Our Venture Model
The focus is on creating a company structure that mitigates the exposure to loss of capital upon failure in the first 12 months of the validation process. This is achieved by incorporating entities as an ESIC with the Australian Government and using a managed business loan for the investors capital.
If the new venture is not successful within our framework and timeframe, the company is closed, returning IP back to the NFP (client) and the investors benefit from neutralising their invested capital.
If the new venture is successful, the studio raises capital for the next stage and plans for the company to be:
spun back into the NFP, or
spun out and restructured for scale
Both outcomes hedge the risk of lost capital whilst maximising the incubation of successful innovation.
We are partnering with NFPs to make it easier to align constitutional ‘Purpose Statement’ operations with a pro-innovation ecosystem.
Working with NFPs
We offer 3 streams to the NFP entity to partner with us:
1 - Fee for Full Studio Services This applies to any client that wants to engage our team for Technology, Brand or Fund Raising services without the option of co-creation partnership with joint equity ownership.
2 - Incubation Phase This applies to any entity (Charity, NFP, Social Enterprise etc.) that aims to bring research or concepts to the Studio and is seeking to create a new product or process. Much like a discovery process, we assess the the opportunity and offer Studio services or co-creation partnership with joint equity ownership as per the outcome.
3 - Venture Partnership Co-creation partnership with joint equity ownership.
Capital Investment is structured upon incorporating the company at the beginning of the co-creation process. At the end of ~12 months, all stakeholders make the decision to either spin-out or spin-in the new co. Restructuring the new co may apply. Case Study - https://madebybare.com.au/
In the case that the stakeholders make the decision to close the company, IP will remain with the NFP initiator and investors will have the benefit of a net-neutral performance to their invested capital (managed risk).
