Sounds like it’s business as usual at Redstar this summer. So look out, startup world.
Redstar, based in Cambridge, MA, has always been a little different. It’s not an incubator. It’s not a venture firm. It calls itself a venture “foundry” (though I’m not sure that label will stick). The 20-person company got started in 2010 with the idea of creating startups from the top down, based on its experience, network, and research.
In other words, don’t call us with a business plan—we’ll call you.
That seems like a reasonable approach if you want to build companies to attack big problems—and not go after the next Instagram, Tumblr, or startup du jour. Led by Jeet Singh, Joe Chung, and Matt Beecher, Redstar has built-in expertise in fields like e-commerce, enterprise software, and wealth management. But it’s looking for founders and CEO types who can lead its new companies in underserved market areas.
It has found one in Gina Ashe, who started last week as CEO of Redstar’s latest concoction. Ashe and the Redstar team couldn’t say much about the startup yet—it doesn’t even have a name (still in the “post-it note” stage)—but they did provide a window into how their work is progressing.
As Beecher puts it, “Over the past two years, we’ve been perfecting our model. We’re still really focused on big, meaty trends in the marketplace, and trying to solve bigger problems.”
Ashe (pictured) has quite the interesting backstory. She is the co-founder and former CEO of Krush, an online retail site that connects brands with consumers in the action-sports genre. She remains on the board, but most of Krush’s sales, marketing, and brand-relations staff have moved to California.
When she was looking around for her next gig, Ashe talked to Redstar and heard its spiel about how startups could be created in a different way. “You hear a lot of things so I was pretty dubious, to be honest,” she says. “I didn’t want to do that traditional VC model.”
What changed her mind? The Redstar founders’ experience as company leaders, she says. “They’ve built real businesses in hard spaces, and they’ve scaled them. They’ve been through the fires,” she says. And, unlike many investors, they were taking their time researching an idea in retail that appealed to her and built on her work at Krush.
“These kinds of businesses take time. They’re not fads,” Ashe says. “We want something that’s going to change an industry.”
It sounds like her startup is building a new distribution channel for retailers and brands, focused on the younger generation. “It’s young people creating a new retail channel. It’s truly a third way to sell,” Ashe says. “There’s online, there’s offline, and there’s this way.”
I pushed them on whether they are trying to create the next Art Technology Group (which Chung and Singh led, now part of Oracle), or the next Amazon. The better analogy, Beecher and Chung say, is more like “what Twitter is doing to traditional news,” in terms of going peer-to-peer.
As for whether the startup will be consumer-facing or brand-focused, Ashe says it’s “definitely both.” At the same time, it’s definitely not a social-commerce play, she says.
These are intriguing hints, but it’s all still pretty abstract. As are Redstar’s longer-term prospects; it’s very early, but it could end up being challenging to apply the top-down approach to more than a few companies.
To date, the firm has been public about one other startup: LoopIt, a social-shopping-and-reviews play led by Andrew Lau, formerly of Endeca, and Geraldine Laybourne, formerly of Oxygen Media. LoopIt got seed funding from Avalon Ventures in January.
Currently, Redstar is all self-funded. But if it proves out its startup-creation model, others will probably want in. “At the right time, we’ll consider raising outside capital,” says Beecher. “But it won’t be your typical VC fund.”
