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VC Insights: Brand Foundry Ventures

Brand Foundry Ventures invests in early stage companies that emerge into the brands you can’t live without. Marrying extensive entrepreneurial, manufacturing and operational experience, the Brand Foundry team has been “seed” financing consumer brands since 2009. With a presence in New York City and Austin, the team offers early stage entrepreneurs the insight and support they need to scale their brands into industry leading companies. They partner with entrepreneurs that build long-lasting connections with their consumers, driving consumer trends through elevated customer experiences. Portfolio companies include Allbirds, Birchbox, Bonobos, Harry’s, LOLA, Peloton, The Wing, Warby Parker, and more.

VC Insights with Ruckus is a series of conversations with Venture Capitalists to learn about what they look for in companies to fund, how they spot the best talent and what is their advice for startup founders looking to grow or get funding.

About the Speakers:

Andrew Mitchell is the founder of Brand Foundry Ventures and leads its strategy. A successful entrepreneur with dual experience as an operator and investor, Andrew has sourced, monitored and executed over 50 early stage investments in the consumer and retail technology space with a total combined enterprise value today of over $3 billion.

Wesley Gottesman joined Brand Foundry in 2017 after extensive operating experience at consumer start-ups. He launched an apparel company, Nine Brand, with Saints’ quarterback Drew Brees and has lead product departments at two consumer technology businesses: PHLUR, a digitally-native fragrance brand, and Buzz Points, a growth stage fin-tech business.

Host: Anish Shah is the CEO & Founder of executive search agency Ruckus. Anish has worked in-house in Growth roles at Snapfish and Getable. He started Bring Ruckus as a Growth consultancy 11 years ago working with 40+ clients, then re-focused his firm on executive recruiting for Growth leaders.

Watch the Full Recording

Highlights

  • 5:52 – Andrew shares on how he shifted from operator to VC
  • 9:00 – Andrew dives on the skills needed to excel in a venture environment
  • 10:00 – Wesley shares how to build a track record for yourself in the venture world
  • 12:30 – Andrew shares how networking and the ability to meet incredible people is the part he loves most of his job
  • 14:12 – Anish shares how learning the inside stories of successful startups and interviewing the smartest talent is what he loves most about his day-to-day
  • 16:12 – Andrew explains how his investing perspectives have shifted from when he first started
  • 20:00 – Andrew shares on how he spots founders with potential. Having exact industry experience isn’t a must
  • 21:07 – Andrew comments on things you SHOULD NOT do in a pitch
  • 22:37 – Wesley suggests a creative way to get a in touch with VCs
  • 25:21 – Andrew shares on how keeping it human is key
  • 26:41 – Andrew gives advice to pre-revenue consumer companies
  • 30:00 – Anish highlights how doing the “science behind the art” in the early stage is smart
  • 33:15 – Andrew and Wesley answers: “Which KPIs are indicators for future success?”
  • 40:58 – Andrew shares on how COVID impact the current DTC landscape
  • 48:30 – Andrew comments on what is the best way to meet companies/founders to invest in
  • 58:40 – Andrew shares on best ways to show value as an agency to work with them


Read the Full Transcript

Grace Portillo (00:00:04):
All righty. Thank you everyone for joining us today with these VC insights with Andrew Mitchell and Wesley Gottesman. So this is being recorded once the event is over, we’ll be sending a link with so you can rewatch the event and let’s engage in the chat. If you feel like dropping in more questions, feel free to do so. Anish, passing the mic to you.

Anish Shah (00:00:43):
Cool. Cool. So my background was actually running growth at different companies, mostly startup companies, mostly B2C companies both full time and as a consultant for about 11 years. I spent 11 years in San Francisco, moved to New York about three years ago. And then just sort of be began recruiting for some of my clients as well. Kind of with the whole idea that people who’ve actually done in-house operating roles and have led different functions. We’d be a better fit to recruit than someone who’s never done the jobs themselves before. So fast forward a few years later, I actually cut out the growth consulting and growth work altogether and built a firm just focused on hiring the best people across growth marketing, product analytics and design for a lot of fast growing companies. As of the last year or two, I would say a majority of the companies we work with tend to be in the, the D TOC direct to consumer space. So that’s why this chat’s really exciting because Andrew and Wes are some behind, a lot of the most popular D TOC companies,

Grace Portillo (00:01:55):
Andrew to Andrew.

Andrew Mitchell (00:01:55):
Yeah. Hey everybody. Thanks for joining us. Glad to be here. So I I’m the founder of brand Foundry ventures. We’re an early stage consumer only venture capital firm. Our mantra is that we invest in next generation consumer brands that we hope you can’t live without. We’re we’re lead investors at the seed stage, which is either pre-product or you know, right at launch typically cut a check around a million dollars in ownership around 10% geographies. We typically, you know, track the coastal big ecosystems like New York and L.A. We have a presence in Austin. We like Nashville and, you know, emerging brand com sorry, cities like, like, you know, Boulder and so forth, but anywhere in the us, we’re comfortable meeting teams and building building businesses. I myself got into this business about 2013 formally after about a couple years as an angel investor. And then prior to that, I was a consumer package goods entrepreneur. So I’ve been in consumer for about 20 years and still love every, every day

Wesley Gottesman (00:03:08):
Hi, I’m Wesley Gottesman. And, and definitely the least impressive person on this call. So I’ll keep it brief but been an operator at a couple of different venture back startups, raging from Drew Brees’ line Nine brand to PHLUR, which is a digitally native perfume company, met Andrew about three years ago and decided to sort of come on board just to learn and intern with him and eventually made him bring me on full time. So I started about a year and a half ago, full time with him and have been just looking at deals and learning from Andrew ever since.

Anish Shah (00:03:44):
That’s awesome. I’ve, I’ve got a way I’ve got to, before we even get into that, I’ve got to know what it’s like, starting a, an apparel company with Drew Brees was he actually, you know, like involved, was he, how, how deeply was he involved? Like, what was that even like?

Wesley Gottesman (00:03:57):
He’s like one of the nicest guys on earth?

Anish Shah (00:04:00):
I would hope so. My entire world would be torn upside down if I found out like Drew Brees was a jerk.

Wesley Gottesman (00:04:05):
Yeah, me too. I mean, I grew up the biggest fan of him. And so the opportunity to work for him was amazing. And his involvement was like almost scary, high level. Like he wanted to like touch and feel every single thing we did. And he had so much, I think, a relationship with his fans that was on the line and he really wanted the highest quality best things possible. It was definitely a difficult relationship given, you know, he’s a football player, not an entrepreneur. So the amount of time he could dedicate was tough. But it was just not believable experience to work with somebody that’s that generous and, and that thoughtful.

Anish Shah (00:04:39):
That’s awesome. Okay. Cool. Sounds like a positive, positive experience.

Wesley Gottesman (00:04:44):
For sure.

Anish Shah (00:04:47):
Cool. So this is actually a series where we we have conversations with, with VCs. Talk about all your sort of burning questions. Everyone who registered for this call, we asked all of you to send in a question. We, we ranked out the top nine questions based on, you know, which ones seemed interesting and which questions people asked multiple times and, and so forth. It’s, it’s a rare glimpse into the life of, you know, what VCs look at in terms of which founders to back, what companies to back, what they look for in talent and even what the day in the life is, or if your goal was to become a VC one of these days, how do you actually get there? Yeah, so hopefully we cover a lot of different areas that, that, that, that help you get a, a much better insight into all of that.

