The CQ | How Med Spas Conquered America, and How Young People Halted Religion's Decline
The Forerunner Team's Must-Reads of the Week
he CQ is Forerunner’s weekly newsletter rounding up the most pressing consumer news and analysis, plus some bonus musings from our investment team. Subscribe now to get the latest edition in your inbox every weekend.
What We’re Talking About on Slack:
The U.S. economy depends more than ever on rich people. The top 10% of earners, households making about $250,000 a year or more, now account for 50% of all consumer spending, a record high, in comparison to 36% 30 years ago. Between September 2023 and 2024, the wealthy increased spending by 12%, while spending by the middle and lower-income groups fell. A chief economist at Moody’s Analytics “estimated that spending by the top 10% alone accounted for almost one-third of gross domestic product.”
How the internet made in-store shopping miserable: In a nutshell, brick-and-mortar stores are understocked, understaffed, and inconvenient, thanks to the prevalence of locked shelves and self-checkout. A study of 30 retailers discovered that a mere 9% of their online women’s clothing assortment was available in stores, with department stores at 7% and mass merchants at 2% (specialty retailers offer, on average, a third of their goods in stores). Meanwhile, a 2024 IBM survey found that nearly three-quarters of consumers prefer shopping in physical stores, yet only 9% are satisfied with the store experience. “Retailers have pivoted too hard to e-commerce and neglected the in-store experience, and that has got to swing back,” says the chief executive of Belk, which is now focusing on improving their stores.
AI is changing how Silicon Valley builds startups. The New York Times reports on the growing trend of tech startups scaling to significant ARR while requiring far fewer employees and less funding. One example is Gamma, which has acquired “tens of millions” in annual revenue with just 28 employees and almost 50 million users. “Before this AI boom, start-ups generally burned $1 million to get to $1 million in revenue. Now getting to $1 million in revenue costs one-fifth as much and could eventually drop to one-tenth.” One founder says that his AI-efficient model had freed up time he would have otherwise spent managing people and recruiting. Now he focuses on talking to customers and improving the product. He created a Slack room for feedback from his top users, who are often shocked to discover that the chief executive was responding to their comments. “That’s actually every founder’s dream.”
When there’s no school counselor, there’s a bot. Sonny, a hybrid AI-powered chatbot, is being adopted by more than 4,500 public middle and high school students in nine districts across the country, many of which are in low-income and rural areas where mental health services are lacking. Sonny offers a way for students to receive “judgement-free” support via text, and what makes Sonny different is that humans with backgrounds in psychology, social work, and crisis-line support are constantly reviewing the chats and can edit responses. At one high school, of the 175 students who have signed up for the service, 53% text Sonny several times a month, and the school has noted a 26% decline in student behavior infractions. Of course, some critics and longstanding practitioners point out that human therapists can pick up on body language to recognize signs of depression and anxiety in ways that a chatbot cannot. “AI depends on being fed that information, but it can be fooled,” says one counselor.
The Wall Street Journal looks at why we don’t trust doctors like we used to. According to Gallup, only 53% gave a high or very high rating to medical doctors, in comparison to 67% in 2021, the biggest drop among the 23 professions ranked by Gallup. Many people feel frustrated that their concerns are dismissed and unsupported by time-pressed physicians, leading them to seek information online, sometimes resulting in dangerous self-diagnoses. And one study found only 14% of people with low levels of trust take their medication. This loss of trust is leading to a burgeoning industry of companies and consultants for helping navigate the healthcare system, including advocacy and reimbursement. “We need to be aware of the mistrust and own it as our problem,” says one former pediatrician who’s now a full-time healthcare advocacy consultant.
Parents who hire elite tutors are setting up their kids for failure. Yes, some parents are straight-up asking tutors to do their children’s assignments for them. But even those parents who aren’t looking to cheat could unknowingly be harming their kids: “In this relentless push for achievement, the over-tutored kid is by definition never good enough. Parents are sending them the crippling message that they are not capable of doing what they need to do on their own…How are they going to make it through life if they need constant hand-holding just to function as a high school student? It is no small irony that this kind of over-tutoring is creating underprepared children.”
Why do women live longer than men? Women in the U.S. outlive men by about five years, with a life expectancy of 80 years compared to 75 for men. This longevity gap is observed across the globe, cultures, and classes. However, women have shorter health spans, facing frailty and a higher risk of conditions like cardiovascular issues and Alzheimer's, particularly after menopause. Scientists are researching the factors that could be the reason for this, including genetics (the XX chromosome in women may impact longevity), hormones (when estrogen drops during menopause, immune systems weaken), as well as lifestyle and behavior (women are less likely to smoke or drink heavily, they go to the doctor more, and socialize more than men). “If we can understand what makes one sex more resilient or vulnerable, then we have new pathways, new molecular understanding, for new therapeutics that could help one or both sexes also be resilient.”
There’s been a flurry of recent reports of Gen Z being the unhappiest generation, so Dazed asked young people what would actually make them happy. The survey discovered recurring themes that shed light on how our current culture isn’t working for them: “Young people want their basic needs met. They want jobs, livable wages, and affordable (free) healthcare. Those who already have jobs crave freedom, the type of freedom they experienced when they were at university. They want to be untethered from their phones, an end to surveillance culture, their own space, and deep and meaningful relationships with other people. They do not want to adapt to a broken world – instead, they are questioning it, resisting it, and demanding something better.”
Bloomberg breaks down how med spas conquered America, expanding more than sixfold from 2010 to 2023, with over 10,000 locations generating $15 billion in revenue in 2023. The rise has been driven by lower barriers to entry (just a license to perform basic medical procedures and a few thousand dollars), increased demand for aesthetic enhancements from Botox, weight loss injections, and more (before-and-afters posted on social media helped), and the fact that it’s a cash business which avoids the expense and red tape of the insurance industry. “It’s easy to wonder, though, whether the thing that ultimately slows down the med spa money train might be the industry’s unchecked success. There are people who come into this industry who are not well trained, who are not experienced or qualified enough to do certain treatments, who cut corners, and who have kind of flown under the radar because the industry has grown up so quickly.”
Christianity’s decline in the U.S. appears to have halted. A major Pew Research Center survey finds that 62% of Americans now identify as Christians. The rise of religiously unaffiliated individuals has slowed, and the overall religious landscape has leveled off since around 2019. One key factor in this shift is the younger generation, where the gender gap in religiosity has narrowed among younger people and nearly disappeared:
Portfolio Highlights:
ABCNews reports on the growing trend of full-body medical scans, highlighting Prenuvo.
Job of the Week:
VP of Growth Partnerships at OURA, the company that is redefining how consumers think about sleep as a key part of their overall health.
There are ~665 other jobs open at portfolio companies, check ‘em out.