The most underwhelming moment for an entrepreneur in a startup ecosystem is the ribbon-cutting on yet another accelerator. Confetti flies, politicians pose, local media snaps a shot of the logo on the wall, and everyone goes home to wonder why venture capital still doesn’t show up. If you’re not familiar with why your region isn’t flush with VC dollars, start here: Why Venture Capital Avoids Your Startup Ecosystem. The short version? It’s not your climate. It’s not your cost of living. You have tech people. And no, it’s not because of a lack of capital.
Venture capital avoids your ecosystem because your region isn’t producing fundable companies.
Before you roll your eyes, be realistic about what makes a company fundable: startups with experienced teams, with unfair advantages in distribution, go-to-market, or technology; scalable business models with early traction; and a meaningful path to exit. Now ask yourself: what part of a local accelerator is delivering that?
Here’s what we know from working with ecosystems across the country: Accelerators usually fail the fundamental tests of venture capital readiness. The accelerator in town likely has a lot of events, they do have a great many people come through, and they do offer panels and talks. We call this “startup theater” because it looks good and as far as your local leaders are concerned (keeping voters happy), it’s probably sufficient to do that. People in my line of work increasingly scratch our heads and wonder why the founders continue to be there.
VCs avoid regions for a few common reasons:
- No distinctive deal flow: If your accelerator just picks from local applications, you’re drawing from a shallow, often inexperienced pool. Most founders applying are doing it for the free coworking space and mentorship.
- Lack of market-driven focus: Accelerators often run generalist programming. Venture capital, on the other hand, chases market signals. If you aren’t sector-specific, and your startups don’t understand or lead their market, investors don’t care (and shouldn’t).
- Over-indexing on pitch training for appearances: Too many accelerators spend more time on slide decks than supply chains but worse, when you look at what they’re doing, they’re not helping any more than polishing the standard pitch deck template. Most have no idea of the psychology behind how an incubator like Founder Institute orients what a team says, and as a result, Demo Days are literally theater. Real traction happens behind the scenes.
- No capital leverage: Accelerators rarely commit meaningful capital. Without real skin in the game, they can’t attract co-investors who rely on smart, aligned lead capital.
So, what does that mean? That your region’s shiny new accelerator isn’t really an engine of innovation. It’s a signaling program; one that signals, clearly, that you’re not ready for venture capital. You could argue it’s a sparkplug, a bit of a jolt for the engine, but in and of itself, they tend to fall short because they aren’t an engine.
Article Highlights
Invest in Venture Studios: An Actual Business that Builds Startups
Where accelerators recruit startups, Venture Studios invent them. Picture a studio as a startup foundry. It begins with a market problem, not a pitch. Studios validate ideas, hire founding teams, build MVPs, and often pre-sell before launch. They don’t hope a founder walks through the door with a billion-dollar idea, they create the conditions for it.
Unlike an accelerator, a Venture Studio is a business itself.
It holds equity in every company it spins out. It funds early development, shares infrastructure across its portfolio, and earns returns when those companies succeed. Studios typically retain 30% to 70% equity in each venture at formation, acting not like mentors or even investors, but like co-founders.
Funding comes from studio capital, outside investors, or often a dedicated fund. Some partner with corporations; others are funded by previous exits. But all operate on a focused, measured cadence—producing a few high-quality companies each year instead of hoping one out of 100 applicants finds traction.
I was going through some of Morrow’s Global Startup Studio Network work and it would seem venture studios have a success rate of nearly 30% to 60% for their startups reaching scale or exit (compared to 1% for accelerators). That’s not a small improvement. That’s a different game entirely.
Seriously, what the hell are you doing (cities and even investors) not demanding these things are in place?
If you need more academic analysis to support why that works, consider the recent research shared by John-Erik Hassel: Köhler, R., & Baumann, O. (2016) – Organizing a venture factory: company builder incubators and the case of Rocket Internet. Available at SSRN 2700098.
