Venture studios & incubations

Venture capital, as a model, is being pulled in many directions. One of the directions taking hold: venture studios and incubations. Rising competition and escalating early-stage valuations are contributing to its popularity. As of July 2023, there were 800+ venture studios worldwide. 

Increasingly, funding great early-stage investments includes building them. Sutter Hill Ventures, who incubated Snowflake, turned their stake in the company into $12B. Science’s Dollar Shave Club sold for $1B in cash to Unilever. Expa deployed $120M across 20 incubated companies with combined valuations of $3B+. Human Ventures has 10 active builds creating over $7.5B in enterprise value. Affirm, created by HVF Labs, was valued at $12B at the time of its IPO. 

Venture Studios are companies that exist to build companies, unlike (most) incubators, accelerators and venture firms. They ideate, research, prototype, validate, and fund their own ideas, typically with dedicated teams.

In this post, we dive into the advantages of the venture studios and incubation model, its challenges, and if you should start a venture studio (preview: many shouldn’t). As with all Signature Block posts, you’ll hear from the operators of 16 venture studios and incubations directly. We also include a landscape of venture studios featuring 15 studios and venture funds that incubate companies, including their taglines, models, and traction.

If you only have a few minutes, here are some takeaways: 

• The venture studio model relies on giving companies a systematic “edge”. Studios take a relatively large ownership stake in the companies they incubate in exchange for their ability to de-risk companies. Successful venture studios build a platform to give each incubation a greater chance of success, often leveraging an advantage within a specific market or expertise.
• Incubating new startups empowers studios to pursue overlooked opportunities. Several venture studios covered in this post identified a “hole” in the early-stage ecosystem to fill. Traditional venture investors rely on others to identify these opportunities.
• Venture studios need to do the work. Sometimes referred to as an “institutional co-founder”, venture studios need to deliver real value to the startups they incubate. Many help by providing playbooks, distribution, and operational support.
• There is a wide diversity of early-stage studio models. There is a wide diversity of operating, funding, and business models among venture studios. No standards exist. Studios suffer from a high mortality rate with “less fit” models getting killed off before they get to scale. 
• A venture studio is more than company-building. The trendier incubations get, the more important it is to consider your motivations, skillset, and ability to raise capital before starting one. Venture studios are an extremely “involved” model for company creation.

Shoutout to Adrian Locher (Merantix); Heather Hartnett and Joe Marchese (Human Ventures); Jesse Pujji (Gateway X); Jon Robert Bradford (Colab); Julie Sandler and Matt Wang (Pioneer Square Labs); Khaled Hussein (Stipple Ventures); Matty Mejia-Johnston (Asymmetric); Milun Tesovic and Roberto Sanabria (Expa); Noah Breslow (Bain Capital Ventures) David Kolodny and Phil Santoro (Wilbur Labs); Shawn Carolan and Greg Rudin (Menlo); Omri Bloch and Graydon Gordian (Fractal); Peter Pham (Science); Safwaan Khan and Furqan Rydhan (Founders, Inc.); Quentin Nickmans and Sarah Barron (Hexa) for contributing to this post.

What defines a venture studio?

Venture studios build, launch, and fund startups, typically around a focused set of opportunities or markets. Their job: get a startup from zero to one as quickly and successfully as possible. Their goal: give their incubations a greater chance of succeeding. How they do this: They typically have a platform team, resources, and capital to execute a specific approach to creating companies. 

Most venture studios are idea generation, testing, and validation machines, aimed to surface startup opportunities. They provide the infrastructure to build multiple companies – sometimes in parallel – that take advantage of efficiencies, economies of scale, collaboration, and compounding knowledge across the studio’s portfolio and team. 

Some funds incubate companies, often more opportunistically. While we included input from these builders, their model is different from venture studios that typically have very systematic processes and an ongoing focus on company-building

So, how are they different from accelerators?

