Who are venture studios hiring to lead their startups?

Analysis of data on venture studio startup founders

Venture Studio Index compiled a database of 250 CEOs of venture studio startups to understand the founder profile that studios are targeting and how it differs from independent, VC backed startups.

Key takeaways

• The average venture studio startup founder has ~16 years prior experience, did not attend a top ten school and does not have a STEM degree

  • By comparison, founders of the top ten unicorns have slightly less experience, are slightly more likely to be a previous founder, and are much more likely to have attended a top ten university and have a STEM degree

• Among venture studio startups with the most traction (funding, employees), most are led by first time founders

  • By comparison, about half the founders of the top 10 unicorns had previously founded a company

• Over time, studios are recruiting increasingly younger founders for their B2B startups and increasingly more experienced founders for their B2C startups

• B2C startup founders: have ~12 years prior experience, most did not attend a top ten university and few have a STEM degree

• B2B startup founders: have ~22 years prior experience, most did not attend a top ten university and half have a STEM degree

  • By comparison, the top 10 unicorns (which are primarily B2B) are led by founders with ~14 years of prior experience and are very likely to have attended a top ten university and have a STEM degree

• Leading venture studios and their typical founder profile:

  • Most leading B2C focused venture studios recruit younger founders who have previously founded a company

  • Most leading B2B focused venture studios recruit more experienced founders who have previously founded a company

• Venture studios recruit founders from a range of education and experience. However, a few appear to focus on a certain founder type:

  • Expa Studio, which launches startups across B2C and B2C, appears to focus on younger founders who have previously started a company

  • Fractal Software, specializing in vertical B2B software, focuses on younger, first time founders from a top school or with a STEM degree

  • Juxtapose, focused on B2C, recruits seasoned professionals who have previously founded companies. Their founders had an average prior experience of ~22 years, compared to ~12 years on average for B2C

  • The Production Board, which focuses on deep science health and agriculture startups, appears to recruit only seasoned professionals who have not previously founded a company

  • Sutter Hill Ventures, focused on enterprise (e.g., Snowflake, Pure Storage), appears to recruit only seasoned professionals who have previously founded or been the CEO of a large company for their incubations

Trends in founder backgrounds over time

Venture studios are recruiting increasingly younger founders for their B2B startups and increasingly more experienced founders for their B2C startups. Compared to the top 10 unicorns (not incubated by a studio), venture studio founders are much less likely to have graduated from a top university or have a STEM degree.

Founders of leading venture studio startups

Most of the top venture studio startups, measured in terms of employees and startup funding, are first time founders. B2C founders are younger on average, and B2B founders have more prior experience.

Founders recruited by leading venture studios

Studios focused on B2B tend to recruit founders with more prior experience, studios focused on B2C tend to recruit younger founders.

Data methodology and limitations

Venture Studio Index publishes a free, public database of venture studios and their startups. We identified the founder/CEO of 250 of these startups and noted their prior years experience, university, field of study, and whether they had previously founded or been the CEO of a company.

In order to focus on recent trends, we selected only startups founded since 2017 for both venture studio startups and the comparison set of top unicorn startups.

Experience is the number of years between graduating undergrad or masters and joining their startup as founder. PhD work, where applicable, is counted in years experience.

For efficiency and to ensure educational backgrounds are comparable, we focused only on US based startups and venture studios.

We selected one founder profile for each startup. When multiple founders were listed, we selected the CEO. Some studio startups are currently led by CEOs who joined after founding, in which case we listed the founding CEO or the founder leading product at inception.

This dataset has the following additional limitations:

• Some venture studios keep their startups in stealth until they raise external funding, others choose never to announce them for strategic reasons. Affiliations in these cases are difficult to identify and we were not able to find all of them

• We did not classify industry background, which is a likely big determinant of whom a studio recruits to lead their startups. For example, deep science focused venture studios likely focus on founders with a strong research background

• Startup and studio data are sourced from the Venture Studio Index database, which tracks 173 studios and 853 startups, as of July 18, 2022. We believe we are covering the majority of, but not all, studios and their startups. We are specifically missing most startups incubated inside venture capital firms who do not run a formal venture studio

See methodology and data limitations for additional background on our database of studios and startups.

Conclusion

Venture studios are recruiting founders from a range of experience and educational backgrounds. Founders hail from different countries, some have military service, others come from academia or other places not typical of most VC backed entrepreneurs. By vetting ideas and providing significant operational and financial support, venture studios can target a broader range of backgrounds than typical early stage VC funds.

We will likely see venture studios continue to specialize across certain end markets and technology expertise. Some venture studios may target only IPO/unicorn outcomes, while others may pursue a higher volume of medium scale outcomes with more certainty. The strategy of a venture studio determines the profile of the founder they recruit.

Those venture studios who are able to deliver the best startup outcomes, raise the most LP capital and achieve the most scale will determine the background mix of venture studio startup founders going forward.

Potential founders/EIRs should consider the various studio strategies when deciding the best partner for them.

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