For the most sought-after founders, the prestige of a top accelerator is increasingly confronted with giving up a significant ownership stake in their company.
Ali Partovi, veteran investor and CEO of venture firm Neo, wants to offer the mentorship and community of one of the most elite accelerator programs — without forcing the best promising tech leaders to hand over 7% or even 10% of their company before they’ve even started.
Partovi, known for his early investments in Facebook, Cursor and Kalshi, has just introduced Neo Residency, a new, competitively structured program that combines the firm’s now four-year-old accelerator with a track for current undergraduates.
The conditions offered by Neo Residency are so founder-friendly that “it’s not comparable to any other accelerator,” Partovi told TechCrunch.
For a cohort of 12 to 15 startups entering the program this summer, Neo will invest $750,000 through an unlimited SAFE — a contract that gives the investor future capital in exchange for money now, without the cap on the valuation used to calculate that stake. Unlike the fixed-percentage deals typical of other accelerators, Neo will receive its equity until the company’s next formal funding round, and even then dilution is tied to the valuation. If the startup raises its next round to $15 million, Neo’s stake will be 5%, but if that valuation reaches $100 million, the company’s ownership will drop to just 0.75%.
“We take the risk up front, so it’s extremely favorable for startups,” Partovi said.
By comparison, Y Combinator typically takes a fixed 7% of a company for $125,000, with another $375,000 invested in an unlimited MFN – or most-favoured-nation – SAFE, a clause that ensures early investors get terms at least as good as those given to later ones. Meanwhile, Andreessen Horowitz’s Speedrun program typically invests $500,000 in exchange for 10% of the startup through a SAFE note, and another $500,000 if another round is raised within 18 months on whatever terms the other investors agree on.
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“We offer such a great offer that it is suitable even for founders who are not even considering another accelerator,” he told Partovi.
Lower cost of equity is only part of Neo Residency’s appeal.
The founders will work for three months at Nea’s offices in San Francisco’s Jackson Square neighborhood, attend a two-week bootcamp in the mountains of Oregon, and be mentored by about 30 veteran operators, including Russell Kaplan, president of Cognition, and Fuzzy Khosrowshahi, CTO of Notion (and the creator of Google Sheets, as well as Partovi’s uncle).
However, the program’s main draw is its prestige: seed and Series A investors generally have great respect for the founders Partovi has chosen.
“The (accelerator) that I like right now has a very high signal, and every founder that I put in there is just wicked smart, is Neo,” said Wesley Chan, co-founder and managing partner of FPV Ventures, on stage at the 2025 TechCrunch Disrupt.
Startups that have come through the program include Moment, a fintech company that raised $56 million from investors such as Andreessen Horowitz, and Přední, a healthcare AI startup backed by NEA and Sequoia.
The Neo Residency will also select five to eight students—either as individuals or small teams—to receive a $40,000 no-strings-attached grant to take a semester to work on a project. While it’s not necessary to immediately leave or start a formal company, Partovi said he hopes the students will catch the entrepreneurial bug and, when they eventually form a startup, approach Neo for funding.
Neo is keeping the program small and elite: it will limit its two annual cohorts to 20 teams, each consisting of a mix of active startups and student projects.
Why does Neo offer such generous terms? “We believe more in our ability to attract and select future superstars than ever before,” he told Partovi.
His track record so far suggests that confidence is well-founded. He famously met Cursor co-founder Michael Truell while Truell was still a student at MIT, and later wrote one of the first checks to the AI coding startup, which is now valued at nearly $30 billion.