Most venture builders don’t come up with ideas internally because coming up with ideas for great startups is hard, really hard. Instead, they partner with entrepreneurs whose desire to build a product stems from some problem they’ve experienced intimately or some void they saw professionally.

sFBI isn’t like that. In fact, everyone I talk to is surprised to learn that our 4 startups have sprouted internally. In a way — it shouldn’t be so surprising. Between leading, mentoring, and working at startups, sFBI’s 10 agents have worked on over 200 combined startups; a number that we were told would look unrealistic in press releases, so we didn’t include it. Not to mention the fact that a majority of us were at some point entrepreneurs ourselves.

But it’s still surprising because even though ideas come easily, creativity is a finely-tuned muscle and validation is a multi-faceted science. Here I want to share not only how sFBI comes up with ideas for our startups, but also how we vet them.

Pulse Play — a scorekeeping smartwatch and app for racket sports

The problem

About two years ago, my friend invited me to play squash with him. I’m not much of an athlete, but I went anyway and saw that a lot of the players were fighting over the score. They were fighting because there was no convenient way for them to keep score besides their memory, and memory as we all know isn’t reliable.

At first I wanted to build a scorekeeper for squash, but the global market is only around 20M players and I had to nix that idea. By chance, somebody I’d admired for years had just retired — 3-time Grand Slam tennis champ Andy Ram — and I was able to schedule a meeting with him. This was somebody who never had to worry about the score, but he admitted that it was something he observed at the tennis court, and that was when we realized this idea could just as well apply to racket sport players across the board: tennis, squash, table tennis, badminton, & paddle tennis.

That brought the total market to 300M players. And as luck would have it, Andy was deciding how to spend his retirement years and there wasn’t a better way to capitalize on his expertise than joining a sports technology startup. Like that, the idea had a market and a CEO.

Validation

In 2014, huge growth in the smartwatch market was already starting to be predicted and building our idea as a wearable didn’t take a huge leap. Just in January, the IDC reported that within five years the ratio of smartphone to smartwatch shipments would drop from 500:1 to 20:1 with an estimated 100 million smartwatch shipments by 2020. Building our idea as wearable and a smartwatch app for Apple Watch and Android Wear meant we could ride the wave of smartwatch adoption.

Meanwhile, we saw that technology in tennis and racket sports was just beginning to take off. Nadal was using Babolat Play on the court, Babolat had coined the hashtag “#connectedtennis”, our neighbor Play Sight was introducing video analysis to courts all over the world, and various sensors were popping up by tech players big and small that could track technique from spin to swing. The field was ripe.

We surveyed tennis players and got positive feedback from left and right. We spoke to clubs and coaches, organizations and leagues, and not only were we met with excitement, we understood that the tennis industry was searching for ways to reverse trends in participation and many felt our gadget could be it. So we had smartwatch growth, the flowering of sports technology, and positive feedback from potential customers — what would become Pulse Play was a go.

Product development

Pulse Play started as a scorekeeper but other features were a natural consequence of the data we would be collecting; as well, the surveys we conducted told us that while players were most interested in live score keeping, they also wanted to see their match history and statistics and head-to-head comparisons.

The social element evolved into a ranking system, opponent finding, and an overall community of players, features that admittedly will take more time to grow and finesse. We ran a successful Indiegogo campaign back in April of 2015 around Pulse Play’s full concept and pre-sold hundreds of units. Now, we’ve finished our hardware and are working on the final bugs in our app before our first-ever shipment.

Bosco — the insight app for your teen’s smartphone activity

The problem

When my son was 11, my wife & I discovered that something deeply problematic had happened while they were away at camp. He hadn’t told us only because he didn’t know there was anything wrong with it and my wife only learned about it because she happened to glance at his smartphone. I thought to myself there has to be a better way.

At sFBI a few months later we were throwing around the idea of whether a smartphone application could detect inappropriate words during calls and censor them in real-time — we have a strict policy of taking all ideas seriously because we never know where they’ll end up.

I brought up the incident with my son and over time this idea pivoted into an app that could detect pre-defined indications of worrying behavior and notify parents. Otherwise parents wouldn’t be bothered, and why should they be — who has the time?

