The Exchanges

Q No, I absolutely love that pledge, and I think really kind of paving the way there in terms of kind of what the future should look like. Who's the best board member that you've worked with, Victoria, and what made them so great?

A So I would say that It is Wesley Chan here at Felicis, and the reason for that is that he builds incredible loyalty with founders who describe him as the person that is always by their side. I was just talking to one of the founders recently who was raving about Wes, and he said what really separated Wes from any other investor is that he was Was completely there for him during the hardest times and during setbacks, like not being able to necessarily get the right type of investor. He, Wes is completely honest and was able to direct him and redirect the efforts in a way that moved the company forward. So he called it kind of a more nuanced version of radical candor, which is a combination of Being honest and caring while always staying on the founder side.

AI assessment note: “It is Wesley Chan here at Felicis, and the reason for that is that he builds”

Q Speaking of the kind of people on the board themselves, sometimes I think it is possible that the entrepreneur feels that maybe they have a slightly overweighted investor board, and they maybe want to balance it out. I'd love to hear your thoughts, Victoria. When should one add an independent board member and slash Or, as a multiple variant here, change the composition of the board. What's that timing?

A I think the optimum time there is when the business key focus turns to scaling up. So, investors are perfect around the board table in the early, early days, and then as you start to scale up and focus on explosive growth, you know, double digits Monthly. This is usually right between A and B. B is the right stage, I have found, to bring in independent board members that have significant experience scaling, driving growth, and potentially key functional expertise in some of the areas that you want to build out, such as sales, partnership, risk, marketing. So that's really the important stage, and then remember that I think of independence as As serving that really critical balance to look out for the best interest of the company, not just the best interest of the investors. I think that there's an argument to be made for two independents at the stage.

AI assessment note: “B is the right stage, I have found, to bring in independent board members”

Q And as I said, couldn't be a bigger fan of the team and the incredible brand that's been built. Next one, what would you most like to change about the Valley Tech ecosystem, Victoria?

A You know, I would say that it would be around eliminating the stigma and support for mental health. Almost 18% of the U.S. population today suffers from anxiety and depression, but the studies have shown that for founders, this number is about two times higher, and so I think it is, as venture investors in particular, I think it is incredibly important that we think about how we are supporting our founders through the difficult job of starting and growing A startup and all the ups and downs that come with it. To address this, Felicis launched something called the Founders Pledge, Founders Development Pledge, where we contribute one percent of our committed capital toward leadership coaching and mental health for the founding team.

AI assessment note: “it would be around eliminating the stigma and support for mental health”

Q Love that one. Ok, next one. I'm sure you have many options. What made you choose Felicis as the fund you wanted to join?

A A couple of things. One was culture. I was looking for no ego, flexible, growing quickly, scalable, and that, I think, is really the most important to get right in making your decision to join Ventures, the right culture fit. Also, for me, team was super important. I did not want to go into a fund where you had your own book of business, and people worked more as loan contributors. Felice's And team-based support to grow portfolio companies. The four partners were constantly pitching in many times a day to help each other, close deals, make intros to portfolio companies, and that team-based approach, I think, is absolutely vital to our returns and our success. And then probably the third, for me, I had a deep background in fintech and consumer, but I also wanted to invest across Other sectors, in particular health, and so that was important to me from a fit standpoint, that Felicis is so active in health and other rapidly changing sectors.

AI assessment note: “A couple of things. One was culture.”

Q Excellent. I do have to ask, kind of, with that coach role, the natural next question for me is, is it possible to also be friends with your founders, or do you think that there's a line of professionalism that one has to draw as the investor and the founder? What are your thoughts there?

A In today's world, the reality is that your business and your personal lives blend completely into just one person, and so I do think that In your role as investor slash advisor, you are a friend to the founder, and your job is to support the entire person with whatever is going on in their lives. I remember early during the fundraising process for Hippo, Asaf's son, we had an important meeting to go through round composition, and Asaf's son was sick with the flu, his wife was away, and of course, I was Thrilled that there would be an opportunity for him to bring his son in so that we could, we could all meet together. We entertained him while Asaf and I worked on the round. So I, I believe that it blends together. That's the reality of a startup. You're in it a thousand percent, and it is your role as the investor to support the entire person.

