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April 2024 Box
4 years of observations on the startup side + highlights of the April box brands
FirstLook
July 21, 2024
Welcome to our 16 new subscribers since our last newsletter. I'll do my best to keep this fun, light, and informative. A friend forward you this? Subscribe here
Seethaaa-ssse-hathehhh-hathehhh-ayaeeh! (“Hi/Hello” in Parseltongue 🐍)
Welcome back to another consistently inconsistent newsletter. Let’s jump in.
Funding Announcement 🤑
Congrats to Artet from the January box on raising $172,000(!!!) from a FirstLook investor! I’m excited for them as cannabis laws continue to loosen and create a perfect opportunity build a massive brand.
As promised, below are some interesting learnings and observations on all things startups since starting FirstLook, a business that has put me right in the middle of the founder-investor table. This is not exhaustive, but a solid starting point. Let’s begin.
Show Up Looking Snazzy
After having had 330+ brands go through FirstLook, I can confidently say having a well designed deck and brand is the way to go. Unless you’ve invented something ridiculous like zero-calorie alcohol, showing up with a lackluster effort typically indicates to investors “you’re not a serious person.” - Logan Roy.
Better Growth Plans
A big miss I see is a lack of creativity in growth plans. On podcasts with founders who’ve hit it big, the host always asks “Bring us back to the 0 to 1 days. What did you do differently than everyone else that opened key doors and created opportunities that provided your escape velocity to get to the next level?” Every. single. mf. time. they have something unique to share. You never hear, “We simply followed the standard playbooks and it all worked out.”
I’m not saying founders shouldn’t dabble in standard playbooks. They work, which is why they exist. However, those usually work best for multi-time founders who can execute with perfection. Otherwise if you’re new, you’re going to make mistakes that shorten your runway. That’s why you need to incorporate some outside-the-box strategies. “Do things that don’t scale,” as Paul Graham once said.
Brian Rant Side Bar! - One part of VC I hate is how investors willy nilly share decks and private info with others. This creates a challenge where founders are hesitant to include juicy details (like creative growth ideas) in decks. A true #rockandhardspot conundrum. To any investors reading this thinking, “you’re dumb, ideas are a dime a dozen. It’s all about execution.” I partially disagree. Many founders who exit exploited an arbitrage or great growth idea early on. Yes, execution is key. But having an arbitrage is the golden goose. I sadly don’t have a solve here as incentives simply aren’t aligned.
Nail the Future
Next is a lack in strength in a brand’s “Why now?”. When you have a great ‘why now’, your startup is naturally pulled to the top. You’re solving an actual pain point that’s growing. Without a strong ‘why now’, the only thing a founder can do is push their startup along, which eventually becomes water up a hill.
The frustrating part here is that the future world the founder believes is likely different than what the investor believes. This is why fundraising truly is a numbers game to find investors who see the same future world. A well thought out and articulated story, supported by data, can open investor eyes and have them “see the light”. It’s challenging, but doable.
In this somewhat similar vein, there are tooo many “me too” brands as the cool folks say. I think founders would do themselves a great service really thinking through what they’re building and what the whitespace looks like. It is possible to beat an incumbent at their own game, but that’s a tough pill to swallow for investors. When there’s a big open whitespace opportunity, however, it’s a tad bit easier. A brands whitespace is one of the pieces that makes up a “why now”.
Lucky Breaks are Imperative
I find that too many don’t fully embrace the importance of catching lucky breaks when building a brand. For CPG brands specifically, getting brands into the right hands (aka FirstLook’s mission). Too often we hear of stories where a founder caught a big lucky break such as…
“Early on Robert Downey Jr got a hold of our product and fell in love. He actually reached out and ended up investing! He then intro’d us to Gwyneth Paltrow who also invested and opened up all these additional doors for us. I don’t think we’d be where we are today without that lucky break.”
Successful founders (and their investors) all mention how much “luck” played a role in their success. “But Brian, they call it luck for a reason.” True. But as one random successful guy once said, “The harder I work, the luckier I get.” I like this quote a lot, but to narrow it more to our CPG world and consider assets on hand, getting a brand’s product into the right hands is an effective means to generate luck.
Getting products into the right hands is key to surfacing folks who love the brand. If I were a CPG founder, I’d look to sample at events with celebrities, influential people, and wealthy folks overall. FirstLook solves for the last group, and we’ve certainly helped seed products for events with celebs and influential types. For those samples that didn’t equate to Robert Downey Jr. writing a check, you’re still strengthening your mere exposure effect. It’s largely a win-win.
Founders Aren’t Angels
Everyone LOVES dunking on investors for dishing out false promises, sucking at emails, being as flaky as a Parisian cafe croissant, and so on. Honestly though, there are plenty of founders who are just as difficult to work with. Founders may hate me for saying this, but I know investors reading this are thinking, “Damn right!”