Accelerators, like Y Combinator, Techstars, and 500 Startups also provide funding and help founders grow their businesses but unlike venture studios, they typically accept founders that have an existing idea and time-box their involvement to a few months, often with a cohort of other companies. While models vary, accelerators function like a very hands-on partner to early-stage startups whereas venture studios serve as a cofounder from day zero, often validating an idea before the CEO is recruited.

Venture studios take a more “concentrated” approach to building fewer companies with a more hands-on approach. Accelerators typically take a more diversified approach to supporting a wider base of companies.

What is the venture studio “test”?

We like this “test” from Ben Yoskovitz in The Many Flavors of Venture Studios: 

“I define a venture studio as an organization that builds and funds new startups.

• If you build startups but don’t fund them, you’re more akin to a dev shop.
• If you fund startups but don’t build them, you’re an investor.

There’s nothing wrong with either of those, but they’re not venture studios. A venture studio is a combination of the two.” 

The advantages of venture studios and incubations

We asked venture studio operators and funds that incubation companies about the advantages of incubations over traditional venture investing (note that some venture funds do both):

• Lower risk and more support for founders
• More hands-on company building and greater control
• Expanded founder pool
• Outsized ownership 
• Higher efficiency and distributed risk

While we only reached out to studio operators for input, we include advantages from both the investor’s and founder’s perspectives below. 

Lower risk and more support for founders

Venture studios are designed to reduce early-stage risk and increase the probability of a startup’s success. In return for the lower risk, a venture studio typically takes a larger percentage of equity. 

This shows up in the numbers in Global Startup Studio Network’s 2022 report:

• Venture Studio startups have a 30% higher success rate than traditional startups.
• 84% of startups coming out of studios go on to raise a seed round.
• 72% of those ventures make it to series A (compared to 42% of traditional ventures).
• The time from founding to series A is 25 months for venture studio startups compared to 56 months for traditional startups.

Most venture studios start this before a company is formed by running through a validation playbook to test demand, distribution, business model, and scalability. Studios “loop in” the founder at different stages, from the point of inception to post-launch and revenue. After the ideation and validation phase, the studio typically continues to help the founders and team with support in marketing, design, engineering, accounting, finance, and more. 

More from the venture studios themselves:

“For the entrepreneur, some big advantages are that we research the opportunity, then work on the strategy in a rapid, structured way to minimize risk and increase the ceiling. This allows the founders to have confidence that what they’re going after is worthy of long-term pursuit. And because we provide sufficient initial capital to bring a product to market, and support the back office and recruiting functions, founders can focus on what matters right out of the gate – building the business, alongside a team that has done it for many many reps and share hard-earned lessons that Shawn, the investment and Labs teams and I learned along the way.”

— Greg Rudin (Menlo)

‍

“The key advantage of this model, which distinguishes it from other startup support systems such as incubators and accelerators, is the level of support that founders receive. Startup studios position themselves as fully-fledged co-founders. Therefore, founders who decide to build with a startup studio get to build their startup with a full-time team of experienced entrepreneurs and operational experts. We call it team entrepreneurship.

This allows them to gain:
- Speed during 0 to 1 phase: to validate the idea, develop an MVP, bring the product to market and hire the first team members
- Credibility due to the track record of the studio and its team
- Easier access to funding due to more efficient metrics and the studio’s network
- Community with access to like-minded entrepreneurs who’ve already been through it.” 

— Sarah Bannon (Hexa)

‍

“Having all been founders ourselves, we're intimately familiar with the ups and downs of the startup journey. We recognized that the path is often isolating, fraught with stress, and mired in uncertainty, usually leading to more questions than solutions. At Expa, our aim was to become the optimal startup partner to mitigate these challenges. This isn't about offering high-level guidance or occasional check-ins with your lead investor; it's about being deeply involved at every juncture, whether the decisions are major or minor, straightforward or complex. Unlike co-founders, who may or may not bring a comparable level of experience and network, a venture studio like ours offers unparalleled expertise and connectivity. In addition to daily operational advantages, our model presents other significant benefits such as capital readiness, resource pooling, risk diversification, and access to an expanded talent pool supported by a broader brand identity. Since every startup has unique needs, our focus is on calibrating the right level of support for each.”

