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Startup Studio Insider Founder Shares How Startup Studios Are A Successfully Proven Business Model 

It can be intimidating for entrepreneurs to launch a startup, as 90% eventually fail . Although there are many successful solo founders , there are various options for entrepreneurs looking for additional support, including startup studios. This business model, also known as venture studios, has continued to increase in popularity across the world, with hundreds of startup studios globally and more than 625% growth in the studio market over the last seven years. Let’s take a look at what the startup studio business model is and how they’ve become a proven business model . 

What is a Startup Studio? 

Startup studios, or the venture studio model, are companies composed of industry experts that specialize in building other businesses, with the primary goal to address and provide solutions to consumer pain points. And unlike accelerators, who have a limited timeline of support (usually three to six months), startup studios provide businesses with key advantages including a team of designers, developers, administrative experts, and marketers to help the startups throughout their various developmental stages. 

Since startup studios provide tools, ideas, and funding assistance for the startups they work with, they’ve mastered venture building and helped to mitigate risks commonly associated with startups. 

Startup Studio’s Global Expansion 

The startup studio business model has benefited from its growth in new networks and regions across the globe. Startup studios can support businesses virtually, which means it’s no longer necessary for the startups to be physically located within the same area. This factor has helped startup studios expand their support to companies across the world, allowing them to invest their resources in the startups they truly believe in. 

As of 2023, some of the most successful venture studios are not based in Silicon Valley or the United States, which was traditionally recognized as the top startup studio business ecosystem. Since Silicon Valley and the United States were originally traditional centers for startups, there was a market gap in various markets that are now being filled with the help of startup studios. 

Additionally, due to remote work flexibility, startup studios are able to recruit top resources and offer startups access to diverse talent. 

The Value of the Startup Studio Business Model 

While accelerators and incubators are great options for some startup founders, their benefits can be limited compared to startup studios. Accelerators speed up the growth of an existing company, with a focus on business scaling. These business models typically have a set timeline of support of three to six months, and many founders find they need support throughout more business stages. Incubators, on the other hand, have the main goal of nurturing disruptive market ideas when developing a business model or company and are mainly focused on innovation. 

However, the startup studio business model focuses on the earliest stages of a startup, often working with companies to test and validate new ideas before they even have a team or product in place. Startup studios also help provide early-stage funding and give access to the equipment, tools, designs, and team needed in order to support the startup. Due to these compiled resources, startup studios provide a more comprehensive and hands-on approach to startup development, compared to accelerators or incubators.

By providing founders with a wide scope of tools, strategic mentorship, and funding, startup studios provide the resources and support needed to substantially decrease risks commonly associated with startups. As the startup studio model continues to evolve and mature, the opportunities to create innovative solutions to the world’s persistent challenges will increase along with it. Check out Startup Studio Insider to learn more about the startup studio ecosystem. 

Jeena Fredo

Jeena Alfredo is a passionate digital marketer at The Business Goals. She is working with other companies to help them manage the relationship with The Business Goals for the publications.

• Jeena Fredo https://www.thebusinessgoals.com/author/jeena/ 5 Thrilling Activities For Effective Team Building
• Jeena Fredo https://www.thebusinessgoals.com/author/jeena/ A Quick Primer on Your Debt-to-Income Ratio
• Jeena Fredo https://www.thebusinessgoals.com/author/jeena/ How to Measure Your Financial Health
• Jeena Fredo https://www.thebusinessgoals.com/author/jeena/ The Top 5 Benefits Of AI in the Finance And Banking

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How Start-Up Studio Makes Money: The Business and Revenue Model Explained

Discover the ins and outs of how start-up studios generate revenue and build their business models.

In today's ever-evolving business landscape, start-up studios have emerged as a unique and intriguing player. These innovative organizations have redefined the traditional start-up model by providing a supportive ecosystem that nurtures multiple ventures simultaneously. But how do start-up studios generate revenue and ensure profitability? In this article, we will explore the business and revenue model of start-up studios, shedding light on their key components, revenue streams, profitability factors, and future prospects.

Understanding the Concept of a Start-Up Studio

Before delving into the intricacies of the business and revenue model, let's first define what a start-up studio actually is. A start-up studio, also known as a venture studio or a studio model, is a company that builds and launches multiple start-ups concurrently. While traditional start-ups typically focus on developing a single business idea, start-up studios leverage their resources, expertise, and network to support the creation, growth, and success of various ventures.

By adopting a studio model, start-up studios aim to mitigate the risks associated with traditional start-ups and increase their chances of success. Rather than relying solely on a single idea or a single founder, start-up studios assemble teams of experienced entrepreneurs, developers, designers, and domain experts who collaboratively work on multiple projects simultaneously.

Start-up studios have gained popularity in recent years due to their unique approach to entrepreneurship. They provide a fertile ground for innovation and experimentation, allowing entrepreneurs to explore different ideas and business models without the fear of failure. This model encourages creativity and diversity, as start-up studios often attract a diverse pool of talent from various industries and backgrounds.

Defining a Start-Up Studio

At its core, a start-up studio serves as a creator, curator, and catalyst for start-up ideas. It generates ideas internally or sources them externally, either through partnerships or external innovators. Once a viable idea is identified, the studio allocates resources, including capital, human talent, and infrastructure, to turn the idea into a full-fledged start-up. The studio then nurtures and supports the start-up by providing guidance, mentorship, operational support, and access to its extensive network.

Start-up studios understand the importance of a strong foundation for start-ups to thrive. They provide not only financial backing but also strategic guidance to help start-ups navigate the complexities of the business landscape. This hands-on approach sets start-up studios apart from traditional venture capital firms, as they are actively involved in the day-to-day operations of their portfolio companies.

Moreover, start-up studios foster a culture of collaboration and learning. They create an environment where entrepreneurs can learn from each other's successes and failures, fostering a sense of camaraderie and shared knowledge. This collaborative approach not only benefits individual start-ups but also contributes to the overall growth and development of the start-up ecosystem.

The Role of a Start-Up Studio in the Business Ecosystem

Start-up studios play a crucial role in the business ecosystem by bridging the gap between traditional venture capital firms and early-stage start-ups. They act as a launching pad for entrepreneurs, providing them with a conducive environment for ideation, validation, and execution. Additionally, start-up studios foster collaboration and knowledge-sharing among their portfolio companies, creating a synergistic effect that enhances the overall success rate of the ventures they support.

By leveraging their network and expertise, start-up studios help start-ups overcome common challenges such as fundraising, talent acquisition, and market penetration. They provide access to a wide range of resources, including industry connections, mentorship programs, and operational support. This comprehensive support system increases the likelihood of start-up success and accelerates their growth trajectory.

Furthermore, start-up studios contribute to the overall innovation ecosystem by driving economic growth and job creation. By nurturing and scaling multiple start-ups, they generate employment opportunities and stimulate local economies. Start-up studios also attract investment and talent to their respective regions, positioning them as hubs of innovation and entrepreneurship.

In conclusion, start-up studios are dynamic entities that play a vital role in the start-up ecosystem. Through their unique approach and comprehensive support system, they empower entrepreneurs to turn their ideas into successful ventures. By fostering collaboration, innovation, and growth, start-up studios contribute to the overall development of the entrepreneurial landscape and drive economic prosperity.

The Business Model of a Start-Up Studio

The success of a start-up studio largely depends on its business model. Let's examine the key components that make up the business model of a start-up studio and how they differ from traditional start-ups.

Key Components of a Start-Up Studio Business Model

A start-up studio's business model differs significantly from that of a traditional start-up. While traditional start-ups typically focus on solving a specific problem or capturing a market opportunity, start-up studios take a broader approach. They operate as a portfolio of start-ups, leveraging their collective strengths and resources to increase the likelihood of success.

One key component of a start-up studio business model is the internal ideation and validation process. Start-up studios invest a substantial amount of time and effort to generate and assess ideas internally before selecting the most promising ones for further development. This internal vetting process ensures that only the most feasible and scalable ideas are pursued.

Another important component is the studio's ecosystem. Start-up studios build an internal support system that comprises various functions such as legal, finance, marketing, and HR. This integrated ecosystem enables the start-ups within the studio's portfolio to access specialized resources and expertise, reducing the burden on individual start-ups to build these functions from scratch.

How Start-Up Studios Differ from Traditional Start-Ups

Unlike traditional start-ups, which typically rely on external funding sources such as venture capital, start-up studios often provide initial funding themselves. This allows them to retain a significant stake in the ventures they create and ensures alignment of interests between the studio and its portfolio companies.

Furthermore, start-up studios follow a studio-centric approach that prioritizes collaboration and knowledge-sharing among their portfolio companies. This interconnectedness and the ability to leverage the collective resources and expertise of the studio and its portfolio companies serve as a strategic advantage for start-up studios.

Revenue Generation in a Start-Up Studio

Now that we have explored the business model of start-up studios, let's shift our focus to the revenue generation aspect. Start-up studios employ various strategies to generate revenue and create value.

Primary Revenue Streams for Start-Up Studios

The primary revenue stream for start-up studios is the equity they hold in the ventures they create. As these ventures grow and attract external investors, start-up studios realize returns on their initial investments through equity dilution or exits through acquisitions or public listings.