Their analysis of Rocket Internet revealed the not-so-secret behind its startup factory success:
- Centralized Control Beats Distributed Autonomy – Unlike incubators and accelerators, venture studios own the venture. They direct resources, strategy, and execution.
- Modular Teams and Shared Infrastructure – Venture studios deploy internal HR, legal, product, and marketing teams across ventures, increasing speed and efficiency.
- Replication > Reinvention – Startups launch from templates. Novelty takes a back seat to execution precision.
- Venture Ideas Come Last – The system comes first: a platform of talent, tools, and tactics. Ideas are plugged in after the infrastructure is ready.
- Rapid Iteration and Internal Benchmarking – Ideas are benchmarked constantly and cut quickly when underperforming.
This is not a startup incubator (which should be what you ALSO have for entrepreneurs!). It’s a startup assembly line. The most successful venture studios act like manufacturers:
- Process-driven
- Outcome-focused
- Relentlessly efficient
And if you’re building or evaluating a studio, you don’t need to start from scratch. Recently, Matthew Burris compiled an exceptional resource at Venture Studio Forum: a curated, up-to-date library of real-world pitch materials from across the venture studio ecosystem. This deck bundle includes:
- 27 Venture Studio Pitch Decks
- 1 Studio Partner Deck
- 3 EIR Presentations
- 4 VC Fund Memos
- 33 VC Fund Decks
Each resource was sourced through deep Google-fu and updated as of July 31, 2025. Use it to:
? See how top studios are positioning themselves
? Benchmark your deck structure and narrative
? Get insights into how LPs and GPs are presenting their funds
It’s a window into the playbook of the most sophisticated builders and investors in the world. And if that’s not the kind of transparency and benchmarking your region needs, what is?
Why Civic Dollars Belong in Studios, Not Startups
Let’s make this political: If you’re a city, state, or EDC allocating public money to support startups, you have a fiscal responsibility not to light it on fire. Founders will tell you they want capital. But giving tax dollars directly to early-stage startups is a moral hazard. Most will fail. Most should fail. That’s how innovation works.
But investing in a Venture Studio? That’s different. That’s funding an innovation company; a job creator, a commercialization engine, and a measurable, revenue-bearing entity that can (and had better) be held accountable for outcomes.
Here’s why it works for government:
- Studios are sector-specific by design. A region wants to be a leader in agtech, clean energy, or medtech? A studio can specialize. It builds what the market lacks.
- Studios create durable infrastructure. This isn’t about free panel discussions and pitch nights. Studios build reusable systems (HR, marketing, engineering, customer acquisition) that lower the cost and increase the success rate of startups.
- Studios are measurable. You want results? Look at companies formed, jobs created, follow-on capital raised, revenues generated. Studios perform.
- Studios attract private capital. They have a track record, leadership, and equity to offer investors, not just a parade of founders asking for checks.
And this doesn’t mean they’re *not* for entrepreneurs with ideas! What they’re doing is specializing, focusing, and developing in the infrastructure, so you don’t have a fintech founder languishing among everyone else with an idea, you have a fintech founder who might be meaningful to the work the FinTech Venture Studio is doind.
The kicker? Venture Studios don’t even need that much from public partners. A lease on a building. A grant to co-fund prototype development. Access to procurement pipelines. This isn’t a blank check to chase dreams. This is civic infrastructure for innovation, built on a proven business model.
Build What Works to help Entrepreneurs Building What Might
I’m working closely with public sector leaders, private investors, and veteran operators who are all recognizing the same thing: we’ve been investing in the wrong things. If you’re serious about economic development, if you want innovation that creates jobs, revenue, and pride in your community, let’s talk about venture studios.
This isn’t hypothetical. It’s working. And if your region doesn’t get there first, someone else will. Let’s build it.
Thanks STARTUP ECONOMIST and Paul O’Brien! I’m right there with you! Working on an article now on the cashflow focused studio strategy and what it means for regional economic development strategy.
