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How To Set Up a Startup of Startups and Tackle Several Opportunities at Once, With Faris Mesmar

Updated: Apr 1


Episode 18: How to set up a startup of startups and tackle several opportunities at once, with Faris Mesmar




Hi everyone,


Today's episode is all about innovation management through the eyes of venture building. We cover what is a venture builder, how the model has come to evolve throughout the years, how to operate a venture builder, what are some of the key metrics to be thinking of, how to make impact, and how to raise funding in order to operate a startup of startups.


But before we get to today's episode, an interesting piece of recent market news worth highlighting is Anghami's move to Abu Dhabi from Lebanon. Anghami is the Spotify of MENA - you can stream music, podcasts, and all kinds of audio content. Though they're based in Lebanon, they recently decided to move their HQ to Abu Dhabi.


Currently, Abu Dhabi is striving to be the tech capital of MENA, so, they've been pouring tons of investment in up-and-coming startups, as an incentive to get them to move to the emirate.


Ultimately, Abu Dhabi wants to be an innovation hub, which means they're encouraging people to set up R&D offices out of the emirate. Anghami will be doing that; they've officially said that they will be launching a research and development center in the UAE's capital. This means really cool and exciting things can be coming out of MENA for the benefit of the content streaming industry, and maybe even something that resonates with a global audience.



In our latest episode, we sit down with Faris Mesmar to discuss venture building. Faris is a serial entrepreneur as well as the founder and managing partner of Hatch & Boost, which is a venture builder. Hatch & Boost is all about creating value in MENA's consumer space by tackling key problems, by introducing interesting solutions.


Together we discuss:


  1. The evolving definition of venture building

  2. How venture builders operate

  3. Importance of making an impact with ventures

  4. Communicating venture performance to investors



Venture builders take ideas to market using a guided testing approach


Venture builders take ideas to market. Each idea is usually packaged as a startup, and the point is to test the ideas quickly, using shared resources. Many notable startups with global scale were launched in startup labs and studios (these terms are exchangeable with venture builders).

The term venture building has evolved over time. What differentiates venture builders from incubators and accelerators is that they have a very hand-held process that guides you from A to Z.


Venture builders are meant to take ideas to market

With accelerators and incubators, you’re put in a cohort for a period of 3-6 months. They teach you the fundamentals and basics of idealization, prototyping, and how to take these ideas to the market. However, they don’t give the hands-on support and guidance needed throughout the initial stages of growth as venture builders do. This is important in the early stages of startups where there is a lot of ambiguity and risk.


The path to success when being guided by a venture builder doesn’t follow a rigid approach. Each startup has its own way of succeeding in the market, so you can’t use the same business models for two different products, but you can certainly apply the same testing methodology. Every venture builder should have their own secret recipe (framework and infrastructure) when launching startups, to differentiate them from others.



Venture studios fundraise like startups


Venture studios raise money on behalf of the startups they are building. Once the startup’s business proposition has achieved product-market fit, it is ready to be presented to institutional and non-institutional investors for funding. Until the startup is ready for funding, the venture builder would cover its operating expenses directly.


At the end of the day, venture studios are startups of startups. Therefore, they too need to fundraise to finance their operations. There are different models of how to fund venture builders too. Entrepreneurs, first-time founders, and investors can look to pair their ideas and investment capital with venture builders to allow the best use of their resources by professional entrepreneurs.



Venture builders bring talent together to transform great ideas into great businesses


Venture builders are trying to solve real problems. You might think of an idea and at the same time, thousands of other people will, too - but creating a real business is all about the execution! Venture builders do this by bringing people - founders, cofounders, and even senior entrepreneurs - in one place to execute on ideas.


When you think of life-changing ideas, you may not be ready because you might be busy with a job, lack financial means, or have other priorities in your life. Venture builders are here to take these ideas to market, as long as it matches their mandate - it doesn't matter if the idea is pre-revenue or post-revenue, as long as it is in the "early" stage.


Even the governments want to help! And international accelerators are coming into the region to seize the same opportunity. This provides current and future startups the support system to grow.



Adding impact is just as important as financial returns


It is Important to report the impact ventures are making, back to investors. The MENA region needs to be ready and accepting of the new impact-driven revolution happening around the world.


Most importantly, a blend of financial returns and impact should be achieved. If you’re only focused on impact, the equation isn’t right. There needs to be a balance between the two.

Nevertheless, it is worth investing in non-profit organizations that care more about impact. This is because of the great positive effect it has on the community as a whole. These initiatives are often paired with government entities that offer initiatives and funding to help these businesses get up and running.


Until next time,


Shereen

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