Grace Portillo (00:05:36):
Righty, let’s start with the questions.

Anish Shah (00:05:39):
Cool. Luckily I, I was able to get a quick chat in with, with Andrew and then with Wes previously, as, as they told me a little bit about this so start from making you repeat yourselves, but you know, how did you shift from becoming, from being an in-house operator to actually becoming a VC and also, you know, what’s the difference that you’ve noticed in terms of what you needed to be really good at in your previous life and what you need to be really good at in this current life?

Andrew Mitchell (00:06:10):
Yeah, I mean, everyone’s story is different. What I can say is that I was fortunate to be an entrepreneur, had a, you know, a decent exit right around 20, 2010. And that afford me the opportunity to invest my own balance sheet, which I decided to do, which is either a smart decision or, or not. But, you know, it’s turned out to be a pretty good one so far. So I’m not going to have a perfect answer, but that that’s, you know, most people either work their, their, their selves in, through an internship or, you know, obviously just connecting with, with various people. It’s very much of people business. I’m sure we’ll touch on that. With, with questions further down, down the pike. I mean, look, what, what overall for us, our mindset is, you know, we, we’re not ego driven.

Andrew Mitchell (00:07:01):
We’re not the, the, the right answer all the time. What we have developed is pattern recognition. And so I think a lot of the good, bad and ugly of those operating experiences for me, I’ve used to translate in my decision making for, you know, investments. Some of that has also changed based on consumer trends and business models and so forth. But at its core, I’ve always been religious about, you know, a product and, or gross margin story you know, building meaningful businesses that should have the ability to, you know, fund themselves. Obviously if you’re, if you’re investing in a and building a big business, you’re going to have to take on venture capital money. So, you know, not to say that we’re focused on profitability, but, you know, the point is let’s, let’s, let’s invest in something that has the opportunity to grow.

Andrew Mitchell (00:07:55):
You know, which I also couldn’t could factor in enterprise value and, and so forth. The second thing is a lot of the thesis has been digital first you know, in, in the early days of kind of 2010, 2011 with the, the Warby Parker and the Harrys and just this kind of new eCommerce 2.0, you know, we talked a lot about, or, or we all saw a lot of the, you know, taking out the middleman and that’s fine that that was a great kind of three year run. And then everyone was, you know, Warby Parker for X, or, you know, Away luggage for Y, it’s a little diluted. But I think the good news is eCommerce has grown every year businesses that maybe started as retail have leveraged eCommerce to extend their business and reach you know, things like AWS and Shopify have, you know, allowed, you know, companies to, to thrive and be built easier than once before.

Andrew Mitchell (00:08:49):
And so there’s a lot of good energy propelling, a lot of, you know, brands and, and really frankly, founders forward, which is, which is the goal. Like we’re rooting for everyone, whether, whether we invest in something or not. So to, to round up my answer of, you know, skill sets, I think, you know, we always lean on, on operators who have, you know, seen, you know, a lot of things of a business they’ve managed HR, they’ve pitched a retailer, they’ve, you know, built a website. We like those type of people. You don’t necessarily have to have domain expertise, but if you’re building something, you know, that’s, that’s what we like to, to, to, to see in the skillset. And again, like some of our core beliefs in terms of how we assess a business and the likelihood of a success high product margin, gross margin, a digital first presence, are you creating something that’s truly differentiated product service or otherwise, and you know, what do you want to build and, and for how long?

Anish Shah (00:09:46):
Cool. It makes a lot of sense. And then Wes, you have a little bit of a different story. Obviously Andrew built the firm and then, you know, you might be able to give a little bit of story on how do you actually get to work with someone like Andrew who built a popular firm?

Wesley Gottesman (00:09:59):
Yeah. I think everybody’s path into venture is different and there’s definitely not like a, you do two years of this, and then you do that sort of storyline. Mine definitely was, you know, a weird bumpy road into meeting Andrew. But I think that the best way to get into venture capital is probably to, to make a bunch of money yourself and be able to deploy it. And if you can prove out a track record, you can start doing it for other people. Andrew’s definitely a, a victor of that storyline and has done a great job of it. And I looked at that and sort of admired it and was hopeful to get and learn from him that hopefully someday I could, you know, do what he has done. That’s turned into a full-time job that I’ve been able to sort of keep that mentorship and, and I’ve been thrilled to do it. But it’s definitely not something that I ever intended at least initially to, to do after business school or do after, you know, my stint in product.

Anish Shah (00:10:55):
Cool. Makes a lot of sense. And like, have you learned that back in your previous world of, you know, running product, being a part of a bunch of startups versus your current world of being in house at a, at a, at a VC firm like, were there some different skill sets that you had to learn along the way that you were like, oh, wow, this is completely new, I got to become really good at this area?

Wesley Gottesman (00:11:15):
I think what’s weird about venture capital. You’ve got to be really good across a lot of different areas in order to speak competently to entrepreneurs that are going through incredibly different things. So I’ve been super lucky to be able to learn from Andrew who has operated a business, you know, across entry to exit and sort of see how he views things and then bring on some of my experience inside of, you know, different aspects of a business to try to provide value. But the things that, you know, I thought I would be doing are probably a little bit less as far as like, yes, you need to be able to understand a P and L yes, you need to be able to read financial statements and balance sheets, but it’s not like you’re able to accurately forecast five years from now a company that is coming up with a product tomorrow. So it’s a lot more of, of the sort of softer skills, a lot more of being able to like foundationally, understand where people are going. And then if you can sort of cognizantly recognize all of the different aspects of a business you’re definitely in a pretty good shape.

Anish Shah (00:12:18):
Cool. That makes a lot of sense. Thanks for that. What what part of your job do you love the most?

Andrew Mitchell (00:12:30):
Like I said before, there’s a people business. It’s, it’s, it’s just awesome to me and get to know other founders of, or all the founders that, that, that come across and through our network other VCs we’ve known and built relationships with for the last decade. It’s really cool. I mean, and, and some of, some of the, the ideas and businesses you see are things that won’t come into the forefront or, or, you know, the wide consumption market for, for years. And so you’re on the, you’re on the cutting edge of, of technology. Even if you don’t invest, I mean, you know, a, a better way to, you know, manage garbage or, you know, a biotech business that is way, you know, way over your head, but, you know, you spent 30 minutes with the founder. I mean, it’s, it’s incredible stuff. So being on the forefront of, you know, innovation and meeting people is really, really fun.

Andrew Mitchell (00:13:25):
And I would also add from the limited partner which is the people that invest into our fund the ability to meet these type of people because our, our limited partner base is mostly family offices, high net worth, just incredible, incredible people that, you know, you sometimes scratch your head and say, you know, how, how did I get invited to the 90th floor of the world trade center to meet X, Y, and Z? And you know, it’s because you’ve invested so much time and energy and obviously built this track record. So all in all it’s, it’s, it’s the people and it it’s a lot of fun.

Anish Shah (00:14:01):
That’s awesome. How about you Wes? Any other thoughts?

Wesley Gottesman (00:14:04):
I’ll give the James Carville from old school response and just say he put it perfectly.

Anish Shah (00:14:09):
That’s awesome. Yeah, and I, I get asked a lot, like what what’s it like going from, from being in house and running kind of marketing and growth for different companies or even as a consultant versus recruiting? Because it’s a very rare path that people go from functional skill set too, starting a recruiting agency. And I’ll kind of tell them, I get to kind of interview the smartest people out there. And then I actually get to learn the inside stories of a bunch of companies because people will very freely give up exactly what’s going on within their company. Why they’re looking to leave a particular company what’s working, what’s not working, whether their products are actually selling, whether the margins are terrible, whether they actually believe whether they’re company that they’ve been a part of for multiple years will actually exit or will really succeed.

