C2V May 2020 Note from the Trenches

Welcome back to another edition of C2V In The Trenches. Things are generally looking more positive and encouraging as we emerge from quarantine and begin to introduce ourselves to the new normal. We thought we’d start by sharing some general industry predictions through the eyes of start-up investing.

Startup Investing Predictions

  1. We continue to love the marketing tech space and those companies that sell SaaS, in fact, we know of several companies that are accelerating revenues during this period.  The reality is, this is a good time to consider making those company software updates, CRM overhauls, or general upgrades that benefit your team's long-term revenue potential and cost savings. Smart CEOs are using the crisis to justify discounts while still supporting partner's products and services. There is more bandwidth and time for implementation projects, as well as for training your engineering and products team on updating new tools and workflow from remote locations. In a challenging macro environment, the most efficient companies will win, and having the right software will be critical to those efforts. 

  2. Many industries are thriving and growing during this period like OTT, streaming, gaming, original content, health/wellness/CBD, video conferencing, 3D printing, etc. We are long on the wellness and fitness train as people are thinking of staying healthy and well even past this pandemic. For example, as CBD becomes mainstream, and more people become aware of its benefits, companies like Beam, a C2 Ventures portfolio company, are beginning to play a bigger role in the wellness category. They’ve even been covered in the likes of The New York Times.

  3. C2V didn't invest in the Ad-Tech space before the pandemic and we certainly like it less in this current environment. Assume that your Ad-Tech company could be in the middle of M&A or consolidation conversations like the Factual/Foursquare deal and think about what that could mean for you. Chris shared some of these very insights in a recent Business Insider article (behind paywall).

  4. People's behaviors will forever be changed in the long term and our team is excited to see what companies will emerge from the ashes. As early-stage investors, we are very bullish on the innovative startups being created NOW that will rise like a phoenix. We predict this summer and fall we will begin to learn about startups focused on the future like online retail, online learning, remote-work tools and services, home fitness, remote healthcare, logistics and supply chain, travel and clean energy (let’s not lose this huge improvement in air quality!) We’ll see new efficiencies in all challenged sectors.

  5. Funding has been and will continue to be available for those companies with real, economically scalable business models, and those who showed some level of steadiness through these times.  The investor community is alive and well, and as we mentioned, we expect to see some excellent companies get funded post this period.  

What We’re Saying

We thought we’d look back at some of our favorite opinions and observations from the last few months:

  • Post pandemic, the acronym WFH aka "working from home" should go away and it will simply be called work because that's what it is.

  • There is no substitute for real-life experiences. The founders who have overcome adversity, are oftentimes the most successful.

  • Direct human interaction is fundamental and necessary for all of us, and we can and should be so much better prepared to quickly address and limit the damage from the next outbreak. 

In other news, we have some exciting developments with Stories Summit and what it will look like in the future considering our new normal, and truly believe good things will come from these hard times.  Thanks to all our partners and registered guests for their patience as we navigate these stormy waters. Expect an update in our June newsletter.

In case you missed it, Matt shared his five lessons from lockdown in a recent Medium article.

Finally, for some light and fun content consumption, enjoy our:

What Others Are Saying

Lastly, we take a look at what others have been saying around the industry.