Harrison Choate

Tech VCs getting over their skis investing in DTC brands set back CPG investment for a decade Historically VC has been about investing in technology that disrupted big markets and captured lots of value That model didn’t fit consumer brands...until around 2012 it suddenly did: FB/IG ads provided hyper targeted access to your core demographic — stand up a website (Tech!) and suddenly you could “cut out the middleman” and grab a bunch of margin typically “stolen” from you by “antiquated retailers” Apply that to BIG markets (Shoes! Beds! Bags!) and all of a sudden VCs were chomping at the bit (they love TAM) In 2016, Dollar Shave Club was bought for $1 billion by Unilever; by 2018 Bleecker and Chestnut streets were full of DTC storefronts and the VCs behind those brands were celebrating Then things started to change: CACs rose, growth slowed, Casper botched its IPO and Apple changed its iOS to make ad targeting even harder The investors who were just recently high fiving on the way up were now underwater (crushed under heavy pref stacks) They were quick to throw the industry under the bus: “Consumer products are too capital intensive” “There’s no big outcomes in consumer” “We’re pivoting to e-commerce enablement - picks and shovels!” “DTC just doesn’t work” ...and their peers, their LPs, the media and the ecosystem at large took them at their word The industry dismissed consumer products as a whole, and in doing so it threw the baby out with the bathwater and led a lot of capital to write off CPG But the real story: these were overfunded businesses with good (but not great) products, structurally low repeat purchase and minimal moat Allbirds, Casper and Away raised a combined $700m to create less than that much value in their end state; Unilever sold off Dollar Shave Club at a steep discount 7 years after buying it The lasting misconceptions became core narratives that were only recently violated as the VC community scratches its head at the recent run of big CPG exits that raised modest amounts of capital (Poppi, Siete, LesserEvil, Touchland, Simple Mills) Word lately is that “CPG is back” — it’s just a shame that all these people thought it ever left

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Kroger is now three layers away from their own customer. This week, Instacart launched full checkout inside ChatGPT. Not a link out. Not "shop on Instacart." You ask for apple pie ingredients. You check out. You never leave the chat. This creates a new hierarchy: Customer ↓ ChatGPT (owns the conversation) ↓ Instacart (owns the fulfillment) ↓ Kroger (owns... what, exactly?) Each layer is trying to make the one below it invisible. Instacart celebrates getting inside ChatGPT. OpenAI is already planning to make them the pipes. Here's the grocery landscape right now: Kroger, Sprouts �� Using Instacart's AI. Two layers removed. Target, DoorDash → ChatGPT integrations. One layer removed. Walmart → Hedging. Sparky internally, ChatGPT externally. Amazon blocked ChatGPT entirely. They know this game. They invented it. For 20 years, Amazon turned distribution into a trap. Sellers thought they were winning reach. Amazon made them interchangeable. Faceless options in a grid. Now the same playbook is coming for grocery. Except there are more layers. And the grocers are becoming SKUs in someone else's catalog. The question every retailer should be asking: How many layers sit between you and your customer? And what happens when that layer decides you're replaceable?

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I’m excited to announce that Klaviyo has acquired Gatsby a longtime partner helping brands turn social engagement into lasting relationships. Social commerce is expected to surpass $100B by 2026, yet many brands still struggle to capture that momentum. Bringing Gatsby into Klaviyo is another big step toward building the best B2C CRM - so every interaction, from a like to a purchase, helps you grow faster. Welcome to the team, Gatsby. Read more: https://lnkd.in/gGzcZW3Y

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New partnership alert!! Excited to announce that Black Flag is partnering with xAI to give founders free credits and direct access to Grok - xAI’s family of powerful, multi-modal, real-time models. Across essentially any end product you're applying to Black Flag with, Grok will deliver: - Deep reasoning across text, code, and context - Faster inference and improved function calling - CUI: Secretary of War Pete Hegseth just announced that Grok is being adopted for handling Controlled Unclassified Information If you're building in critical technology areas important to the West - space, energy, autonomy, cyber - the next generation of secure software will be built with Grok and you can now get a head start through Black Flag. Only 18 days left to apply to Black Flag’s January batch - apply at the link in the comments!