Anish Shah (00:14:55):
So, so, so that, part’s pretty fun. You get to, you get to play with a lot of insider knowledge right there of, of, of early stage startups. So, and then also see how the sausage is made a, a, a little bit more, more deeply. So, so that part’s been pretty fun on, on, on our end as well. So I, I think all three of us seem like being able to meet incredibly smart and incredibly kind of successful people regularly and learn from them. I, I, I guess kind of, kind of, kind of fits into what, what drives all three of us. How is your current consumer investing perspective shifted or changed from when you first entered the industry? Obviously you guys were at the very kind of early stage of DtoC getting some of the really big early winners you know, has how you approach viewing some of these companies looking at their at their pitches. Has any of that changed or over time, maybe with kind of a little bit changes in the DtoC industry or really similar kind of mechanics of how it all works?

Andrew Mitchell (00:15:57):
Yeah. I think, I think what still holds true today is, is the need for true differentiation and be able to answer the question, you know, what customer are you building to, or, or building for? And, you know, what, you know, essentially like what’s the ethos of, of your brand. And I would also say that that DtoC right. So a lot of trends and eCommerce obviously with COVID is doing exceptionally well, but it’s always been trending at least kind of 4-5%. I think what what’s changed is over the last decade, probably less, you know, all in on DtoC like, like we’re not, we will always look at and still invest, which we have recently in direct to consumer eCommerce businesses, you know, multi-brand or single brand with that said, you know, it’s a lot different than the early days, 2010 through 2012 where like, oh my gosh, everything is DtoC because every category had yet been expanded into, you know, luggage, mattresses.

Andrew Mitchell (00:16:57):
And that, that was really fun. I think today it really, you know, it’s a part of the story, but we’ve also spent a lot of time in, in new models and in new categories, chasing, you know, different customer segments. I mean, we’ve been focused more recently on say elderly care and the baby boomers. I think there’s a lot of opportunity in, in, you know, death care, funerals. I mean, again, there’s still a lot of existing categories that just haven’t been, you know, transformed if you will. So I think there’s a lot of upside there. So I think business models, we’re not all in as much as we were just on pure eCommerce. And I think that certain categories, health, wellness, pet, dental, those kind of ebb and flow with changes in consumer behavior. So consumer different sorry, product differentiation, or just pure differentiation if your product service or whatnot and, and, and who your customer is, those have not changed, but the categories in the way you deliver that has definitely changed to some degree.

Anish Shah (00:18:01):
Cool. That makes a lot of sense. Is it safe to say you’re looking for industries and potential companies that are sort of taking on taking on areas that haven’t been fully fledged online and companies that are trying to bring that online? Kind of like you mentioned some, some like death care or some or stuff like that.

Andrew Mitchell (00:18:19):
Yeah. I mean, the best thing for us is just, let’s just walk through a couple examples. So one of our portfolio companies, small door veterinary, so trying to reimagine veterinary care, the, the service that we provide pretty much the same. Obviously we want to do it with a brighter smile and more care and more fun, but the business also brings in, you know, really low touch technology where we’ve got, you know, an app where you can upload your, your pet. So buddy, the dog has, is, is uploaded in your, you know, you can, you can track his medical records, vitamins, all these other things, and you can get alerts. And, you know, that’s very much how the, the world works today, even at a kind of a, a low base level you reimagined care and then you, you know, scale, scale to business. So I think that’s just an example of, you know, a very large category that continues to evolve yet, it’s not necessarily revolutionary, right? I mean, it’s very much brand first and creating a better experience and, and transparency, frankly, for, for the customer.

Anish Shah (00:19:23):
Makes a lot of sense. How do you spot founders with potential, but lacking relevant experience? I’m sure some of your early wins involved founders who hadn’t built yet kind of these like household brands. So like what can they do to show you? Yeah, you don’t have this huge track record, but man, you you’re, you have the capability to build an amazing company?

Andrew Mitchell (00:19:51):
Yeah. Two things come to mind. The first one is we don’t have a, a thesis around, you know, second time, third time founders versus first time we have plenty of first time founders that we’re in involved with and have created amazing businesses. The second thing is you don’t necessarily have to have true domain experience meaning if you’re launching a beauty brand, you don’t necessarily have to have 10 years of beauty experience. And we’ve got a bunch of those as well. I think that the, the one thing we look for is if you don’t have it, does your co-founder have some experience? And again, the, the experience doesn’t have to be beauty to beauty. It could be consumer package goods to beauty just as an example. You know, the knowhow of how to develop a product, how to, you know, work and manage a supply chain what to look for on the P and L and margin structure.

Andrew Mitchell (00:20:44):
So, I mean, in a perfect world, we’ve got an operator and a, and a visionary strategist, and usually that person, the latter, person’s more on the marketing side and that’s, that’s a, that’s a great fit. So relevant experience is helpful. It doesn’t mean it’s it’s an all in type of thing, but I mean, and the, the funny yet serious thing I’ll add is, you know, there’s a lot of signals that we’re looking for. And if, if you’ve got low energy or, you know, reading off a deck, you know, it’s not going to help your cause. Like, we, we want, we want passion. We want emotion. We’re not saying we need this, the sales pitch of a lifetime, but you know, we’re, these are signals. Do you know what you’re talking about? Do you have a, a sense of confidence? We, we won a deal last week. And, you know, we, we literally issued a term sheet after a bunch of diligence through zoom, never met the person, which is not something we typically do and decided to move forward for a lot of reasons. But, you know, when I said, why do you, why do you really need $3 million? I mean, she pounded the table and she said, this, this, this, and this. And I’m like, damn, you know, that’s good. Confidence is good. So just another example. Wes?

Wesley Gottesman (00:21:56):
Yeah, I think in initiative and energy are two things that I definitely look for when I talked to a founder. The energy piece is huge, especially since we do meet with so many entrepreneurs, that if you can come and, and make me excited that I’m a part of this pitch, it’s definitely like a step in the right direction. And then initiative is a thing that I think oftentimes is overlooked, but a lot of people sort of complain about things like VC’s not responding to cold emails, but to me, if you take the initiative to reach out to founders, we’ve backed in the past and say, how is it working with them? Can you introduce us? That’s a really strong sign that somebody is willing to, you know, break the conventions of just like sending a cold email and figure out the best way to connect.

Wesley Gottesman (00:22:38):
So I look for that sort of initiative and, you know, it’s not just a pitch deck, but they’ve actually, you know, put something in front of customers or sold a couple of there’s a business we invested in that’s launching soon. And they basically ran mini bake company to prove out that a market existed and improve out that a branding can resonate in that market before they hired an agency before they went out and raised money. And now we’re, we’re super excited for what they’re going to be doing now that they’ve had the resources to really expand on that.