The biggest value of the venture studio model for economic development is that the studio model can be adapted to the region, local needs, local capabilities, and deliver more targeted results while still delivering a return. This allows an evergreen strategy to emerge where economic development can seed engines of economic growth that become self-sustaining and even growing.
Matthew Burris Absolutely spot on. I’m glad you’re pushing this forward.
Too often, economic development is trapped in a binary: subsidize outside companies to relocate, or fund programs that “support” local entrepreneurs with no long-term ownership, equity, or infrastructure. The venture studio model breaks that cycle.
What makes it powerful isn’t just that it creates #startups, it’s that it builds a repeatable economic engine tailored to the region. Studios hire locally, build sector expertise, and reuse infrastructure across ventures. That’s how you go from chasing jobs to manufacturing them.
Looking forward to your article; let’s keep putting pressure where it belongs: on results.
If any civic leaders want to explore what a regional studio could look like in their sector or community, let’s map it out. This is the kind of investment that pays for itself and grows.
Thank you for the shout out Paul O’Brien and for sharing your insight about this topic!
Acceleration is most misunderstood by accelerators, and especially by those who fund them. Great scoop Paul O’Brien
Love the sentiment LOL Most accelerators probably do the opposite
IMO: They accelerate to Demo Day, while everything else hasn’t moved LOL.
Studios are like Nightclubs / music venues. They provide the stage, the lighting, the PA, etc. But it’s up to bands to show up, promote, perform, etc. Startups are A LOT like bands… most would – and should – fail.
Mark Simchock great analogy! Because “studios” aren’t just offering the stage, they’re curating the lineup, tuning the sound, and running the whole production. It’s not just about access. It’s about orchestration.
The flexibility of the model is the best feature of the model for economic development. Adaptation is key. The model can adapt to the local capabilities, local needs, and ground truth realities. Build for cash flow, build for PE or M&A exit, or even build for VC. Each is distinctly different exercises.
Great work and insight Paul!
Paul O’Brien Yeah. That makes bettter sense. Thanks. I’ve just mainly been thinking about startups as bands. That is, they should be creative and seek an audience. They should also in most cases fail.
Imagine applying the studio model but with AI agents integrated for each key role — Product, Ops, Marketing, Finance. The efficiency gains, reduced costs and faster execution cycles could transform the studio into a self-scaling machine!
Whole heartedly agree — seasoned entrepreneurs managing a specific playbook that allows younger entrepreneurs to bring the energy and roll through with fairly aligned equity is a much better long-term platform than accelerators.
Pre-Series A doesn’t have enough momentum for the accelerator model to thrive.
Rufat Karimov because it’s already process-driven and modular, integrating AI agents is not a bolt-on, it’s a natural evolution but the risk is that AI agents could reinforce shallow execution if the underlying processes aren’t strong to begin with.
Studios gain efficiency by codifying excellence, not just speeding up tasks. Much of that excellence is in experience, connections, and creativity that only people have – and AI can never meaningfully have.
So, the question becomes: how do we ensure these agents aren’t just mimicking generic startup advice, but are actually aligned with high-quality decision-making frameworks that evolve over time?
In other words, who trains the trainers? And how do we audit what the machine is learning across ventures?
Graham Gintz the issue is that accelerators depend on momentum that doesn’t yet exist. They assume traction, team cohesion, and market clarity that most early-stage ventures simply don’t have. Or they enroll early-stage ventures because, frankly, they can’t get later applicants and they’re just seeking to make money from founders.
Studios impose structure from day one.
Hence the question I’m pushing: are we not misallocating public and private capital by continuing to fund accelerators when the earliest stages clearly require integration, not coaching??
Well said! Thanks for validating the choices I’ve made
Great idea! Also look toward crowdsourcing vehicles like Legion-M.
Really appreciate this one, I’ve been banging the table for this approach, especially when dealing with lab to market.
