Why no-code is a game changer for venture studios

There are many surprising uses and benefits of no-code development. For example, we realized that no-code would transform how venture studios test and learn after hearing two pieces of feedback from separate firms:

• First, that a team in LA had reduced average time from idea to first in-app customer data from 4 months to 3 weeks
• And separately, that a team in Berlin had increased the number of tested business concepts in their pipeline by 150% by adding no-code development to their process

Venture studios and company builders are increasingly adopting no-code development into their startup process because it directly boosts two things that have a big impact on total returns of the studio:

• How quickly and accurately they can learn whether a concept will succeed
• How many concepts they can test each year

What is no-code software development?

You may be wondering: what is no-code? At a high-level, no-code is the ability to build complex software without writing lines of code. Instead, developers use a visual editor to build all the components of a software application -- the user interface, data tables, integrations with other pieces of software or databases, and workflows.
 

Just as software engineers once had to rely on strings of 1s and 0s to communicate with computers before technology progressed to a point of enabling lines of code, no-code is just the latest iteration in more efficient and user-friendly ways of building software. 

Why no-code is a game changer for venture studios

There are two main reasons behind accelerating no-code adoption in the venture studio context — aligned incentives and the fact that studios make multiple bets in parallel. The aligned incentives component is relatively straightforward: Since venture studios are the funders and owners of the startups that they’re testing, they have every incentive to lower the cost of development.

Since studios are running multiple bets in parallel, there’s even more of a premium than in a traditional venture startup on speed, agility, and repeatable structures. Reducing the time required to generate significant arms-length user data to falsify key hypotheses means that studios can cast aside bad bets earlier and focus resources on the most valuable experiments. 

An overview of the no-code landscape

The no-code space has expanded rapidly in the last few years and now appears to be the future of software. ​​Today, there are hundreds (if not thousands) of no-code tools to choose from depending on your needs. Some are very specialized and product-specific (e.g.. Shopify, Webflow), while a few others are very general and allow you to do almost anything in any industry (e.g. Glide, Draftbit, Bubble). 

Some platforms are more complete than others. Bubble, for example, is designed to be used across any use case and offers many options to customize an app using integrations and plugins.

As mentioned above, no-code tools like Shopify are ideally suited to a certain industry like e-commerce, but break when developers try to extend them beyond certain rigid guardrails. Others like Glide for mobile app development are not restricted to one particular use case like e-commerce, but require developers to drop down into javascript to extend the app in many cases. This can result in a brittle application that one venture studio described as “convoluted and more time-consuming and headachey than just having coded it from scratch.” 

Airdev focuses on Bubble above other no-code frameworks because it is by far the most flexible and extensible no-code development tool we’ve found to date to validate and scale software concepts.  

How to choose a no-code tool that's right for your venture studio

When selecting a no-code platform for complex application development, venture studio leaders should consider: 

• Design flexibility: Will the framework enable pixel-perfect design that I would expect from CSS and HTML in a traditional build? 
• Pricing flexibility: Will launching the app require us to pay per end-user pricing that can cause Total Cost of Ownership to spike dramatically as users climb to the hundreds, thousands and tens of thousands?
• Functional flexibility: Will my venture teams run into hard limitations with this framework (for example, not having the ability to integrate with a necessary 3rd party system) where we will have to abandon what we’ve built? 
  

Two main use cases for no-code development

Broadly speaking — and just as with code — no-code applications fall into two broad categories: Proof of Concept (PoC) builds and production-grade software products.

The key distinction is how long a team intends to use the software they develop. 

For some teams, the right option is to build something in no-code only for the validation phase, knowing they’ll either falsify their hypothesis and move on to other concepts, or successfully provide it out and rebuild in another stack. 

The founder of one venture studio that adopted no-code in 2020 explained his decision this way:

"Ultimately, our focus is on outcomes, not features. Our goal is to produce great outcomes for our partners and participate in them, or fail quickly so that we and our partners don’t spin our wheels on ventures that won’t succeed." ‍

For others, particularly those building B2B SaaS tools, no-code frameworks like Bubble will continue to be a good fit as their in-production apps scale. 