Anish Shah (00:23:08):
Yeah, absolutely. That makes a lot of sense. We, we come across similar stuff too, where people have perfect resumes. Literally all the popular brands went to the right school, went to the right MBA school and, you know, 15 minutes into a conversation. I’m just noticing, I’m checking my phone. Like, I, I, I just lose interest, listening to this person talk. And it’s because they’re just like, well, I was in, I did integrated marketing and I, I, I did this and I did that. I’m like, alright, you’re just reading bullet points. You know, like show me that you actually cared about what you were doing. Like where where’s the spark? Like, are you just looking for a job or do you want something that’s going to be exciting? So yeah, if that’s a note for you, it’s not just when you’re pitching, like, you know, one of the top venture capitalists in the world, even when you’re applying for a job, like show some passion with whatever you’re doing, otherwise the person on other side is going to notice. And on the, the unfortunate side is they’re not going to give you that feedback. You know, like when someone is really boring in a job interview, I’m not telling them at the end, like, sorry, you just, you just weren’t compelling. I, I was really not interested in what you had to say. So unfortunately, like you really have to have to learn that yourself and like really get some passion, get some excitement about whatever you’re doing. Otherwise it’s going to show.

Andrew Mitchell (00:24:18):
Just to jump in. I, you know, I think taking take taking like some control of the conversation, you know, two people meet on zoom or, or a phone call for the first 30 minutes. There’s probably been a deck shared ahead of time. I mean, make it a conversation. I mean, we don’t need to go through the deck. We want to get to know you let’s, let’s keep it simple. It’s probably 30 minutes. Let’s get to know the team. Let’s talk about differentiation. Let’s talk about how you’re going to acquire those customers into your, your business. And, you know, we’ll talk about the financing the last couple minutes, and then it’s, it’s 30 minutes. Could it go longer? Sure. But, you know, I think, I think what’s, what’s just an interesting thing. And instead of just saying like, Hey, like, how do you want to do this? Just take the reins, you know, Hey, let’s have a conversation.

Andrew Mitchell (00:25:02):
Let’s keep it human. And, you know, here’s what I’d like to accomplish today. And, you know, of course also ask some questions. You know, is it a good time for you? What are you looking for? What excites you? I mean, you know, I know it’s, I know it can be stressful with a pitch, but again, we’re, we’re a human just like the other people. You know, and hopefully we want to team up with founders. You know, we’re not, you know, Jesus Christ just cause we’ve got a venture fund. I mean maybe, maybe Wes is, but not me.

Anish Shah (00:25:32):
But

Andrew Mitchell (00:25:32):
Yeah, just, just keep, keep, keep a human and, and just, just make, make it fun.

Anish Shah (00:25:38):
Yeah. Absolutely. People get scared off a little bit by the perceived power imbalances and that they got to be quiet. Like they shouldn’t make a mistake when I think in very regularly, it’s, it’s, it’s better to like make one mistake as long as it’s alongside, you know, four other things you say that aren’t a mistake and you’re, you’re, you’re just putting it out there. Because every founder is going to make mistakes. You want someone who’s willing to make mistakes, not just be this perfect per person. Who’s sort of scared to do any little thing. So yeah, if that’s, if that’s good advice for any of you guys out there, like come with some, come with some excitement and don’t be, don’t be scared to turn it into a, a fuller conversation. Not just a one way where, where, you know, whoever’s on the other end is asking you questions because they’re going to notice. Thanks for that. I think that’s going to be really valuable for a lot of people. If you give one piece of advice to pre-revenue consumer product companies what would it be?

Andrew Mitchell (00:26:41):
So two things come to mind. One is on fundraising and one is on the business itself. Let’s talk with the business itself. So we’re seed investors. Everyone’s got a different interpretation of what seed is too early. I’ve invested, or we’ve invested, you know, $3 million on a deck. We’ve also determined that certain things need more time. And so maybe we invest, you know, three months into launch. So there’s no, there’s no perfect answer. What I will say is that if you think about how do you de-risk as much of the business for that seed investor, that early investor how, how could you do that? So a couple examples would be like, you know, having, having a co-founder established in a small team, the second thing on, on the product or service could be, Hey, look here’s V1, it’s V1, but I can at least show you something.

Andrew Mitchell (00:27:32):
And if it’s a product it’s a prototype being further along, like having your supply chain, if you’re in the, if you’re in the nursing shoe business like clove doing a lot of the, the work ahead of time Hey, I’ve got a supplier, I’ve got a mold that, you know, with this funding, I can, I can purchase like just, just create a little bit more advancement of the business. De-Risks it for the investor that is super helpful. And again, we’re just one example, but if you came to me and said, Hey, I don’t have, I’m launching a beauty brand. I don’t have the formulas, you know, in the lab prepared or in, you know, in progress. I, I know that that takes at least 60 days, then you’ve got compatibility and stability testing. The point is it’s a lot of time you know, so, so try to advance yourself as far as you can.

Andrew Mitchell (00:28:24):
We, we, we definitely know that resources are limited and you can’t just go invest a hundred thousand dollars into a mold, but like do a lot of the leg work. Hey, that’s great. You’ve got a supplier in China. Tell me about them. You know, Hey, like, it’s awesome. You’ve identified a web marketing business. Oh, we’ve heard of them before, you know, things, things like that. That could be helpful. The next thing that’s important on the investor side is you know, really the amount of money just doing the legwork to understand as best you can. You know, who, who are the lead investors? I mean, if you’re raising $250,000 again, that’s, that’s fine. It’s probably not Sequoia. You know, it’s, it’s probably, you’re probably better off going to people in that specialty, you know, industry. I mean, sure, if you have a leg in to customer or Sequoia, then, then great have a conversation, but, but here’s the point, it’s all about conversion, your consumer package goods, business, or technology, like come to Brand Foundry the chance of converting or higher than going to a generalist or healthcare, you know, growth investor.

Andrew Mitchell (00:29:31):
So that, that’s the point. So do your homework and just try and tighten the funnel on who you approach. It’ll save you a lot of time. Doesn’t mean there’s any guarantees life. It’ll save you a lot of time. And so again, that’s those are the two things I can think about.

Anish Shah (00:29:48):
That’s great. Wes, any thoughts?

Wesley Gottesman (00:29:51):
Yeah. The one thing I’d add is distribution, and it sort of goes back to something Andrew saying earlier about DtoC and how it sort of lost its luster. I think that, you know, everybody is now on the internet as a distribution channel. There’s some stat that I’m going to botch about how Unilever sold a huge percentage of their, had a huge percentage of their businesses past quarter online. So it’s no longer a differentiator to say I’m distributing through direct to consumer, but if you can really think through distribution and how it’s going to get in your customer’s hands and what sort of unfair advantages you have from distribution perspective, either there’s clusters here that are using X app or there’s clusters here that we can get to through our relationships with nursing schools and really nail down how you can get your product in people’s hands and how to make them care about your product. You’re going to be in a lot better shape than saying my business is a retail business, or my business is a direct to consumer business.

Anish Shah (00:30:48):
That’s great. And I, I think something that, that you touched upon Wes earlier was, you know, one of the portfolio companies, you guys just signed, you know, ran a bunch of early tests with a fake company and just showing and doing some of the science behind the art, you know, here, you know, and it’s honestly something that anybody can do. And I, it surprises me that so few companies and early stage starter founders do this because they say, oh, well, it doesn’t, you know, how do I do that? I don’t want to like damage our brand. I don’t want to pretend to sell a product that we don’t sell. It’s it’s, it’s bringing the science to the art, right? If you can go to a venture capitalist and say, Hey, my company is named whatever mouse, but I created some other company called fake company called rat.

