Phase One Ventures isn’t your average software dev shop. We’re a venture studio that builds SaaS products from idea to MVP and beyond. Being a venture studio has allowed us to set higher standards for quality and ethical business. In this blog, we’ll unpack exactly what a venture studio is and isn’t as well as our company’s unique approach that allows us to quickly bring successful MVPs to market and build lasting partnerships.

Phase One Ventures is raising the standards for ethical and quality business one SaaS platform at a time. 

Keep reading to learn why this business model is the key to our success.

What is a Venture Studio?

A venture studio, also referred to as a startup studio or venture builder, is a business model in the startup ecosystem that systematically ideates, builds, and launches new businesses. A venture studio doesn't simply fund existing startups but instead actively participates in the creation of new ones.

At its core, a venture studio is an "idea factory," staffed with full-time professionals who relentlessly search for product/market fit and scalable ideas. By leveraging internal resources, such as software development, sales, marketing, HR, and legal counsel, a venture studio mitigates early-stage risks and accelerates the launch process of a startup. 

Some of the startups that Phase One Ventures has built include Cellyce, an e-commerce aggregator, Dispute Panda, an AI powered credit repair software, Visitor Pixel, an identity resolution tool for businesses, and App Bravo, a community-based software that collects innovative tools and encourages discussion.   

If you want to read more about these projects and see for yourself the quality of our work, take a look at our site → https://www.phaseoneventures.com/projects.

However, in return for their in-depth involvement, a venture studio often acquires a stake in the startup’s equity, ranging anywhere from 45% to 80%. While this might seem like a substantial loss for startups, any venture studio that partners with you believes in your ability to bring in copious revenue. 

Venture Capitals vs Venture Studios

Another important term to know about is venture capital and the differences associated with it. Venture Capital (VC) firms offer financing to early-stage companies with strong growth potential. A key distinction between venture capital and a venture studio lies in the level of involvement in a company's early operations and the types of support provided.

Venture Capitals offer funding to startups, typically in exchange for an equity stake of less than 50%. These VC firms manage funds and, after rigorous due diligence, provide capital from these funds to chosen companies. They generally aim to increase the value of the startups, leading to a profitable exit either through an initial public offering or by selling their stake.

However, the role of a VC firm extends beyond merely providing funding. Larger VC firms often take an active interest in their portfolio companies, contributing to areas like marketing, distribution, and sales to help ensure success and profitability.

Contrastingly, a venture studio goes a step further. While they also provide funding, they act as a temporary task force during the initial stages of a company's operations, significantly influencing the quality of the brand, its output, and speed to market. This structure typically includes several partners who offer services such as development, UI/UX design, marketing, product marketing, finance, HR, and recruiting.

Moreover, venture studios leverage their vast network of partners to foster investor relationships and introduce potential customers. They delve deeply into the challenges a startup faces, providing the resources needed to fuel growth and ensure longevity of the business.

While both venture capital firms and venture studios fund startups, their approach to supporting businesses differs greatly. 

The Different Kinds of Startups

Now that you know the difference between venture studios and venture capitals, it’s important to know the difference between independent and corporate ventures. Aspects like funding, management, and involvement will differ accordingly.

Independent vs Corporate Venture Studios

A venture studio can be either a corporate entity or an independent organization, each model offers unique advantages and exhibits distinct operational differences.

A corporate venture studio, also known as corporate innovation, is a specialized division within an existing corporation that focuses on ideating, incubating, and launching startups. These corporate studios use their abundant capital and social influence to their advantage gaining greater ROIs. This approach allows corporations to diversify their portfolio, stimulate growth, and maximize the use of their static capital. 

On the other hand, independent venture studios operate autonomously to create startups by pooling resources from their balance sheets, deciding strategic directions, and curating a competent team for the new venture. They are primarily funded by their principals and limited partners, who collectively make critical decisions about the ventures to accept and the resources to allocate as these businesses gain momentum. Compared to traditional VCs, independent studios represent a more vertically integrated approach.

In contrast, corporate venture studios blend the resources of a larger enterprise with the startup creation strategy of a venture studio. Unlike a traditional VC, whose focus is solely on investing in startups, a corporate venture studio allows the enterprise to maintain a majority ownership stake in the startups they build. This model encourages the enterprise to assume additional risk for potentially higher rewards, increased ownership, and enhanced control. 

This balance of risk and reward, ownership, and control fundamentally differentiates the operational mechanics of corporate and independent venture studios.

Accelerators vs Incubators

Entrepreneurs and innovators are most likely familiar with accelerators and incubators. Venture studios, accelerators, and incubators all serve as catalysts for startups, but they vary greatly in their approach and involvement.

A venture studio is a hands-on entity that creates multiple startups each year without a fixed timeline. Unlike accelerators or funds, which support already-launched businesses, venture studios decide which companies to build and commit significant resources to. A venture studio provides comprehensive resources to startups, including product design, marketing, and strategic guidance. It cultivates long-term relationships with startups, nurturing them far beyond their early stages.

In contrast, accelerators are growth-focused, offering time-limited programs aimed at speeding up a company's development. They often provide funding in exchange for equity and span various industries. These programs typically last a few weeks and are more short-term compared to the long-lasting partnership of a venture studio.

Startup incubators offer long-term relationships similar to venture studios but typically focus on providing technical facilities, workspace, and networking opportunities. They usually charge a fee rather than taking equity.

The Key to Phase One Ventures’ Success

Of the 720+ venture studios that exist globally choosing the right one to partner with can be overwhelming. Venture studios are still a rather new model for the US but are catalyzing as an increasing number of corporations are beginning to adopt this model.

Phase One Ventures builds SaaS platforms for service-based business. We help you get your platform to market 5x faster by launching MVPs (minimum viable products). Back in 2022, our company transitioned from being a marketing agency to a venture studio. This change was adopted for ethical, enduring partnerships that moved away from transactional, shallow interactions. This was the key that unlocked more business opportunities and partnerships for our company. This is always the quality of business we stand by and challenge other companies to uphold. 

We promote open, consistent communication as well as transparency and involvement that foster genuine and long-lasting partnerships.

If you’re interested in partnering with us, talk to our founder today to start building your market-leading SaaS platform.

Click this link to schedule your free call → https://meet.phaseoneventures.com/jon.