glossier

Auto Added by WPeMatico

Forerunner Ventures’ Kirsten Green demystifies the COVID-19 consumer era

“In general, the consumer has proven to be more resilient than I would have thought,” said Kirsten Green, founder of Forerunner Ventures, which has investments in breakout D2C stars like Glossier, Hims and Bonobos.

She joined us for an Extra Crunch Live conversation to help us better understand buying habits in the COVID-19 era. With tens of millions out of work and uncertainty all around, people are spending less, but Green showed up with a healthy dose of optimism — while acknowledging that her worst-case scenario planning was wrong.

Her top-line advice for companies

Take a cautious approach, be prepared to make hard decisions, but be thoughtful about that. Don’t just make a knee jerk-reaction, which is “this is the apocalypse, we all need 36 months of runway, fire half your staff and go to the bunker.” I think the biggest opportunity for companies right now in many ways is to create value by demonstrating their flexibility.

Powered by WPeMatico

Startups rethink what it means to be high-touch during a pandemic

Glossier NYC, in normal times, is typically visited by more than 2,000 people every day, with lines of people from all over the world curling out the door. And when you enter, it’s tempting to touch, well, everything.

The walls are adorned with flowers, mirrors and giant versions of the makeup company’s flagship product: Boy Brow. Makeup is sold on communal tables, where customers are encouraged to try products. Emily Weiss, the founder of the unicorn startup, calls customer meetups as she sees them: community events.

And, of course, in the store, there are also a few sinks to wash off your makeup (and your hands).

The challenge of running a startup that has a high physical component has become one of the big themes in the world of tech in the last several weeks. Indeed, as companies like Google, Facebook and Zoom do their parts to help people stay connected during the novel coronavirus pandemic, and research for cures, another story has taken shape in a different area of the tech world: startups and larger tech companies with “high touch” models — not just based on customer relationships but literally business models with strong physical components — are facing a world of challenges at a time when people are being asked to stay indoors, and stay away from each other.

To stave off cash shortages and closures, businesses are taking a variety of approaches, and rethinking how they run their businesses, to keep going. In some countries, governments are stepping in to keep businesses from collapsing, while some startups are hoping that their investors will continue to support them as the pandemic continues to spread.

In other cases, startups are quietly coming together to compare notes on how best to tackle legal and other hurdles in an unprecedented environment. (So quietly, in fact, that they didn’t want to talk about this on the record.) When is the right time to talk to insurance companies? How do you negotiate with them and will you ever get anything out of those discussions? What recourse does a company have for forfeiting some payments that are coming due? How do you handle headcount if you lack the liquidity to survive a big dip in your business? What are the best practices for running a business in a reduced or altered form?

“This has been the most difficult five continuous days in all of my team’s careers,” Vibhu Norby, the CEO and founder of b8ta — a chain of retail stores that act as a marketplace between consumers and lots of different hardware and other companies, letting potential buyers try out products before buying — said in an interview. “We don’t have any other business other than our physical one, that’s all we do. But we have an amazing team and there are things that we’re doing that are useful, but there is no playbook for this.”

It’s not all doom and gloom. With people home-bound and spending a significantly higher amount of time online, tech companies that innately support social distancing are getting a huge boost in purchasing. Think in particular e-commerce delivery services such as online grocers, and Amazon. Some are finding that they’ve had to curtail services to be able to meet demand. Others like streaming services are seeing giant spikes in their traffic.

(Haven’t) been there, (haven’t) done that

The trajectory of impact on startups has been a wide one, starting earliest with major events. Conferences and expositions have become something of a cornerstone of how startups come together and do business in a global economy. While we clearly have tech hubs where face-to-face contact is as easy as grabbing a coffee, events become a place where you can catch people from many other corners, or even those who don’t regularly come out of the woodwork.

All of that has changed this year, with just about every major confab this year (so far) getting cancelled. CES, at the beginning of January, just made it through; RSA surprisingly went ahead last month. But many events have been taken off the table: MWC in Barcelona, SXSW in Austin, events from Google, Apple, Facebook and Amazon, E3, GDC and so many more.

People love to complain about how conferences and expositions are a noisy mess, but the fact of the matter remains that they have no rival when it comes to meeting people and doing deals at scale.

The events themselves are tech businesses in their own right, marketplaces that generate billions of dollars in revenues, and connecting hundreds of thousands people for potential B2B sales. “This is going to impact our business for sure,” one exec at a startup (who didn’t want to be named) told TechCrunch when the huge mobile confab in Barcelona was cancelled over coronavirus fears. “MWC is a major event for us…the largest source of qualified sales leads on our calendar. No other event comes close.”

If events businesses were the first wave of “high touch” tech outfits to be impacted by coronavirus, following closely behind has been the transportation and tourism industries — connected to the events business but also far exceeding it in scope.

People have chosen, been requested and sometimes been forced, to stop moving around in an attempt to mitigate the spread of the virus — creating a significant knock-on effect not just for transportation companies, but also the wider tourism industry, “The biggest nuclear winter in online travel,” as one founder put it last week. As people increasingly stay put, Airbnb this week extended its own extenuating circumstances refund policy so that people can rebook already reserved stays that were supposed to happen in the next month.