Instead, our app would be about sparking conversation about right and wrong and letting parents intervene before things get out of hand. Now, that was an app I wish I’d had.

Validation

Doing competitive research, we found that there were hundreds of players and most of them had the word “spy” in them and were built as much for cheating spouses and untrustworthy employees. One was referred to as “full-on NSA-level control over kids’ smartphones.” They were restrictive, they screamed distrust, and they took a lot of time. No thanks.

At the same time, the issue of cyberbullying was exploding and none of the spying apps were making a difference. Our research uncovered story after story and they all followed a pattern: the parents learned about it too late. Our app could be an answer to a real problem. We surveyed parents at every turn — school events, the park, summer camp — and they all agreed.

Meanwhile, we were watching Life360 very closely and saw that its focus on openness and transparency was really resonating with parents. It has a simple idea: everybody has daily commutes and Life 360 will monitor them for deviations. Plus they have a chat platform so families can comment on their comings & goings.

But, their messaging went above and beyond with language around the “family circle”, communication, and staying connected. Parents must love it because Life360 have over 50 million families on its platform. That was evidence to us that there was a big opportunity to take a new approach to the “parental control” market. Maybe we’ll even be able to turn it into the “parental communication” market.

Product development

We ended up naming our app Bosco after an Italian saint who popularized the idea of teaching kids through love rather than punishment. Current notifications include extreme moods, big dips or hikes in social activity, and unidentified over-18 callers, all signs that it’s time for parents to have a conversation with their kids. Our beta will be launched this summer.

CareHood — where caregivers & their loved ones go to discover what can help them & get their friends & family to pitch in

The Problem

CareHood was brought to sFBI by its Head of Business Development & Investor Relations, Marni Mandell. In the past two years, five of Marni’s friends were diagnosed with cancer, 4 elderly grandparents had health issues, and her friends had babies halfway across the world. In each case, she asked the question, “How can I help?”

Almost universally, her family and friends didn’t even know what they needed. More often than not, the kinds of help they received required more work: tasks that needed to be coordinated & scheduled, letters that needed to be answered, gift cards that needed to be redeemed — all efforts that are hard on somebody facing a serious illness or challenge.

Validation

Initially, we validated the problem through personal interviews of dozens of women and men who identified themselves as caregivers. Then we formed a survey, collecting data from more than 90 patients and caregivers where we learned that the problem was universal, as well as potential solutions.

Additionally, our research from AARP and other mainstream patient advocacy organizations indicated that the caregiving marketplace is a tremendous growth industry on point to grow between 2016–2020 to a $279B market.

We were onto something. Just a few days ago, Congress asked how to compensate caregivers who have taken time off to take care of loved ones & a new congressional caucus was formed to answer the question.

I’m not surprised — I’m hearing more and more about the “sandwich generation,” people in their thirties or forties who are responsible for both raising their own children and caring for their aging parents. It proved to us that CareHood is as relevant as ever and could be one answer to the growing needs of people facing serious ailments or challenges and the family and friends caring for them.

Product Development

CareHood is set to launch a closed beta in April followed by an open beta in mid-May. Our MVP is getting the final touches right before we invite our guest bloggers, partnered organizations, established contacts, survey respondents, and key influencers to test the platform in March. The full launch is planned for late summer.

Gistit — audio and written summaries of articles for college students

The Problem

Gistit was brought to sFBI by its Head of Creative Oded Lavie. After Oded graduated from his MBA program last year, he had an ephiphany that between his BA in Psychology and his MBA, he’d read over 1,000 articles, experiments, books and reading assignments. Why? Because his BA and certain courses in his MBA were taught by academics to students continuing to academia. Oded wasn’t, which meant 80% of the time he spent reading was practically wasted. Oded had another problem: as a non-native English speaker, comprehending research articles could take him twice as long as a native speaker.

Validation

Education in the US continues to be a hot-button issue that’s only growing. Costs have skyrocketed and the crisis is accepted as fact by students everywhere. I saw a recent post on Reddit about American students studying in Europe to save on costs — it had 7,822 comments.

