Venture Studio Index - December 5, 2022
Venture Studio Index - December 5, 2022
A studio of studios, 4 new CEO roles, 6 new ventures studios and 8 new startups
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A studio that launches studios
Paris-based venture studio eFounders has rebranded itself Hexa, a studio of studios. Hexa is now a holding company for three separate studios: Logic Founders (focused on Fintech), 3founders (focused on web3) and eFounders (focused on future of work). Hexa plans to launch two new studios next year, eyeing the agriculture, AI, climate, education, healthcare and real estate verticals.
High Alpha has pursued this strategy by launching High Alpha Innovation, focused on co-builds, as well as dedicated funds for certain university partnerships. 25madison launched 25m Health in partnership with Apollo Global and its hospital portfolio company LifePoint Health to build co-build companies.
I’ve spoken to other studios planning to become a “studio of studios” or a “meta-studio,” and expect to see even more. Reasons why:
Venture creation is a craft effort, requiring a studio partner to find management teams, pilot customers, funding and market opportunity. At some point the hands-on work doesn’t scale
Analogy here is the “multistrategy fund” pursued by Citadel, Point72, Millennium, etc. These firms raise a large pool of LP capital and shift funds across many individual hedge fund portfolio managers (PMs), while providing shared risk parameters and back office execution. This franchise model enables PMs to focus on picking stocks, while removing operational overhead. Multistrategy funds are becoming the dominant form of the hedge fund asset class
Similar here, a meta-studio model like eFounders and High Alpha enables the firm to scale its startup creation playbook and LP relationships. Meanwhile, it lowers the barrier to entry for operators with the skillset and relationships to run their own venture studio by eliminating the need to raise their own fund. This franchise model could be a good solution for both sides
Scale. A meta-studio can develop a more extensive track record and larger array of investment options, potentially improving its access to institutional LP capital pools from pension funds and endowments
Industry focus. Slicing up a venture studio into multiple entities enables each studio franchise to focus on a specific end market, and continually develop relationships with potential pilot customers and portfolio company CEOs. Many successful studios are built around end markets such as Cyberstarts (cybersecurity), Redesign Health (healthcare), Flagship Pioneering (biotech) and this enables similar strategic focus
Still, it remains to be seen whether this meta-studio model will dominate as it has with hedge funds. Challenges include:
Many of the largest venture studios exits required significant, hands-on effort by the seniormost studio founder to get off the ground. Mike Speiser is often CEO for the early years of Sutter Hill’s incubations. HVF and Kairos HQ’s founders are still the CEOs of Affirm and Bilt Rewards. Other successful incubations came out of VC firms who pursue a lower volume of high-conviction incubations. While there are examples of successful high volume studios, there also may be a limit to the number of levels that can exist in a successful system. And whether the marginal hour is better spent by the studio founder in improving the trajectory of their winnners vs franchising their studio model
The meta-studio model adds another middleman who needs to get paid in company creation who is not part of the ongoing management team of the startup
Availability of talent. Finding startup CEOs who are comfortable sharing their equity with a venture studio is already a challenge to the industry. How many potentially elite venture studio founders exist who are happy to operate as part of a franchise?
(Techcrunch, Hexa announcement)
Interesting job descriptions
DESCOvery - Entrepreneur in Residence
“A new venture of the D. E. Shaw group (“DESCO”) seeks talented and highly motivated individuals to join its Entrepreneur in Residence (EIR) program as part of our DESCOvery initiative. DESCOvery is DESCO’s venture studio. It explores unique opportunities to build out innovative, non-asset management technology-oriented businesses and ventures in areas such as fintech, insurtech, and data and the EIR will help us explore such opportunities”
gener8tor - CEO, Hi WiFi
“Hi WiFi provides infrastructure, network management and business tools that empower communities to form their own independent internet service providers. Incumbent ISPs do not provide stable and affordable internet to rural and low-income communities. Hi WiFi delivers a turnkey business-in-a-box solution that leverages mesh networks to enable rural and low-income communities to create their own independent ISPs”
General Mills - Co-Founder/Corporate Entrepreneur
“The G-Works Co-founders are corporate entrepreneurs who bring passion, grit, agility and innovation to General Mills as they work in 3 person startup teams to discover new business opportunities. They develop deep empathy for consumers through research, learn through experimentation, and ultimately leverage the scale of General Mills to accelerate growth for their business…we are looking for strategic, passionate, entrepreneurial leaders to join as Co-founders in February 2023. These Co-founders will identify, create, validate, and operationalize new businesses that solve critical consumer problems in the food space. Their specific focus area will be around convenience or joy”
Redesign Health - Founder/CEO of Neurodegenerative Disease Care StealthCo
“Silver is a tech-enabled care partner that empowers PCPs and Neurologists to manage the increasing prevalence of Neurodegenerative Diseases (NDD), in particular the rise of dementia and Parkinson’s (PD) and the impact these NDDs have on patients’ comprehensive health outcomes. Silver’s multidisciplinary care team of mid-levels augments existing clinicians’ capabilities to deliver the “gold standard” of coordinated care in a scalable way to move NDD care into a value-based model.”
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Startup CEO recruiting service
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If you are a studio interested in being a pilot customer and connecting with high potential startup CEOs, email founders@venturestudioindex.com or reply to this email.
Database additions
We added 6 additional venture studios and 8 startups to the database, which now totals 383 studios and 1,775 startups.
Submit studios and startups to data@venturestudioindex.com or reply to this email