The CQ: Leading Stress-Free's Series A Round to Bring Transparency and Reliability to Auto Care
Plus the Forerunner Team's Top Read of the Week
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By Brian O'Malley, Managing Partner
American culture is synonymous with cars. Considering how much time we spend behind the wheel, it's obvious why. In the past 40 years, the number of miles Americans collectively drive has increased from 1.5 trillion to 3.2 trillion per year, enough to take nearly 5,000 trips to the moon and back. That’s more than twice as much driving with a population that’s only 50% larger. And, the more people drive, the more essential the auto maintenance industry is to our quality of life.
Unfortunately, in the world of auto maintenance, clarity and trust are rare finds and often overshadowed by predatory practices and consumer skepticism. The industry is notorious for pushing unnecessary repairs, bait-and-switch quotes, long wait times, and scare tactics. AAA found that nearly two-thirds of Americans don’t trust auto repair shops, and one-third don’t have a shop they feel confident visiting. In this landscape of doubt, Stress-Free Auto Care stands out by emerging as a destination for transparency and reliability.
Our investment in Stress-Free didn’t start with the desire to invest in an auto repair shop. We set out with the belief that the right underlying software platform could help local businesses operate more effectively and transparently, providing a better customer experience along the way. The Stress-Free team started out with a similar thesis, initially providing software to auto repair shops and eventually betting on themselves by acquiring local, under-appreciated auto shops.
Stress-Free’s software immediately streamlines customer bookings, taking a historically completely offline industry and moving 1/3 of appointments online, while simultaneously improving customer satisfaction to a 4.9 star rating. By owning and operating its locations, Stress-Free ensures it has well-trained and incentivized staff to make use of that software. Further, recognizing that software alone is often not enough, Stress-Free also remodels, rebrands, and modernizes all their shops, including what has become a customer favorite Stress-Free lounge with modern amenities like phone chargers, great snacks and free Wifi. Stress-Free endeavors to have the customer’s physical experience at the shop parallel the quality of the modern software experience.
Our experience with Stress-Free has strengthened our interest in tech-enabled services businesses at Forerunner, showing that owning workflows can now be a venture-scale opportunity and more impactful than merely selling software in certain scenarios -- particularly with the improvements made possible by AI.
Read more on Stress-Free's Series A funding in Axios and be sure to keep an eye out for Stress-Free locations when they come to your market.
What We’re Talking About on Slack:
Even after years of rising prices and despite inflation recently slowing down, we still don’t believe how much things cost. Since 2020, the price for milk has gone up 20%, pet food has increased 21%, and deodorant jumped a whopping 59%. A February Wall Street Journal poll found that nearly three-quarters of respondents said that higher prices outstripped gains in their household incomes in the past few years. Researchers say that consumers are disgruntled because they don’t feel that they’re getting the same value they used to, their price expectations are constantly off, and they’re still subject to the elevated prices that were brought about during the pandemic due to labor shortages, supply-chain disruptions, and high demand. “They viewed those price hikes as temporary. The fact that they’re not and they’re continuing to go up is frustrating.”
Latin American immigrants are starting businesses at more than twice the rate of the U.S. population as a whole. In 2023, the percentage of Latinos who started a business was 0.6% in comparison to Asians at 0.35%, Blacks at 0.34%, and Whites at 0.28%. About half of Latino business owners are immigrants and many of the businesses founded are in services, food, and delivery, which are areas that have been in high demand since the pandemic.
End the phone-based childhood now—that’s the warning from The Atlantic. Social psychologist Jonathan Haidt links Gen Z’s current mental health crisis—including the staggeringly high rates of depression, anxiety, and suicide that rose between 2010 to 2019—to the introduction of smartphones and social media into kids’ daily lives and how those two factors have dramatically impacted their development and how they view and interact with the world. It’s a powerful read, shedding light on what this generation has lost as a result, from the decline of play and independence to fragmented attention and social withdrawal. “This rerouting of enculturating content has created a generation that is largely cut off from older generations and, to some extent, from the accumulated wisdom of humankind, including knowledge about how to live a flourishing life…Without solid knowledge of the past and the filtering of good ideas from bad––a process that plays out over many generations––young people will be more prone to believe whatever terrible ideas become popular around them.”