AI assessment note: “I do think that In your role as investor slash advisor, you are a friend”

Q kind of dig in a little bit more into the granular, to the meetings themselves, I actually had a guest on the show that, uh, didn't hold back the other day, and that 90% of board meetings are creative. Clearly, uh, they're a fan. What have been some of your biggest learnings from the many boards you've sat on, where it comes to really driving efficiency at the board level?

A Okay, I'll say a couple things on this front. The first one is, I think that you want to limit the board meeting time itself Not the committee meetings, but the board to three to four hours. After that, I have not found the board meetings to be productive. So that's the first thing. The second, and probably the most obvious, is that the board meetings should not be used for performance dashboards. It is your role as a board member to work with the founders in advance to set up the metrics in dashboards that you want to track. So performance versus board approved plans, uh, business growth, customer metrics, satisfaction and repeat rates, risk metrics, like loss rates, status on hiring progress. You know, the best companies provide access to this type of data for their board members on a weekly and sometimes even on a real time basis. That is not what the board meeting should be about. So I think about within that three to four hour period, The board meeting is really about strategic decisions and trade-offs that need to be made, such as acquisitions, which markets to expand into, potentially reviews of different hiring direction and culture. You should leverage your board to debate and really draw upon their experience in being there for other companies as they have scaled. So I think that's the main focus. Also, major new initiatives, key risks, and how you're mitigating those…

AI assessment note: “limit the board meeting time itself Not the committee meetings, but the board to three to four hours”

Q said that we're in a DTC bubble, and Ryan Koolbeck from CircleUp said that so many of these businesses are great, but they're just not VC backable. So I'm super interested, Victoria, as the nerd in the room, and with you as the specialist, how do you assess and analyze the current landscape for consumer CPG, both in terms of the most active players, and then the way we buy?

A Oh, this is a very, very exciting question, Harry, and one that I am quite passionate about. I like to spend my, some of my free time walking down the aisle of my favorite grocery store, or Walgreens, or even worse, a GNC, and I think when you look at the aisles of these stores, you see the tremendous opportunity for disruption in CPG. I would actually say that every category of consumer goods is ripe for disruption, and I would say that there are Four key trends that are super, super critical for driving this disruption. The first one is the clean movement. So obviously we had the clean movement in food, clean ingredients movement, and that's now trickling through every consumer category from beauty to deodorants to vitamins and supplements. You see it in the move away from mass market deodorant, which has aluminum, And mass market toothpaste, like actually Colgate, which has triclosan. These kinds of today's consumers, the Gen Zs and millennials are growing up in a world where they expect natural ingredients. And so that is, I think, a very fundamental movement where it becomes just basic stakes in consumer products to have the best organic products. And ones that work as effectively as their more toxic counterparts. So that's a big one. The other trend that we see is the growth of consumer businesses that is built around underserved segments. Some of the biggest underserved …

AI assessment note: “every category of consumer goods is ripe for disruption, and I would say that there are Four key trends”

Q on companies that are popping is high, and so absolutely we'll see these two, three, maybe four hundred million exits, which is incredible companies and incredible exits, and I'm not Demeaning that, but often in venture, it doesn't quite work when you hold seven, eight, nine percent. So how do you think about kind of generating venture returns at scale with maybe incumbents willing to move fast and early today?

