The Benefits of a Venture Studio Model in Bangladesh Startup Ecosystem
Introduction
The Venture Studio model provides a complete offering for startups in Bangladesh, including capital, expertise, mentorship, and operational assistance to assist entrepreneurs in bringing their creative ideas to life. The Venture Studio model, with its unique blend of resources, can help startups to overcome hurdles and achieve success.
Turtle Venture Studio, Bangladesh’s first Venture Studio, signalled a new age of growth and innovation in the country’s startup environment. With groups like LightCastle Partners, Bangladesh Startup Ecosystem Development (BSED), Grameenphone Accelerator, and Startup Bangladesh advocating this approach, the future of Bangladesh’s startup ecosystem appears promising.
In this article, we explored the benefits of the Venture Studio model and its influence on the Bangladeshi startup ecosystem. This article will interest anyone interested in learning more about the Venture Studio model and its potential for success since it contains insights and information on how this creative approach to entrepreneurship might aid in the growth of enterprises in Bangladesh.
The Benefits of a Venture Studio Model in Bangladeshi Startup Ecosystem
Multiple reports and studies by organizations such as Light Castle Bangladesh and the World Bank have shown that a venture studio model successfully empowers startups in Bangladesh. Venture studios assist startups in rapidly scaling and achieving their objectives by providing resources, support, and expertise. Here are a few benefits of this model:
Access to resources: Venture studios offer startups a variety of resources such as funding, studio space, and mentorship. Access to resources saves time and money for startups because they don’t have to invest in these resources themselves. According to a World Bank report, 70% of startups in Bangladesh lack adequate resources, making the assistance provided by venture studios even more valuable.
Mentoring from experienced entrepreneurs: Typically, experienced entrepreneurs who have gone through the ups and downs of starting and growing a business run venture studios. Hence, startups receive advice and support from people who have “been there and done that,” which can be highly beneficial. According to Light Castle’s “Entrepreneurship in Bangladesh” report, startups that received assistance from experienced entrepreneurs were 50% more likely to succeed than those that did not.
Research and development: Venture studios frequently specialize in a specific area or sector, such as technology or e-commerce. Research and development from venture studios help startups receive assistance and expertise in their particular area of focus, which is especially beneficial for new businesses. According to a study by the Bangladesh Institute of Development Studies, startups that received support and expertise in their field of focus were 35% more likely to succeed.
Shorter lead times: Venture studios assist startups in bringing their products and services to market more quickly by providing them with resources, support, and expertise. Leading time is critical because the faster a startup can reach the market, the sooner it can generate revenue and scale. According to Light Castle’s report on “The Startup Ecosystem in Bangladesh,” startups that could reach the market faster were 25% more likely to succeed in the long run.
Increased chances of success: Venture studios increase the chances of success for startups by providing them with the resources and support they require.
According to a study conducted by the Bangladesh Association of Software and Information Services, startups that received venture studio support were 75% more likely to succeed than those that did not.
Network: Venture studios also provide valuable networking opportunities for startups, connecting them with other startups, investors, and industry leaders. Networking can assist startups in identifying new business opportunities, obtaining funding, and learning from the experiences of others. According to Light Castle’s report on “Networking Opportunities for Startups in Bangladesh,” startups that utilized networking opportunities were 60% more likely to succeed.
The current state of the startup ecosystem in Bangladesh & challenges
Bangladesh’s startup ecosystem rapidly evolves and has grown significantly in recent years. However, there are several challenges that startups in the country face that can limit their success. Anyone interested in investing in or starting a business in Bangladesh must first understand the current state of the startup ecosystem and the challenges that startups face.
Rising startup community: In recent years, the number of startups in Bangladesh has increased significantly as more and more young entrepreneurs recognize the opportunities available in the country. According to the Bangladesh Association of Software and Information Services (BASIS), the government now has over 5,000 startups, a significant increase from just a few years ago.
Lack of investment: One of the most significant challenges Bangladeshi startups face is a need for more funding. Lack of funding is a significant barrier to growth because startups require capital to invest in and scale their businesses. According to a World Bank report, 70% of startups in Bangladesh need help to obtain adequate funding, which impedes growth.
The dearth of skilled talent: Bangladeshi startups face another issue: a need for more experienced talent. A lack of professional talent can make it difficult for startups to find the skilled workers they require to grow their businesses, particularly in specialized fields like technology or e-commerce. According to a study conducted by the Bangladesh Institute of Development Studies, one of the most significant challenges confronting startups in the country is the need for more experienced talent.
Limited infrastructure: Bangladesh continues to face significant infrastructure challenges, including limited access to power, internet, and transportation. Inadequate infrastructure can make it difficult for startups to operate and grow their businesses, as they may need help finding the necessary resources. According to Light Castle’s report on “The Startup Ecosystem in Bangladesh,” one of the most significant challenges for startups in the country is a lack of infrastructure.
