its time.
for continued growth. I’ve been resisting jumping off the deep end with this guy —> but, here we go!! I’m PUMPED to announce I’m going to market with my newest career chapter and beginning of a new cycle – Conscious Consumer Ventures. Today I begin raising money for The Conscious Fund : first check writers to game changing consumer package goods start ups through conscious capital allocation.
I’ve ranted and raved about private markets, angel investing, funding start ups, scaling start ups, being a woman in finance and business. I’ve worked in investing for a fund in the public markets. I’ve raised capital. I’ve started a business. I’ve operated a business. I’ve scaled a business. I’ve successfully sold a business. I’ve consulted for people who’ve been in similar shoes. I’ve started another business. I’ve talked about starting my own venture capital fund.
I believe in the theory of capitalism. I think it’s the responsibility of those stewards of capital to direct it properly to change the world. I think this is very imperfect system as it currently stands. It can be better. Much better. Today I take action to contribute towards its betterment. I can’t ignore the voices in my head anymore. I can’t wait anymore. It’s clear that it’s time. Just fucking do it…
Since I left Owney’s/Proximo in the beginning of 2020, I’ve discussed the natural progression of my career to start my own fund. I’ve not written publicly since the beginning of this year, but as I re-read some old blog posts nothing is too surprising here. After letting go of my first baby, I started consulting for pre seed and seed stage companies through The Cyclone Group and I dipped my toes into the non-alc beverage space with the launch of a functional better-for-you soda infused with adaptogens, ROCKAWAY. I’ve done some angel investing. Riding this new wave has been (and continues to be) a fun part of the journey and fruitful learning experience. Here are three key learnings of late as it relates to private equity financing (these are screaming at me, in my own head ;)) – disconnects in STAGE, SECTOR and DIVERSITY :
1. One of the loudest observations continues to be blatantly coming from the disconnect in private capital markets. It’s clear to me after a couple of years of watching, that the balance sheet bloating caused by 0% interest rates has inflated everything (not surprising to anyone who follows this stuff!). However, I see a specific problem in the stages of financing for start ups. Seed financing is no longer really seed. Because non-traditional private equity investors are leaning into VC (chasing yield!), the later stage funds are overflowing with capital and that’s trickling down to historically earlier stage funds. When early stage funds have too much money, they need write bigger checks to move the needles for their LPs. When they have to write bigger checks, they can only really entertain opportunities that have larger revenues or very significant traction (and therefore huge, often *unreasonable* potential exit price tags). So many of my consulting clients trying to raise first rounds have been getting ‘nos’ because its ‘too soon’. The VCs they’ve pitched wouldn’t be willing to write anything for less than $1m/check (which means the biz needs to be ready and big enough for that type of investment and in turn, founders equity dilution). The only opportunity for them is through a strong network of angels. I think there is room for more true pre seed/seed funds – call ‘em what you will these days : a more institutional angel fund? micro VC?
2. I’ve been in and around Consumer Packaged Goods sector my whole career, on both sides of the table. It’s my area of expertise. The sector has long been relatively neglected by the venture capital community (outside of the recent several years of Direct to Consumer craze… more on that debacle another time – simply, you need omnichannel presence). I’m not too sure why VC has considered the CPG sector un-investable – perhaps because most of the firms exist in Silicon Valley, tech capital of the world? maybe it’s because the industry is now focused on getting to unicorn status and for extremely rare, almost impossibly achievable growth? I could probably pontificate about that for a long time (and bore you to death). Point is, CPG is investible. Nearly 70% of the US economy is driven by the consumer, yet it only sees a few percentage points of total VC $. There has never been a more exciting time for the birth of innovative, purpose driven, conscious consumer brands. These founders are tackling biological, ethical, social, political, environmental, and moral issues with their new products and brands. They lead from a place of integrity, accountability, and transparency. They are curious, humble and aware. There has never been a more ‘woke’ *cringe* consumer. There is product market fit. The markets these entrepreneurs disrupt already exist (and are huge!). The incumbents are slow. M&A is the new R&D for acquirers.