Anish Shah (00:31:31):
And I tested 50 different products in front of them in front of an audience. And I spent $5,000 on ads and out of those 50 products that I pretended to sell, I sold, you know, a ton of pre-orders of this one product. Everyone loved this one product right here, like going to you guys with that science is just so great. Instead of being like, look at my vision for mouses, isn’t it so beautiful. I have a wonderful designer who made this cool brand. You know, it’s not bringing any signs to the forefront. They didn’t do any work. They just thought of a brand. And now they’re coming to you guys to do the work and, and say like give us money, so we can then go out and figure out our distribution, but there’s absolutely zero reason why you can’t set up landing pages, sell pre-orders for a fake company.

Anish Shah (00:32:13):
Do some of that science, you know, when people make those pre-orders to your best to fulfill them or tell them, sorry we’re sold out whatever it is like there’s customers are, your fake customers are not going to be that mad and nor will it damage your brand because it’s a completely different company, but that’s just one example of an easy way to validate your product. And then also show other people that you took the actual science to validate your product. Instead of just saying, trust me, everyone’s going to love it. I, my idea is the best, like, prove it, you know, put some science behind your idea.

Wesley Gottesman (00:32:47):
Cool.

Anish Shah (00:32:52):
What KPIs do you look for in early stage companies that are good indicators for future success?

Andrew Mitchell (00:33:00):
I’m going to let Wes start with this one since he’s the analyst extraordinaire.

Wesley Gottesman (00:33:06):
I appreciate that. I’m not sure where to begin. It’s definitely a tough question because it is so early and people might think something like CAC would make a lot of sense. Like how much are you paying to acquire a customer, but due to marketplace dynamics, your CAC now is not going to be the same as at scale, although it might cost you $5 to acquire a customer. Now with a hundred dollars in ad spend, when you bump that up to a million dollars in ad spend, it’s definitely not going to stay at $5. So that’s not necessarily like the right way to look at it. But what I can say, I think is super valuable is what happens after you acquire that customer and what’s their propensity to both share their experience as well as come back to buy more of it? I think that that generally is something that stays more constant over time, if you can deliver the same quality. So if somebody is buying your shoes for $5, that’s great. But if you say that person that bought it for $5 that went out and told three other people about it, who also bought shoes, and then six months later, they came back and bought another pair themselves. That’s a super compelling story that I can’t wait to to learn more about.

Anish Shah (00:34:12):
Nice. So almost if they can, if they can prove out some level of, of a referral mechanism that’s been happening naturally because people really enjoyed the product?

Wesley Gottesman (00:34:21):
I think there’s like sort of manufactured versions where, you know, it’s $10 if you refer your friend that I’m not as keen on as the natural, your product is that different and that special that people will tell other people about it because they’re social currency in the product itself, Allbirds, I think is, you know, definitely want to Andrew’s best investments and Brand Foundry’s best investments. I think that’s a really good story of how people could not wait to tell other people that they actually liked their shoes and that they’re comfortable. There was like value in showing up to work in Allbirds and like, yeah, check these out. This is ridiculous. And I think that Clove is another example where that’s happening right now, where nurses are tired of being on their feet all day and, and clogs or crocks and saying, wow, there’s a company that actually took my needs and made it better for me. And I can’t wait to tell my coworkers who are going through the same thing. So those are the examples. And, and that’s sort of the thing that I want to see more than like by only incentivizing $20. I got this guy to send six emails. Although that is great too, and there’s a place for it. It’s just not necessarily what I’m referring to.

Anish Shah (00:35:25):
Makes a lot of sense. And I like, how can someone prove that to you guys, that there is because obviously there’s anecdotal evidence and you know, sometimes I’d imagine very frequently when people are pitching you, you might assume that they might be sort of fluffing the, the reality a little bit. Everyone’s talking about this, everyone wants this, trust me, give me a million dollars. But like how can someone prove to you that there was this sort of like referral mechanism before they, that they’re coming or while you’re in the pitch, like whatever it is, like how can they prove it early, early, early in the process?

Andrew Mitchell (00:35:59):
Well, yeah, I’ll jump in. The good news is once we’re, once we’re launched you know, you’ve got the, the three month cohort, 6, 9, 12, I mean, you’re going to have, you’re going to have data you can just easily pull and you’re probably going to have either an in internal digital marker. That’s going to have some kind of dashboard or an outside partner. A lot of times one we’ve partnered with, so we’ve got the trust there anyway. So I mean, that’s the easy one. We’ve got the data, I think, you know, a pre-launch business or a seed stage business has yet to, to, to launch. You know, we’re going to hypothesize about a CAC to LTV ratio. We’re going to factor in an average order volume. So if it’s, if it’s high end designer shoes for $300, it’s probably the, the chances of a, of a high repeat rate are probably small.

Andrew Mitchell (00:36:43):
They’d probably be, you know, one and a half times per year versus, you know, Lola feminine care or, you know, Cake, you know, wellness products for, for men where there’s kind of just a higher, higher velocity. So we’re going to hypothesize there. Now because we have, you know, a lot of experience, there are certain rails that you know, CAC usually falls into house plants, commodity items. You want CACs probably, I don’t know between 10 and 25. And then certainly you want the ratio of the CAC on, on the higher end products to be, you know, probably in like the 40 to 70 range, again, very wide rails, but, you know, and, and then the other thing that you’re going to factor in is that most of the time, you know, you’re going to want to spend between 20 and 30% of your revenue targets. If you’re doing a hundred dollars, you know, per month in revenue, you you’ve, you’ve hopefully spent between, you know, well, nothing to, to know more than, than $30. So again, there’s, there’s variations depending on the product and the category and, and the order value, but, you know, again, we’ve got just a lot of you know, rails set up to, to help guide us.

Anish Shah (00:37:53):
Makes sense.

Andrew Mitchell (00:37:55):
I mean, for example, I mean the, the easy thing, and then just getting literal on purpose. I mean, if you’re, if you’re selling organic tampons like Lola there’s a plug because we love them you know, go to your nearest Walmart for, for product you know, their, their ticket, their ticket for one box is $12, right. Or, or $19 with a, with a, with a two for one. So, you know, if you’re spending a hundred dollars of customer acquisition, it’s just, it’s just a bad business model. You know, so you know, it’s, it’s not hard math and we’ve established a lot of the integrity of, of the lanes with which to stay in. So.

Anish Shah (00:38:34):
Okay. And that, that makes a lot of sense Wes, sorry.

Wesley Gottesman (00:38:39):
Yeah, I think to add on to like what to do as far as coming up with those numbers and knowing we take it with a grain of salt is really comes back to that initiative piece. To me you can be pre-launch and, and tell that story through initiative you’ve taken and, and tests or initiative you’ve taken and talking to the right people and testing out different distribution areas. Generally one of the ways that I’ve seen it presented that I’ve really appreciated is like zip code level or hospital level analysis of like, I think hospital is the easiest one to describe, but if you sell into, you know, University medical, one pair of shoes and six other people buy shoes from university medical without, you know, an increase in ad spend, you know, that people were talking about it at University medical. So I think that those are the sorts of stories that founders have to be in take initiative to develop and present in a way that makes sense. They can be validated.

