Hi there,
Welcome to the 79th edition of Heartcore Consumer Insights. Curated with š¤ every week by the Heartcore Team.
If you missed the past newsletters, you can catch upĀ here. Now, letās dive in!
How behavioral science can boost your conversion rates - Irrational Labs
People donāt always act rationally. We say one thing and do another. The field of behavioral science studies these behaviors. It sits at the crossroads of psychology & economics, looking at the effects of cognitive, emotional, and social factors on decisions and, ultimately, actions. The application of behavioral science is called behavioral design.
More and more companies are using behavioral design to conduct user research and design experiments that drive behavior change. Itās an end-to-end lens on product development that helps teams think differently about their end-user.
Actionable behavioral design strategies:
Pick a key behavior:Ā most teams focus on engagement/retention but fail to make a unified hypothesis about the most important action to drive the key behavior they want to see achieved. Imagine youāre a PM @Airtable. You want new users to create more workspaces. This is interesting, but itās not fully clear: how quickly? How many? An uncomfortably specific key behavior looks more like this:Ā "within one week of joining, users start to fill in one workspace via a pre-existing template and invite two collaborators." By outlining these specifics, the team can now debate how to design a successful intervention.
Behavioral map: after aligning on a key behavior, itās time to map the environment of decision-making. What is every single step someone needs to do to get to your key behavior? These are cognitive steps (making decisions) and logistical ones (filling out a form field). This is different from a ājourney mapā in that itās wildly more detailed. Doing this usually leads to several āahasā for marketing and product teams.
Identify the psychologies at play: at each step, what are the underlying forces driving user behavior? To drive a key behavior, you need to reduce the barriers and increase the (immediate) benefits. Humans tend to follow the path of least resistance and respond to immediate incentives. At each step of your map, you must first identify barriers and benefits.
Conduct theory-based experiments: while you may already run experiments, thereās likely a way to make them more strategic. For example, by changing only one thing at a time (vs. launching a āredesignā), you can isolate what works and why. Youāre then empowered to build a long-term roadmap around the insights.
If interested, the full article details four concrete examples of experiments that saw significant shifts in conversion rates for early-stage consumer companies.
Livestreaming Ecommerce - How live video is reshaping the western online retail landscape - Clipperton
Livestreaming ecommerce is already a strong success in Asia and is spreading to other emerging markets where mobile is the historical and preferred channel for online shopping.
In Europe and the US, the size of the total retail market combined with a still-low ecommerce penetration in some verticals, as well as the rise of mobile commerce, open great opportunities for video-first and live-streaming digital commerce in the coming years.
As the overall ecommerce experience is constantly upgraded, it is now with no doubt that video content will become a cornerstone of the online buying process.
However, the existing ecommerce stack being highly fragmented and diverse, the modalities of the imbrication of video, social, and commerce will be plural.
Major social players are well-positioned to grab a significant share of the opportunity as they have reached a hard-to-compete scale and can leverage years of customer data to add and run commerce features efficiently.
Though, innovators have room to build. Two main types of players have emerged in addition to legacy social media:
(a) Social-first generalist live streaming platforms of the likes of Popshop/ShopShops/TalkShopLive: rather focused on enabling discovery than boosting conversion, those platforms mix the codes of traditional QVC and new-gen Chinese-like platforms: the art of pitching, fire sales, & social media mechanics. Products can be anything but are likely to be in the lower price range. This approach enables for large volumes sold in a short amount of time. While those platforms could become as viral as they did in China, it remains unclear how brands can build customer loyalty as sales are mostly price-driven. Also, a generalist focus could imply a winner-takes-all logic where a very limited number of players could reach a massive scale while others would struggle to attract and retain users. The competition from well-established and deep-pocketed social platforms could require players adopting this approach to raise and spend substantially more than their counterparts cited below.
(b) Community-driven platforms of the likes of NTWRK/Supergreat/Whatnot: limited to one or a handful of verticals, those platforms are highly powerful as they bring together strongly tied communities and are focused on becoming a gateway for their underlying topic. Most ānichesā in ecommerce are actually not so niche and can become global multibillion-dollar opportunities (sneakers, collectibles, baby food, cars). The combination of educated and passionate users selected brands, and content in one place creates a unique flywheel that platforms can ride without needing to spend outrageous amounts in user acquisition and retention.