A Well, let's say a couple of things. First of all, in the beauty category in particular, there have been some huge exits just in the last year alone. If you look at Estee Lauder's Results. They have publicly said that a significant portion of their double digit, 20 18 sales growth came from acquisition of two millennial brands. Those two brands were two faced and Becca and two faced Estee Lauder paid about 1.5 billion for that brand. So I think first of all, the large exits are there, but more importantly, the VC returns, of course, all depend on when and how much you invest. At Felicis, we are focused, particularly in this category, more on the seed stage, and many of these consumer businesses are actually fairly capital efficient and don't need a ton of money to get off the ground and really scale up, so I would, in terms of VC returns, I would caution against some of the things that actually Ryan talks about, and I agree with, of Mayonnaise and diapers companies that are getting insane valuations and tens of millions of dollars. That's when you get into problems with not being able to generate VC returns, but seed investments in companies that are not me too, but are actually driving very, very smart innovation in these categories. In particular, I again, focus on the platform. Platform companies, companies that are not just going to be a single brand, but they will serve an …

AI assessment note: “the large exits are there, but more importantly, the VC returns, of course, all depend”

Q Not at all, and nothing quite like an ego boost at the beginning, but I do want to start today with a little bit about you, so tell me, how did you make your way into the wonderful world of Venture and become the recently minted partner at Felicis?

A My entire background is all operating, building different companies across fintech, consumer, retail, and most recently I was at Cabbage, joined the Cabbage team in the very beginning, Rob, Catherine, and Mark in 2012 when they were just getting started and had the incredible opportunity of building out all go-to-market functions starting with marketing and then sales, And together we grew the company from its very beginning in 2012. It was just about four or five million into the hundreds of millions of dollars at the end of last year. So I've had tremendous experience in scaling businesses, which is a huge passion of mine. And I also have had the opportunity to, to spend my time advising and angel investing in some great brands across the FinTech, health, and consumer sectors, and then when I really sat down and thought about what is the next thing that I wanted to do, I loved that role of advising and helping startups grow through the various stages and to start to scale, and that's what led me to venture. I would say that it was a very natural transition based on what I was already doing.

AI assessment note: “I loved that role of advising and helping startups grow... that's what led me to venture.”

Q that there's a lack of free and open distribution when it comes to consumer state. You know, I think we all see traditional platforms being so expensive in terms of customer acquisition. This really fundamentally concerns me in terms of growing significantly Customer basis for these kind of DTC consumer brands. Am I fair to be worried? And why do you get excited when I see concern, I guess? Okay.

A So a couple of things. First of all, the Amazon efficiency machine, which is what I call it. And I worked, um, my first job actually was at Amazon. I was part of the team, got to work on one click. It's all about the fastest way and the most efficient way to get you the product that you need. And it is incredible. But this efficiency machine has created a massive opening for experienced retail and independent stores, which I think is super exciting. And so what we have is we have these two extremes in distribution where you have Amazon on one side, you have independent stores on the other side, and then you have the middle. And I'm going to come back and talk about the middle. Independent stores are seeing tremendous growth. We all thought The end of that, you know, Amazon spelled the end of bookstores with the borders bankruptcy, but actually for the last five years, independent bookstores have been growing by about 10% year over year, which is just super exciting, and so what's happening there on the growth of independent stores is that they're obviously bringing back the joy of shopping, discovery, service, and I think that trend is here to stay. What's Super interesting. Stuck in the middle are all of the traditional retailers, the malls, and the big box stores, and all of these digitally native brands. So all the companies we've been talking about, I call them digitally na…

AI assessment note: “efficiency machine has created a massive opening for experienced retail and independent stores”

Q the element that you said about founder NPS and that kind of core relationship with the founder. Obviously the relationships that you've built over time kind of naturally ingrained within you, but I'm super interested As to the elements of kind of advisor roles, and how do you think, and this one's really interesting for me, how do you think about being the most effective coach to the founder, Victoria?