In addition to equity holdings, start-up studios may also generate revenue through providing services to their portfolio companies. These services can include anything from legal and accounting support to marketing and growth hacking expertise.

Another revenue stream for start-up studios can be strategic partnerships and collaborations. By leveraging their extensive network and industry connections, start-up studios can forge partnerships with established companies, generating revenue through joint ventures, licensing agreements, or technology transfer.

The Importance of Diversified Revenue Streams

For sustainable growth and long-term profitability, start-up studios recognize the importance of diversifying their revenue streams. Relying solely on equity returns from their portfolio companies can be risky, as the success of individual ventures is not guaranteed.

By diversifying revenue streams, start-up studios can mitigate the risks associated with a single point of failure. This diversification can include offering services to external start-ups or established companies, investing in external ventures, or even launching their own proprietary products or services.

The Profitability of Start-Up Studios

While start-up studios offer a unique approach to venture creation and support, their profitability is subject to various factors and challenges. Let's explore the key factors influencing the profitability of start-up studios and the risks they face.

Factors Influencing Start-Up Studio Profitability

A factor that significantly impacts the profitability of start-up studios is the success rate of their portfolio companies. The ability to identify and nurture high-potential ventures is crucial for generating substantial returns. Effective collaboration and knowledge-sharing within the studio ecosystem can increase the likelihood of success for portfolio companies.

Another important factor is the efficiency and scalability of the studio's internal operations. Streamlining processes, attracting top talent, and optimizing resource allocation can reduce costs and enhance profitability.

External market conditions and investor sentiment also play a vital role in the profitability of start-up studios. Economic downturns or shifts in the investment landscape can affect the availability of funding and impact the studio's ability to attract external capital.

Challenges and Risks in the Start-Up Studio Model

While start-up studios offer many advantages, they are not immune to challenges and risks. One key challenge is the allocation of resources and attention among multiple ventures simultaneously. Prioritizing and managing resources efficiently across the portfolio is crucial to ensure the success of individual start-ups.

Start-up studios also face the risk of potential conflicts of interest. As a studio holds equity in multiple ventures, conflicts may arise when the interests of different ventures diverge. Transparent governance structures and clear communication channels are essential to address these conflicts effectively.

The Future of Start-Up Studios

As the start-up ecosystem continues to evolve, so does the future outlook for start-up studios. Let's explore the emerging trends and the impact of technology on the start-up studio model.

Emerging Trends in Start-Up Studio Business Models

One emerging trend in the start-up studio space is the specialization of studios in specific industries or verticals. By focusing on a particular sector, start-up studios can leverage deep industry knowledge and networks to create ventures with a higher chance of success.

Furthermore, start-up studios are increasingly adopting data-driven approaches and leveraging emerging technologies such as artificial intelligence and blockchain. These technologies enable start-up studios to gain insights, automate processes, and enhance their ability to identify high-potential ideas and ventures.

The Impact of Technology on Start-Up Studios

Technology has played a vital role in the growth and success of start-up studios. From streamlining internal operations to enabling better collaboration among portfolio companies, technology has been a transformative force.

With advancements in data analytics and predictive modeling, start-up studios can make more informed decisions, allocate resources strategically, and identify trends early on. Furthermore, technology-driven platforms and tools facilitate efficient communication, knowledge-sharing, and project management within the studio ecosystem.

In conclusion, start-up studios have revolutionized the traditional start-up model, providing a supportive environment for multiple ventures to thrive. By leveraging their unique business and revenue model, start-up studios generate value through equity holdings, service offerings, and strategic partnerships. However, profitability and success in the start-up studio space depend on several factors, including the success rate of portfolio companies and efficient internal operations. As the start-up ecosystem continues to evolve, start-up studios must adapt to emerging trends, capitalize on technological advancements, and remain agile to ensure their long-term viability and profitability.

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Startup Studios in 2023: The Ultimate Guide

Building a successful startup business on your own is very challenging.

Luckily there are many options for startup entrepreneurs who need help building their businesses.

One option is to bring on a technical co-founder , and another is to join an incubator or a startup accelerator.

Another route which is becoming increasingly popular is to work with a startup studio.

This guide will take an in-depth look at startup studios and cover the following topics:

🚀 What exactly is a startup studio?

🚀 How do startup studios work?

🚀 Types of startup studios.

🚀 Who are the top startup studios?

🚀 When should you work with a startup studio?

Read on to find out everything you need to know about startup studios in 2023.

How Do Startup Studios Work?

A startup studio creates a pool of resources and uses them to aid the success of all of the businesses it is working on or with.

Some startup studios generate the majority of their business ideas internally, but most will also partner with other businesses and apply their resources to help make them a success.

Startup studios usually provide investment to a business they decide to work with, either as financial investment or sweat equity.

But they also employ people with a diverse set of skills, all of them relevant to building startups.

Startup studios will typically have experienced teams who can take care of all relevant aspects of building a business, including its day-to-day operations, product development, management, marketing, design, and sales.

This differentiates them from venture capital firms in that startup studios don’t just provide capital, but also function as co-founders who apply their resources and expertise to help build the business.

This means that entrepreneurs partnering with startup studios benefit from working with expert teams to build their businesses.

It also means that founders who have startup ideas or very early-stage startups can partner with startup studios, which is not usually the case with venture capital firms.

One of the first examples of a startup studio is Idealab , which was founded by Bill Gross in 1996.

It is a great example of how effective the startup studio model is.

According to Sunny Shuoyang Zhang, in her article celebrating Idealab’s 25th birthday :

Idealab’s company success rate is 70%, 35% of successful companies IPO’d or were acquired, and 5% of companies became unicorns. In contrast, VC-backed companies had a success rate of 33%, with 28% exits, and 1% unicorns.

Types of Startup Studios

According to Wikipedia’s article on startup studios , there are two types of startup studios.

Builder Studios

Builder studios generate ideas internally and build them into successful businesses.

Venture Studios

A venture studio partners with external founders and early-stage startups and helps them grow their businesses by providing investment and expertise.

Who Are the Top Startup Studios?

Since our focus is to help startup founders, we will only be giving examples of the “venture studio” startup studio type.

Here is a list of five top startup studios you can partner with in 2023.

Idealab Studio

Although the original Idealab is a builder studio, i.e. they only work on ideas generated internally by their team, Bill Gross founded Idealab Studio as a venture studio in 2008.

They are both based in Pasadena, California.

Idealab Studio is supported by the team at Idealab and can draw on the knowledge acquired by them over the last 25 years, during which they have “created over 150 companies with more than 45 IPOs and acquisitions.”

Their areas of focus include:

• AI & Robotics
• Consumer/Commerce
• Clean Energy/Environment

Some of the notable companies they have partnered with and invested in include:

Idealab Studio identifies startups they want to partner with from their side, so they do not accept business plan submissions, but you can get in touch with them via their website.

Hexa takes the portfolio concept of a startup studio one step further, by combining three startup studios into a portfolio company of startup studios. Or, as the founders prefer to call it, a startup ecosystem.

Their story starts in 2011, when Thibaud Elziere and Quentin Nickmans co-founded the startup studio eFounders.

According to Hexa’s Medium article, Introducing Hexa , the concept of eFounders was “based on the premise that building companies in teams achieve better outcomes.”

eFounders was incredibly successful, and “launched over 30 companies, including three unicorns, in partnership with over 80 incredible founders who now work with a total of 2,800 people all across the world.”

However, eFounders was focused specifically on companies within the SaaS vertical. Following the success of the eFounders startup studio, the two founders decided to create two more startup studios, each focused on a different vertical.

This is how LogicFounders, focused on fintech , and 3founders, focused on web3 applications , were born.

At the end of November 2022, they announced that they were combining all three studios into Hexa, based in Paris.

Hexa’s areas of focus include:

• Agriculture

eFounders focuses on product-led SaaS. Some of the notable companies that they have partnered with include:

LogicFounders

LogicFounders focuses on fintech applications and has partnered with the following companies:

3founders focuses on web3 applications and has partnered with the following companies:

Hexa operates slightly differently than other startup studios. They generate their own ideas, which they then pitch to founders who have gone through their assessment process to identify whether they want to work with them.

If you think you have what it takes to work with them on developing an idea into a successful startup, you can apply to be a founder here.

MOHARA is a startup studio and digital product development agency that was founded in 2015 by Richard Sams and Ben Blomerley .

Richard Sams explains:

Our innovative sweat equity model makes MOHARA unique as a startup studio. We take an equity stake in exchange for providing our skills and expertise, meaning that we are invested in our partners’ success.

We provide our expertise at cost, meaning you access some of the world’s best startup creators for a fraction of the price you’d pay anywhere else.

And we only make a return if your startup works.

We have over ten years of experience developing software solutions, and a team of more than 75 product managers and engineers who have built thousands of products.

We can function as your tech co-founder and handle all responsibility for developing a winning product, from ideation to execution.

We have collectively functioned as the tech co-founder for more than 20 startup ventures.

So whether you’re an early-stage startup or a scale-up, we can provide the perfect place to build products that translate into results.

