The CQ | Investing in Joy's $10M Seed To Provide Relief to New Parents
Plus the Forerunner Team's Must-Reads of the Week
The 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.
By Eurie Kim, Managing Partner
At Forerunner, we’re passionate about the concept of serving the traditional needs of non-traditional consumers. Consumers are increasingly complex and diverse, but human needs are still relatively predictable — everyone needs purpose, support, growth, and wellbeing — even if the way we fulfill these needs today looks different than it did in decades past. We see big opportunities in reimagining and rebuilding these key life foundations for consumers today — a thesis that led us to OURA, Atticus, Fay, and a range of companies reshaping SMB opportunities.
This theme has also led us to Joy, which recently came out of stealth and announced that we led their $10m seed. Joy is building the essential companion guide for navigating parenthood, with the initial product providing 24/7 text-based access to a wide range of parenting coaches and resources: feeding and lactation specialists, sleep experts, and financial experts ready to answer day-to-day questions like finding the best daycare, setting up a will and life insurance, starting solids and sleep training, and more.
For anyone with a new parent in their life, it’s clear Joy serves an immediate, burning need. The caregiving space is plagued by tremendous emotional and financial challenges, with caregiving being the second most common reason why someone exits the workforce (after retirement) and 80% of new parents saying they struggle emotionally postpartum. Regardless of the circumstances, new parents find themselves in one of the most meaningful and brand new life experiences all without much standardized support.
As a mother of two young kids, I’ve been there. I’ve panicked wondering if my baby was getting enough food, sat for hours on hold trying to get through to my pediatrician’s office weekend advice nurse, and been up at 2am down the google rabbit hole only to become more worried about an issue I didn’t warranted worry. I’ve craved an expert source of readily available, empathetic support to help me through these moments, and instead, like so many others, I’ve pieced it together manually — wrangling disparate services and referrals in a hurry, and often shelling out hundreds or thousands for specialists over the course of my kids' earliest years.
That’s why we were struck when we came across Joy. Not only are they helping solve this consumer burden and market fragmentation, they’re mapping out expansions to serve additional life stages (toddlers, to young kids and beyond) to support the ongoing parenting journey.
Know any new parents? Send them to Joy.co!
What We’re Talking About on Slack:
Unemployment continues to tick up, putting recession warnings back into focus. The U.S. unemployment rate jumped to near a three-year high of 4.3% in July — up from 4.1% in June and 3.4% early last year — all amid a significant slowdown in hiring and a near ~40% miss in the projection of the number of jobs added to the market. Heightening fears about the labor market deteriorating is underpinning conservations about the economy potentially being vulnerable to a recession.
More: WSJ says that the hottest job market in a generation is over. “Frankly, I’m not sure that labor market was ever sustainable. It was built on the back of a huge Covid shock. It was amazing to see but it was never going to stick around long,” says an economist at Indeed. Alongside rising unemployment and more conservation additions of new jobs into the market, wage growth also has fallen to 3.9% year-over-year (which still higher than it was pre-pandemic, but down from past years).
Google Takes Character.ai out of the AI startup race in its most recent acquisition, rehiring the Cofounders that originated at DeepMind. The startup will enter into a non-exclusive licensing deal with Google for its large language model technology and the core Character.AI service will continue to exist. TechCrunch and several other outlets point out that there is a certainly possibility that different regulatory bodies (the Federal Trade Commission (FTC) and DoJ in the U.S.) will scrutinize these reverse acqui-hires closely.
1 million people now owe more than $200,000 in federal school loans, up from 600,000 borrowers in 2017 — and 2.4 million owe between $100,000 and $200,000, up from 1.8 million people. Rising prices for education is a huge factor with the total cost for some schools nearing $100,000 a year. While undergrads have limits on how much they can borrow in student loans, graduate students don’t. “Almost every college looks at their graduate programs as their cash cows.”mUnsurprisingly, 80% of those owing $130,000 to $170,000 said they feel a “high” or “very high” amount of stress because of this.
