What is a venture builder and why is such a hot trend?

Ana Vilar García

Venture building is one of the hottest trends in corporate innovation. But what is a venture builder or venture studio? Is it the same thing? Why is it a key solution for large corporations and why is such a hot trend?

All of these questions, answered below. Keep reading!

What is a venture builder?

A venture builder is a type of company that builds startups based on innovative ideas or new business models. Yes, it’s a company that builds companies. 

But this is a broad definition. Venture builders present some particularities, especially in the way these startups are launched and exited. A venture builder creates these new companies using their own ideas and resources. Unlike a startup accelerator or a startup incubator, the projects are conceived in house, so external or existing startups are not the target of this type of company. Once these new ventures are created, the venture builder is the majority shareholder and looks for a founding team that keeps developing the new business.

👉 Want to know the exact differences between an accelerator, an incubator and a venture builder? Keep an eye on the Corporate Lab blog for a deeper analysis on the topic. 👈

Venture builder vs venture studio

Venture builder and venture studio are two terms usually used interchangeably, but we disagree on this. They are very similar types of companies, especially if we consider their main goal - launching new startups, but the outcome and the actions involved in the process may differ.

A venture builder starts their projects based on its own ideas and builds the project with its own entrepreneurial team. 

On the other hand, a venture studio works with a core team that validates the new ventures and later on searches for the team that will develop this idea. 

In any case, both venture builders’ and venture  studios’ activities can merge at some point and diversify the way startups are created and exited. Nothing is written on stone, and flexibility is always key, also in this matter.

The rise of venture builders: A hot trend in corporate innovation for 2022

According to The Mind the Bridge’s report “Evolve or Be Extinct: Current and Future Models of Open Innovation from the 2021 World’s Corporate Startup Stars”, venture building is one of the hottest trends in corporate innovation for 2022. But why?

This model presents a lot of advantages for companies to jump into innovation without sacrificing their strategy or their resources. These are some of them:

Save time and resources

Compared to the process of launching an independent startup, venture studios offer a way more agile and economic way of finding new businesses and making them a reality

Founding a startup requires several seed rounds plus hiring a team and this may take at least a whole year. On the other hand, hiring a venture studio allows a company to create a startup with less economic resources, without the need of hiring a team, and in fewer time. 

Trust experts on the topic

Large successful companies are experts on many topics, but innovation isn’t usually one of them. It’s not that they aren’t aware of the importance of corporate innovation, but rather a friction when it comes to getting their hands on it. 

Managing a successful company requires a lot of specific knowledge, and this doesn’t necessarily mean that innovation is one of them. That is why a venture studio helps large companies with the innovation issue. A venture studio like Corporate Lab is composed of a series of entrepreneurs, experts on startup creation, so leaving a project in their hands means you can delegate this topic and continue working in your area of expertise.

Don't put all your eggs in one basket

If a company has found their product-market fit and it is successful, why change it? Sometimes, diversifying your business options is a better idea than just disrupting the whole company. There is no need for such a dramatic option, you can just opt for trying out new business models that complement your existing one.

The problem with finding new complementary ideas is that it usually creates a conflict with the existing strategy or roadmap. Disrupting a whole company's business model requires breaking long-term roadmaps, readjusting human resources, and taking risks that are just too risky. 

This is why venture builders are a great option to come across these obstacles. Unlike in-house innovation departments, venture studios don’t clash with the company’s strategy, roadmap or objective key results. They don’t require hiring new people, creating new departments or deviating resources for new projects. 

Does the idea of hiring a venture studio tickle you? Let’s chat! You can schedule a call to discuss new interesting ideas for your company in the area of innovation.

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