— Milun Tesovic (Expa)

‍

“People sometimes associate BCV with growth investing, but most of our investments are actually early stage - usually Seed/Series A. Incubations were a logical extension to this early stage work. They allow founders to have the support and resources of a major investor from the beginning, and we can create proprietary investment opportunities in areas where we have conviction. 

I view incubations similarly to accelerator programs - they are a logical evolution of the startup process - instead of founders wandering for several years on their own and gathering momentum slowly, they can build in a supported environment from Day 1 and leverage that to attract talent, partners, customers, and even outside financing for the venture.”

— Noah Breslow (Bain Capital)

‍

“I believe that the world is a better place with more entrepreneurs designing and building the future we want to live in. Founders who start from scratch tend to spend a lot of time building the infrastructure for their company from the ground up (hiring, marketing, sales, etc.). Venture studios help founders execute faster than ever before. While VCs tend to fund entrepreneurs, VSs are there to support these entrepreneurs from the very beginning with not only capital but also with the needed resources, hands-on experience, and community to co-build these companies and have them ready to accomplish their milestones.”

— Khaled Hussein (Stipple VC)

‍

“Having been involved in a lot of companies from the beginning, I feel like I have a good idea of what works best for the individual needs of companies. We wanted to provide industry access for early customers and co-creation partners, as well as provide the early validation and traction that comes with it. We also wanted to provide access to talent that enables our portfolio companies to build world-leading teams very early on. Building AI Campus Berlin was a no-brainer, as having everyone in one place truly allows for knowledge sharing.

We have already seen how this model helps our portfolio companies navigate the developing world of AI, both in terms of lending resources and providing a sounding board for any issues they might encounter. A good example of this is Deltia, which started with three paying customers (all multi-billion Euro manufacturing companies) before even having built a product.” 

— Adrian Locher (Merantix)

Direct founders, resources, and capital to underserved areas

A common thread in the venture studios we covered was they were started to “fill holes” that existed in the early-stage ecosystem. Less popular opportunities, markets, and geographies have a smaller supply of founders working on them organically. Venture studios can direct founders, resources and capital to these underserved spaces. 

Some examples: Pioneer Square Labs was founded to fill a gap in the Northwest’s early-stage ecosystem. Human Ventures was created to fill a gap in New York’s startup ecosystem, offering builders a space to work together. Menlo Ventures started Labs to incubate companies that they would have invested in (but don’t exist yet).

More from the venture studios themselves:

“We started Pioneer Square Labs for two primary reasons: first, we saw that there was a meaningful gap in the Pacific Northwest’s early-stage ecosystem for experienced entrepreneurs who want to move as fast as possible to launch, capitalize, and scale companies; and second, we knew that the studio model would work. Greg Gottesman, one of our founders, founded and served as the initial CEO of Rover while also working as a VC, and saw a meaningful advantage - in terms of speed, flexibility, and market insight - to both founding and funding an idea at the same time. We started PSL to scale that motion.”

— Matt Wang (Pioneer Square Labs)

‍

“Asymmetric is not a studio/incubator in the traditional sense – our core business is investing in world-class founders building at the pre-seed and seed stages. We often come up with theses, where we identify attractive markets and establish a point of view of what a winning model in that market might look like. 9/10 times, this exercise leads us to make an investment in an existing team in the space, however, 1/10 times (likely even less) we find that no one is building the business we think should exist. In these instances, we will pursue an ‘incubation’ where we go out and pair a high-quality founding team with a high-quality business plan.”

— Matty Mejia-Johnston (Asymmetric)

‍

“Fractal was started for two reasons: (1) We recognized there was an opportunity to help build new technology layers that enable small businesses across many American industries to better compete in the modern economy. (2) We wanted to support entrepreneurship and unlock that opportunity for more talented individuals.”