Among the comments were complaints about all the various ways that educators try to milk revenue from students including paid homework services, mandatory textbooks, and expensive course packs. Gistit would be not just a solution to students’ shortage of time, but an answer in at least a small way to the rising cost of education.

As well, in the last two decades, we realized that there have been huge changes in the way people read and process content. People listen to books-on-tape and news article narrations, read e-books on their tablets and smartphones, and scan endless blog posts and articles that have been optimized for quick consumption. Academic literature? That has never changed.

We validated the idea through conversations with students, past and present, who understand the problem and the pain of the wasted time and we’re planning a survey before we officially start development.

Product Development

We plan to have a beta version of Gistit out this fall, just in time for the next school year. The beta will include written & audio summaries of 100s of psychology articles that are common in Intro to Psychology syllabi alongside translations for non-native English students.

Conclusion

How does a venture builder come up with ideas for startups? I can’t answer that because every venture builder is different, but I can tell you what sFBI does. We come across problems that affect us deeply, we bring them to the table, this table in fact, and we turn them into ideas for a startup. We validate the ideas using a combination of surveys and interviews, market research, and deep dives into current trends. And that’s when we start building.

To get in touch with me about sFBI and opportunities to build with us, please email me at enonl@s-fbi.com.

Venture Builders

are a

Better Investment

Explaining venture builders still raises eyebrows whenever I talk to tech investors. Venture builders — companies that build several startups in parallel — are usually confused with accelerators or incubators, but they’re almost completely different. Venture builders give internal startups a big boost of both human and financial capital through in-house teams and investments; accelerators and incubators usually only give startups access to human capital, and often in just an advisory capacity.

Take our first startup, Pulse Play. Pulse Play is a smartwatch for racket sport players. It’s a good-looking piece of hardware that keeps score, helps players find opponents, and gives them a worldwide ranking. If Pulse Play was a standalone startup, it’d struggle to find a team, it’d struggle to match market need, and it’d struggle to build a business model, all despite the big need for tech in racket sports. Those three things are the top reasons startups fail, with or without an accelerator or incubator.

As sFBI’s first venture, Pulse Play had a full team from the first day, including a designer with decades of experience, a Creative Director from top agencies, a COO with an entrepreneurial background, a Marketing Director with serious credentials, an extremely well-connected Head of Business Development, and a CTO with a few gray hairs and code worth gold. Not to mention me and the three-time Grand Slam tennis champion, Andy Ram, we were lucky enough to get on board thanks to our solid foundation.

Second, standalone startups struggle to match market need. At sFBI this risk is mitigated because of our unique approach. Unlike most startups that think product first and market second (if at all — “this will sell itself!”), we start with the problem we want to solve. We don’t ask the question of what will consumers buy; we ask the question of what problems do people have. This allows us to hone all of our efforts — from ideation to product development to marketing — on how best to meet real needs and ensures there’s a market for our startups.

Finally, many startups fail before they land on a working business model. We don’t even start product development until we’ve assessed the size of the market, conducted a competitive analysis, affirmed our unique value proposition, and tested the market for viable revenue streams. It’s only once we’ve established that there’s a large, approachable market that we proceed. We do that because our team of eight people has worked with over 100 startups and we know from experience that a startup is nothing without a working business model.

Despite the reduced risk, venture builders and their startups represent a different kind of investment vehicle that’s new to investors and it’s clear they’re still grappling with the funding model. Because venture builders typically give seed funding to their own startups and don’t even start searching for investors until they’ve reached a fairly advanced stage, the dynamics and implications of the funding differ. Given the quality of the team, the level of involvement, and the scope of resources, it’s time for investors of all stripes to take a closer look at venture builders and get on board.

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We are currently in the process of raising investment for Pulse Play. If you are interested in finding out more, do not hesitate to contact me directly.

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Enon Landenberg is the Founder, Dreamer, & Doer of sFBI (Small Factory of Big Ideas). sFBI is a venture builder that launches businesses around human-centered innovation. In 1999, Mr. Landenberg co-founded E-Dologic, Israel’s first interactive advertising agency, which was acquired by Publicis Group SA in 2001. Mr. Landenberg is the Chief Commercial Marketing Officer for SpaceIL, a project to land an Israeli spacecraft on the moon, and President of Infinity Augmented Reality, the first augmented reality software platform that universally connects smart devices. He is a well-known expert in the interactive media field, a highly sought-after lecturer at technology conventions, and a featured TEDx conference keynote speaker.

heck

is a

venture builder?

