Influencers, Authenticity, and the Power of Attention: Building Modern Brands

If you can stay alive for 10 more years, I think you'll probably live definitely beyond 100 and perhaps 120 to 150. Hey, everyone. Welcome to the Venture Capital Podcast. This is Peter Harris from the University Growth Fund. He covers the VC side. I'm John Bradshaw, CEO of Codebase.com, appointment.com, I cover the founder side. And today we're going to be back like old times where it's just me and Peter versus a guest. But one of my first thoughts before we dig in, we've done. We did a couple episodes. The first episode we did was with Max Marchioni and John Dayton. One's from Superpower, the other guy teaches at Stanford. They talked about the future of AI and health tech. What have you had thoughts about that show, Peter, since then?

Yeah, I mean, I thought it was great discussion, really interesting, kind of learn both of their perspectives. What I thought was interesting is we invited John to be. I mean, he's a doctor. He works at ihc. He advises on their venture fund. He teaches at Stanford. Really comes from kind of the medical side of things, the reactive medicine. Right. And then Max very much comes from the longevity side, you know, the proactive approach. And, you know, I think all of us were kind of expecting there to be a little more fireworks and between the two. And it was interesting how much they both agreed on a lot of things. I mean, I think John was very cognizant of all of the limitations and challenges in the medical field and really excited about a lot of the stuff that Max was working on. And, you know, I think Max also recognizes that, like most people, right. That there is a tremendous amount of data and insight sitting on the other side of the fence. And so, you know, it's like, how do you solve for both of those? How do you pull together the preventative medicine, the longevity, the health span approach to things and tie it in with the medical. The traditional medical industry, which is very reactive in nature.

Okay. Has it changed your thesis as a VC at all? Or was it just like, hey, we're all on the same page?

I mean, honestly, it was kind of. Yeah, I mean, we're kind of all on the same page. The one thing that I. That really stood out to me that that was a big takeaway was a comment that Max made, which was, it's not so much that consumers or. Or, sorry, it's not so much that healthcare is becoming consumerized as much as it is that consumers are. Are taking their health more seriously. They're like Being help.

I think it's the fascinating, like, why is this happening now? Why are we having, you know, at home? Blood test? Why? Why are wearables, like, why. Why with woo, when the subscription is 30 to $40 a month, are people willing to pay that? Like, that's never happened before.

Yeah, well, and not only that, but I mean, there's always been a subsector, subsection of humanity that's, you know, goes deep into this type of thing. But today it's like everybody has multiple devices that are tracking their data. And I think, I think so my, my philosophy around that is that Gen Z and millennials, lesser, to a lesser extent millennials, but definitely Gen Z has been on display pretty much their entire lives, right in social media. And so the byproduct of that is that it becomes super important to look good. And one of the ways that you look good is that you are in shape and you look healthy. You know, people that are healthy look good. And so I think there's been like this real resurgence in. Not resurgence, but there's like, big interest in looking good and the, therefore, like being healthy. I think there's also what's interesting is then you could make the argument, like, well, how come like, plastic surgery isn't like, you know, breaking all the records? And I think there's also an element of valuing authenticity because so much is kind of fake. Like, Gen Z knows that when they see a picture and life looks perfect, that it's probably not. And so there's also like this value for authenticity that I think eschews some of the traditional plastic surgery and other, you know, mechanisms that people use to look better. Although my impression is that those businesses have also done incredibly well. So it's kind of like everybody is doing well that has anything to do with being on display, if that makes sense. And then I think the other thing is just like, as people are thinking about being healthy more, then that also results in them, like, taking their health more seriously and being more interested in it. And then that's as they, you know, make improvements to their lives, they're seeing the benefits and the outcomes from that, and that's resulting in them taking more control over their, their health. And then the last thing that I think has been like a big factor in all of this is the GLP1 drugs. And just, you know, you have all these people where we've been hammering on the table for the last decade around obesity in the U.S. now you have a drug that's been incredibly effective at helping people Cut weight. And all of a sudden they're like, I'm, you know, I've cut my weight drastically. I'm feeling better, I want to maintain this. And, and it's just like that other, you know, positive feedback loop of like, well, I feel good, I want to, I want to do more things to feel good and feel better. And that just kind of builds.