— Graydon Gordian (Fractal)

‍

“Menlo’s goal for decades has been: ‘Help uniquely capable entrepreneurs build category-leading companies.’ Unless most of the boxes are checked (founding team in place, MVP identified, vision laid out, plan for growth and monetization), it’s hard to get confidence the opportunity under consideration can be an iconic company. With Menlo Labs, if we find an aspiring founder we’d like to work with or identify a big opportunity space during investment research, we have the team and playbooks to fill in the missing pieces to get companies created that we would have wanted to invest in if they walked in the door.”

— Shawn Carolan (Menlo)

‍

“When we started Human Ventures in New York City, there weren’t many places for builders to come together and build. With Joe being a multiple-time founder in New York who had seen companies from inception through exit, we were the connective tissue for founders looking to use shared resources and connections to launch their next company. The venture industry has grown significantly in New York and we have evolved from only incubating companies to also straight pre-seed and seed-stage investing. Starting our firm with building DNA allows for us to be better first check investors to founders.”

— Heather Hartnett (Human Ventures)

‍

“When we founded Merantix, AI was still such a nascent technology that we knew that companies we would fund through it would need all the help they could get to embrace the emerging tech. So, we decided we wanted to create an ecosystem whereby we could nurture the companies through their growth journey.”

— Adrian Locher (Merantix)

‍

“After taking our first true technology venture from napkin to exit in just 6 months, my partner Michael “Squid” Buchanan and I started Colab. We spent a few months arguing about what to do next and ultimately agreed to start a business that solves that problem for us forever–a business that builds new businesses. Originally we thought the incubator model was the most responsible way for us to be able to work on more than one project at a time. However, given I was 23, and Squid was 21, we didn’t have the capital or experience to responsibly support companies financially. We instead decided to invest in ourselves and start building out products in exchange for equity. Our model has since evolved, but that’s how we got started.”

— Jon Robert Bradford (Colab)

‍

Greater control and more hands-on company building for investors

For some investors, the traditional early-stage investing model feels too passive. Their passion lies in actively building companies. Actively building companies also gives investors greater control to shape their outcomes. Of course, they need to be capable of actually doing so. 

Incubating companies also help investors develop their “building muscle”, further establish empathy for founders, and position the firm as relatable peers. For hybrid venture fund incubators, it also generates propriety deal flow for their fund and co-investors.

More from the venture studios themselves:

“We started Science in 2011. Betaworks was the first studio, and we were the 2nd. Mostly because Mike, Tom, Greg and I are operators. I had built and sold 2 startups, and in moving to LA I wanted to do more than just passively invest, and still be part of building companies.”

— Peter Pham (Science)

‍

“I started angel investing because I wanted to work with early-stage founders. I quickly realized that I enjoyed being hands-on more than just being a check writer. Our Studio was a natural evolution of the ‘hands-on’ model of how I was doing things. It's just slightly more structured and formalized.”

— Furqan Rydhan (Founders, Inc.) 

‍

‍

“I decided to do this purely because I wanted to solve for what brought me joy + purpose.  I love identifying opportunities and that initial creation process (from napkin to real entity). I love coaching/teaching others. I wanted to do this every day and decided a studio was the best format!”

— Jesse Pujji (Gateway X)

‍

“We launched eFounders (now Hexa) in 2011 because my co-founder Thibaud Elziere and I had many startup ideas. We wanted to launch them in parallel while focusing on what we knew best: B2B productivity software. The startup studio model enabled us to do just that, by partnering with amazing founders, we transformed all of our startup ideas into fully-fledged companies.”

— Quentin Nickmans (Hexa)

‍

“It keeps our skills (and empathy, and reputation) as founders/builders fresh.”

— Joe Marchese (Human Ventures)

‍

“Phil and I met the day we both started at Google back in 2013. Before meeting there, Phil built FreeForums, a free forum hosting platform he later sold, and I had worked with several startups. We both knew we wanted to start a new company so we started having a weekly dinner to brainstorm different ideas. Eventually, we had so many different ideas for problems we were excited about solving that we decided instead of going after one of them, we would build infrastructure to support solving all of them.”

