Hi there,
Welcome to the 70th edition of Heartcore Consumer Insights. Curated with 🖤 every week by the Heartcore Team.
If you missed the past newsletters, you can catch up here. Now, let’s dive in!
“Traction Tactics” Behind PayPal, Waze, Twilio & More - NFX
Few things matter more to early-stage startups than traction.
Every breakthrough company has a collection of insights responsible for kickstarting its early growth. In them lies the inspiration for what will drive your startup’s traction.
PayPal: "Nobody really believed that eBay was a target market for PayPal but David Sacks noticed that there were 54 sellers on eBay who had hand-typed into their listings: “Please pay me through PayPal." The first reaction of the PayPal team was “Oh my God. Why are these people using PayPal? We should get rid of them”. But then David came into the office the next day and said the opposite: “A-ha! I think I found our market.” So we created a PayPal logo that they could insert, as opposed to type, and then we created an automated way to insert the logo because these sellers had a lot of listings. It basically became both the market for the company to focus on, as well as the guiding light for the product strategy for two years."
Waze: "One of our core theses was to do marketing, partnerships, and other inorganic activities only when we saw an organic trend. We tried many times to open up a specific city or country, but it never worked. While at the same time, for places started organically, we were able to pour the gasoline on the fire and it would light." The very first time I tried the Waze app, I remember my wife saying, “Wow, there are other people using this. I don’t feel alone.” When you think about the technology, there’s the functional side of what it does, then there’s what it makes you feel and a lot of times, startups focus too much on what it does and the hard aspects of the features, the performance, but you also need to focus on what the user feels when using it."
Thumbtack: "As an early-stage marketplace, we asked ourselves: how can we create network-independent value? How can we create value for our pros, before we had any network of customers? Our growth tactic early on was looking for where these pros were and where they were already hunting for customers. At the time that place was Craigslist. What we built was a very easy tool for them to create a Thumbtack profile that with one click they could republish on Craigslist. What that did was attract pros who were motivated to use the internet to find customers. It was exactly who we needed."
Poshmark: "One of our insights in the early stages, which is especially true for consumer products, is that the best way to understand a consumer product is through engagement and return rate of your users. Not growth. That was an incredible insight when we launched. We only had a thousand or so users. But the average engagement time was 20 minutes per day"
Finding “Product-Human Need Fit” in the Post-Covid Era - Forerunner
Maslow introduced the concept of a “hierarchy of needs” in 1943 proposing that certain basic needs drive humans, and subsequently, human behavior. Since that initial publication, the framework has seemingly transcended space and time, becoming an immovable cornerstone of understanding human psychology and behavior.
Maslow spent much of his later career wondering why more people don’t self-actualize. As the pandemic revealed what it looks like when basic needs are not met on a mass scale, it’s clear that self-actualization is a privilege that is out of reach for too many.
The last decade saw a wave of new companies that leveraged fresh, digitally native voices to speak to the new Millennial consumer. In the early days, the Millennial generation was most differentiated by their fully digital orientation, but leaned towards a white, urban, upwardly mobile, coastal audience, given this demographic was earliest in shifting their spend and engagement online.
Many modern brands have come a long way to serve more diverse consumers in the interim; but today, the opportunity for recognizing broader customer segments is massive.
Post-Covid, individuals have stronger voices than ever. They are demanding products and experiences that reflect their unique identities and values. To do this, business models and technology must evolve to enable scalability in addressing wider audiences and our nuanced needs.
There is now a meaningful opportunity for new brands and businesses to acknowledge and embrace consumers as human beings, not just Facebook look-alikes, DAUs, or conversion numbers.
The next generation of innovation must extend not just to those with access, privilege, and power, but to those whose basic needs have been overlooked for too long. And, what better moment than coming out of crisis to be ambitious in our goals for leveraging technology to support all humans’ needs?
The State of European Insurtech 2021
Twitch's CEO insights
a16z creator economy deals
New ways for creators to make a living on Instagram
Why luxury brands are doubling down on Roblox
Pinterest edges closer to social commerce with new Shopping List feature
Ask Why It Won’t Work, And Other Lessons on Building From 0 to 1
Sephora is betting that social commerce will catch on in the US
🇪🇺 Notable European early-stage Consumer rounds :
Wajve, a Germany-based financial app for Gen Z, raises €5M with EQT/468 - link
Curb, a Sweden-based dark kitchen startup, raises €20M with Point72/EQT - link
The Modern Milkman, a UK-based sustainable grocery delivery start-up, raises an undisclosed amount with Insight - link
Lick, a UK-based D2C home decor startup, raises $22M with OMERS/Felix - link
Avi Medical, a Germany-based modern medical practice, raises $34.7M with Heal/Addition – link
Lenus, a Denmark-based coaching platform for fitness pros, raises €50M with EQT - link
🇺🇸 Notable US early-stage Consumer rounds :
Odie Pet Insurance, an N.Y.C-based pet insurance startup, raises $3M with Slow/Walkabout - link
Hummingbot, an S.F-based crypto trading software maker, raises $8M with Initialized/Slow - link
Loupe, an L.A-based live e-commerce streaming platform for sports card collectors, raises $12M with Forerunner – link
Kafene, an N.Y.C-based start-up providing BNPL solutions for subprime consumers, raises $14M with GFC/Third Prime/Valar - link
Rise Science, a Chicago-based developer of a sleep management platform, raises $15.5M with Goodwater/Freestyle - link
Dispo, an L.A-based retro photo-sharing app, raises $20M with Seven Seven Six/Unshackled - link
Stimulate, an N.Y.C plant-based meat startup, raises $50M with Seven Seven Six - link
Branch Insurance, a Columbus-based home and auto insurance startup, raises $50M with Anthemis/Acrew/Cherry Creek - link
Transcarent, an S.F-based healthcare platform, raises $58M with General Catalyst/7wire/Kleiner Perkins - link
Pattern Brands, an N.Y.C-based multi-brand consumer goods company, raises $60M with Kleiner/RRE/Primary - link
🔭 Notable later stage Consumer rounds :
Fresha, a UK-based wellness booking platform, raises $100M with General Atlantic - link
Cerebral, an L.A-based online mental health services provider, raises $127M with Access Industries/Silver Lake – link
Flyhomes, a Seattle-based homebuying platform, raises $150M with Norwest/Battery - link
Monogram Health, a Nashville-based startup helping consumers manage chronic kidney disease, raises $160M with TPG/Frist Cressey - link
Scalable Capital, a Germany-based neobroker, raises $180M with Tencent - link
Ledger, a France-based hardware wallet for securing crypto assets, raises $380M with 10T Holdings- link
BlockFi, an N.Y.C-based crypto-lending platform, raises $500M with Third Point/Hedosophia – link
🍭 Notable Consumer Exits
Dave goes public via SPAC. Dave is an L.A-based overdraft protection and money management app - link
Facebook acquired Unit 2 Games & BigBox VR. Unit 2 Games is a UK-based maker of a Roblox-like game creation, & BigBox VR is a Seattle-based VR development studio - link 1 & link 2
HomeToGo goes public via SPAC. HomeToGo is a Germany-based travel rental search site - link
🖤 Heartcore
Heartcore Consumer Insights is a weekly newsletter covering notable consumer rounds and exits and top content in the B2C space.
