Welcome to the 65th 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!
Over the last two decades, ecommerce has seen steady growth with the pandemic propelling ecommerce adoption forward by many years. U.S. ecommerce is on track to reach its first-trillion dollar year by 2022.
Despite this, high consideration purchases like golf clubs or ski equipment are still largely purchased in brick-and-mortar retail stores. That’s because if you’ve ever tried to buy something like skis online you know how tough it is. There’s an overwhelming number of options, and you spend hours reading reviews and checking out forums looking for guidance.
In the end, you may never actually make the purchase, or worse you may end up buying the wrong product for your needs.
While it’s an ambitious idea and has been tried before, there’s still a real opportunity to provide the best of in-store experiences with the convenience and selection of online shopping.
Enter Curated, an ecommerce platform where consumers shop with the help of free, unbiased advice from an expert.
For consumers, it’s not about speed, but about finding the right product with the help of a real human expert (no AI chatbots!). After a short quiz to understand what they’re looking for, consumers are connected with an expert who shares their first-hand knowledge to help them find the right product.
It can take dozens of messages back and forth with their experts before consumers purchase - but the time and relationship pay off. Consumers have left over 30k positive reviews, and the return rate for purchases on Curated is incredibly low for e-commerce (2%). Since their public launch in 2019, Curated has connected over 1M consumers with experts.
Curated is also part of the passion economy, where people can monetize doing what they love. Curated experts are people who truly enjoy what they do, with deep category knowledge, and are eager to help others pursue their passions. Today, Curated has around 1k active experts.
Brands have also embraced the platform, seeing Curated as a way to reach new customers and get insights about what experts recommend and what the consumer ends up buying.
Financial apps for children, teens & young adults is a hot business right now.
There is a big market, by one account there are 12M children in the UK aged between 5-19 and more than 70M under-18 in the US.
Despite similarities in the stated goals, teen banking apps are approaching growth very differently. There are several noticeable paths:
Building junior banking within adult banking products: family banking is a feature that can have a strong customer retention pull. Neo banks see junior offering primarily as an enrichment of adult banking experience, rather than a new category. Revolut Junior is only available to existing premium subscription customers. The marketing message is also directed to parents: “Designed for kids, controlled by you”. As a side benefit, when children grow up, they could graduate to main account customers. By running a thin margin business on kids, neo-banks would acquire loyal customers very early.
Starting with junior banking, but growing up with customers: Step and Current, are offering independent teen banking experience but plan to grow up with their customers. These companies advertise directly to teenagers, rather than to parents, using influencer power (Charli D'Amelio <> Step). They want to be primarily cool, as that’s what matters to teenagers. As such, their growth could be viral, and importantly cheap. Current started as a subscription teen banking app two years ago but now has a broader appeal with checking accounts, salary advances, free overdrafts, points, etc. Teen banking is still one of its pillars, but it is already building up features that would appeal to teens when they grow up. Step positions itself as a no fees account. Monetization will come from interchange today, and from lending later, as the founder said: “As teens grow up we want to grow with them. We will start offering products when they go to college, for example lending money to get books or computers.”
Stand-alone junior apps: Greenlight in the US and GoHenry in the UK are both pioneers in child banking. Unique children features including spend limits, payment for chores, saving up for big purchases. Both companies position themselves as financial education providers dedicated to teaching kids financial literacy & delayed gratification. As an extension, both of these companies focus just on kids and don’t have adult banking companion offers. The limitation of such a business model is customer churn. Unlike adult banking with low churn and high retention (only 1-2% of customers in the UK switch their accounts annually), junior banking customers tend to grow up. So the churn in junior banking is by age cohorts, rather than in single percentage points.
Sonder Investor Presentation
Customer Service Quality Benchmark Report
Clubhouse is partnering with the NFL for draft week programming
Zuckerberg and the Head of Insta on the creator economy
Neobanks for Teenagers
Step changes in ecommerce
Spotify setting up paid subscriptions for creators
🇪🇺 Notable European early-stage Consumer rounds :
🇺🇸 Notable US early-stage Consumer rounds :
🔭 Notable later stage Consumer rounds :
🍭 Notable Consumer Exits
Sonder merges with SPAC Gores Metropoulos II Inc. Sonder is an S.F-based lodging company that decks out apartments and hotel rooms as hip short-term rentals with backers including Spark/Real/Greylock/Structure/Green Oaks/Fidelity – link
Heartcore Consumer Insights is a weekly newsletter, covering notable consumer rounds and exits, as well as top content in the B2C space.