Transportation, of course, hasn’t only seen restriction for long-distance travel, or even for the carriage of just humans. Uber and Lyft have both cut back on rides, specifically shared, carpool-style services, in an attempt to “flatten the curve” to reduce the frequency of new cases brought on by too much contact, and food delivery services have introduced “contactless” delivery to minimise contact with customers, especially with those who might be infected and are quarantining at home.

“The health and wellbeing of our couriers and customers is our top priority and we think these practices will help give some peace-of-mind to our fleet, while also decreasing the interaction and contact between both parties,” a spokesman for Glovo, a European delivery startup, said last week when the measures were introduced.

But the impact extends beyond obvious sectors like transportation and tourism. Take makeup, for instance.

While Glossier does a majority of its sales online, it temporarily closed its retail locations last week to limit customer interactions. In some ways makeup is innately an industry that requires you (or someone else) to touch your face. Glossier is brainstorming ways to stay in contact with customers, such as FaceTime consultations and Slack groups.

Per Glossier, it hasn’t yet received questions from customers on how to handle the aspect of makeup application in a time when we are told to not touch our faces. It is, however, telling people to wash their hands.

There’s also Revel, which is a marketplace for women over 50 to host and attend small gatherings and stay connected. Given the age group and social aspect of the company, Revel has cancelled all in-person Revel events through at least the end of March.

“The decision to cancel in-person events has an immediate business impact for us,” the co-founders wrote in an email to TechCrunch.

Revel is working on a speaker series over Zoom, virtual walks where members can be connected via FaceTime or audio to go on walks together, and happy hours. The list goes on with book clubs and writing groups.

Similarly, London startup Jolt built a business around a concept of “pay-monthly” business classes that had a strong in-person component: not only was the idea to learn in a physical classroom, but those involved got opportunities to network with other students before and after courses, participate in breakout sessions, work in partner groups with other students and access presentations.

Now with those in-person classes on hold, Jolt has moved up the launch of “Jolt Remote,” an online version that it had previously planned to ship in 2021, which aims to preserve all the dynamics of the startup’s previous, offline efforts. “The company felt it necessary to expedite its rollout in order to keep their students safe, and to reduce the need for their education to be disrupted in the wake of COVID-19,” a spokesperson said.

Jolt‘s teachers will continue to work as they always did, she continued. But instead of their students meeting up in Jolt campuses, they’ll now be able to access the courses virtually.

While Revel’s shifts are likely to have an impact on its bottom line, they said, it was the right decision. Few startups and investors have even started to point at the new innovation that will come out of this pandemic as a bittersweet externality.

Revel, while it only operates in the Bay Area, has more than 200 members from geographies as far as South Africa. They’re planning to join the upcoming virtual gatherings.

The founders say it is helping Revel to build virtual capabilities that they will be able to use in the future when geographic distance, illness or other factors isolate members who need connection.

It’s helping an in-person company think what it means to be in-person.

Powered by WPeMatico

How to use Amazon and advertising to build a D2C startup

Matt Altman & Tyler Elliston
Contributor

Matt Altman runs the Amazon practice area for VMG Ignite, an eCommerce consultancy that helps early to mid stage CPG companies achieve growth. Tyler Elliston is the founder of VMG Ignite. Clients include Sun Bum, Perfect Snacks, Aloha, Pill Club, Solid Gold, and many more.

Entrepreneurship in consumer packaged goods (CPG) is being democratized. Every step of the value channel has been compressed and made more affordable (and thereby accessible).

At VMG Ignite, we have worked with dozens of direct-to-consumer startups trying to both find product-market fit and achieve scale through Amazon and online advertising.

This article focuses on customer acquisition, particularly Amazon and online advertising, for the direct-to-consumer (D2C) CPG venture. Selling on Amazon, specifically third-party (3P), has become an increasingly important component of the D2C playbook. About 46% of product searches start on Amazon, which makes it a compelling source of sales even for early-stage ventures.

Table of contents

How to find product-market fit 

People say that ideas are a dime a dozen. They aren’t valuable. But finding product-market fit? Now, that’s hard. The gap between an unexecuted idea and proven product-market fit can seem vast. Yet it’s a critical first step because, ultimately, marketing amplifies your product and value proposition.

If they aren’t compelling, marketing will fail. If they’re compelling, even mediocre marketing can often be successful. So start with a great product that people love.

How do you create a great product, you ask? A/B test your product configuration like you A/B test your landing page, copy, and design. Your product is a variable, not a constant. Build, ship, get feedback. Build, ship, get feedback. Turn detractors into your customer panel for testing.

Early-stage D2C companies typically get their first customers through three channels:

  1. Begging your friends and family to buy and promote your product.
  2. List it on Amazon as a 3P seller. Figure out the platform and start selling!
  3. Advertise on Facebook. Start with a daily budget of 10x your price point to get started and start tinkering with creative, audiences, and settings to minimize cost per order.

The companies that succeed are often the ones that iterate the fastest. In his book Creative Confidence, IDEO founder David Kelley and his co-author (and brother) Tom relay a story of a pottery class that was split into two groups.