Anish Shah (00:39:40):
Makes a lot of sense. And sometimes you don’t even need that. You don’t even need your digital marketing to kick off. Like I’ve. I talked to a, to a company not too long ago that did supplements. And they, I think they just raised about four or 5 million just recently. And they went door to door to bodegas and just convinced, you know, maybe one out of 20 bodega owners to carry their stuff. And that was a good testing ground for them. And if you sell shoes, if you sell any other kinds of products, go to your local stores, hopefully talk a couple of the boutiques, whatever it is, you’re trying to sell beauty, you know, beauty stores, whatever it is, talk them into selling a couple of your products first, you don’t need this like whole roadmap of like, oh, we’re going to get from zero to a million in like a couple months, like start small. So, so I love that. Thanks for jumping into that there and, and great plug for Lola. And I, I talked to Wes that we worked with them too, and I think Alex is like one of the nicest founders in New York. So, so that’s cool.

Andrew Mitchell (00:40:39):
You bet.

Anish Shah (00:40:41):
Here’s a, here’s a fun one. How does, how does the COVID, how does COVID impact the current DtoC landscape? Does it affect your criteria for investing in the future, or is, is it affecting anything you guys do currently in terms of your investing?

Andrew Mitchell (00:40:57):
Yeah, no, I think we can expound on some of these if, if we want to, but I think, I think three initial, big shifts certainly eCommerce over stores products over kind of in real life experiences and digital the, the digital connection over in-person. Probably all literal in their own meaning, but you know, we can get expound on it if we want, but in terms of just investing in the future, I think you just have to be mindful of what categories you know, service businesses like dentistry, you know, short term effects, wedding, you know, just a, just a terrible sector to be in, you know, that that probably has ramifications longer than dentistry. You know, obviously digital first brands have been excelling just given, you know, necessity, essential businesses, so forth you know, for Brand Foundry we’ve stayed aggressive.

Andrew Mitchell (00:41:56):
We’re, we’re aggressively pursuing new investments. You know, founders are still finding us, we’re still pursuing them and, and building relationships. You know, I mentioned at the start of the, you know I guess the zoom cast or, you know, the start of this, you know we, we won a deal last last week in San Francisco and the entire relationship was built over Zoom. And funny enough she went to one of the founders, went to Warden, I guess that’s a warden plug. We, we love Warden, have a couple people that help us. We do like word. We like a lot of MBAs. We like people. But nonetheless, I went to school with Joey Alberg, so, you know, a very small community and a good reference. So I think you know, again, we’re staying aggressive, we’re in pursuit of differentiated, you know, brands, products, and technology and, and categories that are very large.

Andrew Mitchell (00:42:50):
And you know, we probably won’t do as many that are focused on, on corporate. I mean, we ran into a, a pretty fitness, you know, kind of bring the fitness through a mobile. It was pretty cool. It was guy based in San Francisco and it was like an RV with like, you know, put the doors down in this whole, like Peloton thing. And I was like, oh, this is pretty cool. And I was like, all right, who you serving? And he said, corporate parks. And, you know, we, we planned on talking to him again two weeks later COVID and then just said, Hey, man you know, wish the best, but you know, no, one’s at these corporate parks, so we’re, we’re clearly going to going to wait and see. So certain, certain sectors, certain categories, it’s just kind of a, you know, trying to understand how to de-risk those investments.

Anish Shah (00:43:40):
Makes a lot of sense. So I guess if, if someone was hit pretty hard and there just by, by happenstance or, or unfortunate circumstance, I may, might not be the right time?

Andrew Mitchell (00:43:51):
Yeah. And there’s just, there’s, there’s wild stories. We had two companies raise, you know, one raised $15, one raised $25 million. I mean, literally two weeks before COVID and just, you know, it’s, everything’s go, oh, diligence and this, and then all of a sudden COVID. We’ve had other brands you have, have to reopen rounds from a previous year just to, you know, bridge forward. I mean, there’s all, there’s all just a bunch of stuff going on. I mean, our sentiment with the broader VC community is that a lot of people have dry powder. They’ve got the money, whether they’re as aggressive as us in their pursuits, that’s up for them to decide, but we all have investment periods with which to deploy the capital. And so, you know, we think it’s a really good opportunity where a lot of the pretender entrepreneurs are not going to move forward.

Andrew Mitchell (00:44:37):
You know, it’s a tougher climate, it’s tougher to raise money. It’s tougher to build a business. That’s grit. I mean, let’s, let’s, let’s find, let’s find one another and do business let’s, let’s go. You know, and, and you can kind of look back at, you know, 2009 to 2011 and just after the, the financial crisis made a lot of really awesome businesses were built. And then something that we tell LPs that are, might be a little skittish, you know, like, what’s, what’s your outlook. Well, if we’re funding a business today, we’re giving them enough money for 18 months. So, you know, we’re not necessarily correlated with the stock market. We certainly don’t want a recession. We’re certainly not economists, but I mean, what what’s going on in 18 months. So you still have to fundamentally build a business the same way, have the grid, you know, run gun, but you know, this is long term investing.

Andrew Mitchell (00:45:25):
So I mean, these outcomes, I mean, you know, Peloton for, for me was a seed investment in 2011. Obviously when I PO and is now a 10, 10 billion market cap, that’s a long time, that’s a long journey Allbirds, which is, I’ve never seen velocity and growth in my lifetime. As fast as that, I was a 2015 seed investment. And it’s as, as awesome as it’s been. And as fast as it’s grown, you know, it’s been five years. So, you know, this stuff takes time. So I don’t know if Wes anything else.

Wesley Gottesman (00:45:56):
Yeah. I’ll touch on two different things quickly, one to throw Web Smith and, and 2PM a shout out because of some logic that he’s really pushed forward around what happened in China after SARS, as far as the, you know, lifting of Allboats via eCommerce tide that happened during that time period that we’re starting to see now, I think some of the stats that I’ve read are that close to 50% of retail happened on e-commerce over the last month or so. And really that’s a, you know, something that’s going to lift everybody up and, and should help everybody eCommerce business you know, support the, the missing link that was in person retail. And we’re really excited about what that means over time is I think more people getting engaged with eCommerce is going to be great for the business in the long run. I don’t think everybody’s going to go back to just, you know, in person shopping after this is done and really excited about what that means for, for new brands as they enter into this new world with a lot bigger Tam people shopping online, I think be besides that, to echo something Andrew said about where we invest it and what it means is even if there is a recession after this.

Wesley Gottesman (00:47:07):
And I, I imagine that there will be, we’re not building businesses that are looking to, you know, sell in in 18 months. Even we’re looking for businesses that are really going to be a part of the ecosystem and fabric of our lives in, in five years and 10 years. And with that timeline in mind, it doesn’t make a ton of sense to be very reactionary to economic trends. You know, we can’t predict how deep the recession is or how long it will last, but I can promise you American ingenuity and American progress will keep marching forward. And that in five years, 10 years, we’re going to have some amazing companies that were started during this time of hardship.

Anish Shah (00:47:41):
Yeah. And probably more creative ones too. A certain industries get, get tougher. People have to think a little bit further out of the box because they want to be entrepreneurs, but maybe whatever idea they had 16, 18 months ago just aren’t exactly the, the, the right ones for, for, for today makes a lot of sense. For a new firm starting out in early stage startup investment, what is the best way to meet companies and founders to to invest in?

Andrew Mitchell (00:48:12):
Without a doubt it’s, it’s, you know, it’s the classic warm intro. I mean, it’s a very small, small world. And look, we get a lot of e… you know, I’m not going to say don’t try the cold email cause you never know. But I, I, I think VCs and investors get a little bit of a bad rap because, you know, we don’t maybe respond to a cold email. I think the reason I’ll give you two reasons why we don’t one, we get a lot of email. If you can imagine, you know, we, we alone have 53 current portfolio companies where anyone can reach us at any time we’ve got investors, you know, there’s feel a lot of email. The second thing is if you approach us as a cybersecurity business and our name at the header is Bill, and my name is Andrew.