How to know if no-code development is right for you?

There are a few signs to look out for that no-code is not a good fit today: 

• The core of the concept requires fundamentally new technology — for example the idea is to build a better Zoom, which will entail a whole new approach to video streaming architecture and new algorithms to monitor network conditions.
• The core software will need to have extensive offline functionality — for example, the product is designed to be used by oil workers in remote stretches of the Andes and Artic without cell connection (at least until SpaceX solves this problem with ubiquitous Starlink satellite internet). 
• The core software will need to be hosted on-premise — for example the product is designed for commercial banking customers and sold B2B to the nation’s largest banks that will require on-prem installations 
• The software will need to be used by millions of Daily Active Users (DAUs) right off the bat — typically B2C applications designed for an already large installed user base. This last scenario is rare in the venture studio context as most apps are new and therefore not widely known. 

Outside of those cases above, what types of products are particularly well suited to no-code today? Some of the most common app types include:

• Marketplaces
  Example: Breakr - influencer musician marketplace that scaled to tens of thousands of DAUs, backed by top tier Sand Hill VC. 
  
  (Check out our guide to no-code marketplaces.)
  

• Tech-enabled services 
  Example: Tributi - Tax preparation software that scaled to 25K DAU, accepted to Y Combinator and partnered with Bancolombia. 
  ‍
  

• SaaS 
  Example: Platform to enable SMBs and nonprofits to issue and manage virtual and physical credit cards for their employees.
  ‍
  

What’s common across these uses cases is that the software required is not fundamentally novel, but built using existing engineering know-how applied in a new way to address some unmet need. 

What venture studios should keep in mind when starting no-code

In some cases, studio leaders are hesitant to bring on a new no-code capability because of the concern that they might become locked into working with one provider. The most versatile no-code frameworks like Bubble are newer and less widespread than programming languages like PHP, for example, so managers are sometimes concerned that the pool of available experienced developers to draw on will be more limited. 

Common programming languages we see at venture studios include: React Native front end paired with Rails backend, Swift, Kotlin, Acuity, and Gorilla. Adding a no-code capability to this mix can dramatically shorten the timeline to launching a functional v1. 

What we’ve seen is that the studios that see the highest ROI with no-code are the ones that treat it like any other experiment and apply their standard lean methodology. They identify a lightweight test to begin — one startup concept in their next cohort of ventures, or an internal tool that’s needed for operations — and start there with a 2-3 week build. They compare the results to what they’d expect with their traditional developers, and if the output is in the typical range of 5-10x faster, they iterate and repeat. 

Consider whether to build in-house or outsource

In many successful cases, it still does not make sense to have a dedicated no-code resource in-house because of spikey utilization, management bandwidth, and the fully-loaded costs associated with any full-time hire. Instead, contracting with a no-code development agency for right set of use cases is a cost-effective way to add the capability. 

But in the cases where teams find it does make sense, there are simple options — a wide pool of nearly 1 million Bubble users to draw from, coaching and upskilling from a range of enablers, and subscription toolkits like Airdev’s Canvas framework that allow teams to leverage best in class assets and automations for use by their own professionals. For example, the venture studio arm of a Big 4 accounting firm has an in-house “No-Code Guild” to build with tools ranging from Webflow to Zapier to Bubble. 

An analogous way of thinking about it is like adopting Ruby on Rails to accelerate web app development. Ruby on Rails first emerged in 2005 before going through an explosive period of adoption from 2007-2009. Hiring Rails developers became a bottleneck and teams often brought on agencies to trial the framework for a particular build before going out to the market and recruiting their own in-house developers. 

We expect to see the wave of no-code adoption continuing to grow across venture studios in the coming 1-2 years as more teams see the competitive advantage of its speed and cost-effective iteration. 

Get apps built, tested, and iterated in week with Airdev

If you're looking for professional Bubble developers, we can help: hire us as your full-service Bubble agency or hire individual Bubble freelancers through our Flex program.