As told by an accidental venture builder founder

That my company, sFBI, became a venture builder was an accident. It started as an idea without a name. The idea was that I wanted to create a place where I could focus on building things, where all the elements would be in place to faciliate turning ideas into reality.

This idea came from a problem. The problem was that I wanted to incubate different ideas and it’s difficult to do that through different companies. Companies require a lot of work. And I’m not just talking developing the product and bringing the product to market, I’m talking incorporation, accounting, office space, hiring, reporting structures, and work flow.

This problem was especially troublesome for me because I come from the world of interactive advertising. In 1998, I founded Israel’s first interactive agency, E-Dologic, and I stayed on as the Chief Interaction Officer until 2012 after its acquisition by Publicis in 2001.

Because of my background, I have a natural itch to work on different innovative things simultaneously. It’s a part of my standard work flow to be developing multiple tech-creative projects at any one time. I’m just not happy otherwise. Even now, I run sFBI and, at night, I’m working on building a spaceship with SpaceIL.

I looked around and none of the existing business models solved this problem. The startup ecosystem right now is something like this: idea turns into startup; startup builds MVP; startup searches for angel investment; startup enters accelerator or incubator; startup product goes to market; startup tries to build revenue; startup stutters; startup fails. Sounds rough, but it’s reality. 90% of startups fail, and not for lack of trying.

Now, I wanted to build lots of ideas, not just one, and I wanted to ensure success as much as any entrepreneur can, so I had to come up with something new. It took some time, I won’t lie, but I eventually came up with the tenets for what would be a new kind of company:

• There would be a regular flow of ideas and a protocol to vet each one
• There would be a core team of experienced professionals
• This team would create the foundation for each venture
• Once the foundation was built, sFBI would hire a CEO who would lead the startup
• Once the startup reaches a critical mass, it would start to operate independently
• Meanwhile, the idea hub would continue to operate and turn out developed ideas

This model solved my problem. I could oversee the creation of successive ventures without having to spend all my time talking to lawyers. Talk about an incentive. And I could minimize the chances for failure. The team is experienced, market-oriented, and can build and test business models, addressing the three core reasons for startup failure.

Unfortunately, even for a salesman, the model is difficult to sell. “So, it’s an incubator?” No, not at all. “An accelerator?” No, not that either. “A VC fund?” Even that, no. It’s a venture builder. “A what?” A. Venture. Builder. We build ventures.

I didn’t know the model existed when I set out to build sFBI, but it didn’t take long for me to realize that it was a part of a larger trend. A few weeks into establishing the company, my COO and Marketing Director started sending me articles; soon after a couple groups showed up on LinkedIn; and within months a database of over eighty studios became publicly available.

It turns out that while sFBI might be new to the startup nation–I believe we’re the first–this isn’t a new concept to the world, though it’s still early enough that it needs a lot of explaining.

And that’s what I want to do here: explain the model, give tips, and share our adventures as a venture builder that’s launching businesses around solving problems. Stay tuned here or sign up for sFBI’s newsletter to join the conversation.

___

Enon Landenberg is the Founder, Dreamer, & Doer of sFBI (Small Factory of Big Ideas). sFBI is a venture builder that launches businesses around human-centered innovation. In 1999, Mr. Landenberg co-founded E-Dologic, Israel’s first interactive advertising agency, which was acquired by Publicis Group SA in 2001. Mr. Landenberg is the Chief Commercial Marketing Officer for SpaceIL, a project to land an Israeli spacecraft on the moon, and President of Infinity Augmented Reality, the first augmented reality software platform that universally connects smart devices. He is a well-known expert in the interactive media field, a highly sought-after lecturer at technology conventions, and a featured TEDx conference keynote speaker.

What the heck is a venture builder? was originally published in ART + marketing on Medium, where people are continuing the conversation by highlighting and responding to this story.