Imagine building a new house and instead of hiring a construction company you find four friends and decide that you can accomplish the entire build using Youtube videos and your Dad’s power tools.
Moreover, you're going to take on this venture with just an architect drawing you drew yourself and about $10,000 saved up from friends and family. Sound crazy?
Is it Possible to Eliminate Startup Risk?
Building a software company in a niche market is just as crazy as thinking your four friends can build a house.
Without experience and proper tools, the odds of success are low. With many of the software tools having freemium models and the simplicity to launch a product - it makes many entrepreneurs believe that the Zuckerberg story is possible for them too - but this is an incredibly risky venture and one that commonly leads to immense stress and frustration.
There is a way to eliminate much of the risk while still obtaining the original entrepreneurial goal of freedom.
Becoming an Agency.
When an entrepreneur starts a construction company, oftentimes the first few jobs are small house additions or bathroom remodeling. Over time, the scrappy founder will gain experience and knowledge while growing the team into building entire houses - eventually even a restaurant or two.
What is important is that the owner and the construction workers learned processes along the way that each team member can build on. Shared learned experiences that compute confidence in their craft.
Each process becomes a practiced skill. As team members teach team members the collective group starts learning together and speed and efficiency quickly follow. This process is no different in software.
Each product has a login screen, a forgot password screen, a profile screen, and a set of user permissions. Each time a team member completes the process of planning and coding the entry screens of an application the entire collective company becomes more efficient.
As a principal in need of a team to accomplish a task, isn't it better to hire the team that has experimented 50 times on a product similar to your software idea (or your house) than to try and hire a young entrepreneur to experiment on your product? We think so too…
What is a Studio?
A venture studio is a team of people that have created repeatable processes of building software products. The products can be for startups, fortune 500 companies, or the nearest construction company.
The main purpose of a venture studio is that the team has cycled through thousands of iterations of testing ideas and turning them into products - some of which are stand-alone as profitable businesses.
The unparalleled advantage of Studios is that most are building software products for themselves AND clients. Why is this so valuable?
Well, have you ever gone to a dentist with no teeth? Or hired a landscaper that can’t cut their own lawn? Well you shouldn’t appoint your girlfriend COO either. Venture Studios have been there and done that - and can reliably output products while still providing the ownership of a business partner.
Ownership Over Clients
Back to the Construction Company analogy. When a construction company gets really good at building McDonald's Restaurants and a new McDonalds is franchised in the next town - of course the same Construction company is going to get the first call. The owner will explain all of the random code violations he has avoided by building his previous McDonalds and how he will promise to avoid them for you too.
Software companies should never take on an interface they don’t understand. If your company decides that their fast growing startup needs a CTO to manage the software - why hire a first time CTO? An alternative process would be to hire a less expensive Product Manager and then assign that person to manage a Venture Studio.
The Venture Studio will take pride in the idea and work as if your product was their startup. The Studio will act as a CTO, Development Agency, and Product Manager isolating the core essence of your product and build with speed and efficiency. The Studio will provide advice and direction as they have walked the road you're traveling many times before - and avoided the potholes.
Studios Build Companies
Studios will recommend software that is modern, scalable, and transferrable. This allows the Studio to be a simple transition in your vision. After the MVP is built, you might realize that the product has enough cash to support both the Studio and an in-house engineer to take on support and maintenance. While Agencies typically build for sale, Studios build for scale. Adding an engineer is very common especially at NineTwoThree.
Currently our latest Venture Dishare has the following structure. CEO, CTO and Studio. The CEO works closely with NineTwoThree to develop the direction and application while the CTO manages the codebase and infrastructure of the backend. The Studio builds the mobile apps according to best practices which will eventually be managed by the CTO. This means that the CTO must work closely with us to ensure that our backend calls are supported - but this sense of ownership from both sides allows our teams to create products that look and feel like a Unicorn.
Are You Ready To Build?
If you have a great idea for a digital product able to make a significant impact in the business world, reach out to the team at NineTwoThree. We provide the technical skills and industry domain knowledge to help transform your idea into a successful new business. Connect with us to discuss your ideas and learn how we can make a difference together.