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I see a ton of noise about how to scale effectively on TikTok Shop. Graphs, long case studies, 47-step frameworks. But the reality is simple: 1. Volume and samples. The brands winning right now are sending 5,000+ messages per week and giving out a couple hundred free samples per month. More outreach = more content = more sales. 2. Let creators keep the commission. 20-30% commission gets you better creators who actually promote your stuff. 3. Restock before you run out. Sounds obvious, but I've seen brands blow momentum because they went OOS for 2 weeks. Have inventory ready before you push. That's it. You don't need a fancy playbook. You need to move fast and not get in your own way. DM me if you want to discuss strategy.

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Ride-alongs are underrated. And if you’re in NYC… it’s not a ride-along. It’s a walk-along. 😂 This week we went store-to-store with our distributor and I’m telling you: every CPG founder should do this early and often. Because you learn things you’ll NEVER learn from a spreadsheet. You learn: • how stores actually decide where your product goes • what shelves get the real traffic • what “out of stock” actually looks like in real life • which buyers care (and which don’t) • what packaging stands out in a crowded aisle • what customers pick up… and put right back down And the best part? We got to see Byte’m already on shelves in the wild. Not in a deck. Not in a “launch plan.” Not in a dream. On the actual shelf… next to national brands in a real store. We even got to ask the store how it’s performing, what customers were saying, and what we could do better. That’s the game. If you want to win in retail, you can’t just build a product. You have to learn the ecosystem. And there is no shortcut for boots-on-the-ground. (or… sneakers-on-the-sidewalk)

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Connor Blakley just launched Jams nationwide in Walmart. The product's great, but this wasn't just a CPG launch. It's a cultural moment. At 16, Connor dropped out of high school to start a Gen Z marketing agency. By 19, he was advising brands like PepsiCo, Johnson & Johnson, and Sprint on how to speak to Gen Z. And now, he’s taking things into his own hands. Building Dropout Companies. The new wave of consumer classics. First up: Jams. A crustless PB&J with 10g of protein, no seed oils, no corn syrup, and real fruit jelly. It just hit shelves in over 3,000 Walmarts. Backed by Alex Morgan, C.J. Stroud, and Micah Parsons. Built with creator-led storytelling and a cleaner take on a childhood classic. Positioned to do what Uncrustables did 20 years ago, but cleaner, cooler, and culture-driven. Connor’s not just selling sandwiches. He’s showing what the next wave of food brands will look like. Creator-backed. Clean-labeled. Launching like sneakers. Built for social. He dropped out to bet on his instincts. Now Walmart’s betting on him. This is what new-school CPG looks like.

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Excited to share that Aperiam has invested in Newton Research’s oversubscribed $9M Series A, alongside Greycroft, Bessemer Venture Partners, S4S Ventures, and LiveRamp Ventures. Newton is redefining what agentic AI can do for marketing analytics, enabling brands and agencies to: - Run customer 360 journey analysis across touchpoints - Segment audiences and build predictive models - Automate attribution, incrementality, and media mix modeling - Generate dynamic, natural language-driven reporting - Save up to 126 hours/month and achieve 10x analytics output Their pre-built “blueprints” let non-technical teams securely run advanced analytics on their own data with just a few clicks. John Hoctor, Matthew Emans, and Steven Bennett have successfully built and exited multiple companies. We love to back repeat founders on their most ambitious ideas, like Newton Research. Link to more in comments.

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Hot take: most brands overcomplicate growth. Your best acquisition channel might literally be… someone seeing your product in the wild. Shazam blew up because people used it in front of other people. Square readers became iconic because you saw them everywhere. Beats by Dre took off because they turned humans into billboards. This is Word of Sight and it still works in 2026. If your product has a “whoa” moment, put it on display. Not in a deck. Not buried in onboarding. Right in your customer’s line of sight.

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