So what's the next.

Go ahead.

What, what's the next trend? Where does this keep going as a vc? Where are the opportunities?

So, you know, it's interesting. The other conversation we had recently was with. Which is a podcast that's coming out soon in the telemedicine space, and we had an exceptional founder on there and he talked about this idea of just data aggregation and pulling out insights. And so I think that's going to be a huge opportunity.

I think this, the. What I'm predicting right now, what I share with my parents, is that if you can stay alive for 10 more years, I think you'll probably live definitely beyond a hundred and perhaps 120 to 150. There's a lot of age reversal stuff that's happening now in mice. I think the whole AI stuff is interesting. I think why there wasn't a fight between Max and, and John is because John is like a. He's a vc, so he's super forward thinking. The last time I went, I got a physical, I was a bit shocked that my primary physician was like, show me your Apple Watch data. Like, that's never happened to me before. And I think in the past, the past week, there was a study on AI and they said, we're going to take AI finding results for our cases. Doctors only. Doctors and AI and AI only. And AI was superior, was significantly better than doctors than AI and the reports suggested that doctors aren't open to AI yet.

Interesting, because you would expect that doctors plus AI would be the best. And I, I think, have the potential to be the best.

Can you imagine being a doctor going to school for like 20 years and then you come in and, and, and you're dealing like with people who've actually researched their health. And I think that's probably a new trend that hasn't happened before.

Yeah, yeah.

Like I remember when I was today.

So I went to. So I did one of the blood tests with Superpower. Right. With Life Force. And one of the results that I got back was concerning enough that the, the clinician was like, hey, you should go see a doctor and just chase this down. It's probably nothing, but you Know, it's, it's high enough that you should chase it down. So I finally got an appointment, got in to see him, which, by the way, was kind of crazy in that it took me like two and a half months to get a doctor's appointment. Okay, I have good insurance, but like, it's just. Yeah, there's just not enough primary care docs, I guess. And anyways, so finally got an appointment. He's a young doctor. And yeah, we were talking about. I was like, yeah, I did these blood tests and, you know, I showed him the results and he was flipping through my phone and, you know, we talked about it a little bit. And anyways, it was, it was interesting discussion, but to a certain extent I was like, yeah, well, I'm doing this and I'm doing that. And he's like, well, I don't, you know, I don't like it when people take this drug or that drug or do this or that. I don't recommend it or whatever. And it, I don't know, it was just interesting because to your point, right, I'm rolling in there and I'm like, well, this is what it said. And I actually have benefited from doing that. And here he is like, you know, with a different opinion. So I don't know.

But you also, you'd also talked about Dr. Peter Ati's book, his last chapter. He's like, in nutritional health, something that's super common. We actually know nothing. There are no real controlled studies. We're all just guessing.

Well, because it's, it's unethical. It's unethical to do a true study on nutrition, right? Because what am I going to do, John? I'm going to say, like, hey, John, you consume like a thousand calories, a thousand grams of sugar daily, and I'm going to consume zero. And we're going to see what the effect of sugar is on somebody's body. Right? Now that's kind of an extreme example, but that's ultimately what these all come out towards. And so just on an ethical basis, it's, it's really hard to, to prove anything out. And then on top of that, you also have the fact that, like, everybody has different genetics, everybody has different lifestyles, everybody has different bodies, everybody has different, like, upbringing. Everybody, you know what I mean? And, and everybody has different goals. And so then it becomes even harder to, to have, like, true recommendations around nutrition. And then the last thing is, like, it all needs to be on longitudinal data, which is incredibly hard to process because, like, the thing That I eat today doesn't have an immediate outcome. And if I continue to eat that thing, I may feel good and look fine and my metrics might be good for the next several years. And it's not till like year 15 that that stuff catches up with me. I mean, I think about like, aspartame as like a great example of that. Right. A lot of people consume it and it helps them keep their weight down, but then it ends up resulting in all kinds of other, like, contraindications later on in life. So, yeah, nutrition is just like, incredibly hard and we don't have the data yet and the ability to figure it out.

