FirstLook's October 2022 Box

A big, warm welcome to the 51 new subscribers to the FirstLook newsletter! Thanks for joining. We are now at 1127 total and growing. 

Ciao! ("Hello" in Italian)

2023 seems to be off to a great start for the market. I'm not holding my breath though, there still needs to be some unwinding in the economy. I believe things will get rough soon. Inflation is coming down (which is great), which means people are spending less. Until now, businesses were still maintaining revenues because people couldn't stop spending, keeping layoffs in check. Now that everyone's pulling back, revenues will begin to decline,  and layoffs will pick up. It's a waterfall effect.

I can confirm many early-stage brands are hurting right now. Why? Because for so long they had optimized for growth instead of for margins and efficiency. Now, profitability is the cat's meow. Many opted for broadline distribution early; great for exposure, credibility, and optics for raising more. However, broadliners eat away at margin, and with investors now favoring profits and efficiency, all of a sudden those optics don't matter as much. Uh oh! 

VC is a funny space. Some founders play the game where they do things VCs love, while others focus on building more slowly which typically doesn't attract VC dollars. And rightfully so considering the point of VC is to inject cash as a means to expedite growth and capture arbitrage or whitespace in the market.

With so many investors getting burned now, the pendulum has swung back to profitability leaving many brands in a bad spot. They can't simply turn off their broadline distribution accounts. The pendulum eventually swing back to exploiting opportunities, but that will take time - and as a result, many brands who put too many eggs in the growth basket the last few years will get washed out.  

Overall, I'm excited for 2023. FirstLook has some new features, services, and fun things brewing (like our Founder Horror Stories! newsletter we're launching). I also recently became a mentor for Techstars and a16z's TxO programs. I'm excited to help founders work through their decks and storytelling. 

P.S. - I suck with getting these newsletters out in a timely fashion. That's my fault, I'm sorry. For 2023 I get back on track, fast. Pinky swear. 

💡 Founder Pro Tip of the Month 💡

Keeping the theme above regarding distribution and avoiding getting burned during tough times, I think it's wise for early founders to consider mixing in DSD/Independent distribution as they grow instead of going too heavy on broad liners so early.

Pros: You preserve margin. DSD isn't as heavy of a lift in terms of account management. Your distribution is more diversified which creates a stronger foundation.

Cons: Some VCs will not give you as much love since you may not have as many sexy logos on your distribution mix slide. 

Nonetheless, I think the tradeoff is worth it. As with all things in life, balance is key!

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October Box Brands 🚀

Investors: 38   |‏‏‎‎   Brands: 7‏‏‎   |‏‏‎   Intros: 45

Want to learn more? → Brand Apply Here / Investor Apply Here

Anact

Founded by Brianna Kilcullen  ‎‏‎|‏‏‎‎‏‏‎  Site + IG |‏‏‎   📍 Austin, TX

What made them stand out: I really like the sustainability aspect of Anact. Hemp is one hell of a plant, and it's perfect for creating products like towels among so many other things. Surprisingly, the type of hemp used for textile production that Anact needs isn't abundant here in the U.S. This creates an opportunity for Anact to move upstream and build these farms in the future which can serve as additional revenue and diversification for the brand. Overall, Anact is in a good position to capture this growing category. 

Buzzkill Wines

Founded by Molly Fedick  ‎‏‎|‏‏‎‎‏‏‎  Site +  ‎IG + TikTok |‏‏‎   📍 Napa, CA

What made them stand out: I am OBSESSED with Buzzkill's branding. It's beautiful and modern, yet also hip in a category where people don't want to feel odd for not drinking. They instead want to feel cool for their decision, and Buzzkill strikes that chord perfectly. This brand is early, but Molly is a strong founder. Given the extremely strong tailwinds in the non-alc space, I think Buzzkill is in a great spot to be that cool brand that customers will proudly drink and not worry what others think. 

