Invest Like The Best
Episode 301 Investing in Consumer Change
Invest Like The Best

Episode 301: Investing in Consumer Change

Invest Like The Best

Episode 301

Investing in Consumer Change

Kirsten Green is the founder and managing partner at Forerunner Ventures. We cover the frameworks for identifying brands early, how to build deal flow, and the shift in power between buyers and sellers.

This episode is brought to you by:

Canalyst. Canalyst is the leading destination for public company data and analysis. If you're a professional equity investor and haven't talked to Canalyst recently, you should give them a shout. Learn more and try Canalyst for yourself at canalyst.com

Brex. Brex is the integrated financial platform trusted by the world's most innovative entrepreneurs and fastest-growing companies. With Brex, you can move money fast for instant impact with high-limit corporate cards, payments, venture debt, and spend management software all in one place. Ready to accelerate your business? Learn more at brex.com/best.

[00:02:50] - [First question] - The insights gleaned from studying consumers in the modern era

[00:07:17] - Whether or not the shift in consumer behavior will unlock the potential for new businesses or force the existing ones to change their paradigms 

[00:10:13] - Which of her hypothesis going into the research was proven most wrong

[00:11:46] - The leading persona archetype that drives consumer spending 

[00:14:13] - Thoughts about her investing focus after doing all of this research 

[00:16:40] - How much the digital world is good and bad for community

[00:19:05] - Positive and negative impacts digital access has on children

[00:21:32] - The investing criteria that she and her firm have developed for founders and business models they find desirable 

[00:29:37] - An example of the middle of the spectrum between tailwinds and headwinds that may result in them passing on a business

[00:32:15] - The beachhead problem for entry points, encouraging good focus and entry point selection, and who’s done it well 

[00:35:48] - The history of the consumer of how they buy and sell and where the shifts in power have been 

[00:40:02] - Other interesting trends she’s seeing in the seller empowerment era

[00:43:50] - How different her investing models are for linear product businesses

[00:47:00] - Frameworks she’s developed for evaluating a brand early on 

[00:50:12] - The most defining moment in Forerunner’s history and the hardest lesson she’s had to learn 

[00:53:28] - Ways she’s fostered and mentored young investors at Forerunner 

[00:54:19] - What the most underappreciated thing is today about the consumer

[00:55:05] - User and customer development strategies that work well for early stage products

[00:56:41] - Three businesses young investors should study to educate themselves on great consumer businesses; Shoe Dog

[01:00:06] - Where they find the companies Forerunner tends to invest in, and how to build and effective deal flow pipeline 

[01:05:22] - The kindest thing anyone has ever done for her

Investing in Consumer Change

Introduction

Patrick
My guest today is Kirsten Green, Founder and Managing Partner at Forerunner Ventures. Kirsten launched Forerunner in 2012 and has built it into a leading consumer-focused venture firm with early investments in consumer brands like Dollar Shave Club, Bonobos, Faire and Warby Parker. Our conversation is an exploration of consumer behavior and how to invest behind change in our society. We also discussed frameworks for identifying brands early, how to build deal flow and the shift in power between buyers and sellers. Please enjoy my conversation with Kirsten Green.

A Primer on Consumer Trends and Psychology

Patrick
I've been thinking about our conversation for the last several days and the many directions that we can take it. And I think because you and your firm have such differentiation in the understanding of the consumer, what we'll call the consumer often through this conversation, it would be fun to begin with something you and your firm have been working on fairly recently, which is a huge, I guess, I'll call it a study of consumer trends, passions, interests, preferences and so on. I'll leave it to you to describe what that study is, but I'd actually love to begin with the insights that you gleaned so far from studying the 2022 consumer.

Access the full transcript
Sign in or register to view episode transcripts.

Contact

Get in touch at help@joincolossus.com