Investing In the Everyday Economy
Our central investment theme here at NextView is the “Everyday Economy.” In short, we seek the digital redesign of broad categories of everyday living, thanks to cutting edge technologies and innovative business models.
We are specifically focused on investing in businesses that improve and modernize the ways in which a majority of Americans spend a majority of their time, money, and attention — both at home and at work. Put simply, we’re focusing on real problems faced by all consumers and businesses across industries and classes, not luxury, siloed Silicon Valley issues.
When we first announced the Everyday Economy theme over two years ago, we wrote in some detail about internet-connected computing… its origins, historical parallels to other civilization-shaping technology waves, and how the second order effects are just now playing out 30+ years after the internet’s emergence. You can read that piece here. The short version is that “super technologies” like railroads, electricity, automobiles, and now internet connectivity don’t necessarily follow the patterns of “normal” technology innovation waves.
These super technologies have an outsized impact on society broadly and these impacts play out over many decades. For example, electricity was originally conceived as a way to provide lighting to replace candles and oil burning lamps. But many decades after Edison invented the lightbulb, electricity was reshaping everything from industrial production to transportation to even architecture (high rise buildings were made possible by the electric elevator).
Beyond this theoretical focus on investing in supertechnologies, it’s important to anchor our explanation of the everyday economy in our more literal present. At NextView today, our investments are split about 50-50 between consumer and B2B companies, because the everyday person has a multitude of identities and confronts a multitude of challenges and inefficiencies across their personal and professional lives.
On the consumer side, the Everyday Economy shows up in the products and services we use to manage our families (child care, relationships, elderly care), health (weight loss, alcohol treatment to speech and pelvic floor therapy), homes (co-living, home equity), money (student loans, parental finances), appearance (size-accessible clothing, skin care), and minds (reading, watching, learning).
On the B2B side, the everyday economy shows up in the application and enabling technology layers that facilitate business across industries — the technology that empowers more efficient and effective software development, data insights, marketing & selling, financing, and transportation.
The Everyday Economy in Context
As individuals, the things we do and the purchases we make account for 70% of US GDP. This activity is clustered in a handful of areas: home, transportation, food, work and money, health, apparel, and entertainment. Each of these categories represents a market opportunity in excess of $1 trillion, and each of them is ripe for disruption by digital technologies.
The digital transformation of the Everyday Economy isn’t solely limited to how we learn about or shop for products and services — it’s now fundamentally changing how we experience them.
Managed marketplaces, lab-grown “meat”, robotics, and on-demand delivery networks are changing how we experience the simple pleasure of eating a meal. Other companies are rethinking our concept of home and lodging. The COVID-19 pandemic and mass adoption of remote work amplified the influence of digital collaboration tools on how and with whom many of us work on a daily basis. Lyft and Tesla don’t simply make it easier to hail a ride or drive sustainably — these companies, along with the potential advent of autonomous vehicle technology, are reshaping the entire notion of car ownership and personal mobility.
The internet has transitioned from just simplifying the marketing funnel to redefining the actual products and services we consume.
While our lens on the Everyday Economy is focused on our actions as individuals, it’s not constrained to B2C companies. There are countless B2B startups that are enabling this digital transformation and how consumers experience the Everyday Economy. For example, Attentive is enabling retailers and brands to engage with their customers in new ways. Similarly, Datapeople is reshaping how recruiters and hiring managers at companies such as Doordash, Square, CVS, and Dow Jones use analytics to more efficiently identify and hire diverse, qualified candidates. Consumers may only experience these products indirectly, but they’re shaping their everyday experience of shopping, working, and personal development.
Interested in reading more about Everyday Economy? Here are a few posts we’ve written that go a level deeper on our thematic approach:
Deeper dives in some of these key categories:
- Work & Money
- Why the Everyday Economy Isn’t a Vertical Strategy
- Why Investing in the Everyday Economy Isn’t Just a Consumer Strategy
How We Plan to Continue Investing in the Everyday Economy
In some respects, our thematic focus on the Everyday Economy and its digital transformation isn’t particularly new. Over the last several years, we have been investing in founders seeking to reshape many aspects of our daily lives:
- In food, MealPal is delivering jaw-dropping value for urban workers’ daily lunch plans, and Upserve helps restaurants delight their customers. Kencko offers efficient plant-based nourishment, and Bobbie ensures your baby eats only the best.