Nike’s epic saga of value destruction: CMO and brand strategist Massimo Giunco (a former senior brand director for Nike) recounts how the legacy brand lost $28 billion of market cap in a day, breaking down Nike CEO John Donahue’s plan for reorganization ,which included eliminating the categories of brand, product development and sales from the company, transitioning to a DTC-led company, and changing its marketing model to be digitally led. On ending wholesale leadership, he says, “Consumers are not so elastic as some business leaders think or hope. And consumers are not so loyal as some business leaders think or hope…Many consumers—mainly occasional buyers—did not follow Nike but continued shopping where they were shopping before the decision of the CEO and the President of the Brand. So, once they could not find Nike sneakers in ‘their’ stores—because Nike wasn’t serving those stores any longer—they simply opted for other brands.”
Meta is rolling out its AI Studio in the U.S. for creators to build AI chatbots. Users can personalize their chatbots for a number of uses from writing captions, formatting posts, and generating memes to creating chatbot versions of themselves to engage with fans. “I think there’s going to be a huge unlock where basically every creator can pull in all their information from social media and train these systems to reflect their values and their objectives and what they’re trying to do, and then people can interact with that,” says Mark Zuckerberg.
Bloomberg Businessweek investigates the miseducation of America’s nurse practitioners. Being treated by a nurse practitioner is becoming increasingly more common whether it’s in medical offices or ERs, and they’re able to diagnose ailments and prescribe medications just as doctors do. The number of NPs has risen sharply—in 2014 there was 1 NP for every 5 physicians and surgeons; in 2023 the ratio was 1 to 2.75. In fact, the number of nurse practitioners is expected to increase 45% by 2032. While that means more people have access to care, patients may also be more vulnerable to poorly trained NPs, the majority of whom have received their education online. “Some of the NPs who talked to Businessweek say they wouldn’t entrust members of their own families to the care of some of the newly minted nurse practitioners they’ve observed.” What’s also alarming is that there are no available ways for patients to vet nurse practitioners.
The Atlantic looks at Silicon Valley’s trillion-dollar leap of faith. Funding the data centers and related infrastructure that generative AI depends on is going to cost trillions of dollars from tech companies, utilities, and other industries. Recently, analysts and investors from Goldman Sachs, Sequoia Capital, Moody’s, and Barclays have raised doubts on whether the investments in generative AI will be profitable. Says David Cahn, a partner at Sequoia Capital, “Some of the largest tech companies’ current spending on AI data centers will require roughly $600 billion of annual revenue to break even, of which they are currently about $500 billion short.”
The Senate is set to pass a bipartisan bill meant to protect children’s online safety. If the bill becomes law, social media platforms would be required to prevent harm to children in the form of bullying and violence, the promotion of suicide, eating disorders, substance abuse, sexual exploitation, and advertisements for narcotics, tobacco or alcohol. That means that tech companies would have to take certain measures including options to protect personal information, disable addictive product features, and opt out of personalized algorithmic recommendations, as well as restrict other users from communicating with children.
Food as you know it is about to change. The New York Times takes a close look at the fragility of our global food system, or what one Cornell agricultural economist calls a “food polycrisis,” referring to the rising rates of food prices, worldwide hunger, undernourishment, obesity, diabetes, and heart disease, while the effects of climate change have reduced the growth of overall global agricultural productivity by 30–35%. The insurer Lloyd’s estimated that within 30 years, there’s a 50% chance we will experience a “major” global food shock. A NASA expert says the challenge of saving the food system is a “quadruple squeeze,” explaining: “First, the problem of productivity and hunger. Second, the risk to ecosystems, under threat from fertilizer runoff deforestation and other pollution. Third, the challenge of nutritional deficiency, as those foods we are growing more of are generally getting worse for us over time. And finally climate, which is driving a ‘fundamental change across most breadbaskets on the planet.’”
Portfolio News:
ModernRetail covers the launch of KiwiCo in Barnes & Noble and Target stores.
Glossy reports that Curology’s sister brand Agency targeting anti-aging skin-care for the mature customer is launching on Amazon.
Inc. speaks to Zola co-founder and co-CEO Shan-Lyn Ma about her journey to entrepreneurship.