We are based in London but have offices in Cape Town, Bangkok, and Guadalajara.

If you are a pioneering founder with a great startup idea or an early-stage startup, get in touch with us to become a partner.

Builders is a startup studio that was founded by Michael van Lier in 2015.

According to their website, they are “a startup studio that empowers entrepreneurs to build impactful software companies at scale within Europe by combining our experience in early-stage validation, operational excellence, and pre-seed funding.”

The way that they work is by conducting market research to identify trends within their target markets. They then look for opportunities they think will be impactful within these trends and partner with experienced entrepreneurs to co-found startup businesses around those opportunities.

They are based in Rotterdam, the Netherlands.

Some of the key areas they have identified that they think currently offer opportunities are:

• Tenant Commerce
• Streamlined Communication
• Access and Visitor Management
• Tenant Engagement
• ESG Monitoring Software

Some of the notable businesses they have partnered with are:

• Influentials

Similar to Hexa, Builders generate their ideas and then work with co-founders who have gone through their approval process.

If you want to co-found a startup with them, you can apply to build with them .

Expa was launched in 2013 by Uber co-founder Garrett Camp to “support the next generation of founders.”

According to their website, “Expa Studio combines design expertise, operational support, and capital to turn bold ideas into category-defining companies. As a founding partner, we work with visionary founders by providing hands-on guidance with branding and positioning, product design and development, and fundraising for future rounds.”

Expa is both a startup studio and an early-stage startup investor.

They generate and develop their own ideas and partner with founders to develop their startup ideas through Expa Studio .

They also invest in early-stage startups through Expa Ventures and provide those startups with other resources, such as advice and access to networks.

They have offices in San Francisco, New York, Los Angeles, and London.

Expa doesn’t have any specific areas of focus and will work with startups in any sector.

Some of the businesses they have helped to launch are:

Expa only works with a select few companies at a time but they are always open to receiving submissions, so if you think you have a disruptive business idea you can submit it to them via email.

When Should You Partner with a Startup Studio?

As we have seen, the benefits of partnering with a startup studio are myriad.

Startup studios can provide startup founders with combined resources and knowledge that would be difficult for them to obtain on their own.

They can help with product development, strategic advice, access to investors and funding, and assistance with business processes like sales and marketing.

This means that any early-stage startup or a founder with innovative ideas can benefit from working with a startup studio.

Get in touch to discuss your startup with MOHARA.

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The Venture Studio Business Model Explained

The world needs bold solutions to solve the persistent challenges impacting today’s society. This means that organizations and entrepreneurs need to adopt new ways of thinking about innovation and opportunity. While necessity may be the mother of invention, building a company, or even developing a new product for that matter, is no easy task. From assembling the right team to securing funding, there's a lot that can go wrong, especially for first-time founders.  An estimated 90% of startups fail, which begs the question: where are they falling short and what can be done to improve their chances of success?  While accelerators and incubators play an important role in the venture ecosystem, they're not always the right solution for every business challenge. Since the mid-1990s, a novel venture-building model has emerged with agility embedded in its framework, offering aspiring entrepreneurs more integral support. This business model — the venture studio — is taking a hold of the startup world with a proven track record to support its success. Over the last 7 years, the venture studio market has seen an incredible 625% growth .

What is a Venture Studio?

For those unfamiliar with the venture studio framework, it’s a new model for entrepreneurship, combining company building with venture funding. By design, venture studios play the role of matchmaker, linking business ideas to their talented counterparts to execute those ideas. Venture studios help entrepreneurs grapple with the unknowns of building a new company by providing them with an initial capital amount and operational support. A venture studio’s main goal is to found as many successful startups as possible — all from the ground up.

The Evolution of Venture Studios

Venture studios have been around for some time and the business model has come a long way since its inception, which can be traced all the way back to Bill Gross ​, who founded Idealab in 1996.

• First Wave  Idealab’s initial concept was further developed with the advent of the first wave of venture studios in the early 2000s. Studios realized that it would be more beneficial to provide funding to their own startups, rather than having to attract and raise external capital.
• Second Wave From 2009 onwards, the second wave of venture studios brought on a new digital edge to the entrepreneurial support ecosystem, offering additional services with the rise of web hosting, APIs, and social media marketing.
• Third Wave In 2013, the third wave started to make a breakthrough with its lean startup methodology, prioritizing on-demand mobile services and data as valuable assets. 
• Fourth Wave and Beyond In 2015, the fourth wave of venture studios emerged focusing on a long-term vision that leverages disruptive technology to create even more resilient, sustainable, and value-generating startups.

Benchmarking Growth and Success

By streamlining the company-building process, venture studios are providing founders with a wide range of services to fast-track the development of new companies. According to Global Startup Studio Network , startups that launch from studios experience 30% higher company success rates. Almost every company launched from a venture studio raises a seed round, and 72% of those that raise a seed round go on to raise Series A financing. When it comes to the type of companies venture studios are launching, there is a split of 61% of startups offering B2B solutions, with the other 39% offering B2C solutions. Many venture studios aim for quick wins by positioning their portfolio companies as ideal acquisition targets so that once they secure that money, they can build even more startups. However, other studios target the long run by aiming to build the next potential unicorn that could acquire the majority of the market.  The average studio has created 18 companies to date, with 3.8 being the average number of companies created annually by each studio. Around 47% of venture studios classify themselves as ‘vertical agnostic’, meaning that they do not have a niche focus on a particular industry. However, venture studios commonly focus on building technology-centric companies in the area of financial services, industrial manufacturing, logistics, and more.  Technology-driven startups that investigate AI, IoT, and DLT use cases will continue to gain interest as digital technologies mature with 11% of entrepreneurs already actively participating in the gig economy.

Global Venture Studios Ecosystem Impact

The location of a startup is one of the most important factors contributing to its success. There comes a point in the timeline of a startup where success or failure is determined by the amount of money injected into the company. Among the world’s most dynamic markets — Asia, Europe, and the US —significant differences in capital accessibility directly impact the initial success and future longevity of new companies. European startups are still experiencing a lack of access to large funding rounds because venture capital funds are leaner in Europe. Silicon Valley remains home to many risk-taking investors whereas European ecosystems that have strong seed funding opportunities lack high funding investors. Remarkably though, 38% of all global seed capital is invested in Europe, however, European venture capital investors are less involved in larger rounds, which highlights the shortage of growth capital in Europe. In contrast, the venture studio model is opening up new opportunities and lowering barriers to entry for European founders. This model is proving to be an interesting choice for many aspiring European founders because venture studios focus on capital injections for both the initial launch of a new venture and its subsequent growth trajectory. Venture studios also offer greater diversity in terms of international talent which proves highly beneficial when trying to saturate Europe’s fragmented market. In the coming years, much bigger tech companies will be built, requiring more funding and methods to rapidly scale. There is a general trend toward startups leaving the Silicon Valley ‘bubble’ but the US still maintains its leader of the pack status. While overall investment into US and Asian startups still surpasses that of Europe, the gap is getting smaller. In 2019, $34 billion was pumped into European startups which is 40% more than the previous year. While Europe generates 36% of all formally funded startups , it creates only 14% of the world’s unicorns. Adjusted for population and GDP, the number of seed-stage startups that Europe generates is only 40% of that generated by the US. In October 2020, the European tech ecosystem ballooned to €618 billion in combined value. If this upward trend continues, it seems Europe is simultaneously closing in on the heels of Asia, while also positioning itself in becoming the most entrepreneurial continent. Startup Studio Map by Enhance Ventures

Venture Ecosystem: A Business Model Comparison

Within the startup ecosystem, there are some important differences between the venture studio model and other types of business frameworks. While the mission of each model may be the same —  to help all startups succeed — the core differences are defined by each one’s company-building process and scope of support.

Challenges that arise from incubator and accelerator models can be better tackled via a venture studio approach. Specific solutions are tailored to specific problems as opposed to developing solutions in isolation and later attempting to apply them. Previously the venture studio model has been described as a hybrid mix of an incubator and VC, however, due to its own merits, it has become a completely standalone model. Venture studios are considered to have more ‘skin in the game’ than other business models since they play an active role in founder recruiting, mentorship, fundraising, and more. These studios lower barriers to entry for new founders by offering financial support and higher levels of operational involvement. The venture studio model can be further broken down into three subclasses: 1) In-house venture building; 2) Working for investors and; 3) Working for corporations.

The companies that are developed within the venture studio business model have a unique composition, combining a trilogy of global talent, novel technology, and domain expertise. When it comes to the source of the ideas flow, venture studios can be further classified by the origin of the idea.

