It’s true. Many entrepreneurs now understand the myriad benefits derived from forming a startup studio as an alternative to traditional sources of venture capital. This approach enables them to get the business domain expertise and modern technical know-how to successfully bootstrap any number of organizations. In short, it provides them with a greater chance of a successful new business compared to the past.
Additionally, news about new startup studios quickly making a significant impact rapidly spreads among the entrepreneurial community. These kinds of successes cause an almost viral effect attracting notice from more entrepreneurs in the United States and around the world. Therefore it’s not surprising that other similar-minded professionals want a piece of the action.
Of course, advances in software development technology also play a critical role. The ability to quickly craft prototypes adds velocity to the effort involved in vetting compelling ideas for new startups. In a related fashion, new business concepts are also generated faster than ever before.
So let’s go into more detail on the rapid expansion of the startup studio concept. Leverage this information to make the right decision on acquiring venture capital for your next idea.
Successful Startup Studios Get Noticed
Simply stated, successful startup studios attract other entrepreneurs to form their own digital agencies as incubators of new businesses. This approach is similar to any other relatively new strategy garnering notice in the technology industry. The early adopters normally take the risks as with any emerging concept.
While these successful pioneers obviously benefit from their risk-taking, so do any who follow in their path. Still, forging a thriving startup studio requires a keen mix of technical know-how and business knowledge, especially in the industry sectors the studio hopes to target.
A Growing Community of Digital Agency Business Incubators
Not surprisingly, all this early success led to a buzz in an emerging world of startup studios. A variety of blogs appeared, publicizing positive stories about thriving new businesses incubated within a relatively new agency. When combined with press reports, the secret was out.
A thriving community now exists where startup studio leaders share best practices and lessons learned from their own efforts. This growing knowledge base also helps to drive the increasing number of adherents to this new model for creating businesses.
Prototyping Becomes Cheaper as Technology Advances
Technology advancements in software development allows project teams to craft prototypes and minimum viable products faster than ever before. In short, prototyping becomes cheaper, which makes startup studios more efficient and cost-effective.
Additionally, this approach allows them to quickly vet the technical aspects of any new business and/or product. A mature startup studio following this approach boasts an ability to properly evaluate new business ideas much faster than traditional methods. Of course, this assumes the studio employs or has access to experts in any targeted business sector. All told, faster prototyping provides another critical reason that the startup studio model continues to grow in popularity.
Easier Access to Critical Technology Talent
The transition to remote working in the wake of the COVID-19 pandemic widened the candidate pools for the technology talent the business world needs. Startup studios also benefit from an increased access to software development and project management professionals experienced in building successful new businesses. Before telecommuting became the new normal, the competition for qualified candidates within existing entrepreneurial hubs in Silicon Valley, New York, Boston, and other regions remained fierce.
Studios no longer need to struggle to find qualified tech pros within their local area or a startup hub; now the entire globe serves as a source for the human resources they need to forge fledgling businesses. Salaries for these professionals also decrease when not dependent on competing in high cost of living areas typical of startup hub regions. Again, this is a multifaceted factor leading to more startup studios.
The Failure Rate For Independent Startups Remains Steady
Notably, the failure rate for individual businesses formed outside a startup studio has remained steady for the last 20 years. Despite the advancements in technology and business insights over that time, most startups simply fail to make any meaningful impact, leading to notable losses in venture capital. Forming a startup studio and becoming part of a now thriving community provides the critical support and insights that improve an emerging business’s chance of success.
Ultimately, the benefits of networking play a crucial role in successful startup studios. With many new studios emerging in this expanding business landscape, isn’t it time for you to explore this exciting opportunity?
If you are curious about forming your own startup studio, check out NineTwoThree’s Digital Venture Studio Playbook. It outlines how we leveraged significant experience forging successful startup businesses in a variety of industries.