The business landscape underwent a profound transformation following the 2020 global pandemic.
This change propelled innovations aimed at enhancing the quality of life by challenging and overhauling existing infrastructures. Venture buildings, or startup studios as they’re commonly known, epitomize this change.
These entities systematically birth new startups, providing shared resources to ensure their success. This transformation also gave rise to a novel concept: ‘Remote Venture Building.’
Remote venture building is the process startups are brought to life and scaled by a digital service operating remotely. It’s ideal for teams that are based locally or spread out geographically.
This approach has proven effective as it harnesses untapped talent pools: globally-sourced, part-time workers, parents, domain experts, those engaged in traditional 9-5 roles, digital nomads, and more. By doing so, it amasses a formidable global workforce positioned for tremendous success.
The influence of remote work has spread throughout numerous industries, with global market leaders increasingly adopting this approach. Startups, for instance, have championed this trend. Dropbox implemented a “virtual first” policy, Shopify declared itself “digital by default,” and platforms like Upwork and Buffer have operated with a remote-first model. Even industry giants like Google have welcomed the shift, embracing remote work for their employees. Countries like the United States of America are fully embracing this, with 58% of its employed population, approximately 92 million people having the option to work from home.
Detailed Historical Background of Remote Work
Remote work, while now in the spotlight, has deep historical roots than its recent surge in popularity suggests.
IBM was an early advocate, supporting home-based work for its staff in the 1980s and equipping them with tools to enhance productivity.
Today, 25% of IBM’s workforce is remote. Other companies like American Express and Xerox also recognized the benefits of remote work early on, gradually integrating it into their operations and setting a standard for many to follow.
However, the widespread adoption of remote work truly skyrocketed in 2020 during the COVID-19 pandemic. This unprecedented situation saw numerous businesses shuttering their physical locations, with the World Bank forecasting the most profound global recession since World War II.
Many businesses and startups faced this fate. However, many used this to elevate their products and services and embrace existing solutions.
An example is Zoom, a global conference platform, which went from $602 million in 2019 to $2.6 billion in 2020 in revenue, an extremely exponential growth. With over 1,300 employees, startups like GitLab run the largest all-remote company in the world.
Automattic, the company behind WordPress with 1,200 employees, embraced this shift. This impacted other startups to flow suit.
After the leading companies paved the way, a wave of startups soon embraced the trend. Remote work quickly became a common feature or benefit in job listings on platforms like LinkedIn and Glassdoor.
Leading Venture Builders: The Urgent Need to Navigate the Remote Shift
Several venture builders have set benchmarks and welcomed startups worldwide, preparing them for global competition. Y Combinator (YC) and Entrepreneur First (EF) are notable among these leaders.
Y Combinator emphasizes nurturing startups with structured programs, while Entrepreneur First focuses on developing human capital and supporting potential founders who aim to shape future technological trends. Both have witnessed significant success in their efforts.
These venture builders operate somewhat isolatedly, focusing on a limited number of selected startups through on-site education, training, and exploration.
Despite the prevailing remote trend where 71% of employees worked from home in 2020, they have yet to adjust fully. Upwork’s projections suggest that by 2025, 32.6 million Americans will work from home, a marked increase from the 26.7 million reported by the American Community Survey (ACS) in 2021.
Venture builders, such as Y Combinator (YC) and Entrepreneurs First (EF), are accelerators dedicated to nurturing startups and guiding founders from various markets toward achieving product-market fit and profitability.
Traditionally, they rely heavily on face-to-face interactions, providing founders with comprehensive educational curricula to reach their objectives.
In contrast, remote venture builders maintain the core objectives of nurturing startups and education but deviate in their methods, eliminating physical interactions. This shift in approach has not only modernized venture building but has also made significant contributions to the industry.
As the momentum for remote work continues to grow, it’s imperative for venture programs to adapt accordingly.
A notable testament to the effectiveness of this shift can be seen in the United States Patent and Trademark Office (USPTO).
