The factory is the methodology
AI collapsed the cost of building software by 100x. The unlock isn't any single product — it's the repeatable factory that ships AI products on the user's own keys, infrastructure, and control. Give the products away free with BYOK; sell the factory itself as a studio-in-residence engagement.
The Insight
Before AI, software was expensive. $500K+ and 18 months per product. You needed massive scale to justify the investment. Most ideas never got built.
AI changed the economics:
This is the same shift that enabled Amazon's long tail. Suddenly every book was worth stocking. Now every valid problem is worth solving — and the methodology that ships those solutions repeatably is itself the durable asset.
The Model
× Old Model: Subscription Marketplace
- · Hosted SaaS at $49–$199/mo per product
- · Operator owns the keys, the data, the support load
- · Crowded category, race to the bottom on price
- · Vendor-lock-in is the moat — users hate it
- · Cash flow taps a tiny crowd of paying users
✓ New Model: BYOK Factory + Studio in Residence
- · Products free with BYOK — user runs them on their own keys
- · No managed-for-you secret; no vendor-lock-in
- · Paid wedge is the factory itself, installed via studio-in-residence engagements ($65k/mo × 3–6 months)
- · Each engagement produces a public case study + Factory Floor essay; the methodology compounds in credibility
- · Phase 2: Studio Fund picks up the venture-studio thesis once 2+ public case studies exist
The Math (Phase 1)
Per studio-in-residence engagement:
- Cash retainer: $65k × 3–6 mo = $195k–$390k
- Host equity: 1–3% per Rule 7
- Cohort equity (Shape B): 0.25–1% per company
- Public artifact: case study + essay
Annual at full utilisation (2 engagements/yr):
- Cash from stints: $390k+
- Equity exposure: ~6 host positions over 3 yrs
- + cohort tickets: 24 over 3 yrs
- Power-law upside: ~21% prob of unicorn tail
Phase 1 funds the factory. Phase 2 is the Studio Fund.
Cash from in-residence engagements pays for the methodology development. Case studies earn the right to raise the Phase 2 vehicle.
The Engagement Playbook
Two engagements per year, by application. Windows: Jan–Mar and Jul–Sep.
The exit state: your team running the factory without me.
Every engagement ends with the host studio operating the BYOK Factory autonomously plus a published case study they use to recruit their next cohort.
Why BYOK
Operators want to own the substrate. We give it to them.
Trust
No managed-for-you secret; no vendor-controlled fallback. Every key is the operator's.
Sovereignty
Data stays on the operator's infrastructure. No data exfiltration to a hosted vendor.
Cost control
Operator pays AI providers directly. No middleman markup on inference.
Compound credibility
Open template + public case studies earn distribution that paid marketing cannot buy.
The 3-Year Vision
Prove
- ·37 products live (45 in the portfolio)
- ·First BYOK release shipped (CQR)
- ·2 studio-in-residence engagements completed
- ·2 public case studies + Factory Floor essays
Codify
- ·4–6 more BYOK-first releases in marketplace
- ·3–4 more in-residence engagements completed
- ·BYOK Factory installable in <1 week by a junior operator
- ·Studio Fund LP conversations open
Compound
- ·Studio Fund raised (Phase 2)
- ·~10 case studies; the methodology is the credential
- ·Factory operators across multiple host studios shipping autonomously
- ·Portfolio equity positions compounding; first power-law tail outcomes
Get Involved
Use the BYOK-first products, bring the factory into your studio, or join the team building the methodology.