—  David Kolodny (Wilbur Labs)

‍

Expanded founder pool

Venture studios aren’t just incubating companies; they’re incubating founders, too. By de-risking ideas for founders, they expand the founder pool to those who can’t afford to take the risk to start a company, financially or practically, or lack an idea to pursue

More from the venture studios themselves:

“Why would an entrepreneur join a venture studio and give up the majority of their company rather than go to an accelerator? Most accelerators tend to look for a ‘founder type’ — a stereotypical techie, fresh out of college, who already has an idea and cofounders. Most people don’t fit that pattern. Yet many are more than capable of taking an idea that’s been stress-tested and validated and building it.”
‍
— Steve Blank in Is a venture studio right for you?

Outsized ownership

Studios also take outsized ownership in their entities. While accelerators “charge” 5-10% of a startup's equity, venture studios “charge” 30-70% of a startup's equity for cofounding the company and helping de-risk its failure, sometimes before outside founders and teams join. They typically have greater control over outcomes and a more concentrated portfolio.

More from the venture studios themselves

“Building absolutely drives outsized returns when it hits.”

— Heather Hartnett (Human Ventures)

‍

“Over time I realized, I love investing but I need to have more information and insights when underwriting those investments. Having a studio is the only way it would satisfy all my questions when we invest since we would have unprecedented access to the founding team and data on how the company got where they are and when we jump on the ship we'd know where it's going and why. Overall that's the biggest advantage, having a fund that invests in the studio companies gives us leverage of information in knowing which ones to go deep on.”

— Peter Pham (Science)

‍

Higher efficiency and distributed risk

By working on multiple startups, venture studios can leverage their expertise and resources to create and launch new businesses more efficiently. That said, there is a limit to how many companies venture studios can build in parallel. It doesn’t scale to as many “bets” as traditional venture investing but of course, this portfolio model distributes the risk far wider than a founder building a single company.

Given venture studios are typically launching several startups/per year, they have compounding insights, advantages, and networks around a set of opportunities, industries, and geographies.

More from the venture studios themselves:

“The biggest advantage to our model is organizational knowledge, or what we call studio knowledge. We believe this is far more valuable than capital investment alone. Each time we research an idea, solve a problem, launch a company, and learn from our successes and failures, we build on this knowledge. Studio knowledge collects, compounds, and carries through to all current and future portfolio companies. This uniquely allows our portfolio companies to move faster and further than when raising capital through traditional sources.”

— David Kolodny (Wilbur Labs)

‍

Venture studios and incubations: The challenges

We asked operators of venture studios what the biggest challenges of the venture studios and incubation model are over traditional venture investing:

• Attracting high-quality founders
• Consistently delivering value to companies
• High overhead and split focus
• Capital-intensive and long payback periods

Attracting high-quality founders

One of the biggest challenges studios face – a similar challenge for any company looking for strong talent – is recruiting high-quality founders. Most studios target founders with specialized knowledge, typically either technical knowledge, domain expertise or both, who are willing to trade a lower equity stake for a validated idea, capital, and support. 

Studios typically charge 30-70% of a startup's equity, proportional to the value they provide. Founders are left with a lower equity stake, in some cases significantly lower, than if they were partnering with an accelerator or an early-stage investor. Some critics fear that this trade-off (lower ownership but also lower risk) may lead to adverse selection. This applies even more pressure on studios to deliver value and support for those they partner with.

Furthermore, because each studio’s model and terms vary, we lack industry standards that can fast-track a negotiation (similar to what we’ve seen with YC’s SAFE for early-stage investing). Also, studios are a relatively new option for founders which requires educating them. 

More from the venture studios themselves:

“The hardest far and away is attracting and partnering with talented co-founders/CEOs.”