Internal Idea Sourcing  Ideas are generated, vetted, and accelerated from inside the organization itself. Internally, these ideas are validated and capital has raised all in-house. Once the new idea has proven its product-market fit, the studio then spins it off into a separate portfolio company. The venture studio will then look for additional co-founders, and other team members to scale and grow its newly validated business case. External Idea Sourcing While most venture studios generate all their ideas internally, some studios will acquire and invest in external ideas or companies, as a part of their portfolio. Venture studios will host open calls to scout for new ideas and partner up with driven entrepreneurs looking to build on their own ideas but lack the resources to do so. Hybrid Idea Sourcing In some cases, venture studios take on a hybrid approach. This means that the venture studio will source new ideas from both internal and external networks, combining the best ideas of both worlds. Venture studios provide new founders with an impressive amount of capital. The average studio injects an initial amount of $232,458 into each startup that they develop. In return for this support, venture studios generally take a 34% equity stake in the startups they co-found, with the highest equity percentages at around 80%, and the lowest equity percentages hovering at around 15%. However, this number can change depending on the type of support the studio provides and the experience level of the incoming co-founder, or CEO. Venture studios continue to prove their success, with 84% of studio startups going on to raise a seed round. On average, studio startups go from day zero to seed round in 10.7 months, and seed round to series A in 14.5 months. Of those startups that make it to the seed round, 72% of those ventures make it to Series A. Compare this figure with traditional startups where only 42% of ventures that get to seed make it to Series A.  Between 2010 and 2018, over 12700 startups worldwide were acquired by US companies. In 2018 alone, over 4200 startup exits occurred with the value of startup exit deals amounting to $219 billion worldwide. The industry average for a traditional investment to exit is about 6.6 years, while startups created in studios showed that the average age of a company at exit was 3.85 years.

Startup as a Service: The Venture Building Process

The life of a founder is a constant tug-of-war between success and failure, with around 40% of entrepreneurs stating that they started their businesses to make a difference in the world.  Venture studios focus on developing companies and products that aim to solve industry-specific challenges in a way that is value-generating and accessible. Through a series of sprint cycles, rapid iterations, product-market fit, and manufacturing viability, venture studios do a thorough validation of each business idea to assess its impact and potential, before scaling it up to success. While each venture studio’s process might differ, each follows a similar path of development:

Venture studios build startups parallelly by generating fresh ideas and assigning teams to the ideas that have market potential. Once these ideas have been tested and validated, they are then supported with resources (capital, services, etc.) in order to build an MVP. If feasibility is proven to be successful after this point, the studio focuses on scaling the new venture and then aims to exit. This business model loop is repeated over and over again, each time bringing on a new venture. In the case of an idea failing, it is assumed that resources will be reassigned or the business case will be dropped entirely. Stage 1: Investigate This process involves sourcing ideas, investigating whether it has merit, and evolving it step-by-step into a concrete business case. This stage is focused on defining the value proposition of the business case. By the end of this stage, the entrepreneur should have a clear outline of how to convince potential customers why the service/product is more valuable than what is already available on the market. Objectives

• Clear value proposition
• Competitor analysis
• Define idea hypotheses and assumptions

Stage 2: Validate After the value proposition and early adopter segments have been defined, it’s time to put ideas to the test. This stage is focused on mapping out early product specs (PoC) which will need to be tested and validated with supporting evidence to indicate the viability of the business idea. Objectives

• Customer discovery
• User stories
• Detail PoC features and cost estimates

Stage 3: Create The first product (MVP) is created to satisfy all the necessary properties researched and outlined in previous stages, serving as the “real-life proof” of the more abstract stages leading up to it. MVPs serve as a test for partners and customers to understand its actual usage and to strengthen the market fit. Objectives

• Develop MVP and iterate based on learnings
• Plan out the product roadmap
• Update the business plan

Stage 4: Portfolio On the successful completion of all previous stages, the business case is founded. The company is added to the existing portfolio and venture developers are assigned to the business case to develop the growth strategy of the new venture. Objectives

• Venture is founded
• Added to portfolio

Stage 5: Scale During this stage, the venture is focused on scale-up efforts, exploring new market opportunities, building management systems and middle management layers, and developing new products. This is the final stage before a successful exit, which is usually an acquisition, or sometimes an IPO.

R&D Capacity in Venture Studios

R&D processes can go beyond technology, focusing on key partnerships, cost structures, additional revenue streams, resource allocation, additional product lines, and market segments. The venture studio model incorporates basic elements of R&D at its early stages such as exploring technical and business opportunities, as well as evaluating venture feasibility. In most cases, traditional R&D processes take a long time which is in contrast with a venture studio’s core ethos of rapid development and growth. Traditional R&D processes are also not easily replicable, scalable, and resource-intensive. In some cases, venture studios may avoid taking projects that require intense R&D input. Then there is open innovation which uses both inflows and outflows of knowledge. Corporate partners with venture studios that have built a new, agile R&D model to rapidly validate ideas that these larger organizations would have otherwise spent immense amounts of time and capital researching. The core belief of this ideology is based on accessing distributed knowledge, which is becoming an increasingly popular choice as many market players are beginning to realize that they can’t rely solely on their internal R&D capabilities. This type of partnership — between venture studios and corporations — can reduce the cost of R&D and improves the company’s innovation potential.

The Future Venture Studio Model

Venture studios already have pioneer status in the entrepreneur world. Therefore, there is little doubt that this business framework will continue to evolve in the future. While it’s impossible to predict what changes may take place, we can make calculated assumptions based on what is already known today. In the future, the venture studio model will work like a well-oiled machine with smoother development processes and fewer failures or ‘dropped’ projects. With a streamlined company-building process, fewer resources will be required at each stage of project development, meaning that resources that were once tied up can now be focused on bringing on more ideas into the pipeline. However, greater focus will need to be placed on product/market fit and defining venture value propositions as competition rises for both venture studios and their portfolio companies.

Benefits of Venture Studios

The core value proposition of venture studios is that they reduce the time it takes to build out startups, significantly reducing the risk profile of entrepreneurs, while simultaneously attracting more talent to ideate and innovate new business cases. Unlike startup accelerators and incubators, who mainly provide funding and mentorship, venture studios act as both a builder and a co-founder. Venture studios are renowned for having a wealth of human capital, consisting of venture developers, in-residence entrepreneurs, C-level personnel, and in-house support staff. Generally, venture studios offer a variety of diverse in-house support and outsourced resources that include:

While founders focus on building a product, the studio supports them in other ways. Day-to-day operations are taken care of by the studio’s experienced operators: marketers, designers, finance experts, recruiters, and more. Startups co-founded by venture studios scale faster and provide better returns to investors. On average, these startups have a 53% internal rate of return (IRR) . Compare that to the average for non-studio startups, which sits at 21%.

Corporate Partnerships with Venture Studios

As a company-building machine, venture studios effectively combine the disruptiveness of a startup with the necessary stability of an experienced team. This makes studios an attractive choice for corporations who are looking to develop strategic partnerships with innovation pioneers. As a new model for entrepreneurship, venture studios are agile, have greater access to founder talent, and help corporates explore research and development (R&D) areas at a fraction of the time and cost. Venture studios are better–placed to harness technology to recalibrate a corporate’s existing business model or invent new ones altogether. Around 95% of large organizations with a structural innovation program invest in tech incubators, 90% of such organizations work with small niche vendors or startups directly, and 84% use the acquisition of startups or small vendors to advance innovation. Venture studios act as a kind of outsourced innovation laboratory with a diverse market perspective. Especially in economically uncertain times, the priorities of organizations generally shift closer to short-term business success in part to ensure survival. Partnering with a venture studio enables organizations to spot opportunities that they otherwise would have missed. This allows an ecosystem to flourish where partners and startups co-develop solutions and benefit from a win-win situation. Organizations that see venture studio partnerships as more than a public relations opportunity will develop unique experiences and efficiencies that give them a competitive edge. Corporations that use co-innovation to improve business operations as part of the organizational culture will significantly benefit.

Future Founders: Beyond the 90%

The number one reason why businesses fail is due to the fact that there’s no market need. Venture studios challenge the premise that failure is the default by substantially increasing the odds of startup success. With more venture studios emerging, ecosystem competition is rising in terms of how these organizations source ideas, attract talent, differentiate themselves, and expand their global network. Currently, there are 582 million entrepreneurs in the world which make the venture ecosystem ripe for venture studios searching for fundable founders. As the venture studio model matures, even more innovative ways of building, growing, and investing in compelling new startups will emerge. By offering aspiring founders the full scope of development toolkits, mentorship, funding, and the innovation quality stamp, venture studios are on an upward trajectory in empowering a more prosperous, sustainable, and democratized world.

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What Is A Startup Studio? [With Examples]

If you can’t seem to fuel your startup’s success, why not join a startup studio?

Approaching a startup studio is a viable solution because these places will take you under their wing and help you get out there. 

Besides, not to rain on your parade or anything, but you should know that 9 out of 10 startups fail . 

Yes, some failures are because of terrible startup ideas and value propositions. But, most startups fail because of poor execution — a lack of resources, an absence of market demand, an overwhelming amount of competition, and more. 

Want an alternate and promising fate for your startup? Then, take this advice: ask for help from startup studios.

Fortunately, this article will help you. Here, we’ll discuss everything you need about a startup studio. 

We’ll even throw in a bunch of startup studio examples. This way, you can have a clear sense of what it is.

What is a startup studio?

A startup studio is an organization that helps launch startups using its pooled money and other resources. An intriguing way to look at it is to consider it a startup that creates startups — where brilliant ideas “hang out.” 

Because of this, many people are fond of its startup building concept and would refer to it using alternative names like startup factory, startup foundry, and venture studio.

