There is no right way to build a startup- but Startup Studios are on a mission to try. Given that 99% of new ventures fail, this is an intriguing proposition. The success and explosion of Studios around the world surely indicates they’re making progress on this lofty goal.
In this article, we’ll explore the evolution of Startup Studios, the nuances of the model, what resources Studios provide to the startups they build, and how these processes produce startup success in a repeatable way at scale.
The Basics: What Is A Startup Studio?
A Startup Studio, also known as a Venture Studio, is a company that creates new startups. Think of a Studio as an umbrella corporation that holds many startups within its portfolio.
The Studio model involves a team of experienced entrepreneurs, investors, and domain experts who work together to develop ideas, build teams, and launch new companies.
Unlike traditional startup accelerators or incubators, Startup Studios take a more hands-on approach- providing resources, manpower, and support throughout the entire startup development process. This includes everything from ideation and validation to product development and fundraising.
The chart below is a helpful reference for comparison between Startup Studios and accelerators, incubators, and VC models.
The goal of a startup studio is to create a portfolio of successful, sustainable startups that will eventually spin off into independent companies. When these startups exit, through sale or acquisition, the Studio receives funds in proportion to the equity it holds in the startup.
The History Of The Startup Studio Model
Studios have a relatively short but impactful history.
The concept originated in the early 2000s, with the formation of Idealab, founded by Bill Gross in 1996, and eCompanies, co-founded by Sky Dayton and Jake Winebaum in 1999. These companies focused on developing and launching internet-based startups, with…