People often confuse venture builders, incubators, and accelerators. There are similarities, but they are fundamentally different.
Where incubators and accelerators deal in existing ideas, a venture builder dreams up ideas in-house. The team then builds a minimum viable product. And if it finds product-market fit, the team headhunts an entrepreneurial CEO to scale the venture.
A key aspect of the venture builder model is that the entity adopts most of the early-stage risk, and, in return, the team can take anywhere from 30-80% of each new venture’s equity. That said, no two organizations are exactly the same.
Today, we’ll dig into what makes Novus Labs a little different, but first, let’s quickly cover the two alternative start-up models.
Incubators and accelerators at a glance
Start-ups are notoriously risky. That’s why incubators, accelerators, and venture builders have grown in popularity over the last few decades.Each organization de-risks early-stage companies in its own way, helping teams find product-market fit while raising seed capital. Each is also typically run by experienced entrepreneurs who know how to build a company.
But what marks an accelerator from an incubator? Well, Y Combinator is an example of an accelerator, typically welcoming a group of start-ups into a 12-week boot camp, favoring companies with a viable business model and an active team.
These boot camps usually end with a pitch day, during which the teams get a few minutes to showcase their companies to VCs and angel investors — with the accelerator also expecting to take up to 10% of the company’s equity in return for hosting the boot camp.
Incubators look a lot like accelerators, but they rarely provide start-up capital. They simply offer a co-working space alongside other shared resources, including access to other founders and operational expertise, all in return for a membership fee.
Then we have the venture builder.
The venture builder model
A venture builder is like an incubator for internal ideas or ideas sourced from partners.
You can think of it as something of an ideas factory in which a team takes ideas, builds MVPs, and validates concepts via a set process.
Ideas that gain traction are then taken to market with the help of a specialist co-founder, with venture builders creating and launching upwards of four start-ups every year, often achieving a higher success rate than accelerators or traditional VCs.
The venture builder model is successful because teams can quickly kill less promising ideas while experimenting with select concepts until they find product-market fit — and in reality, there are four types of venture builder:
- Tech transfer studios work with outside partners to find ideas and IP, which they use to build companies inside of their venture studio.
- Corporate studios are like a start-up within a large organization, taking ideas and IP from the parent company, which they can spin off into separate entities.
- Industry-agnostic studios will run with any and every idea they can come up with, regardless of the industry.
- Niche studios will run with any and every idea they can come up with, but they will stay focused on a specific domain, a little like Novus Labs and Web3.
So now you know Novus Labs is a Web3 venture builder, but why would you want to work for a company like ours?
We can think of a few reasons.
Why would you join a venture builder?
If a venture builder typically takes a majority share in the companies they create, why would an entrepreneur choose to join one?
After all, an accelerator typically expects a 10% equity share, so wouldn’t it be a better option? The fact that the venture builder has de-risked the start-up from many early-stage threats makes them an excellent proposition for any aspiring entrepreneur.
You get all the excitement of scaling a new venture without the looming threat of failure in the rearview mirror. Moreover, when you join the right venture builder, you get to work alongside experienced, proven entrepreneurs.
Take Novus Labs. Our founding partners include Will Kannekens, an entrepreneur with ten years of experience in venture investing and marketing. Will co-founded both Skyman Agency and Skyman Ventures, and he’s worked with over 100 promising crypto businesses.
Working alongside Will is Raoul Milhado, a seasoned web3 entrepreneur who has co-founded DeFi and NFT platforms, alongside owning a specialist development studio, which now works exclusively for Novus Labs.
The development studio has deep experience as a leading provider of cutting-edge blockchain, AI, Web2, and enterprise solutions, not to mention a background in building DeFi and NFT platforms alongside custom web3 solutions for major brands like BMW.
Novus Labs is fortunate to have attracted the brightest minds from DAOsocial, a specialist marketing and incubation agency, to work solely with its team.
They’ve done everything from running growth campaigns to serving as interim CMOs.
Poised to grow in 2023 and beyond
With a core team of twelve that includes technical, marketing, creative, legal, strategy, and finance specialists, Novus Labs is perfectly positioned to capitalize on emerging opportunities in Web3.
With five companies scoped to launch in 2023, there’s plenty of work on the table. And our venture building studio makes for an attractive proposition for ambitious entrepreneurs looking to break into the blockchain industry.
If you’re interested to learn more about what we’re building, why not apply to become a Novus Labs partner today?
We’d love to hear from you.