- In apparel, companies like Dia&Co and ThredUp haven’t just made shopping easier, they’ve changed access to apparel and what people actually wear each day.
- In transportation, Optimus Ride is looking to reshape how people get around and Tive is reshaping real-time supply chain visibility. Meanwhile, Zitara is developing a real-time fleet management platform designed to improve lithium battery safety and longevity.
- In home, Grove Collaborative makes it easier to craft a healthy, beautiful home environment. Loftium and Alcove are changing the economics of apartment rental and HomePace is making homeownership more accessible and affordable.
- In health, Monument is bringing a holistic alcohol treatment online, Devoted is reshaping how seniors stay healthy and paid for care, and Expressable is delivering exceptional speech therapy in the comfort of your home.
- In entertainment, The Nudge is helping consumers discover new lifestyle activities and Skillz has created a platform to bring eSports to everyday casual mobile games.
As a partnership, we are all former operators, and the companies we’ve worked for and founded also give texture to the everyday economy in practice. Prior to joining NextView, Melody was the first product hire at Blue Apron, one of the first companies to redefine what affordable, healthy, and efficient cooking now looks like. Prior to co-founding NextView, Lee was an early employee at PayPal, a company that now defines modern commerce, and co-founded Linkedin, a lynchpin to our daily professional lives; Rob worked in product at eBay, one of the first companies to shape how we buy and sell goods online; and David co-founded and sold one of the first email marketing companies, which powered many companies’ early ecommerce relationships with consumers.
As for how we evaluate whether a potential investment falls within the everyday economy, there are a few common lenses we think through and questions we ask:
First, are the founders looking to redesign or just improve a current solution? Improvement is linear and incremental. Redesigns look more like step-function shifts, requiring founders to approach problems very differently. Sometimes, it isn’t obvious from the start that the company will lead to a redesign, but it’s very much part of the company’s Golazo.
Second, we get excited about companies that are redesigning the everyday. We think of this as products that are highly habitual, or that consumers interact with on a daily basis. WHOOP, a personal fitness tracking device and subscription that was recently valued at over $1.2 billion, is used every single day by millions of consumers to better understand their health. Slack and Zoom are used every single day by their business customers. And companies like Peloton enable purchases that may not happen very often, but are products that you will interact with every single day in your home.
Third, we look for companies that we think are relevant to everyday people. This means something a little different depending on whether you are talking about consumer businesses or B2B products, but our belief is that the biggest and most impactful companies will need to be ones that redesign the lives of mass consumers or large populations of business users. It’s not surprising that the biggest ecommerce companies of the last few years — Wayfair, Chewy, Dollar Shave Club, and Jet — were all mass market focused businesses, not ones targeting niche or luxury consumers.
That said, we realize that the starting point for companies at the seed stage may be much narrower than a company’s ultimate ambitions. Tesla is the classic example, as the company started with a high-end roadster as the first step towards ubiquitous electric mobility. This is why more than a thesis or investment lens, we are founder-driven in our decisions and our purpose as a firm.
We’re Excited for What’s Next
We’re excited to continue partnering with founders transforming daily living for everyday people.
We will still strive to help founders by being high-conviction, hands-on investors that drive to decisions, lead rounds, and actively engage with our portfolio companies. And we invest across the spectrum of seed / pre-seed / post-seed rounds, for companies before they have meaningful traction, regardless of whether they are raising a few hundred thousand or several million dollars. Early-stage investing is still the only thing we do.
And we will continue to expand our platform of resources to help seed-stage startups on their audacious mission to redesign the Everyday Economy.
If you’re an entrepreneur on this sort of mission, please get in touch. We look forward to helping you build the future you want to live in.