Paul O’Brien – Thanks for the insight and the shout-out!
This is a great write up by Paul O’Brien that explains why Project25.ai is a studio vs. an accelerator i.e. we don’t watch 1000’s of pitches and tell people “no” all day. Ideas are sourced through an AI model looking for opportunities, the Project25 team or can even come from a company or university looking to get a software product in market quickly.
Thanks for sharing Joe Berti. And for highlighting the distinction so clearly.
What you’re doing with Project25.ai reinforces the core value of the studio model: it’s not about gatekeeping ideas, it’s about sourcing, validating, and building systematically. Integrating AI to surface opportunities adds another layer of leverage, especially when the goal is speed to market, not just mentorship.
Appreciate the mention and the work you’re doing to evolve the model.
Human stays behind every agent to train. First comes strong process built by humans. AI agents should operate inside a well-defined operational framework that captures the studio’s best practices. Then comes “Human-in-the-loop” — Experienced operators review, refine and adapt AI recommendations, ensuring they stay aligned with strategic objectives and market realities. In other words, AI agents don’t replace the creative and relational edge of a studio – they make it compounding by embedding that excellence across every portfolio company at scale.
Let’s go ……
Love this Paul!!! Along with all the comments it seems like “This is the Way” in my Mandalorian voice!
Hail to all the colleagues who are doing the heavy lifting to develop and grow venture studios – we certainly know it’s not easy!
I agree, most startup programs still chase headlines over outcomes. Venture studios feel more intentional. Especially when tailored to a region’s strengths, they’re able to build real, lasting value.
Paul, brilliant take. I’ve written extensively on this in The Forge of Unicorns and we’ve unpacked it even more on our podcast series.
Would love to have you join us for a deep-dive episode, combining your vision on venture studios with the behavioral, software-centric model we’ve been evolving over the past 25 years. It all started back when I was learning from the Ferrari F1 world… and it’s now powering some of the most ambitious venture builders in Europe. Let’s connect perspectives?
Michele Brissoni I’ll DM you and happy to join you. Just let me know when you’d like to record or if it’s alive event.
Love this Paul. I’m with you!
We need to talk about the Innovation Factory Model, which works like a decentralized Venture Studio.
Problem with Venture Studio’s is their lack of scale, not being able to pivot themselves through their own ‘2nd valley of death’ and their commercial motives, which makes it hard for themselves to have a more public mindset to develop a region.
Just a factory with a Startup Up Port does make a lot more sense, as it helps all founders to find S.UP.PORT and to contribute to each other with knowledge, expertise, network, and resources.
See it as a ‘hyper ecosystem’ instead of a ‘micro ecosystem’ like a Venture Studio.
I wish I could put this post on loop, broadcasting from every rooftop.
I will say that I feel like venture studios are the new buzzword hot on the heels of “ecosystem builder” and “AI expert”. Lots of noise coming down the pike.
For our approach, we’re building an integrated venture infrastructure model focused on citical tech codevelopment with enterprise and a DOD acceptance pathway. Looking at it as a venture studio core with an ecosystem wrapper that creates resource clusters around each focus area. Revenue goes back into the nonprofit to promote reinvestment, workforce development, and entrepreneurial education while creating participatory opportunities for the stakeholders in our ecosystem.
I’ve always wondered why accelerators, economic developers, and academia aren’t jumping on this model when they’re so perfectly setup for it.
Isabelle Kent That last question is the heart of it.
The studio model aligns more naturally with the structure, goals, and assets of civic and academic institutions than accelerators ever did, yet the legacy incentives still reward optics over outcomes.
Demo Days are easier to fund than infrastructure. It’s a systems problem.
Your approach, venture studio at the core, with ecosystem clusters and reinvestment pathways, sounds like exactly the kind of vertically integrated platform we need, especially in deep tech and dual-use innovation. Would love to see more of how you’re designing those DOD pathways and stakeholder participation loops.
