Consumer Brands and Essential Inputs

From our very first investment in Kickstarter back in 2010, backing consumer startups has been at the core of Collaborative Fund’s focus.

Since then we’ve partnered with some of today’s most recognizable and innovative brands, including: Sweetgreen, Lyft, Blue Bottle Coffee, Beyond Meat, Upstart, The Farmer’s Dog, OLIPOP, among many others.

Younger consumers want to buy from brands that closely align to their interests and values. Legacy brands are losing share, creating opportunities. My partner Sophie wrote about these trends back in 2016.

In this blog post, I’ll outline how our investments in consumer businesses have led us to invest in the underlying inputs to those businesses, from ingredients, materials, and supply chains, energy, labor costs, infrastructure, and beyond.

I call this “Consumer Stack Investment.” Finding opportunities up and down the layers that enable consumer businesses to adapt and thrive.

For example, McDonalds revolutionized the way Americans consumed beef by making it cheaper and more convenient. Now, Hoxton Farms is cultivating fat as an ingredient, making it fattier, tastier, and better for the planet.

UNIQLO pioneered the use of a special material made of ultra-thin fibers that absorb and emit water vapor from your body. Rubi Labs can turn CO2 into the same fabrics and materials we use today, decarbonizing products in the world’s most carbon-intensive industries. Imagine a world where the clothes you wear deliver superior performance while actively contributing to the fight against climate change.

Today, many consumer businesses that ship perishable goods, like The Farmer’s Dog or Daily Harvest, can’t utilize Less Than Truckload (LTL) shipping from FedEx or similar services. But with Artyc’s new cold chain technology, these companies have the potential to change this while radically improving unit economics and reducing their carbon footprint.

By backing the picks and shovels, Collaborative Fund aims to modernize the next generation of great consumer businesses. These essential inputs become the backbone for many consumer plays.

It’s not going to be easy. These businesses require real technology insights, and in some cases, more capital to scale and longer timelines to commercialize. They all face real risk of disruption by the next new thing.

Just as bioplastics got squeezed by demand for plant proteins. Or hydrogen facing pressure from new battery technology. The future is unpredictable, especially as AI plays a bigger role.

But I remain enthusiastic about the Consumer Stack. Consumers will always prefer better products. And those products will need sustainable inputs.

Back the inputs, pave the way for the future.

This approach mirrors the early days of the internet, where investments in infrastructure —servers, broadband, and protocols—laid the groundwork for the web as we know it. Today’s consumer brands need their own picks and shovels to thrive.

The world runs on consumer products. Food, clothing, transport, and more. Improving the supply chains for these essentials can unlock immense potential.

Of course, both models work — invest in great brands or improve the underlying infrastructure. I see value in both.

But the stack is key. And big changes are afoot.