— Jesse Pujji (Gateway X)

‍

“We prioritize matching the best possible entrepreneurs with our spinout companies. Over the eight years that we have been active, we’ve realized that the most critical determinant of the success or failure of any of our spinout companies is the quality of the founding team that we place behind ideas. The disadvantage here is that the population of best-in-class founders is a small and highly-sought-after one, so we have a strong incentive to build both the most interesting and fairest possible deal for them to win them over.”

— Matt Wang (Pioneer Square Labs)

‍

“The biggest challenge in incubating a business is finding the right founding team. Many things need to align to find the right founders, including identifying candidates with the right background for the job, who have a deep interest in the space and who are at the right time in his/her career to found a business. This process is fairly time intensive, however, we believe it is time well spent. We are able to form many new relationships with top-tier operators who we would love to back in the future, even if they are not the right fit for the business we are incubating at the time.”

— Matty Mejia-Johnston (Asymmetric VC)

“Finding world-class founders and making sure they have agency, autonomy, and the runway to build an epic company.”

— Furqan Rydhan (Founders, Inc.)

‍

“Startup studios face distinct challenges, amplified by the industry's ambiguous structure and absence of standardized terms. This opacity necessitates extensive knowledge transfer when structuring deals with founders, which can be resource-intensive.” — Milun Tesovic (Expa)

‍

“Venture Studios are relatively new and therefore, there are a lot of challenges in running such a new approach to startup building. For example:
- Educating potential entrepreneurs that there is a different path in building a company and highlighting the pros and cons of this path.
- The mentorship and selection process for founders takes a lot more time than the traditional path in VCs where a founder pitches investors and simply hears a yes/no.” 

— Khaled Hussein (Stipple VC)

‍

“Finding brilliant founders to partner with is one of the biggest challenges for any studio. Especially for nascent studios.”

— Sarah Barron (Hexa)

‍

Lastly, here’s a note on the adverse selection point:

“There’s a potential disadvantage is the flip side of the value we provide. Founders don’t have to do some of the messy work upfront around team building, operations setup and fundraising.  We aim to mitigate that by both fishing and teaching to fish… so instead of simply doing all of that for the founders, we provide plans, make intros empower the entrepreneurs with understanding and then ultimately own the relevant processes needed to lift the company off the ground.” 

— Shawn Carolan (Menlo VC)

‍

“There have been some models out there where venture studios wind up with overwhelming cap table ownership, making it hard to recruit founders of the highest quality and investors for later rounds of funding. We are focused on creating ventures with cap tables that work for all parties - we are in it for the long haul with each company we help incubate and want to make sure we attract high-quality founders and follow on investors.”

— Noah Breslow (Bain Capital)

‍

Consistently delivering value to companies

While venture studios increase the chances of startup success, there are a lot of challenges inherent in launching startups which don’t go away with the venture studio model. Venture studios have to be capable and willing to help with the actual building of startups, and often continue to provide support once the startups beyond the initial validation stage. More from the venture studios themselves: 

“There are no shortcuts to building a valuable business. It takes a long time and many turns before a company becomes a scaling business. Studios have to help in building real value for the company vs. straight investing where the value add is often an afterthought for firms.”

— Heather Hartnett (Human Ventures)

‍

“Building a startup is an immense challenge, period, whether you do it via a venture studio or not. But we believe our support system and focus on vertical SaaS help make some of these challenges less difficult.”

— Graydon Gordian (Fractal)

‍

"Not getting distracted with shiny objects. Sometimes you just need to persevere, instead of starting a new project. When your current project becomes hard and you have many other ideas it can be tempting to ditch the current one and start again with a ‘better’ one.” 

— Furqan Rydhan (Founders, Inc.)

‍

High overhead and split focus

Balancing the demands of building multiple startups, at different stages, is a constant challenge for venture studios. It’s hard enough to build one startup. Imagine building multiple at the same time.

More from the venture studios themselves

“The second hardest is figuring out how to focus/allocate resources (from the studio level including my time).”