And agreed: the buzzword wave is coming. The antidote is operational clarity. Thanks for broadcasting this one.
Completely agree, the venture studio model is the right infrastructure for scalable innovation. But from what I’m seeing in the Middle East, investors aren’t buying in. The model makes sense, the returns are there, but the capital isn’t. We’re building anyway and soon interest will rise I believe.
This is a great case for the business model but I’m not sure it actually demonstrates any advantage policy-wise.
– the comparison between private studios and public accelerators is not like-for-like, given many startups may have formed at accelerators before joining a studio
– your academic source simply argues that they’re a valuable part of the ecosystem – not a preferable alternative to accelerators.
– Any moral hazard in government making private investments is equally applicable to startups and studios
I agree that public funding in accelerators could be better spent elsewhere – but the solution is moving that spend earlier, not later, in the lifecycle. Public money in research and tech translation creates more surface area for all accelerators, incubators, studios and VCs to work with, without handing over public cash to private businesses.
You’re right that studios and accelerators aren’t strictly like-for-like, and that’s actually part of the policy point: we’ve been funding accelerators as if they’re innovation infrastructure, when in reality, they’re closer to curated programming (if that). Studios are infrastructure (operational, repeatable, and measurable) and that distinction matters when allocating public capital.
The moral hazard argument is fair. But the difference is that studios, when structured appropriately, are businesses with a balance sheet, employment footprint, and reinvestment capacity. A public partnership with a studio looks more like an industrial development deal or research commercialization contract than a bet on an individual startup.
On timing, yes, public funding earlier in the lifecycle (research, translation, IP pathways) has a high return. But where those efforts fail is often the missing middle: the step between validation and commercialization – you know this, or heck I know this, the amount of IP sitting, wasting away in universities is disturbing. Studios can fill that role, not as replacements, but as operational bridges between the lab, the community, and the market.
Hey Safiollah Heidari – this makes oodles of sense.
Excellent, excellent article, and I obviously think so due to my own bias that this is the way in my local Australian ecosystem. Though, I haven’t been exempt from being laughed at by the occasional VC when voicing it, but this is not a funding model that we are used to in Aus, but I see it as unbelievably crucial and something which would work particularly well here!
And I owe you a message Paul O’Brien, shall touch base!
(Also, sent a shoutout to Matthew Burris the other day right before he dropped that banger post with the decks and resources. Team are on another level storytelling-wise)
Matthew Burris I went to tag you but you’re the top comment. Your work here is riveting!
Mark Gannott thank you!
Finally a model that gives rise to portfolio effects and a process that is both scalable and repeatable for the creation and development of innovative new businesses.
Paul O’Brien
This is an important post that should be studied by business development teams in municipalities, technology translation teams in universities, and by entrepreneurs struggling to get funding without knowing the process and the prerequisites. Thanks for sharing.
Tom Miller Scottsdale is a bit of home! Let’s connect when I’m back.
Investing in infrastructure for real outcomes is crucial. It’s about creating lasting systems that truly enhance regional growth and stability.
My VS is self-funded, focused on my own IP and novel business models for media and entertainment.
Couldn’t agree more.
Love this quote “Venture Studios invent them. Picture a studio as a startup foundry. It begins with a market problem, not a pitch. Studios validate ideas, hire founding teams, build MVPs, and often pre-sell before launch. They don’t hope a founder walks through the door with a billion-dollar idea, they create the conditions for it.”
And get the market problem from your industry partners because you are market focused.
You’re on a roll!
Thanks for sharing this Paul. Saw it on LinkedIn and have already shared it with several colleagues as we work to build out from the manufacturing Silver Tsunami that Northwest PA is facing. Excellent read!
Luke Marshall Agree 1000%! I’ve felt the same way for a while now, and I really think we need more programs that are better suited to the Australian startup and business environment.
