May 1, 2021
Hello and welcome to Pipeline. I'm back from maternity leave, so a big thank you to Tomio for his help filling in on Pipeline the last few months. Don't worry though: You can still hear from him twice a week on the Protocol Fintech newsletter, so subscribe here.
It's also the one-year anniversary since I launched Pipeline! Who knew we would still be in a pandemic or that I would have completed the pandemic trifecta (baby, vaccine and moving out of San Francisco), but thank you readers for sticking with me through it all. If you have ideas and suggestions on things I should refresh or change up, feel free to email me at email@example.com.
Otherwise, on to the news. This week: Basecamp's politics, accelerated equity payouts and why famtech is an under-invested area.
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I promise you: The next trillion-dollar company will be whatever company cracks the code to infant sleep and can best target ads to new parents at 3 a.m.
One of the things that struck me when I became a new parent is just how hard it is — and all the opportunities there are to make it easier and introduce technology.
But the many struggles of parenting are turning into opportunities for VCs to invest in "famtech" or the sector of family technology startups designed to make everything — including finding child care and managing a household — easier. These companies have only become more important in 2021 after millions of mothers left the workforce during the pandemic, and investors are starting to see value in the opportunities.
Investors are collaborating on deals and formalizing famtech as an investing thesis, not unlike fintech or enterprise specialists.
Solving baby sleep may be a stretch for a startup (although VC-backed Huckleberry is trying), but there's still a large market for startups to address other gaps in parenting. So far, solutions have ranged from child care startups like Winnie and UrbanSitter to smart family assistants like Modern Village's Milo to new consumer products like Lovevery's play kits, but with trillions in family spending on the line, there will be a new wave of startups proving that babies are a big business.
The pandemic upended life as we knew it. Most of us experienced the abrupt shift in the way we work, learn and connect, with blurring lines between office and home. While the future of work continues to evolve, the focus on a more engaged and fulfilled workforce will outlast the pandemic.
Focused on seed-stage investing, Maven Ventures partner Sara Deshpande has invested in consumer companies like Carrot, May Mobility and Neighborly.
What's the biggest thing you're talking about at your Monday morning partner meeting right now?
We spend part of all of our partner meetings talking about emerging consumer trends. What are new consumer behaviors we're seeing in our lives, in startup pitches and in the macro environment? COVID has caused one of the most massive shifts in consumer behavior we'll see in our lifetimes, and as we move into a post-COVID world, we're talking about what behaviors will stick and which new ones will emerge. Some of the trends we're watching are silver tech (the adoption of technology by seniors), the side hustle economy, companies built on top of the Zoom platform, hybrid events and new tech for parents and families.
What's one way you changed working in 2020 that you plan to keep?
I'll stick with 30-minute intro meetings with founders on Zoom. The default pre-COVID was typically hourlong meetings in person. We can meet so many more companies this way, and really open up our pipeline to companies we might have had a harder time meeting before when logistics made meetings more difficult. It's definitely a new dynamic and skill for founders, delivering their pitch in a tighter 30-minute window, and worth getting really good at because I think it's here to stay.
What problem do you want to see a startup solve?
There is so much opportunity for startups to solve problems for parents and families. Parenthood in today's world is relentless. With more dual-working couples and more moms in the workforce than ever before, families need support to keep things running happily at home. I'm excited about creative care models that help families access and afford child care — one of the top spend categories for families — as well as new tech products and tech-enabled services that help families manage their homes and the mental load of running them.
What's one article/book/podcast you can't stop thinking about and why?
The book "Maid" by Stephanie Land was a tough but great read. It's about the struggle of a single mom working incredibly hard to raise her young daughter by cleaning houses. It offers a real-world view into the daily life of many Americans and was a powerful story. I'm also reading "White Fragility" right now, which is at the same time educational, difficult and incredibly important.
What's the craziest thing you've seen in a pitch? And did it work?
Once I saw a founder bring a stack of coffee gift cards and dole them out as a question-and-answer game about her business. It did not work. Honestly my best advice for pitching is to really nail your vision and get the investor leaning in, and emphasize the things that are particularly special about your business. Give me exactly what I expect to see with the rest of the pitch. You don't need to break the mold on the basics. Follow the slide flow investors are expecting. Put yourself in the upper-right-hand corner of the competitive matrix, ya know?