Here are the features of typical startup studios :

• The goal is to develop a disruptive business idea or join forces with innovative minds and entrepreneurs.
• It’s where startups can engage with the vast majority of experienced founders and co-founders, investors, and market experts.
• It’s also where the members of startups meet fellow startup members to talk about ideas.

Startup studios vs. startup incubators vs. startup accelerators

Start-up incubators.

Startup incubators are cohort-based entities that cater to less-developed or very early-stage startups. They also welcome anyone new (with a futuristic potential) to the startup world. 

They may be small business entrepreneurs who, despite not having a dedicated team, have an unwavering will to succeed. 

Typical startup incubators create local connections, offer mentoring programs, and provide co-working spaces.

They also help new startups with team building, business ideation opportunities, and startup building.

An example is the University of Toronto’s (UoT) Entrepreneurship Hatchery . It stays true to its motto: “We Create Startups and Entrepreneurial Human Capital.” And it fosters the entrepreneurial spirit of UoT students. 

The Hatchery is the funding incubator behind innovative teams like

• Indus (the inventor of 3D-printed soil)
• Toothpod (the developer of chewing gum for cleaner teeth)
• Themis (the group that uses AI to produce contracts for lawyers)

Startup accelerators

Startup accelerators are also cohort-based entities or programs. Their defining feature is that they assist well-developed startups with brilliant internal ideas. 

Often, they team up with experienced entrepreneurs, wealthy investors, large enterprises, venture capitalists, and venture capital firms.

The idea is to help scale the startup model and accelerate its growth in a short period (like three months).

An example is Y Combinator , an American tech startup accelerator specializing in batch funding. It’s the startup accelerator behind well-known startups like

• Airbnb (an operator of an online marketplace for tourist activities and other means of lodging)
• Reddit (a social news aggregator, discussion website, and content rater)
• Twitch (a live streaming service)

Startup studios

Like startup incubators and startup accelerators, startup studios develop human capital. They build startups and assist them in creating successful businesses.

What makes startup studios stand out is that it welcomes startups of all levels and budding entrepreneurs with market-tested disruptive ideas. Whether a startup is underdeveloped or is at a close point to launching, startup studios provide help.

Below is a table containing an overview of their differences.

Startup studio business model and how it works

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The business model of startup studios revolves around providing help with strategic planning and technical savviness — two critical aspects of a successful business . As a result, they have a pivotal role in the positive transformation of startups.

They can help any budding startup aim high because they follow a step-by-step process. And by following this systematic process, they can think long-term and devise a blueprint or roadmap to a startup’s success.

Below are its business processes.

At an initial stage, startup studios assist startups in making a business case out of ideas. And to help generate ideas for business use cases, they undergo brainstorming sessions.

Here are some brainstorming techniques:

• Rolestorming – Assume the role of someone with a brilliant mind and think like them. Then, come up with the most extravagant ideas if you can.
• Associative brainstorming – Focus on a single startup idea. Then, write down every association. The objective is to trigger your mind and inspire it to work more effectively.
• Freestorming – Find a peaceful area where you can entertain every idea in your mind. It doesn’t matter if these ideas are on the brink of insanity — write them down.

When ideas are on the table, startup studios proceed with validation—focusing on feasibility and scalability. If an idea passes validation, startup studios will move it past the idea stage and forward it to the next stage.

The typical validation process involves the following:

• Conducting market research – Listening to the public and understanding pain points allows a startup to provide a good product or improve its current offering. Market research is also how they learn about influential and trending issues, overserved or underserved needs, and more.
• Running pre-designed tests – Building prototypes is a practical approach. Forward these to an audience and note their responses to see if these prototypes are viable.
• Create the first product specifications – Welcoming feedback and detailed discussions will help. Prepare to revise specifications, if necessary.
• Identifying unsuitable ideas – Exploring weak or problematic areas is a way of guaranteeing an environment of futile-free ideas. The focus should be on clarity, usability, and scalability.
• Gathering supporting evidence – Examining an opposing idea can help determine a better position. Write down the reasons that detail how the said position is better. Then, prioritize the more descriptive ones.

It’s where startup studios convert the validated ideas of startups into working businesses. They create an MVP or Minimum Viable Product to make this happen. 

They also create an MVP for partners and customers to achieve two goals:

• Explain the usage of the idea – Startup studios elaborate on how to use the product in line with the business idea. Also, they provide in-depth discussions, point out strengths and weaknesses, and include the best use cases.
• Strengthen the product-market fit – After learning about the market demand, startup studios help startups build products based on this demand and design a better alternative than those from competitors.

At this point, startup studios establish a business case. Then, the studio team adds a startup to their portfolio companies—gearing them up with an excellent support team.

Here, the main event is how a startup studio takes a step back. It may recognize its vital role in launching startups and building companies. But, it also knows that for a startup to succeed, this startup needs to work with autonomy and find its own identity.

Here are ways startups work better if given autonomy:

• Prove dependability – Assigning higher roles allows them to take proactive approaches and be dependable. It’s also an opportunity for them to shine — show initiative and undertake more responsibilities.
• Enhance radical thinking – Privileging them with the freedom to work using their techniques ignites creative thinking skills. It also reduces stressful methods and increases self-confidence and motivation. 
• Shape professional goals – Encouraging them to work on their own — as long as they adhere to regulations — helps them carve a successful path toward their goals. For example, they can also develop organizations built on trust and inclusion. It is the case if a startup studio exposes them to an atmosphere of trust and inclusion.

At this concluding stage, startup studios create layered management systems. Then, they prioritize scale-up efforts. If they successfully help startups in this, they can wrap up. Ideally, startups will prepare to go public or for an acquisition .

Here are ways how startup studios can help in the scale-up stage:

• Provide networking opportunities – Introduce startups to the startup world. They can also put them in front of a network of investors, venture capitalists, or anyone searching for the next big idea.
• Create marketing campaigns – Emphasize that marketing is a growth hack. With strategic marketing campaigns and a fine-tuned business plan , startups can scale rapidly or at their pace of choice.
• Streamline repetitive processes – Offer guidance and point to less critical tasks. Startups can automate and outsource some affairs — optimizing their operations.

Startup studio examples in 2022

Symalite labs.

Symalite Labs is a bootstrapped startup studio and micro-private equity company. Its mission is to play a role—experiment, build, and scale—a hundred market-leading companies in 10 years.

So far, it has helped lots of startups. Examples are GroupLeads (a company that creates group funnels) and ChatSilo (a service provider of Facebook Messenger CRM and productivity).

Unique features:

• Focus is on the subscription companies in B2B SaaS, artificial intelligence, Chrome extensions, and productized services
• $12 million+ transactions, 15,000+ total users, and 14 software programs
• Leverages design and focuses on turning ideas into usable products for end users
• Provides resources in the areas of product design, marketing, engineering, and operations

Pioneer Square Labs

Pioneer Square Labs is a renowned startup studio and venture capital company. Since it launched in 2015 in Seattle, Washington, it has been developing one disruptive business idea after another. 

It follows the 1st Co-Founder Startup Studio Model . Like any studio using this model, it gives importance to partnerships. It’s also active in taking and receiving pitches from entrepreneurs with genius-level ideas but zero resources.

A sea of entrepreneurs and startups benefit from its funding. Two are Panda AI (a team that developed a B2B artificial intelligence tool) and Shipium (founders of a modern shipping platform for retail and e-commerce).

• Investors are highly invested partners who want to be involved at every stage and in every venture
• 50/50 equity split with partners
• The entrepreneur with the original idea may remain as CEO or COO

Hangar focuses on the public sector and offers an efficient network of public professionals and top-notch resources to public startups. Its goal is to create a positive impact on people’s lives. And identifying areas where technology can help is how it plans to achieve it.

It’s a 2nd Co-Founder Startup Studio Model . It caters to startups who may (almost) have everything going for them—an idea and MVP. But, because these startups need specific resources and expertise, it enters the scene.

Familiar with Cornea? It’s a laudable group that provides life-saving resources and real-time information to first responders. You should know it’s one of the startups that this startup studio launched. 

Other startups it helped are Roster (a for-profit company that provides automated expense software to small and mid-sized businesses) and Camber Systems (a tech company specializing in commercial data analytics).

• The equity split favors the startup; for example, 75% of the equity goes to the founding team and 25% to the startup studios
• Provides what startup founders need the most (tech support, operational help, and connections)
• Accommodates startups that operate in Stealth mode

Beeso is a startup studio and venture builder based in Omaha, Nebraska. It works on large enterprise projects and tech startups — wearing its experience up its sleeves.

It follows the 3rd Co-Founder Startup Studio Model. It’s the ideal solution for entrepreneurs who have brilliant ideas.

But while they have brilliant ideas, they need help with everything else — aligning sales and marketing departments, developing viable product models, and streamlining growth objectives.

Most startups that benefited from its assistance are those from Omaha, such as Atlas Lab Safety (laboratory safety and compliance software) and Loophire (a recruiting platform that uses AI and machine learning). And it also extends help to startups based outside its hometown. 

A couple of examples are MusiQcast (a platform for publishing and sharing music videos) and Pluck (an open-video talent resource for the hospitality and restaurant industries) in London.

