Enterprises are working with Venture Studio to accelerate their technological advancement and business scale-up to survive the COVID-19 pandemic. However, many businesses are unfamiliar with the concept and wonder if Venture Studios can actually help them.
What Is A Venture Studio?
At first glance, a Venture Studio may appear to be just another way of describing the venture builder model. Venture Builders are firms that create startups through internal idea generation and concept validation. They leverage their team members and other resources to execute and spin off the new venture.
While it certainly fulfills those functions, a Venture Studio can also offer venture building for corporations as a service.
Why We Need Venture Studio?
The era of pursuing growth at any cost is over. Entrepreneurs and investors now prioritize scalable businesses with sustainable unit economics in the long run. Innovation is no longer exclusive to startups; even larger, established organizations must embrace it to avoid becoming obsolete in the digital age.
Thus, the government is making efforts to encourage Singapore-based multinational corporations (MNCs) and large local enterprises (LLEs) in industries overseen by EDB* to support corporate venturing by working with venture studios.
How A Venture Studio Can Help Corporation
A Venture Studio offers corporations a comprehensive set of capabilities that streamline the typical development silos, thus accelerating the corporate venturing process within a 6-month sprint. It ensures sustainability against unexpected disruptions and enhances the ability to compete with other tech giants in the same industry.
Furthermore, Venture Studio combines the best of both worlds by fostering entrepreneurship and providing the stability of a team and resources from corporations.
Through this model, Singapore can enrich its corporate ecosystem with startup innovation, mitigating the economic impact of COVID-19 and influencing the investment landscape.
How A Venture Studio Can Help Enrich ASEAN’s Startup Ecosystem
Increasing The Probability Of Success
Startups have always been considered risky, where any mistake can potentially cripple or even lead to business failure.
However, a Venture Studio is a safer bet. They focus on business ideas that are already at a mature stage, rather than pursuing unicorn ideas. In other words, the Venture Studio does everything it can to reduce operational risks and the failure rate.
As a result, Venture Studio can establish a robust foundation for startups, backed by in-house teams, funds, and resources, significantly boosting the chances of success. It’s akin to choosing blackjack over roulette, as the former provides a higher likelihood of winning a smaller reward.
Capital Reassurance
Most of the time, founders tend to spend more time seeking investments than working on their businesses. Additionally, they may have to scale back their operations due to a lack of funding, which can have a detrimental impact on the quality of their services or products. This can lead to potential customer backlash or even a migration to competitors.
Conversely, startups that receive support from Venture Studio benefit from an initial funding advantage, often provided by the Venture Studio themselves, complete with transparent funding guidelines, defined goals, and progress milestones.
As companies grow stronger and expand their capabilities, Venture Studio steps in to facilitate connections with investment opportunities from various investor parties, significantly reducing the risk of failure due to a lack of capital.
Shared Resource
Running a startup often demands various resources and services unrelated to the core business, such as accounting, HR, marketing, sales, and more. Therefore, startups can significantly benefit from the shared resource model of venture builders, where they gain access to these necessary in-house services without the heavy financial burden.
The same can be said for the existing customer base that startups can tap into within the Venture Studio ecosystem. Therefore, it substantially reduces marketing and sales costs while enabling startups to concentrate on their core business.
Consistent Access To Talent
Finding the right talent is a challenging task, and the economic downturn has made it even more difficult. Consequently, many startups often lack a fully developed in-house team. In contrast, a venture builder takes responsibility for the startup’s talent resources. They assemble in-house expert teams to maintain peak performance consistently.
Moreover, they recruit talent to support and join the startups, alleviating HR concerns as individuals are thoroughly vetted. It is also cost-effective, allowing for the reallocation or reuse of workforce for suitable projects.
What Is EDB’s Corporate Venture Launchpad?
The Economic Development Board (EDB)’s Corporate Venture Launchpad is a 6-month program, designed to facilitate the connection between qualified venture studios and MNCs/LLEs. Through this, corporates will be able to work alongside subject matter experts for:
- In-depth validation of venture concept(s), investable business plan, and venture launch pipeline.
- Co-funding for qualifying costs of each concept validation sprint.
- Facilitating and developing venture-building capabilities for corporations.
- Potential co-investment support by EDB New Ventures for ventures launched from this program.
For corporations that want to join the venture launchpad, you can find detailed information here.
EDB’s Corporate Venture Launchpad Sprint Process
Stage 1 – Idea Generation
Ideas and how they are discovered, created, evaluated, and developed are considered core elements of entrepreneurship. Beginning with opportunity mapping and assessing corporate advantages, Venture Studio significantly shortens the idea-generation process for businesses.
At this stage, Venture Studios and corporations focus on narrowing down ideas for validation.
Stage 2 – Concept Validation
Through their network and a specialized team, Venture Studio helps conduct a deep dive into customer needs and pain point validation to create value propositions. This stage also involves implementing Proof of Concept, Prototyping, and MVP to verify feasibility.
Additionally, businesses collaborate with venture studios to develop an investable business plan for their startup, which includes the business model, go-to-market (GTM) strategy, market sizing, financials, and resource allocation.
These requirements also align with the minimum deliverables for EDB’s Corporate Venture Launchpad sprint endpoint.
Stage 3 – Venture Launch Support
If corporations give the green light to set up and kick start the venture movement, EDB New Ventures will provide potential follow-on co-investment with access to industry networks, expertise, and risk-sharing capital.
Venture Studio Is Here To Stay
Created by today’s business and funding climate, Venture Studio will increasingly be involved with helping both startups and large corporations navigate the concept of disruptive innovation, as well as the evolving market for entrepreneurial talent. It also plays a crucial role in economic sustainability as startups do not have to rely only on government or individual support.
Thus, as more businesses continue to enter the program, the benefits of Venture Studio will only continue to become the spotlight. After all, innovation will keep thriving but the economy remains resilient in the face of turbulence.
