The CQ | StrictlyVC recap, Arcade's series A, Our Inaugural Founders Summit
Plus Our 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.
We’re in the thick of the tech industry’s Spring rush and have had a jam-packed few weeks across our portfolio and as a firm. A few recent highlights:
We hosted our first-ever Founders Summit, convening our early-stage portfolio Cofounders and CEOs, followed by a reception including extended friends of the firm. We covered the most pressing topics in company building today, led by a series of domain experts, all off-the-record. Some key focus areas: tactical guidance on how to be your company’s best storyteller, what research says about where consumers are most open to (and skeptical about) AI experiences today, exactly what it takes to raise a growth round in today’s highly scrutinizing market, raw data on consumer spending and sentiment, and what great company culture looks like today from CEOs that have scaled from startup to IPO in a few short years. We already can’t wait for next year!
We announced our investment in the series A of Arcade, a new platform that’s revolutionizing product design by empowering users to create unique, personalized items via AI. Arcade is led by Mariam Naficy, who previously founded Minted, and is once again pioneering the intersection of technology and design. Over time, Arcade is expanding to new categories (they started with jewelry and already moved into home decor) and will provide dynamic new monetization models for makers, creators, and design-savvy consumers alike via modern online storefronts.
We hosted our a StrictlyVC event with TechCrunch in our backyard at the Presidio theater, bringing together a range of speakers spanning some of the most pressing, diverse topics in tech:
Our Founding Partner Kirsten Green spoke to the consumer AI opportunity, the unique momentum of OURA and The Farmer’s Dog, and the state of VC markets and secondaries today
Flexport’s CEO Ryan Petersen spoke about the hysteria surrounding tariffs and what this all actually means for businesses
The Mach Industry’s CEO spoke about building one of the most high-profile defense tech startups as a 20-year-old founder
The Kalshi CEO spoke about the rising popularity of the prediction markets space and navigating a heightened regulatory environment
San Francisco Mayor Daniel Lurie shared his plans to transform the city into a can’t-miss destination for business and one of the safest, most vibrant cities in the world
Up next: new portfolio companies to announce and more events to host, which we’ll be sharing more about in the coming weeks.
What We’re Talking About This Week:
The Cut asks: Are we all living beyond our means now? Many Americans, but especially millennials and Gen Z, are struggling to keep up with the rising cost of living, despite working multiple jobs and/or earning six figures. Expenses like groceries, child care, health care, and rent (the average cost of housing consumes 50% or more of many people’s paychecks) are outpacing wage growth, leading to an increased reliance on debt and buy-now, pay-later services even to cover essentials like trash bags. Meanwhile, with the “doomscroll-to-checkout pipeline,” more people are justifying splurges and trips due to global instability and uncertainty about the future. Online, “You can see someone on a boat. You can see someone skydiving. That leads to these questions of, ‘What am I doing wrong that I can’t afford that?’ Or, ‘You know what, I deserve that. Let me figure out a way to achieve that— which usually means, ‘Let me put that on my credit card.’”
A young generation goes to work for Mom and Dad Inc. As Gen X and boomer business owners are looking to firm up succession plans before retirement, more young adults are considering joining the family business, pushed along by a cooling entry-level job market, the threat of AI, and a potential trade war. The number of small businesses employing a young-adult child of the owner has doubled since 2018 and increased 13% year-over-year as of January 2025. A 2024 survey of nearly 9,000 small-business owners found 42% plan to transition ownership in the next five years, up from 36% in 2019, and 28% of those plan to pass the business to a family member. “For the first time in a generation, there’s more excitement and interest in taking over a business that already exists.”
Fearing recession, young people are heading to grad school. “The number one influencer of students thinking about grad school is either an economic downturn or economic uncertainty. Students think that will be a good relaunch when the job market picks up,” says an admissions consultant at Ivy Coach, where they are seeing increased interest this year, as are several other admissions consulting firms like Kaplan and IvyWise. The unemployment rate for 20- to 24-year-olds rose to 7.5%, up 2 percentage points from April 2023. Plus, factors like AI displacing white-collar jobs and growing degree inflation are making a master’s degree feel essential for entry-level roles. However, people who opt for the grad school route run the risk of accumulating school loan debt—graduate student loan interest rates reached 9.08% for the 2024–25 year, significantly higher than undergrad rates.