• Provides lots of assistance and does most of the (initial) heavy lifting
• Requires a larger equity share (typically, 25%) than other startup studio models
• Provides “growth hacking” expertise

Differential

Differential is a corporate startup studio and remote-friendly product agency. Its objective is to prepare startups for their big break and help with their next venture. In addition to helping startups leave their nests with well-developed products, it also focuses on technological advancements and corporate innovations. 

It follows the Builder Outsource Startup Studio Model. From an outsider’s perspective, it appears as a “service for hire” company. But a closer look will tell you a collaboration (between Differential and a startup or established company) is happening. Because it collaborated with a startup, it requires equity .

Lexmark, a manufacturer of innovative technologies and imaging solutions, is a company that partnered with it to unlock growth opportunities. Other examples are Big Ass Fans (a supplier of fans and evaporative coolers), and TaylorMade (a sports equipment manufacturer)  

• Takes over the engineering side of projects and ensures happy board members
• Provides a futuristic business plan and short-term support
• Offers consultations for feature add-ons and product shaping

Final thoughts: should you go for a startup studio?

Being a part of a startup can be rewarding. But it’s risky. You may even reach a point where you think failure is inevitable.

The truth is that it’s not.

While failure is part of having an appetite for tackling risks, many struggling startups can avoid it. And the practical way to avoid failure is to have a reliable support ecosystem. 

If you’re struggling but believe you have a one-in-a-million idea, decide to join a startup studio .

With a startup studio, you can secure funding. You can also target the right goals, build valuable products, and more. Plus, you can gear up with the ability to grow and discern if pivoting is an ideal course of action.

Bring Your Idea Through a Startup Studio

In the world of entrepreneurship and growing new business, success doesn't just happen overnight — there is usually a long process before things start firing on all cylinders. Usually, these professionals work with other experts or other businesses to help them learn the ropes and build something great. 

But with this type of service in high demand over the years, there are now many businesses who solely focus on bringing these entrepreneurs or startup companies to the next level. These companies are trained and experienced on what makes a great company and the steps needed to build a new business from the ground up. These businesses who lend a helping hand are called startup studios.    

What is a Startup Studio?   

A startup studio, which is also sometimes referred to as a startup factory, startup foundry, or a venture studio , is a company that focuses on building success for a business. Especially in the initial development phase, these companies are solely focused on helping these businesses build and reach their goals. This method of business building is sometimes called "parallel entrepreneurship."    

Types of Startup Studio Models    

When it comes to startup studios, these businesses will typically operate with a startup studio model. Depending on the services offered by the company, they will use a certain startup studio business model that will determine the types of clients they work with. Take a look at the different models out there:    

"Builder" Studios    

Builder studios are focused on developing businesses from the early stages of formation. Another aspect of this model is that it typically involves building a business from internal ideas.     

"Investor" Studios    

When learning how to start a venture builder, one approach is to use the investor model. This approach focuses on bringing in early-stage external startups, then providing them with funds and expertise in order to grow. As businesses need the right amount of funding — and usually a lot of it — finding investors to build a business is key.    

"Incubator" Studios    

Incubator studios are also called accelerators, and these work to get startup studio equity as an exchange for providing expertise and funding.    

What’s the Hype Around Startup Studios?   

With the growth in venture studios and many businesses claiming they are very beneficial, why are they so attractive to entrepreneurs?    

Faster Growth   

Given that these startup studios come equipped with industry professionals and those who have been in the shoes of entrepreneurs, you’re able to grow faster and more efficiently.     

Trusted Processes    

While there may be some trial and error when it comes to some aspects of your business, another benefit of using a startup studio is that you're in good hands. These professionals use trusted processes that have worked for similar companies just like yours. So, chances are, they might work for yours too.    

Perfect for Scale    

There is a good chance that the startup studio you’re working with has worked with some companies that made it big. On the other hand, maybe the venture studio has worked with large companies before. Whatever the case may be, venture studios can usually help you build something great — and something big.    

If you want to learn more insights about the different models, then be sure to do a startup studio online search, and be sure to also look up the book titled Startup Studio Playbook.    

Startup Studio Alternatives    

When it comes to building startups, entrepreneurs have more options than just utilizing a venture studio. Take a look at the different options out there, including their pros and cons:    

Startup Studio vs. Incubator   

A startup incubator is a company that helps startups by offering training and providing guidance on the startup process. Incubator businesses are typically focused on the early stages of startup formation, so their services are usually focused on getting over the challenges during the initial formation phase.    

Venture Studio vs Accelerator    

Another option for entrepreneurs is to use a startup accelerator. These are fixed-term, cohort-based programs that involve seed investment, sales, mentorship, connections, and educational components. Another aspect of this method involves a pitch event or demo day that is used to accelerate growth for the startup. Most of these businesses are privately funded, which typically works as an investment fund.    

How to Choose    

Feeling confused about the startup foundry topic? Not sure which one works for your situation? While choosing the right business can be a struggle, it is a vital step in your business journey. When it comes to venture studio vs incubator and venture studio vs accelerator, it really depends on your needs and how far along you are in your journey.    

Do you need a lot of investing? Are you at the very early stages of your formation? Do you have a large team, or is it just you? These are the questions you need to be asking yourself to determine the best approach to take. If you take the accelerator studio approach, then you’ll more than likely have to pitch your idea to investors. If that doesn’t sound like a process that is right for you, then the best approach might be to choose a startup incubator studio.   

Startup Studio Network    

To give you a better understanding of startup studios, we’ll dive into some of the key players in the startup studio world. We’ll talk about some history surrounding the topic and include some key names that have brought venture studios to where they are today.    

Startup Studio History    

To learn about the history of startup studios, we travel back to 1996. During that year, Bill Gross founded the company Idealab. Bill was one of the first people to talk about the ‘incubator industry.’ The focus of the company was to test many different types of ideas at once, then take the most successful ones and turn them into companies. The company was also known for attracting the human and financial capital needed to bring these new companies to the market.    

However, the startup studio trend really didn’t gain traction until 2008. Since then, these startup studios have really grown. Today, there are more than 70 startup studios around the globe and over 20 of them have been built since 2013.    

Major Players   

As startup studios have really grown over recent years, we’ll now talk about some of the more notable companies that exist today:    

Ideo Colab Ventures    

Ideo Colab startup studio is a business who invests in early-stage web startups to give them the support they need to grow. The Ideo startup studio also works with these businesses to co-create with them in order to develop innovative products. To learn more about Ideo Colab ventures, check out the Ideo Colab website, and also research the Ideo blockchain fund and Ideo crypto.    

High Alpha Venture Studio    

High Alpha is a venture studio that is changing the world of entrepreneurship. High Alpha is unique because they focus on company building with venture funding in order to create an efficient process. Since they were founded in 2015, the studio has created 17 new companies.    

Some other notable companies that have made a serious impact include:    

• Human Ventures
• Atomic Startup Studio
• SK Startup Studio
• Entrepreneur First
• Startup Studio Evan Luthra
• Rocket Startup Studio

For more insights and resources for startups, be sure to look into the Global Startup Studio Network.    

Global Startup Studios    

While startup studios have grown in popularity throughout the United States, they are also gaining traction around the globe. Whether you’re looking for a startup studio Orlando or a startup studio in India, these studios are starting to pop up everywhere. Take a look at the following list to see some of the more notable studios all across the globe:    

New York Studios    

If you’re looking for a startup studio NYC solution, then you have many options. Take a look at this list of New York studios:

• Innovation Dept
• Venture Lab
• Interplay Ventures

Midwest Startup Studios    

While New York is a major player when it comes to venture studios, the midwest is also gaining traction for being a hot spot for these companies. In fact, startup studio Chicago and startup studio in Indianapolis are some very common internet searches today. Here are the more notable startup studios located in the midwest:    

• Aspire Ventures
• Differential
• Rev1 Ventures

International Startup Studios    

While the United States has a strong grasp on the number of venture studios on the market, other countries aren’t too far behind. From a startup studio London to startup studios in India, here are some of the venture studios located around the globe:

• Agave Lab Ventures
• Far Ventures
• Ideation Kings

Types of Startup Studios 

A huge reason why many startup companies choose these studios is that they operate in many different industries. Take a look at some of the various industries where utilizing a startup studio is common:   

Healthcare Startup Studio   

With healthcare always being a strong focus in our world, there are many different types of software and technology that is being developed to offer help in this industry. That being said, utilizing a healthcare venture studio is the perfect solution for those working in this field.    

Information Technology Startup Studio    

Since many of these startups are involved with tech and software, information technology is an industry where startup studios can offer great assistance. Technology is constantly changing and new advancements are coming forth, so this industry is especially popular when it comes to venture studios.    

eCommerce Startup Studio    

As eCommerce is another industry that is constantly growing, startup studios are heavily used when building eCommerce startups. These companies develop innovate ideas and ways to stay ahead of the competition; therefore, these startups will frequently seek help from expert startup studios.

High Alpha Venture Studio

The venture studio model is a new model for entrepreneurship, combining company building with venture funding in order to compress time, iterate quickly, and scale faster.

