Ali Partovi’s Neo Looks To Upend The Accelerator Model With Low-dilution Terms - Beritaja

For the about sought-after founders, the prestige of a top-tier accelerator is progressively weighed against giving up a important ownership liking successful their company.

 Ali Partovi, the seasoned investor and CEO of venture patient Neo, wants to connection the mentorship and organization of 1 of the about elite accelerator programs—without forcing the champion up-and-coming tech leaders to manus complete 7% aliases moreover 10% of their institution earlier they’ve moreover started.

Partovi, who is known for his early investments successful Facebook, Cursor, and Kalshi, has conscionable introduced Neo Residency, a new, competitively system programme that combines the firm’s now four-year-old accelerator pinch a way for existent assemblage students.

The position that Neo Residency offers are truthful founder-friendly arsenic to beryllium “not moreover comparable to immoderate different accelerator,” Partovi told TechCrunch.

For the cohort of 12 to 15 startups entering the programme this summer, Neo will put $750,000 via an uncapped SAFE — a statement that gives an investor early equity successful speech for money now, pinch nary ceiling connected the valuation utilized to cipher that stake. Unlike the fixed-percentage deals emblematic of different accelerators, Neo won’t person its equity until the company’s adjacent general backing round, and moreover then, the dilution is tied to valuation. If a startup raises its adjacent information astatine a $15 cardinal valuation, Neo’s liking will beryllium 5%, but if that valuation hits $100 million, the firm’s ownership drops to conscionable 0.75%.

“We return the consequence up front, truthful this is highly favorable to startups,” Partovi said.

In comparison, Y Combinator typically takes a fixed 7% of the institution for $125,000, pinch different $375,000 invested connected an uncapped MFN — aliases most-favored federation — SAFE, a clause that ensures early investors get position astatine slightest arsenic bully arsenic those fixed to later ones. Meanwhile, Andreessen Horowitz’s Speedrun programme typically invests $500,000 successful speech for 10% of the startup’ via a SAFE note, and different $500,000 if the adjacent information is raised wrong 18 months astatine immoderate position are agreed to by the different investors.

“We’re offering a woody truthful awesome that it’s due moreover for founders who are not moreover considering immoderate different accelerator,” Partovi said.

 The little equity costs is only portion of Neo Residency’s appeal.

The founders will activity for 3 months astatine Neo’s offices successful San Francisco’s Jackson Square district, participate successful a two-week bootcamp successful the Oregon mountains, and beryllium mentored by about 30 knowledgeable operators, including Russell Kaplan, president of Cognition, and Fuzzy Khosrowshahi, CTO of Notion (and the creator of Google Sheets and besides Partovi’s uncle).

But the program’s main tie is its prestige: Seed and Series A investors mostly person awesome respect for founders handpicked by Partovi.

“The 1 [accelerator] I for illustration correct now that has very precocious signal, and each laminitis I met location is conscionable wicked smart, is Neo,” Wesley Chan, co-founder and managing partner of FPV Ventures, said connected shape astatine 2025 TechCrunch Disrupt.

Startups that person gone done the programme see Moment, a fintech institution that has raised $56 million from investors for illustration Andreessen Horowitz, and Anterior, a healthcare AI startup backed by NEA and Sequoia.

The Neo Residency will besides prime 5 to 8 students—either arsenic individuals aliases mini teams—who will person a $40,000, no-strings-attached assistance to return a semester disconnected to activity connected a project. While location is nary request to driblet retired aliases commencement a general institution immediately, Partovi said he hopes the students will drawback the entrepreneurial bug and, erstwhile they yet motorboat a startup, move to Neo for funding.

Neo is keeping the programme mini and elite: it will headdress its 2 yearly cohorts astatine 20 teams each, consisting of a operation of progressive startups and student projects.

Why is Neo offering specified generous terms? “We person much assurance successful our expertise to pull and prime retired early superstars than ever before,” Partovi said.

His way grounds suggests that assurance is well-founded. He famously met Cursor co-founder Michael Truell while Truell was still an MIT student and later wrote 1 of the first checks into the AI coding startup, now weighted astatine about $30 billion.