4 ms·
The article describes something akin to what a "spin-off" is. Reading the article, the author seems to assume that you already are in a capacity to set up your
by CaptArmchair 6y ago
The article describes something akin to what a "spin-off" is.
Reading the article, the author seems to assume that you already are in a capacity to set up your own studio. Either by having an existing business or being able to acquire an existing business and redirecting revenue streams, or by raising external capital (VC).
But those aren't the only ways to acquire the funds to set up a "studio" that separates the operational aspect of product development from the financial rigours that come with founding a business.
Such "studio's" can be found in research environments (academic, military, pharmaceutical, telecommunications, technology,...) Bell Labs, Fairchild, Intel,... come to mind as examples that started out as studio's before spinning off as independent businesses. Other examples would be public funding e.g. via programs managed by departments such as DARPA, NASA, SBIR (https://www.sbir.gov/ https://www.sbir.gov/), or via licensing, procurement, research grants and so on.
Those examples are far from inclusive. The author already asserts that the idea isn't new either.
The bigger problem I have with the article is that it's unclear who it's intended audience is. I don't think it's founders since the very essence of bootstrapping assumes spinning up a new business as fast as possible.
Investors then? The author claims how studio's "de-risk" by being able to diversify and rapidly pivot between ideas compared to independent start-ups. For instance:
> Because studios become experts at rapidly generating and testing ideas, the cost of each attempt is much less than it would be for a normal startup.
The author doesn't back up this claim. And what about other risks which are innate to studio's? Setting up a studio is still a sizeable investment in time and resources. And creating spin-off companies is never a goal in itself, it's only something that happens if there's a clear strategic advantage or incentive in doing so, depending on the relationship between the different stakeholders.