How We Help Entrepreneurs Build Profitable Lifestyle Businesses

Starting a business can be a daunting task, especially for first-time entrepreneurs. That's why business incubators have become popular in recent years, providing startups with the resources, guidance, and funding they need to succeed. But what about entrepreneurs who aren't looking to build the next big tech startup? What about those who want to build profitable lifestyle businesses? 

The last decade was all about big rounds and fundraising for tech startups, which will always be in-vogue as entrepreneurs take big swings for an all or nothing outcome. But, we view things a bit differently here. While we’re happy to occasionally invest in these startups, the vast majority of our time is spent cultivating asset light services, media and software companies that are designed to turn a profit in 3-6 months.

At our business incubator, we focus on incubating lifestyle businesses – businesses that are meant to be profitable and sustainable. We provide startup funding, guidance, and resources in exchange for equity and profit sharing, starting the companies together on Day 0 and remaining active participants early on and as the businesses scale. Here's a breakdown of our process:

1. Identify the right entrepreneurs: The first (and most crucial) step in our process is identifying the right entrepreneurs to work with. We look for people who have the potential to build amazing businesses, but want to work within an ecosystem such as Spacebar Ventures to tap into a network of experienced entrepreneurs, investors, advisors and customers. We work with first time entrepreneurs to serial entrepreneurs and everything in between. We are strict in who we work with - we move forward with less than 3% of the people who reach out to us or apply.
2. Identify a market and rigorously test ideas: It’s no secret most businesses fail. We’ve been there. But our approach allows for a much higher ‘hit rate’. One of the ways we do this is by testing out ideas together via a process-oriented customer development approach in which we aim to minimize market risk, which means we’re not here to reinvent the wheel or create a new category – rather, we focus on existing, proven markets and find ways to develop a better offering within a defined niche.
3. Provide capital: During our testing phase all the way through launch and beyond, we fund our founders from their salary to seed capital. If a business needs additional funding beyond what we initially provide, we’ll often make additional commitments and tap our network on vetted, accredited investors.
4. Offer guidance and resources: In addition to funding, we offer guidance and resources throughout the incubation process. This includes access to mentors and advisors with expertise in the entrepreneur's industry, as well as resources for marketing, legal, and accounting support. We remain actively involved throughout the process, providing support and guidance as needed.
5. Share in the upside: Finally, we share in the profits and equity of the business. This ensures that we have a vested interest in the success of the business and that we remain actively involved even as the business scales. We believe that this approach creates a strong partnership between the entrepreneur and our incubator, with both parties invested in the success of the business. But it also allows us to be flexible – often a business that raises venture capital is a successful business, not not a successful venture-backed business, which leads to that business having to shut its doors (in fact - we’ve even acquired these kinds of businesses giving them a second life!). In our case, we love businesses of all sizes. If there is a market and a determined entrepreneur, we can make it work, profitably. 

At SBV, we believe that there's a need for a new type of incubator – one that focuses on building profitable lifestyle businesses. By providing startup funding, guidance, and resources in exchange for equity and profit sharing, we're helping entrepreneurs turn their dreams into profitable businesses. If you're interested in learning more about our incubator or if you're an entrepreneur looking to build a profitable lifestyle business, drop us a note or email me at brandon@spacebarventures.com