DELOCE

Founded by‎‎‎‎‎‎‎‎‏‏‎ Sean Zoka & Keaton Moody |‏‏‎  Site +  ‎IG + TikTok |   📍 Los Angeles, CA

What made them stand out: Caffeinated cocktails are a big business, and DELOCE aims to make a splash here. Their espresso martinis are a great way to kick off a happy hour, pregame (or "pre-drinks" as my sister calls them), or Saturday afternoon party. They also have an impressive list of investors backing them including Vice Ventures, Electric Feel Ent., and Velvet Lane Ventures, among others. ‏‏‎

Everykey

Founded by‎‎‎‎‎‎‎‎‏‏‎ Chris Wentz |‏‏   Site + IG |‏‏‎   📍 Cleveland, OH

What made them stand out: EveryKey is one of the few tech brands to go through FirstLook, but unsurprisingly nabbed the most intros of anyone in this box. They're the world’s first universal smart key that wirelessly unlocks your phone, computer, tablet, and automatically logs you into your online accounts when you're nearby, then locks everything down when you walk away. They started out focusing on B2C, but turns out B2B is also a huge business. Namely, they've been securing massive government contracts lately, many of which are military, which is a good sign for how well the product works considering how important security is there. 

Joydays

Founded by‎‎‎‎‎‎‎‎‏‏‎ Amy Cohn & Maya French  ‎‏‎|‏‏‎  Site +‎‎‏‏‎‎‏‏‎ ‎‏‏‎‎‏‏‎ ‎‎IG + TikTok‏‏‎  ‎‏‎|‏‏‏‏‎  📍 Los Angeles, CA

What made them stand out: It's safe to say America has a sugar problem. So much so that everyone is waking up to it. Enter Joydays, a hard to replicate formula of cookies created with top baking food scientists and chefs that won't cause blood sugar spikes. They had a soft launch in August, and killed it. Sold out online, and have retailers wanting to bring them in. They have great advisors around them as well including the former President of the American Diabetes Association, Founder of Pop Chips, and Innovators from Pepsico, Nabisco, Campbells, Noma & Alinea. With the strong tailwinds in this space, Amy and team could go far. 

TiDBiTs Candy

Founded by‎‎‎‎‎‎‎‎‏‏‎ Kristi Vartanian & David Vartanian  ‎‏‎|‏‏‎  Site +‎‎‏‏‎‎‏‏‎ ‎‏‏‎‎‏‏‎ ‎‎IG‏‏‎   ‎‏‎|‏‏‏‏‎  📍 Ventura, CA

What made them stand out: This husband and wife duo have cracked the code on making delicious gummy-esque candy bites that don't contain allulose. This is important considering the uncertainty of the ingredient long term by retailers and governments food departments. It's not easy to create what TiDBiTs pulled off which took a year of formulation with top food scientists. This provides them a head start in a category so many people love. 

WOO More Play

Founded by‎‎‎‎‎‎‎‎‏‏‎ Lauryn Evarts Bosstick, Westin Mitchell, Michael Bosstick, & Mackie Swan |‏‏‎ ‎‎‏‏‎‏‏‎ ‎‏‏‎Site + ‎IG  ‎‏‎|‏‏‎ ‎‎‏‏‎‎‏‏‎‏‏‎ ‎📍 West Hollywood, CA

What made them stand out: WOO has so much going for them. Their brand attracts first-time category shoppers by focusing on women in long-term relationships who are looking for an accessible, comfortable entry point to intimacy products. For example, 63% of their customers are new to purchasing sexual wellness products, and, after purchasing WOO, 71% of their customers use lube every time or most of the time they have sex. They also have a distinct advantage in the industry. Other sex companies can’t advertise, but WOO More Play can thanks to their partnership with strategic investor Dear Media which helps them reach millions of women through their robust influencer and podcast network (150M+ episode downloads, 60M social reach.) They also have a super start team lead by Mackie who has 5+ years industry experience previously scaling another CPG intimacy brand and launching products in more than 40,000 retail shelves including Walgreens, Target, Whole Foods Market, CVS and more. WOO FTW! 

That's a wrap. Hope your 2023 is off to a great start. November box is next.

If you're a brand, sign up here to jump in our boxes. If you're an investor, sign up here to get a box! 

Thanks from the FirstLook Team- Brian, James, and Mahdi