Okay, our next podcast that we did is with Tim Holiday and Peter Hollins with Space Station. Do you have any takeaways from that podcast?

So the big thing that I learned from that, my big takeaway was this idea that working with influencers, content creators and artists, basically anybody who's built an audience should go beyond just leveraging them for their audience and they should be approached and respected as people that have built one of the hardest things to do right now, which is an audience and attention. And they probably know significantly more about how to do that than, you know. Oh, still, what behind the ears. MBA grad and marketing. And I think about like one of our portfolio companies is a company called Wyze. They do these smart home cameras that are really awesome. Their cmo. I think one of the like, best decisions that they ever made as a company is their cmo. And an early co founder of the business is a guy who has a pretty decent following on YouTube, but really his daughter has a huge following on YouTube and he's been like her social media manager forever. And so he just understands how to build an audience and capture attention. And if you look at Wise's marketing strategy, they basically spend almost $0 on marketing and they use PR and social. Like I think they were one of the top product sellers on TikTok for their category. They may still be, I. I don't know. But they're just really smart about how to use existing channels very cost effectively. And I think a lot of that came from his expertise. So anyways, yeah, I think that was like one of my big, big takeaways is like there's this opportunity to leverage these people for more than just, you know, product placement. And the, the other thing that goes along with that is increasingly in the world of AI, and we've talked about this, your ability to grab people's attention and hold it is probably going to be the most valuable thing you can possibly do.

Are we in the age where every CEO needs to be a content creator?

I'm not necessarily saying that you need to be a content creator, but you need to figure out how to cost effectively rise above the crowd and the noise because it is only going to get more and more and more noisy.

Everyone, every CEO has a podcast now.

Every? Yeah. Every vc. Every CEO. Yeah, to a certain extent.

Okay.

But even so, like, even with like quote unquote, everybody, it's still like not the majority. It feels that way. But you know, I, I did a dinner last night with a bunch of VCs and none of them are, I would argue, are content creators. At most they, they post occasionally on LinkedIn. So there's maybe one person there that maybe two that were active in content creating from the VC perspective, which is probably about right. It's probably about 10 to 20% max of VCs actually produce content.

It's still a lot. It's a lot of time.

Still a lot.

Sometimes I see VCs creating content and I'm like, why, what, what is your motive? Because like in Utah, for example, there's what, two deals that you need to be part of every year? Yeah, it's a super competitive space. But yeah, I mean, I think sometimes having a brand helps.

Well, but what are the things that you took away from that conversation?

I mean, I don't know if I feel like I'm bought in. What are my takeaways? I don't feel like there was any big aha moments. I feel like I look at content and podcasting as a, podcasting as a sales strategy. I think it's a really good way to meet people. I think it's a great way to serve people as well, is how I look at. It's kind of like service first based sales. I really, I think their approach of having a fund to partner up makes a lot of sense. I'm curious, if I was currently raising, would I go to a space station or would I, you know, take, you know, take months or a 16z? Like if both were an option, like, obviously, I mean, I'd take a 16Z. But the fact that I think I even thought about that question means that the world has significantly changed in my view.

Yeah, yeah.

But I do think there's a play of who was I talking to? I was talking to someone who used to be in the space and I was like, if you just owned a particular vertical, like, hey, I know all the influencers in the, in the health Space. You know, I do partnerships, funding, things like that, you know, bringing ambassadors as part of the founding team. One of the things that Peter Holland said, which I've thought a lot about, is, you know, maybe, maybe as you have a startup, if you're a CEO and you're not like the content creator, maybe a part of your founding team should be, hey, how do I have like a Peter Holland as part of this?

Yeah. And that was kind of my point, that these content creators can do a lot more than just, you know, plop your product on their, their page and talk about it. Right?

Yep. One of my friends, Jennifer Harmon, she's doing a company right now called lemd and she brought in an influencer named Jordan Page as one of the. I don't know if it's a co founder or, you know, early executive. And I wonder if that's just kind of like the next new thing is, I've got my idea. I'm going to find an influencer first and then maybe later find a dc.

