A digital venture is when an entrepreneur or team of entrepreneur's undergo a risky journey of bringing an idea into existence through a digital artifact.
Digital ventures are an important phenomenon in the global economy. Four of the world’s five most valuable brands—Apple, Google, Microsoft, and Facebook—started as digital ventures. These companies, along with many other startups change lives - not just for the founders - but all of the users of the product that have increased their productivity, knowledge, communication, or socialization.
But what if the Venture fails? Sure, the four brands above have proven out massive returns to shareholders with copious amounts of daily users - but for every Startup success there are 9 that fail. Interestingly enough, lack of cash was the reason for closing up shop only about 16% of the time - meaning the startups had the humanpower to succeed - but not the extramental resources to obtain product market fit.
Simultaneously, 20 stories up in the same building, a giant corporation is deciding how they might achieve their quarterly numbers by cutting costs and recognizing revenue. Their “innovation strategy” is an afterthought because the return on investment seems too risky. With all of the capital and resources available the ability for the corporation to produce a competitor to the latest startup chomping at their market share seems impossible. Plus, 9 out of 10 fail - why should the corporation worry? Or should they…
Both the Startup and Corporations face the same problems but from opposite ends of the spectrum. Corporations want to move faster and take calculated risks while startups need additional resources to scale smarter. A Digital Venture Partner sits in the middle to bridge the gap between disruption and insights while leveraging the speed of startups with the resources of corporations.
Working backwards from identifying pain points and motivations, a Digital Venture Partner explores the competitive landscape and maps out the business opportunities. When the scope of the venture is defined the partner will wear many hats thinking about the marketing, pricing and operational structures needed to commercialize new products and services. The right partner will take ownership and manage ventures from beginning to end, and sometimes actively operate these new businesses in the market.
The difference between an Agency and a Digital Venture Partner is simple - ownership. An Agency exists to produce a predicted end result as defined by the requirements while the digital venture will see business opportunities and build solutions around them. This success can only come from practiced failures and finding a partner that has many failed Digital Ventures of their own will de-risk the endeavor due to understanding what does not work.
After all, a digital venture starts with an idea. An idea that could change the world or bankrupt a team. Ideas are frightening to corporations because they threaten what is known and an opportunity for a startup to challenge the way things are. Under the proper care by a Digital Venture Firm, an idea can be a delightful experience that hides all the complexity and produces a strong positive emotional connection to the brand - ultimately delivering value to the customers and shareholders - just like Microsoft, Facebook, Google and Apple did for all of us.