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Startup Studio: The Business Model

Startup Studio, the Workshop Series, is designed for entrepreneurs like CEOs of early-stage ventures, founders, cofounders and CXOs.

How is an idea different from a new venture opportunity? Turn an idea into a viable venture by crafting a business model.

• Identify a strategy for targeting a market segment with a solution that will attract customers, partners, investors, key employees and other resources that will be needed to enter and gain traction in the market and create value for stakeholders
• Value proposition will reflect the entrepreneur’s assumption for how the business model will generate cash flow

There is no single path that entrepreneurs follow as they identify the ideas that may become valuable businesses. Finding ideas is a creative process developed via:

• Personal experiences and expertise
• Network of relationships with others who offer a fresh perspective

To further explore your idea, use the Business Model Canvas as your lens to evaluate the opportunity and serve as your roadmap for venture development. Continue to update the Business Model Canvas as your venture evolves.

Business Model Canvas

• Strategic management and entrepreneurial tool that allows you to describe, design, challenge, invent and pivot your business model  http://www.businessmodelgeneration.com/canvas/bmc

I recommend beginning at value proposition (top, center) and working your way around the canvas in a clockwise direction.

Value Proposition:

• What value do we deliver to the customer?
• Which one of our customer’s problems are we helping to solve?
• What bundles of products and services are we offering to each customer segment?
• Which customer needs are we satisfying?

Customer Relationships:

• What type of relationship does each of our customer segments expect us to establish and maintain with them?
• Segments expect us to establish with them?
• Which ones have we established?
• How are they integrated with the rest of our business model?
• How costly are they?
• Through which channels do our customer segments want to be reached?
• How are we reaching them now?
• How are our channels integrated?
• Which ones work best?
• Which ones are the most cost efficient?
• How are we integrating them with customer routines?

Customer Segments:

• From whom are we creating value?
• Who are our most important customers?

Cost Structure:

• What are the most important costs inherent in our business model?
• Which key resources are most expensive?
• Which key activities are most expensive?

Revenue Streams:

• For what value are our customers really willing to pay?
• How are they currently paying?
• How would they prefer to pay?
• How much does each revenue stream contribute to the overall revenue?

Continue to follow the canvas:  http://www.businessmodelgeneration.com/downloads/business_model_canvas_poster.pdf

Reprinted by permission .

Image credit: CC by FryskLab

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Startup studio has unique approach to build companies

by Paul Gatling  ( [email protected] ) May 8, 2024 12:12 pm 424 views  

Highway Ventures, a startup studio that launches and grows advanced mobility companies , is forming in Northwest Arkansas.

Founding partners Lane Patterson, Dylan Terry and Joe Comizio bring a unique blend of experience in startups, federal research and investing to Highway Ventures. Their innovative business model involves leveraging intellectual property (IP) and technology from federal research labs to build companies.

“Before launching Highway Ventures, our founding team was deeply engaged in IP commercialization at a large federal lab,” Patterson explained. “It was here that we discovered the opportunities it presents. We believe that by tapping into the IP generated by labs and combining it with the opportunities in Northwest Arkansas, we can create a powerful engine for economic growth and job creation.”

In 2024, Terry said there’s an anticipated $200 billion in federal funding for research and development aimed at fostering technological innovation in various U.S. institutions. Yet, there’s a significant lack of funding and attention toward the crucial step of transitioning these innovations from the lab to commercialization in the private sector.

“Today’s reality is that a ‘valley of death’ exists, where technology is running out of funding and dying in the lab,” he said. “Highway Ventures is the bridge over the valley of death.”

Supported by Massachusetts-based nonprofit firm VentureWell and with the backing of the Walton Family Foundation, Highway Ventures hopes to establish 10 to 15 companies in Northwest Arkansas, focusing on creating high-paying technology jobs.

Terry said Highway Ventures will officially launch on May 8 in Bentonville during the Midcontinent Venture Capital Summit. Cortado Ventures, an early-stage VC firm in Oklahoma City, is organizing that event.

More From Forbes

Chatgpt prompts for recurring revenue: pivot to a subscription model.

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ChatGPT prompts for recurring revenue: pivot to a subscription model

Ever dreamt about making money on repeat, without having to constantly pitch or sell? If you’re stuck in a rut of selling one-offs or constantly launching, monthly recurring revenue can seem like a far-off fantasy. But if subscription nirvana is the destination you have in mind, keep on reading. ChatGPT can give you ideas on how to pivot your business model so the default is that you get paid every time.

Use the prompts to explain your business and see what you can conjure up. Copy, paste and edit the square brackets in ChatGPT, and keep the same chat window open so the context carries through.

Prompts for a subscription business: ChatGPT helps you make money on repeat

Identify subscription opportunities.

Every business has potential to adopt a subscription model, you just need to figure out your best bet. Uncover every aspect of what you already do and get a second opinion on what could make the transition into monthly recurring revenue. Don’t go in with pre-conceptions. Be open to every opportunity.

“My business is [describe your business], delivering [describe products or services] to help [describe your ideal customer] achieve [describe the outcome you help them achieve.] With that in mind, create 5 options for subscription-based products or services that they may want to buy, related to my business, that we could pivot to offering to make more revenue and delight our customers. Give each opportunity a name, then explain why it might be attractive to my ideal customers.”

Develop subscription offers

Turning a one-time sale into a recurring deal isn’t just about changing the pricing. It’s about crafting offers that customers can’t resist. What could your offer be? Develop the ideas into tangible outlines, to open up options for what goes on sale. Understand the components of the offer so you know whether it’s viable for your business.

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“I want to develop these ideas [choose your favourite ideas from the last section] into subscription offers. For each one, we need to define the title, the components of the offer (what they get) as well as the price. Acting as a business consultant, ask me questions to collect information, then present each idea as a fully-fledged offer, making sure they will be irresistible to my ideal customer.”

Test subscription concepts

Before going all in, test the waters. Simulate subscription launches, gather feedback, and adjust your approach based on what resonates most with potential subscribers. Understand what they really want, get a grasp on what’s putting them off, and get buying signals before you start the build. This stage is important.

"I'm planning to test [specify which subscription concept you want to test] based on our previous discussions. The idea is to simulate a launch before fully committing, to see how potential subscribers react. Help me create a series of hypothetical customer scenarios and questions that I can use to gauge interest and collect detailed feedback on the subscription offer. Acting as a potential customer, ask questions that uncover what excites my ideal customer about the offer, any concerns they have, and their willingness to subscribe at the proposed price."

Automate subscription processes

Don’t let your new business model bring administrative headaches. Subscription management should be smooth and automated, from billing to customer onboarding. Once you know you’re going ahead, and you have customers ready to buy, set up systems that keep these processes running.

"I want to streamline and automate the subscription management process for my business. This includes everything from billing to customer onboarding and delivery. Outline each process that I need to consider when offering and delivering this subscription. Ask me if I have a process, tool and/or person already in place to look after each one, then populate a table with this information and identify gaps where I need to take action to ensure the process is streamlined and automated where possible."

Understand subscription economics

Do you need ten customers or ten thousand to make this work as you planned? Get the numbers right or get burned. Don’t make your move without understanding the financial underpinnings of a subscription model, to set prices and accurately predict revenue. Now is where the groundwork is laid; everything else is easy.

"I need to get a clear picture of the financials involved in my subscription business. Help me calculate the necessary subscription numbers and pricing to meet my financial goals. Ask me about my cost structure, desired profit margins, and current customer base size. Then, guide me through creating a model that estimates how many subscribers I would need at different price points to achieve profitability. This will help me set realistic prices and targets for my subscription service."

Pivot your business with ChatGPT: prompts for successful subscriptions

Turn one-off products and services into monthly recurring revenue with some ideas, offers and a plan of action. ChatGPT can help you identify opportunities, narrow them down and define your offer, then test with your customers and get them ready to subscribe. When you’re up and running, make delivery pain free and understand the potential for this part of your business to grow. Make recurring revenue a walk in the park with these powerful prompts.

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Home » Home » Unlocking Success: A Comprehensive Guide on How to Start a Beauty Business

Unlocking Success: A Comprehensive Guide on How to Start a Beauty Business

By Space Coast Daily  //  May 15, 2024

Embarking on the journey of starting a beauty business is an exciting endeavor filled with creativity, passion, and entrepreneurial spirit. However, navigating the complexities of the beauty industry requires strategic planning, market knowledge, and access to reliable suppliers.

In this comprehensive guide, we unveil the essential steps and insights on how to start a successful beauty business, including valuable tips on finding suppliers and leveraging Beauty Supply wholesale catalogs for sourcing top-quality products.

Step 1: Define Your Niche and Business Model

Identify your target market, niche specialization (e.g., skincare, haircare, cosmetics), and unique selling propositions (USPs).

Determine your business model, whether it’s a salon, retail store, online shop, or a combination of these.

Step 2: Conduct Market Research and Develop a Business Plan

Research industry trends, competitive landscape, customer preferences, and market demand for beauty products and services.

Create a detailed business plan outlining your objectives, strategies, financial projections, marketing plans, and operational structure.

