easy to give face time with the founders and managers of the program. No one gave off an ego or an "I'm better than you" complex.
Andrew Lee and Troy Kirwin. Gave me personal introductions to some of the companies and also made content with me at the event. That's normally not something you're getting at any large accelerator of this kind.
I believe this stems from a heavy understanding that content is valuable in the social media era. There were multiple content creators at the event making content, chatting with founders, and even angel investing.
3 → Support
I had amazing chats with founders, but what really stuck out to me was the feedback founders gave for the speed run program. Many founders attested that they felt incredibly supported throughout the program, which included getting face time with their partner on a daily basis.
Other founders spoke of the value that A16Z brings from a content team perspective, which has allowed them to accelerate marketing campaigns, launch videos, and understanding how to work with creators at scale.
So, if you're analyzing Speedrun founders with any reservations that founders are leaving the cohort unprepared, those reservations can be thrown by the wayside.
I believe Speedrun having smaller cohorts with more face time significantly contributes to the level of preparation founders have when they finish.
Bryce, Justis, and a host of investors gather for a quick picture at demo day.
What to Improve
1 → More Bets on Hardware/Robotics
There were only two robotics hardware companies in the entire cohort. Dispatcher and URSA mining. I'm a firm believer that robotics is the single most interesting category for AI advancement over the next 10 years. It would be great to see Speedrun make more hardware and robotics bets over the next couple of years.
2 → Startups should launch openly sooner
I believe startups should launch openly on Speedrun's website when they're ready. Not all at once at the end of the cohort. It makes it easier for investors to do some research and due diligence in advance.
Having the companies in stealth leading up to the final week might create initial hype, but there's something truly valuable about being the first in your cohort to launch openly. It signifies boldness and a readiness to enter the market.
Overall
Speedrun is the Y Combinator level alternative that some founders have been seeking. The two accelerators will eventually rival each other over the long-term, where founders will have to ask themselves who do they align more with?
It will become the Lakers-Celtics rivalry that Silicon Valley has been missing in the accelerator scene. Because the accelerator path no longer runs solely through Y Combinator. Speedrun is here, they're formidable, and they are going to have a lot to say over the next 10 years.
If you're an investor, I highly recommend you get to the next Speedrun Demo Day. If you're a founder trying to decide between Y Combinator and Speedrun, the answer might not be as straightforward as it once was. They're both great, but who you align with may go beyond initial perks. But the interpersonal things that don't show up on the scoreboard.
Great job by the Speedrun team. I look forward to attending their next demo day.