Founders Not Getting Their Chance
Ok back to dunking on investors. So this is just a hunch, BUT, I think the world is missing out on a ton of great companies coming into existence because investors don’t make time to talk to enough founders.
I get it, I get it, there are only so many minutes in a day, and thus decks are the starting point to learn about a business. HOWEVER, when you listen to all the great VC investors with multiple, billion dollar winners under their belts, every one of them says to ‘bet on the founder above everything.’ Obvious, right? Let’s amuse ourselves here and go a little deeper…
In a recent episode of the Equity podcast they interviewed Mike Maples, a legendary and crazy successful investor. He said the following that I thought was mind blowing:
“Steve Jobs used to talk about think different. So I want somebody who thinks different and acts different. And the think different comes from the insights. I'm more focused on what's the insight than on is this exactly what the product will be? Because 80% of our profits have come from pivots.
And so in the success case, there's an 80% likelihood it won't be the same thing.”
I found this so interesting, but it syncs well with what every successful investor says: we are truly betting on the founder above everything else. It also perfectly pairs up with my other complaint above; founders needing a stronger “Why now?” aka their insight. This slide in a deck is arguably more important than the problem slide (of which the problem slide and ‘why now’ slide are interrelated).
To wrap this up, I think a good portion of founders don’t get their ‘shot’ because investors get too caught up with decks and the current business. This, of course, is not a blanket statement as there are companies where it’s easy to tell this won’t produce venture returns. But overall, if all the successful investors say to “bet on the founder” than I think it’s wise to make time to talk to more founders. The first place investors can do better here is making time for female and underrepresented founders. The total lack of dollars going to them is very telling.
Founders Sacrifice SO MUCH
It’s easy to rattle off surface level sacrifices founders make to build their companies. Low pay, long hours, and tons of stress building a business. What isn’t talked about nearly enough are the real real sacrifices. Here are some examples I’ve come across and or experienced myself:
Health - many founders go periods of time with no health insurance which is a dangerous game to play.
Social Life - founders can fall out of favor in their friend groups because they can’t afford “that ski trip out west.” After a few “sorry, can’t make it” replies, guess who gets left off the invite year 3 of the annual trip? Making matters worse, they have to see all the pics on social media of that friend's trip. 2x brutal!
Love Life - you’re broke as shit, who wants to date you?! :(
Starting a Family - yep, this part of life gets pushed back in most cases
Saving for Retirement - ‘Fuhgeddaboudit! This becomes more stressful as time passes and you feel like you’re further falling behind in life.
Ridicule - if founders got a nickel every time they heard “when will you get a real job?” we could all self-fund our startups.
The sacrifices I’ve heard over the years are insane. My hats off to all the founders out there. You are truly incredible people. You are the lifeblood of the global economy. Your efforts drive innovation, push the world forward, and shape human history.
Unpacking everything I’ve learned or noticed about investors is in the next newsletter. Should be a zinger!
Thanks for coming to my TedTalk.
To wrap up, here is Rohan Oza’s favorite VC scoreboard:
Founder Pro Tip of the Month 💡
If you’re building a CPG brand, do your absolute best to strategically give out samples. I remember an investor telling me about a shoe brand they invested in that was later acquired (maybe it was Greats? I can’t remember), and how the founder took 500 of their first 1000 pairs produced and gave them away for free to investors, taste makers, and anyone else significant.
Their theory was this: 1/3 will love them, and buy another pair + inspire others to buy a pair. 1/3 will like them but not buy another pair, but still inspire others to buy. And the last 3rd will not like them and won’t inspire others to buy.
This means 2/3rds of those sneakers lead to additional sales and the eventual ground swell needed to get a brand off to a strong start. Obviously it wasn’t cheap to do this, but if a sneaker brand can give away half their initial inventory, you can certainly do the same with your product in an intelligent way like jumping in the FirstLook boxes :) #shamelessplug #Idontcare
Did a friend forward you this and now you want to join?
April Box Brands 🚀
Investors: 47 → Apply Here | Brands: 6 → Apply Here | Intros: 39
Investors interested in a brand below, please email [email protected]
HAWKs
Founded by Emma Flanders | 📍LA — Shop / Instagram / Linkedin / PR Vid
How We Met Them: Via my friend Jackie Fast at Sandbox Studio
One Liner ✍️ — HAWKs is a year-round enrichment and day camp program designed to encourage children’s sense of wonder about the planet and instill a deep sense of connection to the outdoors - let's get kids off screens and back outside into the green.
What made them stand out: HAWKs was a tad outside of the FirstLook scope (CPG), but it’s still consumer and I looove this company. There is such a desperate need to get children away from screens right now, and summer camps like HAWKs are the perfect answer. I will also admit this was quite timely for me as my smokin’ hot wife and I are expecting our first baby soon and so worrying about screens is top of mind. From a business standpoint, I really liked HAWKs as Emma is wicked smart and her franchise model makes a ton of sense. I will 100% be signing up my son as soon as HAWKs makes their way to Cleveland! (…maybe I should be the one to open a franchise here. Hmmm.)
