NEXT Studios Launches NEXT Up Program to Advance Indiana’s Rising Startups

Venture studio helps launch ideas into companies with accelerated NEXT UP program

INDIANAPOLIS, April 21, 2021 – NEXT Studios, a Midwest venture studio designed by entrepreneurs, for entrepreneurs, with entrepreneurs, announced today the launch of the NEXT UP program.  The program is launching its inaugural cohort starting Monday, May 3, 2021 with women-led startups from around the Midwest chosen to take part. 

Each month, a different community of underserved entrepreneurs will be invited to hone their ideas during a five-day “Discovery Week.” Those with a unique concept and clear identity will be invited to pitch for a potential investment from an affiliated local impact fund. Once accepted into the second phase of the program, an intense and focused six-month journey will accelerate the typical 12 to 18 month startup process. Pursuing their entrepreneurial dreams will become a full-time job as entrepreneurs work directly with mentors, experts and sponsoring institutions to refine and productize their businesses. A tailored group of services such as management, hiring, branding, finance, operations rapid prototyping and development expertise will help get products to market and generate that first dollar of revenue. 

In collaboration with and support from the Central Indiana Community Foundation (CICF) who supports creating a community where everyone has an opportunity to thrive, the third and final phase of the NEXT UP program will provide entrepreneurs an opportunity to pitch for additional funding to officially launch their company. 

“It’s an exciting time to be helping create an ecosystem of inclusive entrepreneurship,” said Joe Cudby, managing entrepreneur of NEXT Studios. “Entrepreneurship is hard, messy, complicated and NEXT Studios looks forward to using the cohort model to help actively think about the team element for driving company success and accelerating the lifecycle of startups from big ideas to get them to market faster.”

Four founding teams will be selected to take part in the inaugural “Discovery Week.” Founders seeking to apply for this or later cohorts can visit nextstudios.org/nextup/ or email nextup@nextstudios.org. To learn more about NEXT Studios, please visit next-studios.org.

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About NEXT Studios

Founded in 2020, NEXT Studios is a venture studio that is a partnership of experienced entrepreneurs who help visionaries share their ideas, craft them through a repeatable process, and move them forward with capital and talent.  The studio works with entrepreneurs across the state to move their ideas into products and their products into companies.  The studio uses a proven process to reduce the risk for investors and encourage more local investors to get involved in our local innovation economy.

Why Are Venture Studios Popular?

Photo by Austin Distel on Unsplash

It is estimated by Enhance Ventures that there are now over 550 studios in operation around the world, having grown by 625% since 2013.

This growth may come from several factors:

  • Due to the rapid growth of large cloud-based platforms like Google, Amazon and Microsoft, there has been a reduction in the availability of venture capital for early-stage startups. Investors are increasingly wary of funding a startup which could be seen as a competitor to one of the platform companies. To the degree that VCs make earlier stage investments, the risk reduction provided by venture studios makes those startups more attractive.
  • Many of the bigger opportunities for startups come from machine learning, deep computing, and other technologies that are beyond the capabilities of first-time entrepreneurs. Solving these issues usually requires the deep experience that few startups can afford. Studios offer this expertise in a teamed approach with the startup founders, which allows the company to be more ambitious in its goals, which could drive larger returns.
  • The typical ten-year cycle for a startup that focused on the largest sale price of the company is not the ideal training ground to develop new entrepreneurs and seasoned teams. It also tends to result in a lack of diversity in investors and founders, because the only objective is the best return on the investment, so anything outside of the “tried and true” is perceived to add risk. Studios can be tailored to cater to different geographies, diversity in founders and objectives beyond the biggest “exit.”

What is the difference between venture studios and startup accelerators?

Venture studios are not the same as startup accelerators such as Y Combinator or Techstars. A typical accelerator may offer a 10-to-12-week program focused on ideation or productization in exchange for $10,000 to $100,000 in funding and an equity stake. The objective is to help the founder move their business along to the point where investors might be interested in funding the next stage. It is expected that most of the startups will fail, and so an accelerator becomes an effective way to “play the field” and invest a relatively small amount of money in many different startups at the same time, such that if just a handful are winners, they offset the losses for the majority that don’t succeed. 

While it’s possible to succeed as a startup founder without the support of a venture studio, partnering with one reduces the risk of failure and can accelerate your ability to access venture capital and the resources you need to succeed.

Written by the NEXT Studios Team

How Do Venture Studios Work?

The new engine of intentionality in the world of startups and innovation

Sometimes called “startup studios,” venture studios are organizations designed to create new startup companies. They do this either by generating new ideas for startups or by recruiting founders with ideas, and then they apply significant amounts of time and capital to the process of growing the startup successfully.  At the heart of every venture studio lies a process, which generally has four steps (though each studio may give them slightly different names):

  1. Ideation – the process of coming up with a new idea and “pressure testing” it with potential buyers through conversation and the sharing of prototypes
  2. Productization – the process of developing the “minimum viable product,” or MVP, which is not the final version but is enough to share it with customers for feedback and continued development
  3. Launch – the process of creating and initiating a go-to-market strategy, including sales, marketing and customer support 
  4. Scale – the process of building an organization around initial market success that will help it grow

Venture studios are often outgrowths of venture capital funds, as each stage of the process requires capital funding to pay for each activity. Depending on the depth of the involvement, the equity stake taken in the company can be quite high, as startups are risky and most fail.  The involvement of a studio in the startup tends to reduce the risk for investors, as the process and the experience of the team can help to avoid common mistakes that would cause others to not succeed.

