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Startup incubators and accelerators have become a fixture of the tech ecosystem over the past decade, promising to boost fledgling companies’ odds in a world where most startups fail (indeed, roughly 70% of new ventures don’t survive their first ten years (Howarth, 2024)).

Programs like Y Combinator, Techstars, and others in the U.S. and Europe have now been around long enough to analyze their long-term return on investment (ROI) and performance.

Do incubated startups actually survive longer, raise more funding, or achieve more exits than others? How do the top programs stack up against each other, and what do founders say about their value?

This episode examines the data from the last ten years, focusing on tech startups (primarily SaaS and related sectors) graduating from incubators.

We’ll explore survival and graduation rates to Series A, exit outcomes (IPOs, M&As, etc.), the financial performance of the incubators’ portfolios, comparisons among top programs (like Y Combinator vs. Techstars), founder sentiment, and even the downsides and underperformance patterns that emerge from the accelerator model.

The results show a story of improved odds and outsized successes, but concentrated in a “long tail” of big winners that drive most of the returns.

Let’s jump in👇

One of the clearest measures of an incubator’s impact is how many of its startups survive the tumultuous early years. Top accelerators appear to dramatically improve the above-mentioned 30% survival baseline. For example, data from Y Combinator (YC) shows that over 50% of YC companies are still alive a decade after graduation – nearly double the typical survival rate.

In fact, as of late 2024, only about 13% of YC’s portfolio had shut down entirely, with the rest either still operating or having exited (Broe, 2025). Other programs also beat the odds: one analysis found the estimated survival rate of YC-backed startups to be ~93%, compared to around 80% for Techstars and ~81% for 500 Startups (ByteBridge, 2025). While methodologies differ, it’s clear that top tier accelerator graduates fail at a lower rate than the norm.

Another important metric is the “graduation” to Series A and beyond. In other words, do incubator startups successfully secure substantial venture funding after the program? Here again, the top accelerators show strong results. Roughly 45% of Y Combinator companies go on to raise a Series A round (compared to ~33% of seed-stage startups overall) (Broe, 2025). This indicates nearly half of YC startups advance to that next level of funding and growth. Techstars reports a similar advantage in early fundraising: 74% of Techstars companies raise follow-on capital within three years of the program (Techstars, 2023).

In other words, about three-quarters of Techstars graduates find additional investors, often an essential step toward scaling. These follow-on funding rates suggest that the accelerator stamp of approval and demo day exposure give startups a substantial fundraising edge. As YC itself touts, being an alum can open doors to top-tier VCs that might otherwise be out of reach (Broe, 2025). It’s worth noting that accelerators also select for teams that already have high potential, so some of this outperformance is due to selection bias.

Nonetheless, the combination of selection + program value-add seems to meaningfully improve both survival odds and chances of raising Series A for startups in these programs.

Ultimately, the success of an incubator-backed startup (from an investor’s perspective) is typically realized through a liquidity event such as an acquisition, IPO, or major secondary stock sale. How often do accelerator startups actually reach a lucrative exit?