A Such a great question, Harry. I think that you must start off with an environment, honesty, and transparency. I think your role as an advisor is to be the rock for the founder, so the That you stand behind them, but also a mirror where you are providing constructive feedback, honest feedback, and someone that they, you establish over time, that trust where they know that you're going to tell it to them like it is. I think once you have that relationship built and a framework of trust, the coaching should really encompass three core areas that I have found to be the most important for startups. One is actually focus. Focus and trade off decisions on how you prioritize investments from who to hire, who you hire, to which channels you pursue, to technology investment are so critical in the earliest stages of a company, and really through all stages. The second one is de-risking the company. I think your role as an advisor is to see around the corner and to help your founder think through what The potential risks and think about how to do risk those risks. It could be things like multiple credit facilities, customer risk, so that you're not overly concentrated in any one customer, various go to market approaches. So you're not over overly reliant on one channel. So that I think is a really critical part of being a good advisor. And the third is really stages for first time founders…

AI assessment note: “coaching should really encompass three core areas that I have found to be the most important”

Q Speaking of the kind of people on the board themselves, sometimes I think it is possible that the entrepreneur feels that maybe they have a slightly overweighted investor board, and they maybe want to balance it out. I'd love to hear your thoughts, Victoria. When should one add an independent board member and slash Or, as a multiple variant here, change the composition of the board. What's that timing?

A I think the optimum time there is when the business key focus turns to scaling up. So, investors are perfect around the board table in the early, early days, and then as you start to scale up and focus on explosive growth, you know, double digits Monthly. This is usually right between A and B. B is the right stage, I have found, to bring in independent board members that have significant experience scaling, driving growth, and potentially key functional expertise in some of the areas that you want to build out, such as sales, partnership, risk, marketing. So that's really the important stage, and then remember that I think of independence as As serving that really critical balance to look out for the best interest of the company, not just the best interest of the investors. I think that there's an argument to be made for two independents at the stage.

AI assessment note: “This is usually right between A and B. B is the right stage”

Q So if that's the investing element, another core role under the kind of investor hat is obviously board membership. A lot of operated tan VCs maybe struggle with boards in terms of being too hands-on. How do you think about how involved a board member should be in the business on a practical level?

A So I would break it up into two pieces. The first one on the emotional side, I think that your job as a board member is being that rock of support Encouragement and belief in the founder at all times, but especially the hard times that we know that all startups will go through. Then in terms of day-to-day involvement, I think there's kind of a risk framework that I think about where in the day-to-day operations, everything is good. You're just, you're growing. Your role as a board member is ask the thoughtful questions that Approve budgets. Approve cash burn. But it's really big picture to help the founders identify the infrastructure and the operating systems that they need both to scale and to manage risk. So that's kind of day-to-day. You're providing that guidance. Then your role as a board member, I think, becomes more important as the company may enter periods of critical transactions. So Some important transactions may include a fundraise, a strategic investment, an acquisition. During those periods of time, I think the board starts to become more involved. In fact, we at Felicis, we focus on helping our companies with fundraise. I think that anytime you're looking at a large strategic partnership slash investment, there's opportunity to form a special board committee. That will stay on top and evaluate all the risks and all the different partners. And then I've also bee…

AI assessment note: “basically increases with the level of risk that the companies face.”

Q But I do want to start saying, you mentioned that obviously being there, the transition to the world of venture, now sitting on the other side of the table as a partner at Felicis, a question from Aydin himself, who asks, what are the most surprising or maybe unexpected aspects of venture?

A It's such a great question. Well, one is that it is incredibly relationship driven in every aspect of venture from deal sourcing and winning deals to the way that you close the deals and the relationship with the founder, of course, is everything. One of the things we do at Felicis is we track NPS score with founders and something we pay a ton of attention to, but I think I've been surprised by the How much you are drawing on your networks from industry relationships, VCs, operating companies for every aspect of the venture business. Again, from sourcing, closing, certainly customer intros. I think that's one area where having the operating background is super helpful. The other part is that venture moves so quickly. There's this crazy perception that VCs, you know, sit around in partner meetings and Review decks and meet with companies, but the reality is the business is very dynamic. There's so much hustle involved. You're constantly moving and visiting different companies, visiting customers. I love that part of the business. So very, very fast moving in some ways, similar to an operating role.

