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Why the future of startups continues with venture builders?

And what are Venture Builders?

Reading time: 4 minutes

If you haven’t heard of venture-builders let me introduce them to you: They’re organizations that build companies using their own ideas and resources.

Unlike incubators and accelerators, venture builders don’t support startups.

They create them.

They don't take any applications, nor do they run any sort of competitive program that culminates in a pitching events. Instead, they pull business ideas from within their own network of resources and assign internal teams to develop them (engineers, advisors, business developers, sales managers, etc.).

The Venture Builder identifies business ideas already validated in other markets and gathers the team and talent needed to develop them and make them grow. In addition to making an initial investment for entrepreneurs to reach the MVP and start pulling, VB offers teams founders headquarters finance, commercial management, platforms and systems, marketing and public relations and human resources;Then... the entrepreneurial team will only have to worry about developing the startup.

"Corporate venturing is changing."

Investing in tech startups is no longer a pure VC business. I observed private equity backed investors seeking new business models outside the traditional sectors. And noticed investment banks and multinationals, engaged in huge financing rounds ahead of contemplated IPOs.

Their problem: they don't know how to find the right startups, and neither how to make accurate evaluations.

If we take some of the differences into account, I know that many venture builders invest in seed funding in order to generate adequate interest from investors and to develop prototypes of products, they also incubate and initiate concepts within their company​.

THIS LAST POINT, IS WHAT MAKES THE DIFFERENCE WITH ACCELERATORS OR TRADITIONAL VENTURE CAPITAL.

Venture builders are the professionalization of entrepreneurship. Want to know some benefits?

  1. Do not want to think about founding? VB will look for it.
  2. Do not want to deal with the administration things. VB will offer the administration team that will help you controlling the payroll, tax, legal-thing, and IT infrastructure.
  3. Office? VB will provide it.
  4. Do not want to bother in picking-up talents. You will have all the talents, software engineers, and developers –ready to join. 
  5. Lonely? Not anymore. In VB, you can have more access to more people, more networks, and more infrastructure, in the real world. So you do not have to feel so lonely anymore.
  6. Wish to be paid in salary while building your company. So if you are a kind of entrepreneur who is not too risky (especially when dealing with family cash flow) but still dreaming of building a company, then VB is a good choice for you. 
  7. Work environment, you are surrounded by many entrepreneurs that have similar experiences, the experience of coworking without sharing space with non-entrepreneurs.
  8. Want your company scale very quickly. As quick as possible grabbing the market and making high profit.
  9. Do wish a faster route to market. Less than 6 months is enough for the company to be ready.

The venture-building philosophy is a rising movement in the tech and start-up industries. The most notable venture builders include Obvious Corp., which spun off Twitter and Medium; Mark Levin’s HVF (Hard Valuable Fun), which produced Affirm.com and Glow.com; Betaworks, whose portfolio includes Instapaper and Blend, and Germany’s Rocket Internet (PayMill, Jumia, FoodPanda, etc.)

In my opinion all multinationals at the end will have venture builders inside their own companies. They will provide the resources with external people with talent and skills. It's gonna be their way to approach the market and validate innovative products faster. Probably then reselling the tech and the insights, or using it by themselves, solving internal problems.

Which route will you choose for your startup, and where are you going to invest your money? What do you think about venture builders. Are they going to be the future?

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