Their adoption of a work-from-anywhere policy not only prompted a surge in employee productivity but also earned them the title of the Best Place to Work in the Federal Government and saved USTPO $38.2 million, as recorded by Harvard Business Review.
In the global playground, a survey of 278 executives, McKinsey claimed to want to reduce office size by 30%, indicating a shift in perception. If prominent venture builders were to similarly transition to a ‘build-from-home’ or ‘learn-from-home’ model, they could offer broader access to their programs.
This evolution would pave the way for founders to pursue more efficient and productive methods as they develop their startups.
Taking Y Combinator (YC) As a Case Study
YC’s impact is evident with its portfolio companies such as Stripe, Coinbase, Airbnb, and Deel — some of the most renowned startups. Currently, YC has stakes in over 4,000 companies valued at $600 billion.
This valuation cements YC’s reputation as a leading venture accelerator. However, there’s been a notable shift in recent years, especially following the Covid-19 pandemic.
Before the pandemic, only 10-15% of startups were remote or had a remote focus. Post-pandemic, that number skyrocketed to 85%.
In 2021, YC observed a swift transition to remote and hybrid systems, marking a 6.5% increase in hiring compared to 2020, with 70% of jobs being remote or online.
By 2023, YC statistics showed that 27% of its top companies operated entirely remotely, while another 55% had partial remote operations.
These businesses span countries such as the United Kingdom, Canada, the United States, Australia, France, Netherlands, India, Nigeria, the United Arab Emirates, and beyond.
Remote startups represent approximately $16.2 billion of YC’s valuation, while companies with partial remote operations account for around $30.3 billion.
Our forecasts suggest a substantial 30% growth in the number of remote startups over the next five years, backed by substantial infrastructures that support their remote operations.
Given these developments, a change in how accelerators approach investing is anticipated. At present, YC employs a dual investment strategy: they invest $125,000 for a 7% equity stake and an additional $375,000 through a SAFE (simple agreement for future equity) with particular terms. As more startups are accepted into both YC and other venture programs, the investment methodology is set to experience a significant shift from its current framework.
We can expect a rise in remote venture builders. As time progresses, many on-premise accelerators will gravitate towards remote operations, though only a handful will adopt a fully remote model.
However, as systems become more refined, startups previously operating entirely on-premise will increasingly transition to a complete remote setup. By 2028, we forecast that 20% of these traditionally on-premise venture buildings will transition to full remote operations, paving the way for an accelerated emergence of new remote startups in subsequent decades.
The Ecosystem: Companies Supporting Remote Venture Building
As venture building becomes more prevalent with the rise of remote work technologies and practices. Several companies, often called “venture builders,” are leading the front in providing a streamlined approach to tackling these across different industries, even in the Web3 space. Some prominent leading venture builders here are Buildspace and Soonami.
Buildspace
Buildspace venture-building studio takes startups through the intense and resourceful process of moving from an idea to a fully-fledged project that garners people’s interest across borders through an online six-week program.
Buildspace contributes to the revolution and adoption of remote lifestyles. It takes it further by ensuring the entire program is fixed on weekends and at night, adding more to the platform’s flexibility. To add, there’s a cash prize for outstanding projects & creators to win.
Soonami
Soonami is one of the most defined venture builders in the ecosystem, specifically focusing on AI and Web3 startups.
They have three value propositions: to help these startups create, build, and scale through mentorship and a tailored accelerator program properly.
Soonami is the only one of these companies to have made software for ventures: foundance.org, a remote platform to offer a virtual co-founder, a tokenized IP and ownership agreement, and a capable solution to support projects before incorporation.
The program offered by Soonami is fully remote, ensuring global inclusivity and allowing participants from anywhere in the world to join. What sets Soonami apart is its unique ability to construct software platforms that align with a startup’s vision, effectively placing the right product before its intended audience.
