Venture Building vs Venture Capital?
Venture Building is a young but rapidly growing trend on the Polish startup market. In short, it is a business model that involves creating new companies from start to finish. What were the beginnings of Venture Building? What does it look like in practice? How is it different from Venture Capital? Read this article and you will find out everything!
Venture Building – what exactly is it
Venture Building is a structured process of developing business concepts and transforming them into fast-growing startup projects. It works based on the resources of a given venture builder – not only financial, but usually also technological, business, operational or marketing.
As Arkadiusz Seńko says: Venture Building is a business creation process from the idea and MVP stage to scaling and exit, carried out by an experienced organization.
Venture Building – history
Although the term „Venture Building” did not yet exist at that time, its origins date back to the 1960s, when the first companies dealing with creating new enterprises from scratch appeared.
However, probably no one will be surprised that this business model comes from Silicon Valley. The first company of this type, IdeaLab, was founded in 1996 by Bill Gross, one of PIMCO’s investors.
IdeaLab has successfully created over 150 companies, almost ⅓ of which have been listed on the stock exchange and bought out. It provided startups with significant benefits, especially through access to computer systems at a time when cloud technologies were not yet widespread.
In the 2000s, VB began to enjoy the popularity of the technology industry, where venture building companies focused on creating new technologies and innovative solutions. In recent years, this model has already gained notoriety in various industries and is now used by many companies around the world.
Venture Building – advantages
Venture Building is currently gaining more and more popularity because it has a lot of significant advantages. The most important of them are:
- versatility; the ability to use VB to create a startup in virtually any industry,
- using the knowledge, competences and experience of a venture builder and previously established companies,
- reducing the risk of making mistakes,
- comprehensive support for the organization,
- chance for dynamic development of the organization,
- the joy of developing new concepts and the satisfaction of launching new projects!
Venture Building and Venture Capital – differences
It happens that Venture Building (VB) is confused with Venture Capital (VC). Of course, these models are somewhat similar, but they differ in the way companies are financed and managed. Here are some major differences between the two models:
- VB is financed from its own resources or from loans, while VC is financed from external investments,
- VB focuses on creating new enterprises from the beginning, while VC invests in existing ones,
- VB is involved in the development of a startup, offering its knowledge, experience and resources, while VC usually stays outside and does not get involved in the daily activities of the company,
- VB is both an investor and a creator, while a VC is usually just an investor,
- VB often involves participation in the company’s supervisory boards and strategic decisions, while VC usually stays outside and does not get involved in the day-to-day operations of the company.
|Venture Building (VB)
|Venture Capital (VC)
|is financed from its own resources or from loans
|is financed from external investments
|focuses on creating new enterprises from the beginning
|invests in existing enterprises
|is involved in the development of a startup, offering its knowledge, experience and resources
|usually stays outside and does not get involved in the daily activities of the company
|is both an investor and a creator
|is usually just an investor
|often involves participation in the company’s supervisory boards and strategic decisions
|usually stays outside and does not get involved in the day-to-day operations of the company
Venture Building – examples
One of the largest both venture building and venture capital funds is Tar Heel Capital Pathfinder, which:
- invests in pre-seed, seed and series A rounds of projects from around the world,
- builds scalable technology businesses with a global reach,
- focuses on investments in innovative industries and new technologies,
- in addition to financing, it guarantees support, e.g. developers, designers, product owners, financial, administrative, legal or business strategy specialists,
- in a very short time creates a product or helps to improve it and bring it to market,
- has experience in solving unexpected and unusual situations faced by startups.
Part of the THC Pathfinder fund is the largest Polish startup studio, Red Sky, which:
- for almost 17 years, it has been implementing technologically advanced projects and creating IT solutions that are used by millions of users around the world,
- introduces new, revolutionary products to the market every year,
- supports great ideas and promotes talents,
- invests in projects at various stages of development and creates its own, starting from an idea,
- we help in building innovative start-ups not only by providing financial resources, but above all by substantive support,
- deals with the creation of software in the latest technologies and according to the latest trends, placing particular emphasis on the final satisfaction of its clients.
Do you want to create your own business, but you have no idea about it? Or maybe you have a great idea, but you are afraid of creating a startup yourself? Do it in the venture building formula and build a business with us!