The first group was told they would each be graded on the single best piece of pottery they each produced. The second group was told they would each be graded based on the sheer volume of pottery they produced.

Naturally, the first group labored to craft the perfect piece while the second group churned through pottery with reckless abandon. Perhaps not so intuitive, at the end of the class, all the best pottery came from the second group! Iteration was a more effective driver of quality than intentionality.

Don’t know how to manage Amazon or Facebook? Here are some best practices:

How to get started with Amazon

Powered by WPeMatico

Lattice raises another $15M to improve performance reviews

Sam Altman’s little brother Jack is an entrepreneur, too.

Jack Altman, whose resume includes a stint as vice president of business development at Teespring, has raised $15 million in Series B funding for his startup, Lattice, a modern approach to corporate goal setting. Shasta Ventures led the round, with participation from Thrive Capital, Khosla Ventures and Y Combinator, the latter being the organization his brother led as president until very recently.

Lattice, used by high-growth companies like Reddit, Slack, Coinbase and Glossier, helps human resources professionals develop insights about their teams. Founded in 2015, Altman and Eric Koslow, like most entrepreneurs, developed the idea for Lattice out of their own pain points.

“We realized that with quarterly goal settings, OKRs, we would write them up and get the leadership together and then they would sit on a shelf and nothing would happen,” Altman told TechCrunch.

Lattice, a SaaS business, is a flexible platform that caters to startups and larger businesses’ specific cultures, management practices and varying approaches to employee engagement. The product, inspired by platforms like Gmail and Slack, is designed with consumers in mind. Lattice, the team hopes, has a look and feel that makes incumbent HR platforms feel antiquated. 

The product makes it simple for employees and their managers to complete engagement surveys, share feedback, arrange one-on-one meetings and complete comprehensive performance reviews with a larger goal of reworking the company goal-setting process entirely. No more once-yearly check-ins; Lattice enables businesses to check-in with their employees on a weekly basis. 

Lattice currently has 1,200 customers, 60 employees and was cash flow break-even for the first time in Q1 2019. With the latest financing, the San Francisco-based startup plans to invest in product development.

“Life is short,” Altman said. “You want to have work that you enjoy and an office that feels good to be at.”

Lattice has previously raised capital from investors including SV Angel, Marc Benioff, Slack Fund and Fuel Capital, Sam Altman, Elad Gil, Alexis Ohanian, Kevin Mahaffey, Daniel Gross and Jake Gibson. Lattice completed the Y Combinator startup accelerator in 2016.

Powered by WPeMatico

Glossier launches its first spin-off brand, a line of Instagram-friendly ‘dialed-up’ beauty extras

Glossier, known for its line of understated makeup products and a cult-following of millennial Instagrammers, is getting colorful with the launch of its first spin-off brand, Glossier Play.

The company — led by founder and chief executive officer Emily Weiss, who built the nearly $400 million business from a makeup blog called Into The Gloss — has raised a total of $92 million in venture capital funding from top-tier consumer investors Forerunner Ventures, Index Ventures and IVP. Stitch Fix founder Katrina Lake and Forerunner founder and general partner Kirsten Green, are among the company’s board members.

Weiss introduced Glossier in 2014 as a clean-skincare and natural beauty advocate. Today, the direct-to-consumer business boasts a growing line of barely there makeup, designed to mimic Weiss’s own subtle, au naturale vibe. The launch of Glossier Play, inspired by 1970s’ nostalgia, is its first foray into bright colors, glitter and, in the brand’s own words, “dialed-up extras.”

Glossier Play’s initial line-up of “extras” includes colored eyeliners ($15), highlighters ($20), multi-purpose glitter gel ($14) and the “Vinylic Lip” ($16). Customers can purchase “The Playground,” a set that includes each of the new products, for $60.

Introducing Glossier Play! A brand of dialed-up beauty extras that make getting ready the best part about going out. Four new makeup products at https://t.co/4PxDM67E2R pic.twitter.com/ULRrc9Ycn3

— Glossier (@glossier) March 4, 2019

The advertising campaign for the Instagram -friendly line will be led by none other than Instagram star Donté Colley, as well as pop musician Troye Sivan. The new line and future spin-offs will help Glossier compete with beauty incumbents, Estée Lauder and L’Oréal, for example, in a market estimated to be worth $750 billion by 2024.

Glossier, headquartered in New York, counts 200 employees, meager in comparison to its nearly 2 million — and growing — social media following. The company surpassed $100 million in annual revenue in 2018, it tells TechCrunch, and acquired 1 million new customers. In total, Glossier retails 29 products across skincare, makeup, body, and fragrance.

The company won’t be introducing additional brands this year and clarified it is not a brand incubator.

Powered by WPeMatico

ADAY aims to simplify your wardrobe with $2M in funding

 ADAY, a fresh entrant in the highly competitive world of direct-to-consumer fashion, has raised $2 million in new funding for its mission to simplify wardrobes with a line of durable, technical and chic womenswear. The company is the latest in an ever-expanding movement of startups that offer direct-to-consumer products for the fashion-conscious consumer. Read More

Powered by WPeMatico