— Jesse Pujji (Gateway X)

‍

“The sole job of any studio is building successful companies so that will always be our greatest challenge and focus. The success of a studio relies on how they can affect the outcomes of each company in their portfolio and for this reason, we're not trying to compete on the number of companies we launch. Our strategy, from the beginning, has been to build fewer companies per year with more resources, more funding, and more operational support behind each company to ensure their long-term success. We call this “putting more wood behind fewer arrows.” 

— David Kolodny (Wilbur Labs)

‍

“Time is the other one, as we engage deeply with companies. I envy other investors who passively invest.”

— Peter Pham (Science)

‍

“Harder to scale company building as compared to a straight investing venture firm. Requires more overhead to operate.”

— Heather Hartnett (Human Ventures)

Capital-intensive and long payback periods

Studios require a large initial investment to build a platform that can scale to support the incubation of multiple companies.

Given they invest even earlier than a typical early-stage investor, their time to exit is typically even longer. Those who are building multiple companies need to keep investing more capital, both into companies and for operational expenses, until they begin to see successful exits. Not doing so can slow down the pace of experimentation. This capital intensity often results in a greater ask from LPs. Most venture studios charge more than your traditional two-and-twenty venture fund, increasing their hurdle to convince LPs to invest.

More from the venture studios themselves

“The most challenging aspect of running a studio is time and money. It costs a lot to staff world-class people at the studio, as you can imagine they can go work anywhere so you have to compensate them both in cash & equity for the diversity of things they will be working on. The typical 2% fee structure doesn't cover the operating expenses for most studios.”

— Peter Pham (Science)

‍

“Larger capital allocators are less familiar with funding a studio model. While the return potential is higher, it can be more difficult to raise capital for this structure in the beginning.”

— Heather Hartnett (Human Ventures)

‍

“Incubating companies, so to say the first step in the venture capital journey, means focusing on the most complex part with the highest failure rate. It's a very different phase than, say, growth investing and means for us as an investor it takes longer until we see profit and portfolio uptakes. But, having now built 10+ companies with the majority showing outstanding traction, we feel that we're getting a lot of things right.”

— Adrian Locher (Merantix)

‍

“Unlike most others, we don't maintain a formal capital fund within Colab. We've remained a bootstrapped and partner-owned company from the beginning. This means that we rely solely on past successes to finance future opportunities. Our portfolio is intentionally diverse in terms of risk profiles, founder styles, and upside potential. This diversity allows us to hedge our bets and stay agile. The challenge lies in striking a balance in this highly unpredictable, early-stage environment."

— Jon Robert Bradford (Colab)

‍

Should I build a venture studio? 

If you’re considering incubating companies or starting a studio, here are some questions to consider:

What are your motivations? Does early-stage investing feel too passive? Do you want to more actively build companies? 

A common thread in the venture studios we covered is how “involved” the model is. It demands a commitment to helping founders build their businesses, day in and day out. Those considering this path need to love building and have the stamina to do so, repeatedly. 

Do you have a clear focus? Is there a “hole” in the early-stage ecosystem that you’d like to fill? Do you have an edge in that space?

Many venture studios thrive in part because they have an advantage in a specific market or area of expertise. This focus enables them to compound knowledge, networks, and other advantages over time.

Are you able to raise the capital required to run a capital-intensive model? Can you endure long payback periods? 

Venture studios are a very bespoke model making it difficult to raise capital for this structure in the beginning. The higher the rate of experimentation, typically the larger the amount of capital required. 

The Landscape

We asked 15 studios and venture funds for their taglines, models and traction. Hear directly from them in this landscape. This is a living doc and will never be fully “complete”. 

The document is open for contribution. If you're running a venture studio or incubating companies, we'd love to include you. Please email us at team@weekend.fund with your tagline, model and traction details. 

‍

If you haven’t already, subscribe to Signature Block to get the next one in your inbox.

Until next time,

Ryan, Michael and Vedika from Weekend Fund :)