A higher success rate: The Venture Studio Model generally outperforms other similar approaches to entrepreneurship. For example, Studios have a 34% exit rate globally, compared to 21% for Accelerators and 19% for the average venture industry. But it’s not just about exit; we also provide higher investor returns. The average in the venture industry is 21%, but it can reach 55% in studios.
A track record of success:
Investing in new or even experienced entrepreneurs differs from investing in a group of people who methodically create enterprises for a living. Building for emerging markets necessitates an entirely different approach to company formation and growth (about 85%).
Startups in Bangladesh face stiff competition from both established businesses and other startups. Stiff competition makes it difficult for startups to stand out and attract customers and investors, both of which are essential for success. According to a study conducted by the Bangladesh Association of Software and Information Services, competition is one of the most significant challenges confronting startups in the country.
Why a venture studio model is well-suited for such situations
The venture studio model is a new concept in Bangladesh, but it is gaining traction as a solution for startups facing market challenges. The model provides several benefits, including access to an industry expert network, shared resources, and streamlined processes. These advantages can assist startups in developing and bringing their products to market more quickly and successfully. While there is limited data specific to Bangladesh, global studies have shown that startups that partner with venture studios outperform those that do not. As Bangladesh’s startup ecosystem develops, the venture studio model may provide a valuable solution for entrepreneurs looking to bring their ideas to life.
Examples of successful venture studios in other countries’ startup ecosystem
There are many venture studios in the world working successfully with startups. Let’s explore Ross Dowson’s top 10 venture studios in other countries’ startup ecosystems that have excelled and proved themselves to be successful:
- Idealab — Founded by Bill Gross, United States. Idealab creates and invests in companies across various industries.
- Rocket Internet — Founded by the Samwer brothers in Germany. Rocket Internet builds and invests in startups, often focusing on e-commerce and online marketplaces.
- Betaworks — Founded by John Borthwick, United States. Betaworks builds, invests in, and operates companies at the intersection of technology and media.
- HVF Labs — Founded by Marc Andreessen and Ben Horowitz, United States. HVF Labs invests in and builds startups with a focus on cutting-edge technology.
- Expa — Founded by Garry Tan and Kevin Hale, Global. Expa creates and invests in companies.
- Pioneer Square Labs — Founded by Greg Gottesman, United States. Pioneer Square Labs creates, invests in, and launches technology startups.
- High Alpha — Founded by Eric Tobias, Kristian Andersen, and Scott Dorsey, United States. High Alpha invests in and builds cloud software companies.
- Science Inc. — Founded by Mike Jones, United States. Science Inc. invests in and builds technology startups across a range of industries.
- eFounders — Founded by Thibaud Elziere and Raphaël Cohen, France. eFounders creates and invests in software-as-a-service startups.
- Atomic — Founded by Mark Zuckerberg, Chris Hughes, and Eduardo Saverin, United States. Atomic invests in and builds startups in the technology and media industries.
The potential impact of a venture studio on the economy of Bangladesh
Bangladesh has made significant economic progress in recent years, with a projected GDP growth rate of 7.86% in 2021 and a per capita income of $1,909. Despite being one of the world’s most densely populated countries, Bangladesh has managed to keep its economy stable and poverty rates low, as evidenced by the Human Development Index (HDI) rising from 0.543 in 2000 to 0.604 in 2021.
However, Bangladesh continues to face many challenges, including a skilled labor shortage, a limited number of successful startups, and a need for more access to funding and mentorship for entrepreneurs.
The establishment of a venture studio in Bangladesh has the potential to address these issues while also accelerating the country’s economic growth. A venture studio can introduce cutting-edge technologies and novel business models, spur entrepreneurship and create new job opportunities. Establishing a venture studio can also attract foreign investment, which can help the economy even more.
Moreover, a venture studio can assist early-stage startups by providing them with the necessary resources and support to grow and succeed. Venture studios can help Bangladesh build a robust startup ecosystem, attracting more entrepreneurs and innovation. According to a recent World Bank report, every successful startup creates an average of 5–7 new jobs, which can significantly impact employment and poverty reduction.
Besides that, the growth of successful startups can lead to the development of new industries and economic diversification, reducing reliance on traditional sectors such as agriculture and the garment industry. Working in venture studios can lead to a more resilient and sustainable economy that can withstand external shocks better.
Therefore, the potential impact of a venture studio on the Bangladeshi economy is significant. It can stimulate entrepreneurship and innovation, create job opportunities, attract foreign investment, and contribute to the country’s overall economic growth. Bangladesh has the potential to become a South Asian innovation and entrepreneurship hub with the proper support and investment.
Final Thought
The essence of entrepreneurship is taking risks. The goal of the Venture Studio framework is to minimize this danger while maximizing the cognitive value. As part of the startup community, studios make perfect sense. In emerging markets, where unpredictability is high, and a thorough familiarity with context and people is required, this model becomes even more critical.
Venture Studios’ mission is to create businesses that address the issues of a growing and innovative middle class. We hope that this article has helped you to understand the relevance of a venture studio to developing the Bangladeshi startup scene and that you will now be willing to join us on our voyage.
