Technology is undeniably one of the most exciting sectors to be working in right now.
And seems like all you need to do to become a successful entrepreneur is create a cool app, get funding at a huge valuation, and then sell it for a lot of money.
There’s probably never been a better time to launch a startup and it’s not unreasonable for budding entrepreneurs to think they can succeed.
- It’s faster and cheaper than ever to create a product.
- Angel investors are jockeying to support promising ideas.
- A growing number of incubators and accelerators offer plenty of opportunities for support and mentorship.
- There is a universally accepted “lean startup” methodology to help guide development.
- There are countless inspiring examples of success, such as Hootsuite, Shopify, and Slack.
And yet more than 90% of startups will fail. That’s because industry hype has led to a fundamental misunderstanding of what makes a company successful.
Launching a successful business with little more than a good idea and hard work is like winning the lottery. It happens occasionally, but not for most people. The reality is that for the majority of tech entrepreneurs, it takes years of hard work – and a few failures – to learn what it takes to turn a good idea into a successful company.
In his book Outliers, Malcolm Gladwell spends a lot of time talking about the “10,000 hour rule.” Put simply, in order to become an expert at something, raw talent is not enough. Success, Gladwell claims, almost always requires an investment of at least 10,000 hours of deliberate practice and study.
Many entrepreneurs would like to think that this process can be hacked, and that they can develop business acumen overnight. In reality, this just doesn’t happen.
Likewise, entrepreneurs shouldn’t expect to hack fundamental business practices such as finding the right product market fit, creating a strong business development strategy, or putting together the right team. These skills are all time-tested fundamentals for building profitable long-term companies. It takes time to learn them.
Enter the foundry. Incubators and accelerators offer mentoring and resources to help entrepreneurs navigate the startup process, but more often that’s not, this isn’t enough. This could explain why even a top accelerator program such as Y Combinator sees only about 6.7% of its companies reach their benchmark return on investment.
The foundry model is similar to an incubator, except that it invests in people instead of ideas. It takes a more hands-on approach to developing companies, with the expectation that success rates will be considerably higher.
Newly established Stanley Park Ventures has embraced the foundry model. According to Stanley Park Ventures cofounder Jonathan Bixby, “a foundry starts by finding the right people it can develop as co-founders. Once the foundry has found somebody they can work with, it provides that person with a thoroughly vetted idea.”
A recent survey by CB Insights found that 42% of failed startups attributed their implosion to a lack of market need for their product. Foundries spend more time vetting ideas to ensure that there is a solid product/market fit before embracing an idea for further development.
With the right people working on the best ideas, a foundry differs from incubators and accelerators in that it is prepared to support their co-founders with resources, guidance and funding as they iterate on through to creating profitable companies.
Bixby believes his teams experience, ideas, and philosophy of deliberate practice – coupled with great people – will create a winning combination.
Banking disruptor Koho is the first startup to emerge from Stanley Park Ventures’ foundry and they’re on the lookout for more entrepreneurs to partner with to co-create great companies.
Bixby told Techvibes, “we’re looking for people who want to rise above the noise and hype and who believe that a philosophy of deliberate practice is key to becoming a successful a tech entrepreneur.” Apply today.