In ecommerce, the browsing experience on the customer end has not dramatically changed in the past 20 years, sticking to the search <> buy scheme. With social media being ubiquitous and online content consumption at an all-time high, it seems inevitable that the future of ecommerce will be more social, frictionless and of course, a lot more fun!
Is there room for the next wave of fintech startups to succeed?
Twitter enables tipping with Bitcoin, plans to let users authenticate NFTs
The Rise of Consumer SaaS
Rent the Runway S-1 teardown
You canāt buy a community - hereās how to build one
Vertical Fintech is Reimagining Community Banking
Why premature scaling fails: The Traction Treadmill
The hottest and least understood e-commerce model: Community Group Buying
šŖšŗ Notable European early-stage Consumer rounds :
Lapse, a UK-based app that lets group of friends capture and share photos with each other within a 24-hour delay, raises $1.4M with Speedinvest - link
Horsnormes, a France-based anti-waste organic fruit and vegetables home delivery, raises ā¬1.5M with Stride/Kima - link
Ulysse, a France-based plane booking solution, raises ā¬4M with Frst/Kima - link
Cala, a France-based pasta cooking robot, raises ā¬5.5M with Backed VC/Possible/Kima - link
šŗšø Notable US early-stage Consumer rounds :
Layer3, a Washington-based crypto platform that provides tools for decentralized autonomous organizations, raises $2.5M with ParaFi/Electri/Redbeard - link
Bubblehouse, an N.Y.C-based NFT marketplace creating aĀ social platform for creators and collectors, raises $4M with Third Kind/SV Angel - link
Studs, an N.Y.C-based ear-piercing startup, raises $20M with Spark/Thrive - link
GraphWear, an S.F-basedĀ needle-free continuous glucose monitoring wearable company, raises $20.5M withĀ Mayfield/MissionBio - link
Found, an S.F-based start-up aiming to facilitate weight care via telehealth tools, raises $24M with GV/Atomic - link
Commonstock,Ā an S.F-based social investing platform, raises $25M withĀ Coatue/QED/Floodgate/Upside Ventures - link
Empathy, an N.Y.C-based startup helping families manage the financial, legal and logistical challenges after losing a loved one, raises $30M withĀ EntrĆ©e /General Catalyst/Aleph - link
šĀ Notable later stage Consumer roundsĀ :
Sunday, a Denver-based lawn care startup, raises $50M withĀ BOND/Sequoia/Forerunner - link
Anyfin, a Swedish loan refinancing company, raises $52M with FinTech Collective/Accel/EQT/Northzone/GFC - link
Inkitt, a Berlin-based self-publishing platform, raises $59M with NEA/Kleiner Perkins/HV - link
All Day Kitchens, an S.F-based restaurant delivery company, raises $65M with Lightspeed/GIC - link
Ladder, an S.F-based life insurance startup, raises $100M withĀ Thomvest/OMERS - link
Masterworks, an N.Y.C-based company that sells fractional shares of fine art to retail investors, raises $110M withĀ Left Lane/Galaxy Interactive/Tru Arrow - link
Betterment, an N.Y.C-based investing and savings app, raises $160M with Treasury/Kinnevik/Bessemer/Anthemis - link
Fanatics,Ā Ā a US-based sports fandom platform, raises $350M withĀ Silver Lake/Insight/Endeavor - link
Perfect Day,Ā an S.F-based animal-free milk protein maker, raises $350M with Temasek/Canada Pension Plan/Horizons Ventures - link
Honor,Ā anĀ S.F-basedĀ senior care network and tech platform, raises $370M with Baillie Gifford/Prosus/a16z/Thrive - link
šĀ NotableĀ Consumer Exits
Dapper Labs acquires Brud. Brud is an L.A-based virtual influencer startup ā link
Udemy goes public via IPO. Udemy is an S.F-basedĀ massive open online course platform - link
š¤Ā Heartcore
Congratulations to our food delivery platform portfolio company Taster on their equity crowdfunding round, welcoming 568 new individual investors (customers, fans, suppliers, restaurant owners, and food entrepreneurs) on their journey!
This week, The Economist is mentioning the work of our portfolio company GOURMEY, as part of "the new Anthropocene diet". š You can read in that edition a great coverage about sustainable foods with an exciting focus on cultivated meat.
Heartcore Consumer InsightsĀ is a weekly newsletter covering notable consumer rounds and exits and top content in the B2C space.
