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Automation and Processes in Startup Studios

By: Manush Melkumyan | Date: April 15th, 2021 | Categories: startup studio, venture-builder,

Many rookies in the Startup Studio environment say that they have left the Corporate sector (in addition to other career-related reasons) also because they aspired to gain more freedom and less discipline. What they have been expecting was to follow fewer processes in this new exciting working environment that they so enthusiastically joined. 

On the other hand, I’ve heard a few major Studios refer that the Processes are not the most important part of the Startup Studio’s success, or at least they are not the main focus. Well, I could agree perhaps only with successful players that already have all the essential processes in place - even if they are not on paper yet - however the flow is well organized and things happen organically. 

It’s similar to a situation when an Olympic champion claims that he/she doesn’t focus on the daily routine, or that they have issues with discipline. Of course, they don’t. This is an essential part of their life and has become as necessary as breathing or eating properly. 

Let’s have a look at a daily routine of an average (with no specific daily commitments) person, for example, mine: wake up and routine in the morning, meals 3 times a day, work and business meetings with a flexible schedule, some learning to keep improving myself, leisure and personal meetings. 

This may be a daily routine for anyone. If we sometimes miss a few components (we still have to wake up), leisure or even a healthy meal, that’s going to be ok, but if we abandon these habits at all and quit the routine our health, body, psychology, and then all our life will get messed up (and this is especially true also for hair if we skip the brushing procedure!

As they say, we don’t need to invent a new bicycle, we just need to learn from the success cases and there are so many of them and not only within the Industry. In nature, including human nature, we can meet one of the best examples of processes. If the sun would shine whenever and wherever it happened to, or it would be snowing at any time during the year, or the night would arrive in the middle of the day, no life could exist in such conditions. It would be chaos. 

Likewise, no smooth operations will be possible to organize in an unorganized setup. Hence the processes are the basis of the organizational setup and are the brain for a proper functioning mechanism. 

Going back to the industry: Startup Studio Model is unique for its efficiency and metrics, for example timings are crucial, such as rapid MVPs, quicker spinoffs, and shorter periods in between the financing rounds. All of this is a result of well put in place processes in line with the other components such as structure, team, and business methodologies. 

Design thinking, agile methodologies, lean startups, and other tools and approaches ease processes making them efficient. And sometimes we think that everything we learn just now is new especially with all the fancy titles. But, hey! as the Russian expression quotes: “Everything new is well-forgotten old…” So all of these process optimization mechanisms were well put together starting even before the first industrial revolution when the modern automation of processes was born in its embryonic form. 

Have you ever been to a factory, seen a conveyor? Anyways, no doubt you imagine how a conveyor belt works. 

Well, well-built Studios have something similar to the conveyor belt. Imagine several MVPs being developed at the same time, launched after one another, simultaneous funding rounds for the various Ventures going on, spinoffs and so much more going on. The studio works as a plant, a venture factory with the ultimate goal to have a high success rate for the Ventures and ensure high returns for its founders.   

Since Startup Studios can be imagined as Factories producing ventures as the product, a lot can be associated with this circular spinning system. If we don’t have all these “conveyors, equipment, logistics”, other tools and mechanisms to help make things quicker, better, more efficient, we won’t get to the final destination as quickly as we wish to or won’t get there at all.  

Furthermore, let’s see what process can be standardized or even automated in the Startup Studio?

Ideation process: many think that ideas are the most important in innovation, startups, or in general. Maybe genius ideas are a rare thing, however, what makes them truly genius is the execution and the fact of them being prone to market realization. So, regardless of the fact if these ideas are internally or externally generated within the Studios, they shall be resistant to competition and other threats as well as somehow guaranteed for validation. Many Studios have already proven processes for validating ideas even before the MVPs. These types of unique processes are one of the key success factors not only for the particular Studio but also for the Model and ecosystem in general because the experience and techniques can be adopted by other Studios and Venture Builders. In addition best practices can be mimicked not only looking at peers but also seeking in other industries, ecosystems and aspects as described above. 

Venture Creation process: Once the idea is confirmed with all the processes behind it’s good to go to the MVP creation stage. Generally, Studios claim they don’t have a preset process for building their ventures, but given that it’s the primary goal for a Startup Studio, most of them have, maybe again not quite on the paper. For example, creation of an e-commerce app or landing page for a venture that makes a food delivery is necessary, automation of marketing tools for a venture that provides community-building services is a must, etc. Another part of the cycle in this process is the flow between the business team and executing team, how the technical tasks are being formed and translated into the product, in addition to all the tools and platforms described for the MVP development.

Operational processes: Management of the Studio is mainly a clear process described within playbooks either separate procedures for each section for example business processes, Product development and IT, Marketing, branding, and communication, etc. and most importantly the funding and fundraising for the ventures, where the average timing between the rounds, capital structuring, expense allocation and other information can be defined. 

One general process for administration and project management (at least its basic features) including tools and platforms is always present (maybe not necessarily registered in the docs if there are ready apps to support) to ease and smooth the operational flow.  

On top of this, each venture created within the Studio may have its separate one or more processes, given that the spinoff takes approximately up to 5 years, so the ventures also need to be organized with a solid operational base including clear processes such as product management, lead conversion or the client support &, etc.  

Since the core Studio team of 7-20 people may support simultaneously building 2 to 10 startups a year, these processes will be an excellent reference point for the team members if the procedures are not fully automated and even if so, for the new members during onboarding. So there is lots of time, resources saved and efficiency ensured here.

Startup Studio is a relatively new entrepreneurship model and unfortunately, there’s not so much academic knowledge and expertise on how to properly set up things also related to the processes and other aspects too. But the best thing would be to learn from the best practices and there are so many there, all you need is to reach out to peers, ask to share their experience, and observe.

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Manush Melkumyan

Manush is currently the Executive Partner at StudioHub. Prior to this, she has been working in the top management in the Corporate and earlier in the Public sectors with 10+ years of engagement within the Startup ecosystem as an entrepreneur, mentor and consultant. "Life more than anything amazes me and I aspire to animate everything around!" M.