Andrew Mitchell (00:49:02):
I’m probably not going to respond. I’m trying to be dramatic on purpose. So, you know, take the time to at least, you know, tighten it up you know, mention someone’s name. I mean, you know, so, so I’m, I’m all for the, the cold email and I’ve, I’ve, I’ve honestly cold emailed LPs and it’s, it’s worked not a lot, but it, it works so, you know, more power to you, but I think the reality is, you know, it’s, it’s the warm connection. It’s not bombarding you through LinkedIn. Linkedin is, is a cesspool, in my opinion definitely has some value, but you know, there there’s, there’s enough people through a uni, any university, any marketing agency, just spend some time to, to just see how you could get to us. And, and, and just that helps, that helps immensely. So again, I think you know, just, just show some hustle and try and try and get to us like through a warm intro is probably your best, your best bet.

Anish Shah (00:50:04):
Makes a lot of sense. And, and just out of curiosity, when of the companies you have funded, like how many of them have come from other venture firms saying like, Hey, we’re putting in X amount. Can you also put in X amount as well? Because I would imagine that’s just like a, a much quicker kind of process for you guys. Well, because you’ve gotten a voucher from someone else who trusts, who is putting down their own money, but I’m curious how, how… of your obviously, maybe don’t know, like right off the top of your head, but ballpark, like how many come from something like that, another investor, and then how many come from from something outside of another investor?

Andrew Mitchell (00:50:38):
Yeah. It’s, it’s not a good percentage. I mean, we’re actually looking at a deal right now that that came from a really friendly fund in New York that we’ve done plenty of deals with. I know they’re leading and, and invite us in to participate. And so we’re reviewing that deal. And again, the example I just used from last week when we won the term sheet negotiated was, you know, she went to business school with, with Joey Alberg. So those are founders and intros from founders we’ve backed in the past, are our, are the best deal flow. They’ve got a, a pretty good lens. They went to school or, you know, built a business with them and, and have a good sense of what they’re doing. You know, and again, other firms, so I don’t have a good percentage, but those are, those are two, you know, very good sources of, of deal flow. One thing just for humor’s sake, that is, is, is a good suggestion not to do, if you don’t mind would be, you know, if you’re a startup, please don’t hire an advisory firm or an investment banker to to reach out on your behalf. That is pretty much 99.997% probability of going just automatically to delete. So please, please don’t do that.

Anish Shah (00:51:46):
That’s actually interesting to hear that. So I, I was working on an early stage product years ago with a few different founders in the, in the ed tech space. And one of the people who I ended up meeting was a chief of staff of a very, very famous politician who was one of the top two politicians in the country. He was a chief of staff for this person and he said, well, Hey, we’ll get you all the we’ll get you all the investors you guys want, you know? But by the way, you got to pay me a a 10k per month retainer and that’s and that’s just, just, just ongoing for, “business development.” And I’m like, this is this, this, this guy is very Wikipedia, very Google-able, like very high up. There was a chief of staffer, a very famous politician. And he wants a 10k a month retainer for intros. Part of me, I was young. I was sort of like, oh, cool. This guy was this guy’s up there. Luckily I didn’t take it, but that’s good to know from you guys that, that, that offer is, is, is kind of not going to work out.

Andrew Mitchell (00:52:53):
Yeah. Someone, someone chatted. So I think, you know, let’s just try and answer that question. I think the question is if you’re trying to get into investing at, at seed and let’s just call this person an angel investor, what’s the best way to invest again, it’s, it’s very much of people and relationship business. I mean, look, we’re, we’re very open to anyone investing with us. If they can show some value and have a good reputation, so, you know, how, how do you, so how do you meet us, right? If you’re a current or if you’re a, a new angel investor, I think it’s the same thing you would, you would try to do as a founder. I mean, you’ve, you’d, you’d connect with us, you know you’d, you’d get a warm intro into us. You’d, you’d, you know, email us and say, Hey, look, you know, I’ve, I’ve invested A, B, and C.

Andrew Mitchell (00:53:44):
You know, we’re going to probably look at, at, at a track record. We’re probably going to look at, you know, where, you know, where you’ve come, how we know you, but again, we’re, we’re totally open. We want anyone to invest anyone to sit alongside of us on the cap table. That’s friendly, that’s hungry. That’s you know, that adds value. I mean, look I built a reputation, fortunately a little bit of right place, right time and, and, you know, having conviction to invest and sometimes making decisions after one call, that’s a choice. But, you know, my initial check size is when I got involved as an Angel were, you know, 10/25k that’s a lot of money, but it’s not like a million dollars that the fund typically invests today. So the point is, you know, be less concerned about the amount of money, you know, if you can, if you can just demonstrate conviction and be helpful and work hard, you know, people are going to remember that like, oh yeah, Susie Q was, was awesome.

Andrew Mitchell (00:54:40):
I mean, she was only invested for $5,000, but like, you know, I’ve got this new deal, let’s get Susie Q back on this one, you know? And so I think, I think that lends itself to just, if you want to be an angel investor, you got to take it seriously. You know, I know you’re probably in to make money, but most people that do are, are trying to, to build a career if not a business. And those are the kind of people that we would welcome in probably more so than just a nice person. That’s got, you know, 25k lane around. So, so even more specifically, how could you be helpful, you know, connecting, you know, leveraging your network you know, suppliers, agencies, anything that, that can bring a new customer into the brand or help the team with, you know, building of the business that’s helpful, you know, and, and two, two, you know, one or two simple cases.

Andrew Mitchell (00:55:32):
I mean, look, I was, when I was an entrepreneur, I had all this supply chain experience in the health and beauty space. And so, you know, the Harry’s shaving cream, literally the formulas, my formula that I worked on with a third party manufacturer in like 2007. So when, when Jeff and Andy came and said, Hey, look, we’re building this thing. You know, one of the questions I just happened to ask them was and started the date was I think 2010 when they were thinking about launching the business, you know, who do you have? What’s your supplier, who’s your supplier for, for the tubes, you know, the deodorant, the, the shaving cream? And, you know, so at that time it was a smaller check for me, but I’m in, and, you know, I was able to be resourceful. So anyways, just another case study and, and point to, to drive home on, if you want to angel invest, you know, be a good person, you know, work your way in through the relationship somehow be credible and just, you know, stay, stay really active and, and hungry.

Anish Shah (00:56:29):
That’s awesome. And in a rule of thumb, I have it, if you are going to be bold and cold email, because Andrew mentioned like most of the time it doesn’t work, but most of the time, the cold emails you get are, are garbage. They’re copy paste. And Andrew even mentioned like sometimes the wrong name is in there, whatever it is, my rule of thumb is if you’re sending a cold email to someone, it should take you no less than 30 minutes to write that cold email you should be Googling everything you can about that person, finding every piece of information, if not, to impress the person, just to show them that you even like looked at them, right? You knew who they were. You’ve done your research, whatever that is. And most people who are at a certain level in their career are mildly Googleable.