While I’m on the same page as Paul O’Brien and have been following Matthew Burris ’s work in this space, I do think the Australian ecosystem would benefit from a more tailored framework. The American-style venture studio model might not resonate as well with local founders and investors. It just feels like we need something that aligns more closely with how things work here.
Safiollah Heidari care to elaborate for us all? What’s the difference in culture or expectations?
Safiollah Heidari I’m all for the flexibility in the model. Studios can build ANY company for ANY return strategy, not just for venture capital. It impacts the design of the studio, the economics have to work, but fundamentally a studio is about building the support framework to build companies. That must be adapted to the ecosystem, thesis, team, capabilities, etc. Cookie cutter copying studios only works when the strategy and approach is a great fit for the new situation. This is rarely the case.
We build this in to the Venture Studio Index, BTW. The category matrix highlights the return profile (deep tech, VC, PE, cashflow) and formation role (Founder, cofounder, late cofounder, refounder). The return profile aligns with the follow on and liquidity strategy.
Spot on, Paul. As a healthcare-focused venture studio, we at Sharpless take a fundamentally different approach.
We don’t just mentor or consult—we co-found. From day zero, we identify unmet clinical needs, assemble the founding team, craft and validate product models, and build with rigor. All while tightly integrating with regulatory, clinical, and commercialization realities.
I’ve been around long enough to see this movie play out in cities across the country: Launch the next accelerator, promise the world, deliver a pitch deck template and a coworking space, then wonder why VC still won’t return your calls.
VCs fund companies, not hopes.
Fundable means:
Market-obsessed
Traction-heavy
Talent-stacked
Exit-minded
You don’t get that from pitch practice and free kombucha.
What actually works? Venture Studios.
Studios don’t support companies, they build them. They don’t wait for a unicorn to walk in. They create the right market, team, infrastructure, and momentum to manufacture scalable companies with real unfair advantages.
While accelerators might (maybe) see 1% of startups reach meaningful scale, venture studios are operating with 30–60% success rates. That’s not iteration. That’s transformation.
Cities, EDCs, investors: you want ROI on your civic dollars? Fund the model that comes with its own accountability. Studios hold equity, they invest capital, they build internal teams, they create jobs. And most importantly, they’re measurable.
Don’t just cheer for entrepreneurship, create the engine that actually builds it.
Let’s stop playing startup theater and start producing outcomes.
John Zozzaro Couldn’t have said it better. This is the shift: from performative support to accountable production. If civic leaders want real ROI, they need to stop funding the stage and start funding the engine.
Our vision is for evolving the venture studio model to go deeper:
Not just adapting to regional economies, but to founder recovery itself as economic infrastructure.
Because for many late-diagnosed, burnout-recovering, neurodivergent women founders, the idea doesn’t fail; the support architecture fails them.
hashtag#GenderGap
Pre-venture studio framework repositions:
• Executive function scaffolding as a prerequisite for IP development
• Place-based Brand Camps as founder re-entry zones
• Narrative equity as investable IP (not just PR gloss)
• Localized Giving Tree systems that turn collapse into catalytic deal flow
This isn’t a “program”; it’s civic IP regeneration that treats founders as systems thinkers worth building systems around.
Appreciating your call to move beyond performance metrics and into durable infrastructure. We’re looking to prototype this model in the StL region this Fall; would love to exchange notes.
Carol J. Dickerson, Pharm D you might explore getting on Matthew Burris’ JT Benton’s Venture Studio Forum for some playbooks.
Paul O’Brien there’s no shortage of “information” on this topic, that’s for sure
I kept circling back to the section: “Why Civic Dollars Belong in Studios…” in Paul O’Brien thoughtful take on economic development studio models.
What stood out in his framing was how studios can be held accountable in ways early-stage startups often can’t. He points to studios as builders of reusable infrastructure—systems that serve not just one founder, but many. Several voices in the comments add texture to that idea—Carol J. Dickerson, Pharm D explores founder recovery as infrastructure, and John Zozzaro calls for a shift from performative support to accountable production.