Yeah. Yeah. I mean, it's interesting too, the evolution of just like, how these, these businesses are being built. For a little while, it was like, okay, we're going to have a brand, we're going to slap an influencer on it. They're going to partner with somebody. They're not going to really do much, but they'll be the face. And I think more and more of those businesses, like, more and more companies have tried to do that and it's been really challenging anyways, so. But you look at somebody like Haley Bieber who effectively sold her business for a billion dollars, and, you know, she's been really successful in that, I think, in large part because she can speak very authentically to the brand. Right. She put up the original funding, she picked the products, she pushed back on the formulations. She was like integral in, like, the designs and so forth. And then she posted herself using the product freaking every single day. And so, you know, she was basically getting, they were estimating she was getting $400 million of free advertising or earned media every year, which is insane. And. But that allowed her to have 40% EBITDA margins in an industry that typically only has like 15 to 20%.

So how do you think the acquiring company looks at that? Because I feel like once, once the company sold, it no longer will hold the same place in Haley's heart. Yeah, all of your margins.

Right. I am sure that they included some pretty hefty golden handcuffs in there for her. And, you know, she, as part of that Is now they're like chief innovation officer or something like that. And I think they're gonna have her involved across their entire brand.

But you know they're going to want to start doing things differently than she is and she's going to secretly start hating them.

Yeah, for sure. That they had bought is her. Right. So no, I think it's a great question and it's really like tbd.

It's a divorce in the making.

That's also why maybe it was appropriately valued because on its face I think she, she left a lot of money on the table. I think as a standalone brand that she was running and continue to build that company is probably worth 2 to 3 billion given the size of the business and the growth. I mean they went from zero to like $400 million in the course of like three years. Like it's insane. And profitable with like 85% growth or EBITDA. Sorry, not 85, 85 million in EBITDA. And so like that you compare that to like other companies. Right. Like even if you compare them to some of the fastest growing like the like lovable. Right. It's a much better business with better margins frankly. And a lot of ways it's not, you know, and they're both usage based models so you can't even make the argument that it's, that it's recurring revenue versus not.

So I thought about that idea once. An influencer in the box model for the beauty industry.

Yeah.

For, for years I've seen everyone like selling shirts and I'm like well what else can they do? And I've got a family member who works for Pat McGrath lab. So it's a very famous like high end brand.

Yep.

And I'm just like, you know what, all of the inner workings of the back office is the same. If you could just take it and then build a brand around another person, bring them to your, your, you know, chemical suppliers, your formation people, your, your marketing team. You could probably just make a grundle just being like hey Liza Koshy, we're going to help you launch your brand.

I think so as long as the influencer is actually deeply involved in the product and stands behind it. If it's just slap my face on the front, I think that's been played and is tired and won't perform well.

Which was why I think Haley's company, the seeds for its destruction have been sown.

Yeah, maybe there will.

They're all guaranteed to be fights, disagreements. She no longer has CEO power. You've got really deep pockets in there. And I don't see the, see that, that group that she hangs with, they've got a certain energy. I think it's going to, it's going to blow up.

Well, ELF is a really good brand. They do a really good job. So I don't know. My guess is that growth stalls, but they probably make quite a bit of money on that brand and that it will ultimately be a really good buy for them.

And in five years she starts another brand. Yeah.

Or she just like, I mean she's going to walk away from this deal with like 700 million in the pocket. She doesn't need to do another thing for the rest of her life. Right.

Okay, we're good. Well, as, as we wrap up this episode, maybe one question for the audience is as, as Peter and I are changing and bringing more guests on, you know, should, should we interview a guest and then do a follow up episode afterwards where we can like dive in, dissect it or was like the, the, the conversation enough just with with each podcast? So leave comments below, messages on LinkedIn and X& I'm curious what you guys.

Think and let us know what topics you would like us to cover. What are the themes that you are seeing that you're curious about and we'll go find some exceptional founders, industry experts and VCs to talk about it.

All right everyone, well thanks for watching. Go to vc, FM and socials and you can see all of our social channels there.

All right, we'll see you there.