Anish Shah (00:57:10):
You can find something about them. I, I was commenting to Andrew before we, we went public with this Zoom. He’s oddly not very Googleable. You don’t find very much online about him, but, but again, you start going through a rabbit hole and you will find enough information to populate that, that email with at least something, something so they’ll at least notice, right? Like even if they don’t respond, just, you know, you, you could know that you at least put your all in there instead of like, Hey dude I’ve got a great idea. I could use 1 million, you know, just, just not even really caring or just don’t template like an email and send it out to 20 people. It, you, you, everyone knows that it’s templated. If there’s no personalized information and never ever used an in like one of those LinkedIn auto like series sort of pro products where someone is just getting templated emails five times over, you’re just going to look like a bot. But yeah, I mean, if you’re going to go for it, put the effort in and you know, one out of 10 people, you email out of that out, out of the 300 minutes you spent on there, I have to imagine at least one will respond to you at the very least if you put in that effort.

Anish Shah (00:58:26):
Oh, interesting. It’s, it’s cool. We’re getting like people from all different angles here. What is the best way for an agency/ consulting firm to show value and work with you and your portfolio companies?

Andrew Mitchell (00:58:39):
I mean, I think that the, the easiest way is we’re going to probably lean on case studies, you know, what, what brands at this stage of your work with, and just, you know, just make us feel comfortable that you should be invited into you know, call it an RFP. If you come through us, that’s what we’re going to look for. Like, yeah. Tell, tell us who you worked for and, and why you’re potentially better. I mean, look, it’s, it’s probably like a 10 or 15 minute call because we want to just qualify you a little bit, but you know, certainly want to tee that up for the founding team to to learn more, make the decision. We’re, we’re certainly not going to make that decision for, for the founders, but want to make it credible enough that if we do enter you in yeah, we, we want to, you know, we know enough about you and, and that it makes sense.

Andrew Mitchell (00:59:28):
I wouldn’t necessarily think you don’t have to be like the lowest price offering, but, you know, just tell, tell us about your online experience. Like what, what companies have you worked for? I mean, most agencies, you know, there’s, there’s all these logos and Pepsi co and like, everyone’s got the same thing and you’re like, all right, well, what did you do for PepsiCo? Like, you know, Hey, you know, Kelloggs, you know, I mean, you know, how many agencies they’ve got, they probably have, you know, 150, I mean, and that’s fine. Tell us what you’ve done for early stage startups. We’re happy to invite you in and, and, you know, please please, you know, reach out.

Wesley Gottesman (01:00:00):
Yeah, I’ll, I’ll second that, because the way that this meeting came together was actually through connecting with Anish via somebody else. And what I would say the best way for you to show value and sort of become a partner in somebody that we want to recommend is do a really good job and, and build a reputation of being a really good person and a great person to work with. It came from Greg Fitzgerald, who I had connected with, through somebody else talking about how great he was. And he just said, you know, Anish is just such a good guy. He’s somebody who can bring a ton of value to your portfolio companies. You definitely need to meet him. And if you can get that sort of bringing endorsement, especially from somebody that we trust and respect, of course, we’re going to want to bring you in and, and involve you when there’s an opportunity to.

Anish Shah (01:00:43):
Awesome. Yeah. And karma goes a long way, do something good for someone do something good for someone else they’ll, they’ll, they’ll come back around or even if they don’t, whatever you can, at least you can, at least again, it’s kind of like the cold email example. You can at least know that you did your best and, you know, just keep it going like that. Grace was that the last question? Okay. We have one more question from the chat. How can a new seed investor meet founders to invest in?

Wesley Gottesman (01:01:17):
Yeah, I think Andrew touched on

Andrew Mitchell (01:01:19):
That’s the holy grail man. That’s the holy grail. You know, it’s like when, when investor I’ll, we’ll give you a serious response in a second, but like, that’s like an investor saying like, where’d you get your deal flow? I mean, there’s, you know, it’s not like we’re typing into Google, like, oh, like veterinary care and, you know no, it gets back to the, to the, to the, the people aspect. I mean, look, we’re, we’ve been in this for 10 years and, you know, we, we may have had a conversation seven years ago with some person that circles back today. It’s, you know, it’s, you got to just network your way in, like where, where do people, you know, I don’t think you have to go to all these demo days, but again, if you were thinking about how what’s the best use of your time, you could either sit at home and, and crank out 3000 emails to try and, you know, get in, or you could say, look most consumer investors go to this conference. Most consumer investors go to this demo day. They go to, you know, an event, you know, there’s a coffee shop. Most VCs go to in New York city. I mean, you got to, you got to get creative, but you know, one plus one equals three. So I don’t know if that’s a great answer, but it’s the most real answer I could, I could probably offer Wes you have it.

Wesley Gottesman (01:02:39):
Yeah. Just echoing that and echoing what a new shed of karma goes a long way and, and being loved and respected by your peers. They’ll want bring you in and get you involved. So, you know, Andrew, I think has done an unbelievable job to date of building up a reputation from brand Foundry, really just through, not from events like this and to Anisha’s point, it’s not easy to Googleable, but if you talk to any of our founders, they’re going to say, yes, absolutely work with Andrew. He does an unbelievable job and brand Foundry is there when we need him most. And that’s how we get our deal flow at the end of the day, is people want to work with you if you treat them well?

Anish Shah (01:03:13):
Yeah. And it could take years to build a network that compounds itself. So I don’t know, people ask us how we get, how we got all of our clients. And I, I kind of just say that the beginning start of it is, and it might be kind of similar to you guys, how, how you sort of just meet more people who are exciting and interesting. It’s just get coffee with everyone, you know, out of those five out of five people, maybe one of them introduces you to another person. Start that process again. It’s if you want to build a bus, and this is even if you’re on the consumer side, if you’re even building a normal startup, you need to be well connected. Like you, you need those connections for so many different reasons for hiring for, for, for knowledge, for someone who could introduce you to someone who can build your supply chain, who can do a million different things for you.

Anish Shah (01:03:56):
Like you, you, you can, you can’t just be sitting at, at your, your desk being introverted and not talk to anybody outside of whatever your tunnel vision is. So if you want to do anything remotely entrepreneurial and not just be stuck to your corporate job or whatever it is that you’re doing, like you’ve got to get out there and meet as many people as possible. And yeah, you, you, the other thing I’ve learned is you, you have no idea what or who of the people you meet are going to be the ones to introduce you all around. I would say half of our business right now is literally attributed to one person I met and that’s a person I called emailed. So yeah, you got to get out there, get away from your desk. Anything else you wanted to kind add into that one? Cool. we’re, we’re outta questions now. I don’t know if there’s anything you guys wanted to plug. I think you guys gave a good run down of your, of your firm and, and everything else. Wes might want to plug his favorite soda or whatever he’s drinking over there. But yeah, I dunno if any,

Wesley Gottesman (01:04:58):
20 for a discount code on, on whether you.com give it a shot. It’s a really delicious sparkling CBD beverage. How do you spell that?

Andrew Mitchell (01:05:06):
20

Wesley Gottesman (01:05:07):
W E L L E R. And I’m also putting on some starfish right now. I want to plug them too. It’s it’s an hacky company for gen Z. So trying to, to show all of our products off, but it was a really great time. Thanks so much Anish.

Anish Shah (01:05:23):
Yeah, most definitely. This was awesome. Thanks both of you guys for spending your time here and teaching, you know, this squad of what, 40, 50 people who showed up for this chat a ton of new, new knowledge. Thanks a lot.

Andrew Mitchell (01:05:36):
Yeah. Had a great time. Thanks for hosting. Appreciate it. So thanks, grace. Bye. Thank you, N thanks buddy.

Anish Shah (01:05:43):
Absolutely. Thank you guys for coming. Bye.

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