AI assessment note: “one is that it is incredibly relationship driven in every aspect of venture”

Q Excellent. I do have to ask, kind of, with that coach role, the natural next question for me is, is it possible to also be friends with your founders, or do you think that there's a line of professionalism that one has to draw as the investor and the founder? What are your thoughts there?

A In today's world, the reality is that your business and your personal lives blend completely into just one person, and so I do think that In your role as investor slash advisor, you are a friend to the founder, and your job is to support the entire person with whatever is going on in their lives. I remember early during the fundraising process for Hippo, Asaf's son, we had an important meeting to go through round composition, and Asaf's son was sick with the flu, his wife was away, and of course, I was Thrilled that there would be an opportunity for him to bring his son in so that we could, we could all meet together. We entertained him while Asaf and I worked on the round. So I, I believe that it blends together. That's the reality of a startup. You're in it a thousand percent, and it is your role as the investor to support the entire person.

AI assessment note: “I do think that In your role as investor slash advisor, you are a friend”

Q easy though, Victoria, I have to say, when I was researching for the show, to look at your incredible start into the venture and with Felicis, and to see this incredible blue sky, but I'm sure there's been challenges. Have there been certain elements which you found more challenging than others with regards to the transition, and what have you done to really try and get to grips with them?

A Another excellent question. I think that the hardest part of moving to venture is Time. How you leverage your time. And in fact, I would say that managing time is actually easier in an operating role. It is in many ways more predictable than in venture. And also because of the team aspect, it's easier to move forward on so many fronts at one time because you're, you can leverage your I have found it so far challenging to get the perfect formula on managing and optimizing my time. Some of the things that I have been working on have actually been to say no to meetings faster that are not a fit, and I think that's actually particularly hard for operators that may come in with a very large network, so you're getting many, many referrals all the time from your personal and professional network.

AI assessment note: “the hardest part of moving to venture is Time. How you leverage your time.”

Q But I do want to start saying, you mentioned that obviously being there, the transition to the world of venture, now sitting on the other side of the table as a partner at Felicis, a question from Aydin himself, who asks, what are the most surprising or maybe unexpected aspects of venture?

A It's such a great question. Well, one is that it is incredibly relationship driven in every aspect of venture from deal sourcing and winning deals to the way that you close the deals and the relationship with the founder, of course, is everything. One of the things we do at Felicis is we track NPS score with founders and something we pay a ton of attention to, but I think I've been surprised by the How much you are drawing on your networks from industry relationships, VCs, operating companies for every aspect of the venture business. Again, from sourcing, closing, certainly customer intros. I think that's one area where having the operating background is super helpful. The other part is that venture moves so quickly. There's this crazy perception that VCs, you know, sit around in partner meetings and Review decks and meet with companies, but the reality is the business is very dynamic. There's so much hustle involved. You're constantly moving and visiting different companies, visiting customers. I love that part of the business. So very, very fast moving in some ways, similar to an operating role.

AI assessment note: “one is that it is incredibly relationship driven in every aspect of venture”

Q So if that's the investing element, another core role under the kind of investor hat is obviously board membership. A lot of operated tan VCs maybe struggle with boards in terms of being too hands-on. How do you think about how involved a board member should be in the business on a practical level?

A So I would break it up into two pieces. The first one on the emotional side, I think that your job as a board member is being that rock of support Encouragement and belief in the founder at all times, but especially the hard times that we know that all startups will go through. Then in terms of day-to-day involvement, I think there's kind of a risk framework that I think about where in the day-to-day operations, everything is good. You're just, you're growing. Your role as a board member is ask the thoughtful questions that Approve budgets. Approve cash burn. But it's really big picture to help the founders identify the infrastructure and the operating systems that they need both to scale and to manage risk. So that's kind of day-to-day. You're providing that guidance. Then your role as a board member, I think, becomes more important as the company may enter periods of critical transactions. So Some important transactions may include a fundraise, a strategic investment, an acquisition. During those periods of time, I think the board starts to become more involved. In fact, we at Felicis, we focus on helping our companies with fundraise. I think that anytime you're looking at a large strategic partnership slash investment, there's opportunity to form a special board committee. That will stay on top and evaluate all the risks and all the different partners. And then I've also bee…

AI assessment note: “basically increases with the level of risk that the companies face.”