I’m asking myself: If we’re looking to build community through job creation, measurable impact, and durable infrastructure, should civic allocators be experimenting with the studio model?
Much of what Paul explores here aligns with what I’m seeing from Alloy Partners (formerly High Alpha Innovation), which was put in motion via Fieldbook Studio in Arkansas—and is now replicating elsewhere. Might be worth a look.
Appreciate how you’re framing the question around infrastructure rather than just startups or programming.
Studios shift the conversation from “who’s getting funded?” to “what are we building that endures?” That’s the lever civic leaders need most: something accountable, transferable, and designed for reuse, not just success stories, but systems.
Thanks for sharing this Casey
Circling back to share the thoughts of my colleagues . . . this article has definitely triggered an intriguing conversation. And, my rationale for sharing is to elicit feedback, challenge assumptions, encourage dialogue, etc….
The initial commentary is from a portfolio manager (and multiply exited founder) colleague:
There is a lot of talk about this to include us looking to do something with «entity» via a Venture Studio model that focuses on «commercializing entity» IP.
IMHO, the interesting thing about the venture studio is the fact that inventors/early idea people are NOT the people that drive things forward. The venture studio model I have seen is based much more on senior level talent coming in and driving the company. That talent is plugged in at a certain point and taken out at a certain point only to have a new group come in as the company expands.
But here is my take as it applies to «entity»….we have very few companies that are Venture Studio ready. That stated, if we realigned to be more venture studio focused, that could be of interest. But, again, it means we would have far fewer companies flow through but potentially more successful outcomes?
I absolutely agree that accelerators are a dime a dozen and the value is much further upstream vs where we sit.
And, my additional thoughts added to that email thread:
In my mind, this isn’t a ‘burn the boats’ moment, but there are a number of things that resonate:
The «program we run» is described – nearly exactly – in the article.
If what we’re doing is another of the million examples out there, perhaps now is an opportunity to find a better pathway?
And by ‘better’ I mean a way of accomplishing the ‘build great businesses and have a positive economic impact’ mission.
I also think that considering a VS model would significantly reduce the system pressures related to the «internal entity support system» resources that are important to the success of a company.
We’ve all discussed the opportunities to rework how our ‘top of the funnel/shake the trees’ actually works; perhaps incorporating a VS would be appropriate?
The traditional accelerator/incubator model makes people who are smart in one area, become smart in every area which seems to me to be counterproductive.
This article challenges those of us in the entrepreneurial support system to rethink why we make smart engineers, learn how to pitch, do finances, do HR, understand deal terms, etc…
The venture studio model handles all/most of that. It finds the problem, does customer discovery, finds the first customer and then finds the money, hires/engages the talent, handles the ‘stuff’ allowing great technical, business, marketing, sales, etc… entrepreneurs to do what they do best to build a successful company. The studio is setup to keep the distractions out of the heads of those who shouldn’t be distracted by it.
The result is – if we believe the statistics stated – better outcomes and certainly, when we consider what a true economic gardening model would look like, it’s a lot closer to venture studio (and the efficiencies of that model) versus how things are traditionally done today.
However, the reality is that we are at the beginning. Accelerators, incubators, etc… all have very viable places in whatever comes next.
Again, IMHO, Accelerators are Entrepreneurism 101; learn all of it and be the hero CEO/founding team. Incubators are closer to the VS model in that some (but certainly not all) of the distractions are handled by the incubator (mostly physical plant and some back office support).
The VS model, again IMHO, removes all of the ‘essential but not critical’ distractions and allows entrepreneurs to entrepreneur. I’m a fan of that!
And regarding «entity», what if we looked at the GTM as a ‘market problem first’ model rather than a ‘founders with an idea first’ model?