There are several different models for venture studios, but most of the differences center around how much of the company is owned by the studio as compared to the founders.

  • 1st Co-founder studios are designed for founders with an idea but little to no expertise in how to start a company. Generally, the studio will take half of the equity in your company, leaving you with the other half, and then they will do practically everything else from validating the idea through development of the product through the launch of the product into the marketplace. Usually, the founder will move into the role of CEO at the launch stage, and the company then operates like other new startups.
  • 2nd Co-founder studios are designed for startups that are further along in the process. Often, they have a minimum viable product and some degree of customer interest but are struggling with a go-to-market strategy and the funding required to launch the product and scale a team. This is frequently seen with engineering-oriented founders who are experienced with a technology and have created the basic product but lack the business skill and experience to create a company around it.  More of the equity is held by the founder in this model – typically 65% with 35% to the studio, and the role of the studio is to supplement the founder’s team with additional resources working in concert to move the company forward.
  • 3rd Co-founder studios are designed for startups that have a solid team but have certain “holes” they need filled. A very typical need is for someone to manage the product or technology, or perhaps to setup and manage a sales team or a marketing team. In this model the studio operates like mercenaries brought in for specific purposes to complete the leadership picture. Here the smallest amount of equity goes to the studio – somewhere between 10% and 25% depending on how many needs must be met.

Of course, all of these are guidelines: there is an infinite range of models for studios across the spectrum.

Why do founders choose to partner with venture studios?

The core value proposition of a venture studio is to access skills, expertise and a network beyond the founding team. These resources reduce risk and enhance outcomes by equipping a startup with resources they usually cannot afford early on:

  1. Skilled teams employed by the venture studio or through their partner network amplify the ability of the startup to execute and reduce the time and expense of rework based on mistakes and inexperience.
  2. Methods and tools created and offered by the studio to portfolio companies help obtain results more quickly as they are the result of distilling experience and failures into process.
  3. The willingness of venture studios to “roll up their sleeves” and provide hands-on guidance both reduces risk and provides accelerated mentorship and training to founders.

Essentially venture studios absolve you as founder from having to figure out how to attract or get investors to fund your business or how to convince someone to invest in your product. You get to focus fully on leveraging the skills, expertise and network of the studio to build your startup.

Written by the NEXT Studios Team

Ladies, Be Careful Not to Silence Yourself

Shelley Klingerman | Managing Entrepreneur for NEXT Studios and CEO & Founder of Stiletto Agency

Photo by Chelsi Peter from Pexels

Building a company with partners is a whole different experience than building a company by yourself. Ask me how I know. Both are rewarding and challenging, but they are different journeys. When you build a company yourself, you are 100% in control of the decisions that, for the most part, only affect you.  It’s your success or your failure and you know that. It could be a great payoff for you, but you could also lose it all if it doesn’t work.  And when it’s just you, you can control the level of risk you’re willing and comfortable in taking. Most likely that level of risk will come with a lot of questions; such as, “Do you have another source of income to get you by? Do you have a spouse that can support you while you test the waters?  Are you going to jump in with both feet and burn the boat?”  It doesn’t matter what you do, because you only have to “worry” about yourself.  You can’t be silent because you’re talking to yourself and making independent decisions that you will immediately know about.

In a partnership it’s different. You are bringing various experiences and perspective to the table to build a company. No single partner’s thoughts, opinions or experience trumps another, UNLESS YOU LET IT.  If you don’t speak up, it’s on you. Most partnerships come together because everyone is bringing an important perspective to the table and you are stronger together than you are independently. Always keep that in mind, you are there for a reason.  There might be times when you feel your perspective doesn’t align with the majority so, “I must be wrong” or you trust the others. That’s common, however, your purpose for being at the table is to disrupt the group think and provide a DIFFERENT perspective. One that might be completely opposite of what’s being discussed, but it’s your responsibility to make sure it’s considered.  It might not be the way things go, but at least it was considered.  I’m here to tell you, it can be intimidating and misinterpreted (by you) that, “I don’t see it that way, so I must be wrong”.  Yet, it is so important that you don’t silence yourself. You need to be heard for the benefit of the company that you’re equally responsible for building and its success. If you are a female, this whole experience has the potential to be exacerbated.  

As someone who is passionate about this challenge, I spend a lot of time empowering women on how to seize control of their safety through my work in Stiletto Agency, as well as empowering visionaries (entrepreneurs) to seize control of their future through my work as a Managing Entrepreneur with NEXT Studios. And to be completely honest, I spend a lot of time managing this for myself. Ladies, if we’re going to come to the table, we have to check any insecurities, passiveness, and 100% trust at the door. Acknowledge feelings when they surface and know they were given to you as tools to guide you through life in both personal and professional situations. There is NO feeling that should be dismissed. Every feeling/emotion has a very important role. Some are meant to pause you; others are meant to make you act. They are YOUR feelings. You own them. No one can tell you they’re wrong.  

You may allow others to provide you information that you can take into account to work through your feelings, but they can’t change them, only you can.  My point is, when something doesn’t FEEL right to you, it’s real. It might not be the way someone else feels, but that doesn’t mean your feelings aren’t valid.  When you’re building a company or making your way through a corporate environment, don’t not address something that doesn’t feel right to you.  Unchecked, these feelings will manifest into things like resentment or panic, which become a much larger distraction and can unnecessarily derail your success.

Women get concerned about being labeled, so we don’t speak up. We need to. For our own good and for the good of our business. Do not silence yourself. I often go back to this quote by Eleanor Roosevelt: “No one can make you feel inferior without your consent.”