Q the element that you said about founder NPS and that kind of core relationship with the founder. Obviously the relationships that you've built over time kind of naturally ingrained within you, but I'm super interested As to the elements of kind of advisor roles, and how do you think, and this one's really interesting for me, how do you think about being the most effective coach to the founder, Victoria?

A Such a great question, Harry. I think that you must start off with an environment, honesty, and transparency. I think your role as an advisor is to be the rock for the founder, so the That you stand behind them, but also a mirror where you are providing constructive feedback, honest feedback, and someone that they, you establish over time, that trust where they know that you're going to tell it to them like it is. I think once you have that relationship built and a framework of trust, the coaching should really encompass three core areas that I have found to be the most important for startups. One is actually focus. Focus and trade off decisions on how you prioritize investments from who to hire, who you hire, to which channels you pursue, to technology investment are so critical in the earliest stages of a company, and really through all stages. The second one is de-risking the company. I think your role as an advisor is to see around the corner and to help your founder think through what The potential risks and think about how to do risk those risks. It could be things like multiple credit facilities, customer risk, so that you're not overly concentrated in any one customer, various go to market approaches. So you're not over overly reliant on one channel. So that I think is a really critical part of being a good advisor. And the third is really stages for first time founders…

AI assessment note: “the coaching should really encompass three core areas that I have found to be the most important”

Q easy though, Victoria, I have to say, when I was researching for the show, to look at your incredible start into the venture and with Felicis, and to see this incredible blue sky, but I'm sure there's been challenges. Have there been certain elements which you found more challenging than others with regards to the transition, and what have you done to really try and get to grips with them?

A Another excellent question. I think that the hardest part of moving to venture is Time. How you leverage your time. And in fact, I would say that managing time is actually easier in an operating role. It is in many ways more predictable than in venture. And also because of the team aspect, it's easier to move forward on so many fronts at one time because you're, you can leverage your I have found it so far challenging to get the perfect formula on managing and optimizing my time. Some of the things that I have been working on have actually been to say no to meetings faster that are not a fit, and I think that's actually particularly hard for operators that may come in with a very large network, so you're getting many, many referrals all the time from your personal and professional network.

AI assessment note: “I think that the hardest part of moving to venture is Time.”

Q Not at all, and nothing quite like an ego boost at the beginning, but I do want to start today with a little bit about you, so tell me, how did you make your way into the wonderful world of Venture and become the recently minted partner at Felicis?

A My entire background is all operating, building different companies across fintech, consumer, retail, and most recently I was at Cabbage, joined the Cabbage team in the very beginning, Rob, Catherine, and Mark in 2012 when they were just getting started and had the incredible opportunity of building out all go-to-market functions starting with marketing and then sales, And together we grew the company from its very beginning in 2012. It was just about four or five million into the hundreds of millions of dollars at the end of last year. So I've had tremendous experience in scaling businesses, which is a huge passion of mine. And I also have had the opportunity to, to spend my time advising and angel investing in some great brands across the FinTech, health, and consumer sectors, and then when I really sat down and thought about what is the next thing that I wanted to do, I loved that role of advising and helping startups grow through the various stages and to start to scale, and that's what led me to venture. I would say that it was a very natural transition based on what I was already doing.

AI assessment note: “loved that role of advising and helping startups grow... that's what led me to venture.”

Q said that we're in a DTC bubble, and Ryan Koolbeck from CircleUp said that so many of these businesses are great, but they're just not VC backable. So I'm super interested, Victoria, as the nerd in the room, and with you as the specialist, how do you assess and analyze the current landscape for consumer CPG, both in terms of the most active players, and then the way we buy?