To date, Soonami has invested $3,500,000, launched four ventures, and made three investments. Among its ventures, Auditone.io and q.org are notable leaders operating within the Web3 space, a zero knowledge technology called zkfaith is in development.
Learn all there is to know about Zero Knowledge proof in this comprehensive guide by DroomDroom.
The significant role of these venture builders in the success of startups is undeniable. They not only manage the entire process internally but also properly decentralize it, capitalizing on the benefits of remote work.
The Advantages of Remote Venture Building
In this fast-paced technological age, remote venture buildings have numerous advantages, and the benefits are evident in plain sight. Some of these advantages that affirm the need for remote venture building include:
Access to Global Talent: This is one of the most significant benefits of remote venture buildings. They are restricted to hiring experts from a specific geographical location; instead, they’re open to accessing a vast talent pool and can bring the best hand on board to see the startup scale.
Cost Effectiveness: With team members interacting, communicating, and building remotely, these startups can reduce operational costs by having less overhead from the absence of physical infrastructure. With this, the Business infrastructures scale slowly as the startup grows.
Rapid Experimentation: By leveraging the strengths of a diverse team, remote venture buildings can rapidly experiment and iterate, benefit from the various inputs, access digital collaboration tools, and continuously learn how specific markets react to the products. This arms remote venture buildings with the ability to quickly navigate and grow in the market.
Diversity and Inclusion: Venture building can level the playing field, allowing for more equitable access to opportunities. Some key areas where this is reflected will be:
Empowering Diverse Demographics: Facilitating better inclusion of women, part-time founders, and other underrepresented groups in the startup ecosystem.
Inclusivity: Ensuring everyone, regardless of location, can benefit and contribute. This helps increase cultural awareness and lower bias and diverse points of view.
Resilience: The decentralized nature of the venture building assists in developing solid operational resilience. Essentially, they’re not completely affected by disruptions such as natural disasters or economic downturns, and if employees in one location are affected, the team can still function without being affected.
Flexibility in Regulation: Remote venture buildings are more adaptable to diverse global regulatory environments that might have impeded growth.
Remote venture building shows how their flexibility is a crucial ingredient to scale and access a broader market and expert teams. This product can penetrate markets and reach product-market fit, sustenance, and longevity.
Challenges and Solutions in Remote Venture Building Supported by External Platforms
Despite the undeniable benefits of remote venture building in the business world, potential shortfalls are associated.
Communication Breakdown: This is a significant barrier to remote venture building because the diversity of languages, cultures, and time zones makes communication challenging. Some of the best approaches to this include hiring talent who have spoken a language they understand; another tack will be using practical remote communication tools, having clear communication protocols, and operating in a time zone that ensures optimal output for specific departments.
Team Cohesion and Culture: Lack of cohesion and culture tends to impact the team’s performance output, missing the company’s objectives and results and reducing team member retention. The best way to approach this will be by engaging in virtual team-building activities and fostering a strong remote culture.
Time Zone Differences: Due to the different times associated with remote venture building, communication can be hard due to delays, and competing in specific tasks can be a drag. Some of the best ways to approach this is through adopting asynchronous workflows for communication like emails, etc., and scheduling overlapping work hours.
Security Concerns: Operating a decentralized team not found in a central location makes teams of a venture building susceptible to issues connecting to an unsecured network, phishing risk, and theft or unauthorized access. To avoid this, educating groups on security best practices and implementing strict Digital security measures are ways out.
Regulatory and Compliance Issues: Operating remotely opens venture building to certain regulatory restrictions and compliance expectations to function perfectly. The most common are the employment laws of different countries where team members work and how they vary, the tax implications for hiring team members in some countries, and other things. Understanding global business regulations and utilizing local experts and advisors is helpful.
Platforms like Soonami and Buildspace offer solutions to mitigate these challenges. They’ve been instrumental in their efforts to provide systemic solutions to these problems. Buildspace operates a seasonal venture building accessible to global participants and has optimized its program to be inclusive, not just for individuals in different time zones but also for those with activities that run tight schedules. Soonami takes a step further by educating on the value of remote systems of working and having them propagate to the world.
