To set the foundation, startup studios are company creators. A simple way to look at it as startup studios being in the business of building businesses, they are teaching companies how to scale and then scaling how to scale companies. Another side of startup studios is the provision of starting capital for startups as well, studios are also actually investing in startups, providing them with capital which helps them along the way in terms of sustainability. The third side of startup studios is the resources. Studios also provide startups with a team that is ready to support them, giving them the room to scale and grow at a faster rate.
One of the unique features of startup studios is speed. Startup studios have the ability to go to market as quickly as possible, the ability to assemble the right team and the ability to source for capital which then gives founders the room to focus on the operational aspects of the business and ensuring that they validate as fast as possible. Studios are really great at saying “no” be it at the idea level or investors level which helps them move faster. Studios put in place stage-gate processes that help them create a defined structure to follow as an idea is being built and instead of letting things linger, they are really good at setting bookmarks at various stages to ensure there is a check-in place to determine whether or not an idea should move forward or if the right KPIs are being met.
A traditional startup from the day it is created to the day it reaches its seed round takes about 3yrs but because a startup studio has a core team working to validate a particular idea, a startup coming out of a studio takes roughly 10 months. The founders that co-found with studios don’t need to bootstrap everything and because of the human capital studios provide, they don’t need to worry about the administrative tasks that traditional founders are straddled with on top of building a company.
84% of companies created within the GSSN community reach the seed round of funding which is astronomical compared to traditional startups.
From an investor’s perspective, knowing that there are strong entrepreneurial teams behind the companies being built in startup studios and the fact that the average IIR on startups built in studios is roughly 53%, compared to 21% IIR in traditional startups are very attractive to investors.
A quick breakdown of the startup studio model is:
- Working with a studio gives startups the network effect when they co-create.
- Studios give the startup the spotlight
- They ensure they have the capital to support the startups
- The team-building aspect ( focusing on subject matter expertise in the industries that they are trying to build in)
- Industry knowledge (A good studio will have a focus.)
Startup studios address a couple of challenges within the startup ecosystem more effectively which are:
- Setting a foundation for the startup to grow and scale effectively. Studios go in with the foresight that the company is going to be a large corporation someday and they lay the foundation to prepare the team for it which is a very professional way of approaching starting these companies.
- When looking at ideas, it is easy to chase something you get tied to but a startup studio is good at pivoting and moving to where the ball is going to be and ensuring they are addressing the market needs. they are great at taking an objective approach as opposed to an emotional approach to startups.
GSSN’s vision is to generate the best way to build successful startups/ventures, create more jobs & wealth, help strengthen the economy and the startup ecosystem so that the whole society is benefiting and research has shown that startups are the best way to achieve these.