Founders' pre‐entry knowledge and the heterogeneous returns to accelerator participation

Research Summary While startup accelerators often benefit founders and their ventures, these gains may not be uniform. We examine how founders' pre‐entry knowledge—the cumulative education, industry experience, and entrepreneurial exposure that teams acquire prior to launching their startups—shapes the heterogeneous returns to accelerator participation. We propose two potential mechanisms driving these returns: knowledge compensation, whereby accelerators fill gaps in basic knowledge and competencies, and knowledge complementarity, whereby accelerators amplify the absorption and deployment of expert knowledge. Using data from 6723 startups and their founding teams, we find evidence in support of the complementarity mechanism. Our findings also suggest that the returns to accelerator participation are contingent on the alignment between founders' pre‐entry knowledge and program design. Managerial Summary While startup accelerators aim to level the entrepreneurial playing field, we find that founders with substantial pre‐entry knowledge and experience tend to gain more from participation in these programs than novice entrepreneurs, potentially widening startup performance gaps. Program design also appears to play a key role. While specialized and unstructured programs offer value for seasoned entrepreneurs by building complementary knowledge, structured and generalist programs offer some, albeit limited, opportunities for less‐experienced teams to build foundational skills. These findings underscore the need for tailored programming that aligns with participants' learning needs. For program designers and policymakers, these findings suggest investing in diverse formats to support varied founder profiles. For entrepreneurs, they highlight the importance of selecting programs that complement and build upon their team's prior knowledge.