Welcome to the 33rd edition of Check your Pulse, a tech and startups newsletter designed to make you feel human. I try to make this one of the best emails you get each week. If you’re enjoying it and know someone who’d like this sort of thing in their inbox, they can sign up here.
Happy Sunday, friends.
This week, I had lunch at a food court with 15 different trash bins to choose from, so finishing my meal required playing some sort of real-world Tetris to properly dispose of my food. I have worked on sustainability related consulting projects, I have a B.A. from Brown, and I invest in CPG companies and yet I still couldn’t figure out what went where.
The cultural resonance around climate change feels palpable compared to a decade ago. Blackrock, the world’s largest asset manager with $7 trillion under management announced that it will avoid investments in companies that have sustainability-related risks while Microsoft announced it will be carbon negative by 2030.
It has long been an economic axiom that growth is good. But in the age of climate consciousness, that idea is coming under attack. The growing “degrowth movement” questions the feasibility and wisdom of consuming more stuff and is calling on advanced countries to embrace zero or even negative GDP growth.
This is a pessimistic view in that it assumes a world where there is no change or innovation. The degrowthers extrapolate from what is going on today, failing to see that new ideas and technologies might change our trajectory.
Consumers are increasingly spending with their conscience but do not want to sacrifice, and there is a growing wave of companies meeting their needs.
Tesla provides an electric, renewable energy-based transportation solution, but it’s fast, beautiful, and cool.
Sweetgreen tastes really good, but it it also produced humanely and sustainably.
Nest is state of the art and comfortable, but it’s also energy efficient.
For Days tees are amazing, but they are also manufactured responsibly and 100% recycled.
Just tastes just as good as chicken eggs, but is made from plants.
Rent the Runway gives you access to an endless closet, but doesn’t require you to consume fast fashion.
Beyond Meat tastes delicious and is good for animals and the environment.
And there’s so much more to do.
As Erik Torenberg said this week “Society survives or dies based on its ability to sustainably grow the pie. Without a growing pie, there’s a winner for every loser, and we engage in zero sum conflict”
We need to come up with innovative business models that respect our planet and sustain economic growth. We need to create materials that are cheaper and more environmentally friendly without imposing 15 trash bin tests on people.
For founders up for the challenge, this is the time to prove that we can have our cake and eat it too.
(P.S. CYP is taking a break next week but will be back on the 23rd)
I was interviewed on Letterlist about my upbringing, how my newsletter came to be, and opportunities in consumer tech. 🎤
Nassim Taleb’s commencement speech at American University in Beirut is such a gem! I have a single definition of success: you look in the mirror every evening, and wonder if you disappoint the person you were at 18, right before the age when people start getting corrupted by life. Let him or her be the only judge; not your reputation, not your wealth, not your standing in the community, not the decorations on your lapel. If you do not feel ashamed, you are successful. All other definitions of success are modern constructions; fragile modern constructions. Success requires absence of fragility. I’ve seen billionaires terrified of journalists, wealthy people who felt crushed because their brother in law got very rich, academics with Nobel who were scared of comments on the web. The higher you go, the worse the fall. For almost all people I’ve met, external success came with increased fragility and a heightened state of insecurity. But self-respect is robust. 💯
This long essay by David Perell (one of the few people who can get me to read a 16,000 word essay) on News in the Age of Abundance is worth every second of your time. I promise it will make you smarter. 📰
Bubble Goods (the online health foods paradise) released a very handy list of branding, fulfillment, and other creative partners/agencies/resources. If you’re building a consumer brand (esp. in food), this is a great list. 🍱
Hamilton the movie is coming in 2021! 🎬
Everything about this 👏🏼👇🏽
How to Raise Media-Savvy Kids in the Digital Age This makes more sense to me: “According to the latest research, encouraging your children to think critically about the media they’re consuming is much more important than playing screen-time babysitter.” 👈🏽💻
@Humansofny tells the story of Bobby Love, the man who escaped from prison and changed his identity. His wife found out 40 years later. 😮
I love the Japanese concept of Ikigai ("reason for being). If you do what pays well and you’re good at, you’ll be rich but bored. If you only do what you love and are good at, you’ll be happy but poor. The true win is when what you love, are good at, and pays well intersect. 👇🏽
Excellent roundup of DTC Valuations by Alex Taussig. If you’re a consumer founder, a must read. 👍🏼
A solid report on what can we learn from retail exits of the 2010s. One of the most important conclusions is that raising a lot of money did not necessarily mean a company’s exit value would be higher. 👇🏽
On a related note, Casper’s IPO is sobering news for the ecosystem (its valuation was cut to $500m after last raising at a $1.1b valuation in the private markets). Web Smith makes a compelling argument for capital constraint 👇🏽
Some interesting observations in this Techcrunch article that takes a close look at different business models: 1) ARR ≠ revenue: SaaS companies have higher “quality” revenue that grows every year. $1,000 of ARR will grow to $1,200 of ARR next year, but $1,000 of mattress revenue probably means $0 of mattress next year. 2) Margins: Uber, Lyft, Casper, Peloton, and Sonos have 40-50% gross margins (vs. 80%+ SaaS gross margins), so they need 2x as much revenue to earn the same number of gross margin dollars. 3) Growth and scale: Many of the non-SaaS companies can grow much larger than SaaS companies more quickly, and they are targeting significantly larger markets (e.g., transportation vs. data visualization) 📉
Li Jin on why and how creators can make more money from fewer fans. The creator economy is in the midst of a decisive shift—from a “bigger is better,” ad-driven revenue model to one of niche communities and direct user-to-creator payment. 💯
Wren is a new service that makes it easy for anyone to calculate and offset their carbon footprint through a monthly subscription. Through a series of questions, Wren calculates your CO2 emissions and automatically offsets your emissions, so you can live carbon neutral. I believe this trend will only grow and be integrated into our everyday life — for example, when I buy a plane ticket or a new AC unit, I will have the choice to offset it directly in the checkout process. Carbon offset resellers have existed for a while, but the majority of them offer a poor customer experience and lack transparency. While I appreciate what they’re building, I find it hard to justify that a company in the carbon offset stack can generate high margins— as a consumer I’d want to maximize the amount of money that goes to fighting climate change, not for a middleman to make a profit. A potential solution to this is if the carbon offset aspect is given for “free” and the product monetizes other aspects. For example, Doconomy is a credit card with carbon offset features, so they can monetize in other ways. For the most part, these carbon offset resellers are “marketing” companies attracting eyeballs and converting them, which means there are limited barriers to entry and defensibility is unclear. As a consumer, I’m going to start offsetting my emissions. As a VC, I’m holding off until the economics are clearer.
If you’re wondering who’s behind this newsletter:
My name is Sari Azout. I am a design-thinker, strategist, and early stage startup investor at Level Ventures and Rokk3r. My mission is to bring more humanity and creativity to technology and business.
Know a founder i should meet?
Drop me a note at email@example.com
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