It is a pretty well known fact that independent films hardly ever perform as well as films from established production companies like Universal Pictures or 20th Century Fox. These larger production companies have established teams and processes and they get better at producing successful movies as their experience grows and their team becomes better at working together. The same can be said for startup studios.
It is obvious that indie movies can't compete with the Disney’s of the world. And yet, most startups are launched independently from a startup studio and still expect to become a unicorn.
Both movies and digital ventures benefit from repeatable processes to turn them into commercial successes. This approach allows a “creative factory” to take full advantage of a mature methodology focused on continuous improvement.
While movies might seem like more of an artistic endeavor than a web or mobile application, they both have the goal of reaching their target audience and becoming a financial success. Because of this goal, it behooves any startup studio to analyze the top commercial movie studios to learn how they transform a creative spark into a financial success. At the same time, any entrepreneur with a great business idea benefits from partnering with a startup studio just like a screenwriter with a compelling script needs to work with a top-shelf production company.
So let’s look more closely at what benefits startup studios gain from studying how Hollywood production houses turn ideas into successes. Understanding their approach serves to inform a venture studio about the full range of tasks to transform any fledgling startup into one making a real industry impact.
Comparing the box office results of independent studios to those of the movie industry’s behemoths reveals the latter enjoy significantly higher success – from a financial standpoint. Notably, in 2016, Walt Disney Studios become the first moviemaker to exceed $3 billion in domestic box office revenue. That same year, the studio boasted half of the top 10 revenue producing films. Needless to say, this data provides a clear example of the financial success achieved by well-honed, mature processes.
According to GSSN research, 34% of startups created by startup studios result in an exit, compared to 27% of companies that went the traditional VC route.
Walt Disney Studios and other top-shelf movie production studios boast mature and well-honed processes to reduce the amount of risk when producing and releasing movies. In fact, startup studios exist for a similar goal: reducing the acute risk found when forming new businesses. A startup studio having mature processes in place for technology, marketing, HR, and legal lets entrepreneurs focus on brainstorming great ideas and bringing them to market.
While a leading movie production house rarely needs programming talent like a startup studio, the top-shelf technical capabilities required for cinematography, graphics, animation, and sound effects parallel those software development skills. Another similarity between these two studio types lies in marketing and market research. After all, a well-produced movie likely makes little impact in the entertainment world if it misses its target market. This same concept applies to a startup with a great mobile app but no market nor subsequent demand.
In fact, market research and domain expertise remain critical differentiators between startup studios. An entrepreneur with a great idea for a new business benefits from partnering with a startup studio with the marketing and technical skills compatible with their idea. This is a similar concept as someone with a great screenplay looking for a top-shelf movie studio to turn it into a blockbuster.
While independent filmmakers can produce great results, they end up spending most of their time on the technical side of things instead of on actually making their movie. The same is true for a startup founder that isn’t able to focus on building their business because they are bogged down with building and managing an engineering team.
In the end, any startup studio looking for suitable lessons from the top movie studios in Hollywood need to focus on two areas. The first involves technical capabilities. For example, top movie companies, like Disney and Pixar, built their reputations on state of the art innovations in animation, sound, and more. Any great screenplay for a blockbuster, especially in Sci-Fi and comic book franchises, benefits from the top-shelf presentation provided by an enterprise-level production company. To attract entrepreneurs, a startup studio needs to build a similar reputation for excellence in mobile app and interactive website development.
The top Hollywood studios also deeply understand the target market for their movie releases. In a similar manner, a startup studio also depends on significant market expertise in the areas its new businesses hope to target. This knowledge base plays a key role in reducing the risk when forming new startups. Ultimately, any startup studio benefits from top-shelf technical chops and keen business domain expertise across multiple industry sectors. In the end, startup studios remain the best way to launch a new business.
If you want to take your startup studio to another level, connect with the team at NineTwoThree. As thought leaders in the industry, we boast significant experience highlighted by technical excellence and that critical business acumen. Connect with us to discuss how we can help your startup thrive using IoT, machine learning and other custom app development methods.