In light of the possible TikTok ban, brands that rely on it worry. Many companies, both large and small, but particularly in the industries of beauty, fashion, health and wellness, have depended on the app to boost sales and attract younger customers. Tiktok’s easily digestible short videos and its “For You” feed brings brand’s marketing content to new consumers, plus advertising via the app is much less expensive than Google and Meta. Tiktok has been crucial—and in some cases, the only advertising avenue—for a lot of small business owners, many of whom say they don’t have a backup plan.
Americans who chose to take a pay cut say they’re happier, according to several surveys. Even though pay has been increasing at a faster pace than average, 15% of workers who switched jobs between late 2020 and 2022 said that their pay and benefits decreased. And 40% of workers who took jobs with lower pay and benefits during that time said their new job was better than their last one. Increased work-life balance, more fulfilling work, or employers that embody their values were the reasons 42% opted for a downgrade in pay. They’re not alone in that opinion: About half of American workers say that they’d be willing to take a 20% pay cut if it allowed them to prioritize their quality of life.
The American dream accelerates away from those in the slow lane. Low-income consumers are struggling and being held back by higher interest rates, inflation, and the depletion of pandemic-era support. “Those who have already achieved the American dream are fine, but it’s getting further away for those still reaching for it.” Even companies that cater to low-income customers are feeling the strain: Dollar stores, McDonalds and Yum Brands (which owns KFC) are all underperforming the S&P 500.
In order to make it in today’s world, everyone’s a sellout now. And it’s all because of the internet, says Vox. “No matter who you are or what you do—from 9-to-5 middle managers to astronauts to housecleaners—you cannot escape the tyranny of the personal brand. For some, it looks like updating your LinkedIn connections whenever you get promoted; for others, it’s asking customers to give you five stars on Google Reviews; for still more, it’s crafting an engaging-but-authentic persona on Instagram. And for people who hope to publish a bestseller or release a hit record, it’s ‘building a platform’ so that execs can use your existing audience to justify the costs of signing a new artist.”
TikTok is paying creators to up its search game. The social media platform announced a new monetization program, called Creator Rewards, which will allow creators to be paid based on how well their content matches up with the topics users are searching for in the app, similar to how SEO works. There’s even a new tool that creators can use to research trending searches (for example, “Succession outfits” or “Fairy Grunge Room Ideas”). “One way to read this is that it’s a case of TikTok incentivizing creators to make videos that satisfy business needs. If I search ‘best vacuum repair shop nyc’ and there aren’t relevant videos that the platform can serve up, that’s a problem for TikTok—I’d probably leave the app and search for that on Google Maps or Yelp.”
Google is doubling down on generative AI healthcare, with a batch of new tools including personalized health coaching for Fitbit users, modified versions of Gemini AI to examine medical images, and a massive, voluntary public dermatology database. So far, these generative-AI and large language models tools have only been tested in simulated environments, but now they are going to be tried out in hospitals for experimental use by doctors and patients. Google makes a point to note that the tools won’t be making diagnoses, just asking questions of patients that a clinician might normally ask. “But it’s a bit more complicated than that. If an AI is asking questions of a patient to try and ascertain a result, of course some sort of diagnostic framework must be guiding how its questions progress, or why it might ask one question in response to something a patient mentions.”
Automakers are sharing consumers’ driving behavior with insurance companies. Car companies, like GM, Honda, Kia, and Hyundai, are collecting information from internet-connected vehicles for use by the insurance industry to “create more personalized insurance coverage”—or in other words, build a risk score to raise insurance rates. Car companies track everything from distance driven and speeding to hard braking and sharp accelerations. In some cases, drivers have given consent through signing up for usage-based insurance, where rates are set based on monitoring of their driving habits. But other times, if drivers allow access to navigation services, roadside assistance, and car apps that drivers can connect to their vehicles to locate them or unlock them remotely, they may not realize that they are turning on features that will share information about how they drive to data brokers.
Portfolio Highlights:
Cleo, Glossier, and Zola made Fast Company’s list of the Most Innovative Companies of 2024.
Fortune profiles Lauren Cooks Levitan, CFO of Faire.
Speechify is named one of the top 100 Gen AI Consumer Apps by a16z.
The Information covers that Wonder raises $700 million.
Oura’s CEO Tom Hale visited the Hurdle podcast to discuss the wearables industry.
Chime's CMO Vineet Mehra speaks to Business Insider about why the role of CMO is more important than ever.
Chime’s Chief Corporate Affairs Officier Jennifer Kuperman is profiled in Axios.
The Room Podcast features Ritual’s CEO Katerina Markov Schneider to discuss how she found her company and working in health technology.