Success rate is a helpful metric, but it depends on which player/party is interacting with the Studio. Studios lend themselves well to Consumer fields which traditionally have lower exit multiples than B2B/Infra/Software.
- Are you an LP? You can have great paper returns, but poor DPI over time. How do you feel being an LP not seeing that GP's are double dipping on equity grants at company formation for them to only secondary as fast as possible after a quick markup (easier done in the last few years in zero interest rate environment) arguably breaching fiduciary responsibility?
- Are you a "Founder" getting hosed on equity? You do receive a ton of support and resources, but you're paying with the most expensive cost of capital (equity). Do you have full control of the company? What are the voting rights of your stock grants? Where does the buck truly stop?
- Are you an early stage employee getting a sliver of the already somewhat upside down cap-table?
I saw 2 types of studios
- that incubate their own ideas and bring founders to operate them. Here founders don't have the large stake, but it's not their idea and resources
- that bring outside founders with ideas. Here founders retain big part of equity.