Fast-Track Your Next Business with a Venture Studio
Within the startup ecosystem, there are distinct approaches each venture studio takes, in addition to completely separate models, such as incubator or accelerator. While the mission of each model is the same — to help all startups succeed — the core differences are defined by each one’s company building process and scope of support. Keep reading to find out which approach makes the most sense for you and your business
Types of approaches
Sometimes known as a startup studio model, the venture studio is a company that builds various companies in rapid succession, or a few companies simultaneously. Often these studios will invest in the venture also either with reduced fees, and/or with capital. They build each business from the ground up and provide assistance to the startup founders in the form of capital, expertise, manpower, and connections – all in return for an equity stake in the future business.
- Working In-house: A corporation owns the venture studio function and all the startups that form part of its portfolio. Examples of this are FordX in mobility, and Bayer’s G4A team in healthcare.
- Working for investors/startup founders: The venture studio holds equity in the different ventures and charges discounted fees for the services and support it provides. The studio may also invest its own capital or align with friendly early stage funds to get its deal flow. Examples include Human Ventures, Atomic, and Teem Ventures.
- Working for corporations: The venture studio sells its services to corporations in exchange for fees. Corporations sometimes use this model to incubate internal ideas. Sometimes the venture studio may take an equity percentage based on the strategic value it provides. These can be large consulting companies that have existing relationships, or managed in a lean model by startup executives. Examples include BCG Ventures, Bionic Ventures (now Andersen Consulting), and Teem Ventures.
Venture Studio vs Incubator vs Accelerator
Within the startup ecosystem, there are some important distinctions between the venture studio model and other types of business frameworks. While each model’s mission is to help the startup succeed, the core differences are defined by each building process and scope of support.
- Incubators collaborate with new entrepreneurs to convert their initial ideas into a working business model and eventually, into a profitable business. They usually don’t provide any funding to the startups, but rather offer resources in the form of financial advisory, networking, and guidance.
- Accelerators provide structured mentorship, capital, and connections to selected founders with a promising minimum viable product. Their goal is to rapidly scale growth by providing both funding and years’ worth of learning in short periods of time.
- Venture studios take a more hands on approach in the startup’s day to day, and often develop a strong relationship with the company that goes beyond the startup period. Not only do they offer qualified resources, startup experience and capital, venture studios link each startup with the experts who can take the product to the next level.
Should I partner with a venture studio?
Like with most decisions, it depends. If you have a fully built out team of experienced startup leaders and plenty of cash to deploy, you may not need the help. But if you have great expertise in a specific area, and a strong idea for a “proof of concept,” you should not procrastinate onboarding other experienced company builders to the project. A venture studio partnership may be a cost effective way to build faster and hit goals while leveraging a bigger network. After all, launching a business is no easy feat. It takes a lot of different skills, early stage venture experience, and a lot of support services. Often these skills are hard to find for one-off ventures, yet are key parts of the services provided by a venture studio. So, if you want to increase your company’s success rate by 30%, and leverage the experience of those who’ve been there before, there’s no better time than now to partner with a venture studio to meet your goals.
ABOUT TEEM VENTURES
You need strong leaders to advise on the initial conception using research, strategy, and concept testing. Studios like Teem, have the unbiased decisiveness and proven expertise to make efficient use of capital and ensure your product launch will transform into a thriving, scalable business. Don’t risk the high opportunity cost of overbuilding- or even failure. Schedule an evaluation session with us today!