What’s wrong with a portfolio of companies that can return 5-10x your money within several years through acquisition? $5m value to $25 or $50m in a few years sounds realistic and good enough compared to shooting for $1B valuations (accompanied by tons of write-offs!) for the new norm in VC. But, ‘CPG is too capital intensive’ hm no, not if you outsource manufacturing and are flex and nimble with overheads – mainly your sales & marketing budgets. Test quickly, turn easily. I would argue that tech can be equally or more capital intensive as it needs to hire expensive engineers for an indefinite amount of time to find product market fit and revenue generation. You can get there quicker with a tangible product.
3. Perhaps the most unexpected revelation in the past year has been my realization that I have a personal responsibility as a woman to take this on. Since picking my head up from the rum game and spending more time engaging my network and consulting business, it is apparent what you read about women in business is true. As I’ve talked about in the past, I’ve never defined myself as a woman or as ‘other’ in my career. I was the only woman investor at the fund I worked at and I was one of a few female distillers in the country when I started Owney’s – I was always asked about this by the press and I really didn’t understand what they were talking about. I lean more masculine than feminine, but does that matter? I was just me - being a female didn’t define me. It still doesn’t. But, now I get it. Incredible entrepreneurial women are crossing my path day in and out (I suppose we are drawn to each other), with an unbelievable capacity to kill it. Yet, they get no attention. Lots of nos. It’s something I can’t reconcile especially when I think some of these deals are so compelling. Fuck that. I want to invest in these fierce people. The numbers speak for themselves : women founded companies return more money faster for investors than their male counterparts – yet only 2% of all capital gets directed toward them? Female Founded Funds rep about 2.5% of all VC. We don’t write enough checks. Let’s close that gap, shall we? Women funders are 3X more likely to invest in women founders and women founders make more money quicker… see where I’m going with this… WE NEED MORE SEATS AT THE TABLE.
Long story short, after committing to practicing more mindfulness a few years back (which I’ve written about from time to time) – and without getting too meta, I recently remembered my calling to VC – I know it sounds soft and cliché (especially to you finance bros) but it feels like that (feel those feelings!) deep in my soul. It smacked me right back in the face. Stirred up some fiery energy. What am I waiting for? I am inherently an investor – from finance 101 in ungrad leading to my major – it came naturally to me. I’m good at it. I was validated early on in my professional career in public equities and moved fast at the hedge fund I worked at out of the gate. I have a growth mindset. So, it was my interest in getting into private market investing that led me to founding Owney’s! (If you’ve read anything about that ‘aha’ moment in the past, you’ll know that although that vision was cultivated from my work in public booze investing, I had been soul searching and looking for a job in VC. I jumped in to the rum vision after watching a TED talk given to MBAs at Stanford about VC – the prof was insisting these students go start a business and get that really real (I can attest!) experience before getting into VC so you can come back through with a true understanding of how to work with and invest start-ups.). I’m unapologetically entrepreneurial (it’s literally in my blood). I’ve been called feisty. I can truly relate to and help those entrepreneurs that I work with. I’ve proven that (ask my consulting clients!). I’m also quite frankly, real. Some may say it’s that New York bullshit. What you see is what you get. I believe this is a good recipe for success in the world of venture capital.
So yeah, things have seemingly come full circle. I might have resisted getting here a bit – but, this is my path. Everything thus far had led to taking this next step. ITS TIME TO CONTINUE GROWING. It’s a mindset. I’m going to rock it, but I’ll never lose the importance of humility (which is a reality faced every day). It will be a gift to do what lights me up and what I truly believe in, but also a great responsibility as a fiduciary. I am very serious about conscious capital allocation -- the opportunity to fund companies that will change the world is fire burning, exhilarating to say the least.
**get at me if you want to chat about getting on the ride – if not, stay tuned as the takeover unfolds!**