Critical Components for Successful Remote Venture Building
While remote venture building might seem easy to set up and thrive based on many examples, some structures and components play a huge role in their success.
Strategic Planning: This starts with defining the mission and vision statement. This gives clarity to the problem statement and how to approach solving it. A core requirement of this aspect includes embarking on market research and collaborating with experts.
Talent Acquisition: Sourcing and retaining the best remote talent is critical for success to be attained. Some reasonable ways to approach this will be in partnerships with talent pools or recruitment platforms. Also, understanding the best practices for onboarding and recruiting remote talent.
Robust Technology Stack: Investing in tools for collaboration, project management, and more
Integrating technology is a strong footing for any remote venture building to thrive; this cuts across communication tools to product management and development tools to assist. Soonami is worth mentioning here for its unique strategy of helping startups develop proprietary platforms built on their founder’s ideas and preparing them to launch in the market.
Metrics and KPIs: Monitoring progress and adjusting as necessary
Having objectives and goals is important to a startup and companies, up to the personal level, but tracking and monitoring the progress are prerequisites to success. The same principle applies to remote venture building; it may be tedious because of its decentralized nature, but investing in analytic tools.
This will give insights into product metrics and allow venture study web traffic, among other real-time data metrics that are instrumental to the success of the startup in the long run. With these metrics, startups can track their growth and, more notably, know where to channel their resources for scaling.
Remote venture building, including the like of Soonami, offers dedicated training and tool development that sees startups accelerate their growth over time; successes are more attainable.
Future of Remote Venture Building
The rise of remote venture building signals a transformative moment in the startup ecosystem. As the post-pandemic world has showcased four to five times more remote work than pre-COVID-19, the potential to create and sustain high-impact startups remotely is feasible and incredibly efficient. Tools that once seemed exclusive are now accessible to many, empowering teams to maintain robust productivity.
According to McKinsey, there is the possibility of advanced economies driving more sustainable growth relying on remote and hybrid systems of work after results from its survey showed 20 to 25 percent of workforces would work 3-5 days a week from home.
The initial skepticism surrounding this trend, as voiced by Zapier’s CEO, Wade Foster, is well-captured in his statement: “We got a lot of odd looks and curious questions when we decided to be all-remote, but COVID-19 has demonstrated how resilient the model is.” For those considering a foray into remote venture building, studying established entities like Soonami offers valuable insights.
The technological horizon promises even more excellent facilitation. Innovations in virtual and augmented reality, advances in artificial intelligence, and the decentralized architecture of Web3 create a more supportive landscape for remote venture builders and startups alike.
As these advancements gain traction, the valuation potential for remote venture builders will become undeniable.
Leading voices in the startup world, from ecosystem experts to venture accelerators, will be compelled to harness the remote model’s opportunities.
While this shift might be incremental, with some ventures transitioning entirely and others opting for hybrid approaches, it’s clear that pioneers like Soonami and Buildspace are at the vanguard, redefining how startups develop and thrive in this new era.
Conclusion
The adoption of remote venture building marks a transformative era for startup development. Its advantages extend beyond mere augmentation of the current landscape, promising to redefine it into a flourishing ecosystem.
As remote venture building becomes more structured, it is poised to drive a substantial portion of future startups, accelerating their growth and impact.
Enhanced collaboration will further amplify its efficiency, unlocking unparalleled access to global talent and substantially reducing operational costs. In this evolving paradigm, the possibilities are boundless.
Resources and Further Reading
- To learn more about Buildspace product offerings and how it works, check the frequently asked questions on its site here.
- To understand more about remote Venture building and how it can implemented in Web3, visit Soonami’s blog.
- Take a dive into venture building for Web3 companies through this detailed article.
- Discover all there is to know about startup accelerator programs and how they work.