More Americans are making only minimum payments on credit cards. In Q4 2024, 11.1% of active U.S. credit card accounts made only minimum payments, the highest rate in 12 years. The share of accounts 90 days past due also hit a record. Total credit-card balances increased 4% last year, marking a slowdown from the double-digit growth rates seen in 2022 and 2023. “These trends, along with a new series high for revolving card balances, indicate greater consumer stress,” note the report’s authors.
The beauty salon recession indicator: At a beauty industry trade show with more than 32,000 attendees in March, Bloomberg spoke to professionals working in beauty, hair, and personal care who revealed they are seeing early signs of a potential recession. Many noted that clients are stretching out time between appointments, tipping less, and choosing less expensive, low-maintenance looks, “citing the ‘political situation’ and implying they’ve lost money in the stock market.” Tariff threats, particularly on beauty product imports from China, could further strain operating costs for salons and beauty companies; some have already started stockpiling inventory or intend to absorb price increases.
More economic indicators: Young women are starting to recession-proof their lives. According to the University of Michigan Consumer sentiment survey, men and women have generally felt similarly about the economy since 2021, but in 2024, men started feeling more optimistic. Men and women are “perceiving similar risks, but women tend to feel a little less positive,” says the survey’s director. Google searches for cost-saving beauty choices like "press-on nails" are 10% since February) and "blonde to brunette hair" has risen 17%, as the Wall Street Journal reports that many women are opting for DIY fashion, canceling Netflix, skipping Ubers, and swapping in-person therapy for a chatbot. Says an economist at the National Partnership for Women & Families: “Young women in particular have a better feel for something going south. When their spending starts pulling back, it’s possible that things will quickly spiral for the economy as a whole.”
To escape the grind, young people turn to ‘mini-retirements.’ Rather than wait decades for traditional retirement, some workers are choosing to take extended breaks between jobs while they’re still young to focus on travel or personal growth. These breaks can come after a layoff, through unpaid leave, or by voluntarily stepping away, though unlike a sabbatical, there’s no guarantee of a job when they’re ready to rejoin the workforce. That said, these mini-retirements are taken mostly by those who feel financially stable, and many believe the pay-offs, including confidence, clarity, and better work boundaries, are worth the lapse in income. “I don’t feel that same stress and overwhelm anymore. And I think that’s because I got that time to reset,” says one woman 10 months after going back to work.
Many American women are giving up on marriage. The share of women ages 18 to 40 who are single was 51.4% in 2023, up from 41.8% in 2000. A 2022 Pew survey of singles showed only 34% of women were looking for romance, compared with 54% of men, meanwhile a 2023 survey found 48% of women said that being married was not too or not at all important for a fulfilling life, compared with 39% of men—up from 31% and 28% in 2019. A combination of factors—greater financial independence and education as well as shifting societal norms—has led to this decline in marriage rates and the growing divide between men and women in terms of finances, politics, careers, and, ultimately, what they expect in a partner. “To the extent that some women are staying single because this is what they want, that’s great. But we have to take seriously the likelihood that many are doing it as a Plan B because they’re not finding what they’re looking for, and that should make us concerned.”
Portfolio Highlights:
Axios interviews Dutch CEO Joe Spector about the growth of the business.
Fast Company also spoke to Dutch CEO Joe Spector, covering how he wants his telehealth company to help pet owners in veterinary deserts across the country.
Fortune profiles Wonder founder and CEO Marc Lore in a cover story.
Dan Leahy, co-founder and CEO of Makersights, writes for Inc. about what tariffs will mean for the apparel industry.
Pie CEO Andy Dunn talks to CNBC about how becoming a parent helped him stress less about work.
TechCrunch reports on the launch of Chime’s premium tier, Chime+ in addition to its new banking features. Meanwhile, Ad Age covers Chime’s embrace of FinTok.
Forbes writes about Ritual’s commitment to traceable science and sourcing.
Forerunner Highlights:
Kirsten’s final issue of The Generalist’s Letters to a Young Investor series was published, focused on how to build a tier-one firm that lasts
Kirsten joined TBPN (the Technology Brothers live show on X) to discuss our Consumer Trend Report and where we’re investing next
Jobs of the Week:
Strategic Finance Senior Associate at Faire, Director of Integrated Marketing (US Advisor Segment) at Fora, and Revenue Strategy Lead at Headway.
There are ~745 other open jobs at Forerunner portfolios companies — check them out.