Creative capital is the secret sauce, not venture capital

Creative capital is the secret sauce, not venture capital

Around 90% of businesses fail, and the reasons behind this are well known: undercapitalization, scalability issues, a lack of a competitive edge, or viable intellectual property. 

However, what about the 10% of those who succeed? What did they do to succeed in the face of adversity? Startups require two types of money to build a route to market success: venture capital and creative capital.

The financial and operational assets invested in a new, untested commercial entity are referred to as venture capital. The design and development assets that bring a brilliant concept to life are referred to as creative capital. Although venture capital receives the most attention, creative capital has the potential to remain longer and grow more valuable.

Airbnb, (now LinkedIn Learning), Square, YouTube, Byju’s, and Pinterest, among other billion-dollar unicorns, have profited from “creative” founders who were physical and digital product designers, educators, developers, and visualizers. 

These businesses were able to generate a lot of attention by producing and amplifying tales and visuals. There for the company can able make a profit.

Venture capital usually arrives after rigorous assessments and due diligence cycles are completed. However, when creative capital is developed and applied before venture capital, it helps speed up these assessments and analysis of a company’s concept, often accelerating product deployment, reducing founders’ dilution, and improving valuations.

So, what is the definition of creative capital?

Depending on the industry, creative capital characterized as a combination of strategic assets such as:

  • Insights and statistics on your target audience
  • Product, service, and experience visualizations, for example
  • Systematic branding, naming, and communication
  • Prototypes for product design and engineering
  • Estimated development costs in the early stages
  • Identifying and introducing network partners
  • Product expansions and roadmaps in the future
  • Content, platforms, and setup for digital content
  • Identification and development of intellectual property
  • Expertise in advising investors

These assets usually generally generated to use in conjunction with business strategy and introduction, ultimately assisting businesses in bringing their ideas to life. What is the purpose of creative capital?