Step 3: Register Your Business and Obtain Licenses

Register your beauty business with the appropriate authorities, such as obtaining a business license, tax identification number, and any necessary permits or certifications.

Ensure compliance with regulatory requirements related to beauty products, services, and salon operations.

Step 4: Build Your Brand Identity and Online Presence

Develop a compelling brand identity, including a memorable name, logo, branding elements, and brand messaging that resonates with your target audience.

Establish an online presence through a professional website, social media platforms, and digital marketing strategies to reach and engage potential customers.

Step 5: Source Reliable Suppliers and High-Quality Products

Leverage Beauty Supply wholesale catalogs on BeautySourcing to discover reputable suppliers offering a diverse range of high-quality beauty products at competitive wholesale prices.

Consider factors such as product authenticity, quality assurance, pricing, MOQs (Minimum Order Quantities), shipping options, and supplier reliability when selecting suppliers.

Step 6: Create Unique Product Offerings and Services

Curate a unique product lineup tailored to your target market’s preferences, including exclusive offerings, innovative formulations, and trending beauty products.

Offer personalized services, such as consultations, treatments, and beauty experiences, to enhance customer satisfaction and loyalty.

Step 7: Implement Effective Marketing and Sales Strategies

Develop a multi-channel marketing strategy encompassing online advertising, social media marketing, influencer partnerships, email campaigns, and promotions to attract and retain customers.

Implement sales strategies, such as bundling deals, loyalty programs, cross-selling, and upselling, to maximize revenue and customer value.

Step 8: Provide Exceptional Customer Experience and Feedback

Focus on delivering exceptional customer service, personalized recommendations, and seamless shopping experiences to build strong customer relationships and drive repeat business.

Encourage customer feedback, reviews, and testimonials to gain insights, improve offerings, and enhance overall customer satisfaction and loyalty.

Step 9: Monitor Performance, Adapt, and Grow

Continuously monitor key performance indicators (KPIs), sales metrics, customer feedback, market trends, and competitive analysis to assess business performance and make data-driven decisions.

Adapt and evolve your business strategies, product offerings, marketing tactics, and operational processes based on insights and market dynamics to sustain growth and competitiveness.

Conclusion:

Starting a beauty business requires careful planning, strategic execution, and access to reliable suppliers for high-quality products. By following this comprehensive guide and leveraging resources like Beauty Supply wholesale catalogs, you can unlock the pathways to success in the dynamic and vibrant beauty industry. Empower your beauty business journey with insights, innovative products, and trusted suppliers to create a thriving and profitable venture that delights customers and stands out in the competitive market.

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CoreWeave debt deal with investment firms raises $7.5B for AI datacenter startup

Funds to be used for purchasing servers and networking kit.

AI server startup CoreWeave has raised $7.5 billion in a debt deal from private equity companies Blackstone, BlackRock, and others.…

The extra billions CoreWeave now has at its disposal will be used to further the hyperscaler startup's business model, which is renting out AI computing resources to other companies like Microsoft and Open AI. As of November, the AI datacenter company had 22,000 H100 GPUs at its disposal, though that number has likely gone up since then.

We can certainly expect that number to rise further as a direct result of CoreWeave's latest cash injection, which will also be used to purchase the servers that AI GPUs go in, as well as networking equipment. This will likely help CoreWeave achieve its goal of operating 28 datacenters by the end of the year, twice the amount it operates currently.

Two of these datacenters will be located in the UK, the first international expansion for the New Jersey-based firm. The UK datacenters are valued at £1 billion ($1.3 billion).

According to Crunchbase, CoreWeave has raised $4.6 billion in investments, including $1.1 billion funding received earlier this month and a previous deal that granted the company $2.4 billion.

Given that CoreWeave's debt now amounts to $9.9 billion and the company was most recently valued at $19 billion, it seems unlikely that CoreWeave would be able to obtain this loan without securing it with collateral. With its last debt deal, the AI firm used its own GPUs as collateral, although CoreWeave has declined to comment to The Register on whether it's using GPUs as collateral again.

Obviously, using GPUs as collateral is very risky business, because it's the single most important component in CoreWeave's servers. Should the AI datacenter operator fail to make its debt payments, it would probably lose its GPUs, and that would probably make it impossible for CoreWeave to operate.

Still, lots of capital is likely necessary for the AI datacenter startup to achieve its goals. The only other companies that have achieved hyperscaler status include giants like Google, Amazon, and Microsoft, all of which already had the money needed to fund their datacenter ventures.

Though potentially risky, CoreWeave's latest loan could help it grow even further, and if renting AI computing is profitable, then paying off debts might not be so hard, as long as CoreWeave has enough time. ®

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What's the killer AI app for consumers? Google finally has a contender.

• Google showcases potential killer apps for generative AI.
• The company demoed an AI agent that can help you remember where you left your glasses. 
• Google's infrastructure, talent, data, and experience makes it a strong player in developing useful AI tech.

Since ChatGPT burst onto the scene in 2022, there's been no real " killer app " to get consumers embracing AI in massive numbers.

Even ChatGPT may not count: The chatbot's online traffic is still only about 2% of Google 's, according to Similarweb. Other chatbots are doing much worse , leaving investors mostly focused on corporate use cases.

A killer app is an application that is so useful and so easy to use that it convinces everyday people to adopt a whole new technology en masse.

Spreadsheets and word-processing software made many individuals buy personal computers for the first time. The internet, possibly the biggest killer app of all, made us all buy smartphones, tablets, and a host of other connected devices.

So, what will be the killer app for generative AI ? Put another way: My mom has never used ChatGPT, but she Googles stuff all the time. What will get this octogenarian, and everyone else, using genAI as often as they use toothbrushes?

AI killer app contenders

At its IO developer conference on Tuesday, Google showed off some pretty amazing AI killer app contenders.

These were shared mostly under the umbrella of Project Astra, an experimental Google endeavor at the leading edge of AI models and agents.

"To be truly useful, an agent needs to understand and respond to the complex and dynamic world just like people do — and take in and remember what it sees and hears to understand context and take action," Demis Hassabis , CEO of Google DeepMind, said. "It also needs to be proactive, teachable and personal, so users can talk to it naturally and without lag or delay."

Never forget where you left your glasses again

In a video, Google showed an employee holding up a smartphone with the camera on. She walked through DeepMind's office in London pointing the device at various things and asking questions.

The camera at one point showed a speaker and she asked what it was. A Google AI model lurking on the phone (and in the cloud) answered correctly. Then she pointed the smartphone at a colleague's computer screen, which had a bunch of software code on it. The AI model correctly told her what that code was for, just by "looking" at the live video feed from the camera.

After a couple more examples, the DeepMind employee asked if the AI agent remembered where she left her glasses. The Google system replied that she'd left them next to an apple on her desk in the office. She walked over there and, lo and behold, there were her glasses by the apple on her desk. The AI agent "remembered" the glasses in the background of previous frames from the phone's live video feed.

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If Google's AI agent can help regular people never lose their glasses ever again (or their keys or other stuff at home or at work), then I think we have a killer app.

Simple, useful, and quirky things like this can turn wonky technology into products everyone uses. For instance, famed investor Warren Buffett never bought a personal computer, until he wanted to play chess online with Bill Gates.

Returning shoes

Other Google executives discussed similarly compelling, everyday applications for genAI.

CEO Sundar Pichai said the company's AI agents can plan and execute multiple tasks — to the point where the bots will be able to return a pair of shoes you ordered online and don't want.

Calendar entries

Google VP Sissie Hsiao showed off another killer application for this new technology.

In this demo, a smartphone camera was pointed at a school flier with details of several upcoming events. The Google AI agent captured all the dates, times, and other details and automatically loaded them into the user's Google Calendar.

Rental agreements

What if you want to know how a pet might change your apartment rental situation? Do you want to actually read the 12 legal documents you skimmed and signed last year? Of course you don't.

You can now drop all these documents into Google's Gemini Advanced AI model and start asking it questions like "If I get a pet, how does this change my rental situation?"

Google's AI agent will ingest all the documents quickly and answer your questions by referencing specific parts of the agreements.

If generative AI can do annoying, boring tasks like this, a lot of regular people will start using the technology pretty quickly.

"Google was built for this moment"

When done well, these AI agent tasks will seem easy. But Google has been working behind the scenes for at least a decade to get to this point.

This type of technology requires massive computing power, lots of energy, huge data centers, muscular AI chips, lightning fast networking gear, and oodles of information to train the models. Google has all this in spades.

DeepMind's Hassabis gave a little taste of this when discussing Project Astra's ability to respond to questions during live video feeds.

"These agents were built on our Gemini model and other task specific models, and were designed to process information faster by continuously encoding video frames, combining the video and speech input into a timeline of events, and caching this information for efficient recall," he explained.

There are very few other companies with the infrastructure, talent, data, and experience to pull this off. (Maybe OpenAI and Microsoft together?)

"Google was built for this moment," Pichai said.

On February 28, Axel Springer, Business Insider's parent company, joined 31 other media groups and filed a $2.3 billion suit against Google in Dutch court, alleging losses suffered due to the company's advertising practices.

Watch: What is ChatGPT, and should we be afraid of AI chatbots?

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