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A Letter from Our Founderβ¦
Dear CQ Readers & Forerunner Friends,
This coming Monday, July 18th, will mark Forerunnerβs 10th anniversary. I still remember setting up our earliest office in San Franciscoβs Mission district a decade ago. Amid boxes of supplies, I ate Friday night pizza on the floor of Forerunner HQ with my husband and then-three-year-old son. Soon, those boxes would be replaced by the foot traffic of incredible founders like Andy Dunn, Neil Blumenthal, Dave Gilboa, Emily Weiss, Michael Dubin, Chris Britt, Max Rhodes, and so many more, as well as a passionate team dedicated to investing in the evolution of consumer-driven technology.
At the outset, my aspiration was to build a multi-stage venture firmβbut not in the conventional way. As an outsider to Silicon Valley, I didnβt have a vetted playbook to follow in building a venture firm. What I did know was the consumer. I knew investing: market actions, how to develop an investment thesis, how to evaluate a business. I knew how to hustle. I knew Iβd found a lifelong partner in Eurie. I knew how to build relationships. And I knew that Forerunner could be the relentless champion of a visionary group of founders reinventing the way we live and thrive.
One of the resounding philosophies at Forerunner is βfewer, but better,β and I fully believe in optimizationβor maximizationβinstead of scaling for scalingβs sake. This philosophy has trickled down through the firm in every way that matters, and Iβm proud that we have:
A streamlined portfolio of ~150 companies in which we have immense conviction and founders we trust to guide with integrity.Β
A tight-knit team of 14 that works together and celebrates each success.Β
An impressive, curated group of LPs that have backed us with each new fund, and Iβm consistently humbled by their support.Β
A unique, intentional lens on the market that focuses our investment process on solving for the end user, allowing us to be true partners to the businesses and entrepreneurs we back.Β
A pulse on the consumer that comes from our deep love of people.
And you, our Forerunner friends.
I want to take a moment to thank you for being a part of Forerunnerβs journey. Tapping into this rich ecosystem of leaders, technologists, executives, consumers, and friends has kept us sharp for 10 years. Letting us know what issues excite you, motivate you, worry you, and change your mind has made us better investors.Β
Our ears are always open and oriented toward your opinions and feedback. Keep sharing, and keep pushing us to evolve. We promise to keep making sense of it allβthe seismic shifts in consumer sentiment, the changing customer behaviors, the ebbs and flows of the economyβreporting our findings back to you, and using that knowledge to invest in a better future for us all.
Hereβs to the next 10 years,Β
Kirsten
Founder & Managing Partner
This Weekβs Top 10 Consumer Insights
A new poll shows 70% of Americans think a recession is inevitableβand they have already started to prepare by making key changes. 62% of respondents are reducing spend, 39% are creating budgets, and 26% are building up their emergency savings funds.
All of the above said, with a strong job market keeping consumers afloat, people are still dropping money on a range of goods, services, and dining (even if they canβt spend quite as much). With inflation ongoing, Americansβ spending increased by 1% in June. Spend bested expectations in May, as well.
Millennials and Gen Z are beginning to feel the weight of the economy and its effect on their future. According to a new poll, 61% of these young respondents feel they wonβt be able to attain their dream future. Plus, roughly 38% of Millennials feel behind financially on a regular basis compared to just 25% for the average American.
In-person work isnβt dead. In fact, younger workersβthe future of the workforceβwant to get back to the office. Just 24% of 20-something employees would prefer to be full-time WFH, followed by 29% of workers in their 30s, 33% of workers in their 40s, and 41% of workers over 50.
Currently, just 7-8% of the workforce remains at home because of the pandemic. This number has held steady since April when it leveled off, and may signal the rough percentage of the workforce that will remain at home indefinitely. The stat has also declined significantly since the start of the year when 15% of the workforce was at home due to Covid-19.
The rental market is heating up as the housing market cools. The average price of rent in Manhattan crossed $5,000 for the first time everβwhich is up over 30% from one year ago. A lot of would-be buyers pivoted to renting given higher mortgage rates, making an already competitive market even tougher.
Companies are expected to boost employee salaries by 4.1% in 2023. But with inflation hovering at over 9% today, some wonder if that will be enoughβor too lateβin a job market thatβs already prompting resignations.
One quarter of Americans claim their next car will be electricβnot for sustainability reasons, but because of the rising cost of fuel. In fact, 77% of those interested in EVs said rising gas prices was the driving force behind it.
Customers arenβt resonating with Amazonβs private labels, per reports. The WSJ claimed this week that the e-commerce giant is dialing back its 45 in-house brands amid weak sales. Similar to Walmart and Targetβs brands, which have seen success in recent years, Jeff Bezos once wanted Amazonβs slate of labels to account for ~10% of total sales.
Even if it hasnβt been in the headlines recently, the baby formula shortage is still a source of angst for many families. Earlier this month, the availability of powder formula sunk to its lowest level of 2022 with 30% of products out of stock as of July 3rd. Consumers in Alaska, Utah, and Wyoming are having the toughest time with formula accessibility.
β¨ Ask Forerunner β¨
Want to ask a Forerunner investor about the state of the market, what consumers want, or how to build a better business? Click here to ask your question; the best ones will be answered in future editions of The CQ.
Weekly Wisdom
βI might be an automation βvisionary,β but Eurie is a commerce visionary. She understood the consumer and digitally-native retail brands, understanding what the market was going to evolve into, and then the macro-aspect of what the consumer was going to be looking for. So pairing up with another visionary who had a deep understanding of what the future was going to look likeβand was shaping that futureβthat was key vs. someone who just said, βOh, just copy what this other company did and weβll be fine.β That was never a conversation Eurie and I have ever had. So, you asked how did she contribute in the early days? She was certainly a cheerleader, but also, I didnβt have to go to 40 different places to understand product-market fit. She intrinsically understood what the market neededβmaybe not the technical solution, because thatβs where me and my team come in. But when we talk about [knowledge at] the platform-level and the service-level and the solution set, what is needed to drive these brands and consumers, she had deep knowledge.β
βScott Gravelle, Founder & CEO of Attabotics, on TechCrunch Live this week with Eurie, discussing the importance of choosing a complementary skillset in an investor.
Forerunner & Portfolio Highlights
Eurie attended Fortune Brainstorm Tech this week to discuss the power of personalized health data with ΕURA CEO Tom Hale. Watch the talk and demo here.
Eurie sat down with Attabotics Founder & CEO Scott Gravelle on Wednesday for TechCrunch Live. They talked about why a robotics company needed a consumer investment partner to scale. Check out the discussion here.
Work at a Portfolio Company
Software Engineer (Backend), Catch | Catch is a growing startup on a mission to disrupt traditional e-commerce payments.
The Backend Engineer will own end-to-end design and implementation of features including development, testing and release.
Talent Acquisition Specialist, Attabotics | Attabotics is the worldβs first 3D robotics supply chain system for modern commerce.
The Talent Acquisition Specialist will play a key role in growth by attracting, engaging, and recruiting top talent across various disciplines.
CRM Coordinator, The Farmerβs Dog | The Farmerβs Dog was born from a mission to change the landscape of pet health, providing dogs and their humans with honest, smart, and simple care.
The Customer Relationship Management (CRM) Coordinator will help improve how we automate communication with our leads, customers, former customers, and evangelists through channels like email and SMS.
There are ~1,152 other openings on our jobs site. Check βem out.