Long Table
Founded by Samuel Taylor | 📍Chicago — Shop / Instagram / Linkedin / Shark Tank!
How We Met Them: Cold outreach!
One Liner ✍️ — Long Table is next gen pancakes from old gen grains, powered by love.
What made them stand out: After watching Long Table’s Shark Tank episode, and seeing ALL 5 SHARKS say Long Table was the best pancake they ever had, I had to experience it myself. I can confidently confirm this is true. How you wonder? Easy. Long Table uses unique heirloom grains (a secret recipe!) and proprietary process to create their mixes. This creates a fluffy and stupid dumb tasty pancake that I will now be a loyalist to for the rest of my life. Great product aside, I also really loved their sustainability angle via regenerative farming practices. Superb product + better for the planet practices = a winner in my books.
Made Trade
Founded by Cayley Pater + Andy Ives | 📍Carrboro, NC - Shop / Instagram / Linkedin / Youtube
How We Met Them: Via their signup on the FirstLook.vc
One Liner ✍️ — Made Trade is a tech-enabled marketplace specializing in expertly curated ethical and sustainable home goods.
What made them stand out: Made Trade is the exact marketplace the world needs. Imo, capitalism is out of control. Demand from wealthy countries puts intense pressure on developing countries to churn out products at the expense of their people and the planet. You think all that shit from Temu and Wish gets created without shortcuts?! GTFOH. For those who have heart and soul, Made Trade is where you want to shop for verified ethical and sustainable clothing, shoes, home decor, and furniture. From an investor standpoint, Made Trade has been growing quick in part because of their custom built tech-stack and via key partnerships like JP Morgan Chase who filled out their airport lounges with Made Trade goods. Marketplaces are big businesses when done right. I pray Made Trade goes the distance.
Protein2o
Founded by Bob Kral + Andy Horrow | 📍Chicago — Shop / Instagram / Linkedin
How We Met Them: Cold outreach!
One Liner ✍️ — The #1 Protein Sports Beverage Takes Aim at Big Growth!
What made them stand out: Protein2o aint no spring chicken. This company is in the 10’s of millions in yearly revenue, and I’m not surprised. Their drinks, which all contain 15-20g of protein, taste great. They even have additional lines like Protein + Energy and Protein + Electrolytes. This brand is on trend too as protein demand from consumers is going “up and to the right.” I’m not sure I’ll ever drink a Gatorade again. Great product on trend aside, Protein2o has a great team around them. This includes Bob Kral (Former SVP at Walgreens and GNC) and Andy Horrow (former PepsiCo Exec: Tropicana, Pepsi Int'l, Gatorade). Board of Directors includes Chris Running (Muscle Milk Co-Founder) and Gary Ippolito (Former EVP at E&J Gallo). Safe to say they have some experience on board.
SuperMush
Founded by Alli Schaper + Brian Friedman |📍LA — Shop / Instagram / Spotify / Linkedin / Youtube
How We Met Them: Via my friend Jackie at Sandbox Studio 🙏
One Liner ✍️ — SuperMush is an LA-based mental wellness lifestyle brand inspired by the 60s and 70s that creates superfood mushroom gummies and media.
What made them stand out: I liked SuperMush for two primary reasons. First, they have an absolutely stacked cap table full of celebrities, artists, athletes, and everyone in between. This will help open key doors as they continue to grow. Second, Alli and team are great at creating community and doing things outside the standard growth playbooks that ultimately gets eyeballs on the brand. A few things include having a dedicated Spotify channel (v cool), doing badass giveaways like a full paid trip to Ibiza to see Blond:ish (are you f*cking kidding me?!), activations at festivals like ACL and Bonnarro, and whipping around a classic VW bus! Overall Alli, Brian, and team are extremely dedicated to their craft, very creative in their marketing efforts, and have the exact vibe and energy to take this brand far.
Unicorn Distillery
Founded by Rick Hewitt | 📍Seattle — Shop / Instagram / TikTok / Linkedin / Video / Press
How We Met Them: Via their signup on the FirstLook.vc
One Liner ✍️ — “Unicorn Distillery Delightfully Disrupts The Vodka And Tequila Categories” - Forbes
What made them stand out: I LOVE this brand. Their all-natural vodka and tequila CHANGES MF COLOR when you add in acidic ingredients like a lime wedge or mixer. Talk about a conversation starter at a party, sheesh! And it’s not just parties either. Restaurants and their bartenders love Unicorn as it enhances the customer experience which boosts sales (and tips!). You know you’re onto something when bartenders are pushing your product.
Product adoption aside, Unicorn is very on trend. 1 in 3 American drinkers are aesthetic driven, of which color is the #1 reason why they photograph a cocktail. Cool, right? If it wasn’t so damn hard to pull together an SPV for a alcohol brand right now, I would have definitely tried to pull together an investment into Unicorn.
That's all she wrote folks. May box is next. Keep on building my friends.