Instead of a founder and another person approach «entity» with their idea for a company and then have to go through all of the challenges to understand, build, find a customer, search for PMF, etc…
What if instead, «entity» looked at doing all of the precursor work to discover the problem/opportunity/client and then hiring/finding super talented entrepreneurs to build the ‘thing’ the VS has already discovered is a problem in the market with a customer(s) ready to pay for it and then build a company around that?
VS is a 180° shifted where it is the center of the hub and the entrepreneurs are a spoke on the wheel, laser focused on the thing they are building.
Just my $0.02 but the more I learn about all of this, the more my entrepreneurial brain gets triggered.
quick question while I chew on this more. Why would you have fewer opportunities that are Venture Studio ready?
In my experience adventure Studio should be involved at the idea stage: with the marketing experience to put in the validation work, the market assessment, SWOT analysis, etc. to determine that an opportunity is worth further development.
The fact that I’m interested you can do this, is why I’m intrigued and supportive of the model; accelerators certainly do not do this, and incubators, while working at the seed stage, tend not to have that market experience to even properly guide Founders as to how to do it let alone do it themselves and support them.
Our mission is from ‘idea on a napkin to Series A. By the nature of our mandated mission, we’re economic development focused. If exits happen, everyone wins but that’s not our north star. We’re all about high quality/family growth jobs, sustainability, scale and evolution. As such, our ‘top of funnel’ is anyone with an idea in innovative tech or small manufacturing and the desire to work on it. Not all of those are going to be VS ready.
And, agree that VS should be involved at the idea stage. Even ahead of the founders (which in my mind are the hired guns with expertise that a VS can support by removing the distractions of being everything to build a company). Through the work we do and the accelerator/incubator model, we have ‘influence and encouragement to refine’ but ultimately it’s the founders company. That’s part of the challenge of an accelerator and less so of an incubator (at least IMHO).
Our accelerators and incubator are all run by exited founders/C-levels so they do have broad experience in building/running/scaling a company but don’t in all cases have deep vertical expertise. And that may be the opportunity of a VS; focus on X# verticals in our tech/manufacturing space in order to leverage our inherent expertise, the market need, funder interests, local/regional installed customer base, etc
that clarifies the “fewer opportunities” point, thank you. So, it’s a function of your broad mandate and intake, and that a VS model would force a tighter aperture from the start. I’d argue that isn’t necessarily a negative if the trade-off is greater leverage per venture, stronger fit with your vertical strengths, and more measurable economic outcomes.
This is where I’m hot on Venture Studios – they’re better suited to specific verticals. It’s just not conceivable that anything but a broadly applicable education program, like Founder Institute, can actually serve all entrepreneurs; not meaningfully. This is why so many “Accelerators” are a waste of space – pretending that they’re there for all startups, all tech, or all entrepreneurs, is just misleading. When, in a VS, we put together experienced professionals who are then owner/operator/investor in the work they’re doing, they have to be clearly focused on, say, Advanced Manufacturing because clearly, they aren’t going to serve, say, MedTech. To be a VS for a region, just doing whatever is innovative there, isn’t possible in an achievable way.
What strikes me is that your mission (high-quality jobs, sustainability, and scale) doesn’t conflict with the VS approach. If anything, the VS model’s control over execution and alignment with market demand could give you more predictability in hitting those targets, even if the quantity of companies launched is lower.
Your thought on focusing a VS around a small number of manufacturing verticals (not “tech” – that’s a generic word) seems like a natural bridge between where you are and the efficiencies you’re describing. It would let you maintain the broad community-facing “top of funnel” for discovery and engagement, while creating a deliberate, resource-intensive VS pathway for the most strategically aligned opportunities.
That’s the conversation I think is worth having: how to design that dual-track so you don’t lose reach, but you gain depth where it matters most.
Food for thought since I too work in economic development – the Venture Studio where I see myself most impactful, would be directly related to those verticals that drive that (rather than the ventures in the region): CivicTech, GovTech, PropTech, etc. – the things that we should be doing to enabled better economic development.