A Oh, this is a very, very exciting question, Harry, and one that I am quite passionate about. I like to spend my, some of my free time walking down the aisle of my favorite grocery store, or Walgreens, or even worse, a GNC, and I think when you look at the aisles of these stores, you see the tremendous opportunity for disruption in CPG. I would actually say that every category of consumer goods is ripe for disruption, and I would say that there are Four key trends that are super, super critical for driving this disruption. The first one is the clean movement. So obviously we had the clean movement in food, clean ingredients movement, and that's now trickling through every consumer category from beauty to deodorants to vitamins and supplements. You see it in the move away from mass market deodorant, which has aluminum, And mass market toothpaste, like actually Colgate, which has triclosan. These kinds of today's consumers, the Gen Zs and millennials are growing up in a world where they expect natural ingredients. And so that is, I think, a very fundamental movement where it becomes just basic stakes in consumer products to have the best organic products. And ones that work as effectively as their more toxic counterparts. So that's a big one. The other trend that we see is the growth of consumer businesses that is built around underserved segments. Some of the biggest underserved …

AI assessment note: “Four key trends that are super, super critical for driving this disruption.”

Q that there's a lack of free and open distribution when it comes to consumer state. You know, I think we all see traditional platforms being so expensive in terms of customer acquisition. This really fundamentally concerns me in terms of growing significantly Customer basis for these kind of DTC consumer brands. Am I fair to be worried? And why do you get excited when I see concern, I guess? Okay.

A So a couple of things. First of all, the Amazon efficiency machine, which is what I call it. And I worked, um, my first job actually was at Amazon. I was part of the team, got to work on one click. It's all about the fastest way and the most efficient way to get you the product that you need. And it is incredible. But this efficiency machine has created a massive opening for experienced retail and independent stores, which I think is super exciting. And so what we have is we have these two extremes in distribution where you have Amazon on one side, you have independent stores on the other side, and then you have the middle. And I'm going to come back and talk about the middle. Independent stores are seeing tremendous growth. We all thought The end of that, you know, Amazon spelled the end of bookstores with the borders bankruptcy, but actually for the last five years, independent bookstores have been growing by about 10% year over year, which is just super exciting, and so what's happening there on the growth of independent stores is that they're obviously bringing back the joy of shopping, discovery, service, and I think that trend is here to stay. What's Super interesting. Stuck in the middle are all of the traditional retailers, the malls, and the big box stores, and all of these digitally native brands. So all the companies we've been talking about, I call them digitally na…

AI assessment note: “they actually have tremendous power and leverage to start distributing with this middle portion”

Q on companies that are popping is high, and so absolutely we'll see these two, three, maybe four hundred million exits, which is incredible companies and incredible exits, and I'm not Demeaning that, but often in venture, it doesn't quite work when you hold seven, eight, nine percent. So how do you think about kind of generating venture returns at scale with maybe incumbents willing to move fast and early today?

A Well, let's say a couple of things. First of all, in the beauty category in particular, there have been some huge exits just in the last year alone. If you look at Estee Lauder's Results. They have publicly said that a significant portion of their double digit, 20 18 sales growth came from acquisition of two millennial brands. Those two brands were two faced and Becca and two faced Estee Lauder paid about 1.5 billion for that brand. So I think first of all, the large exits are there, but more importantly, the VC returns, of course, all depend on when and how much you invest. At Felicis, we are focused, particularly in this category, more on the seed stage, and many of these consumer businesses are actually fairly capital efficient and don't need a ton of money to get off the ground and really scale up, so I would, in terms of VC returns, I would caution against some of the things that actually Ryan talks about, and I agree with, of Mayonnaise and diapers companies that are getting insane valuations and tens of millions of dollars. That's when you get into problems with not being able to generate VC returns, but seed investments in companies that are not me too, but are actually driving very, very smart innovation in these categories. In particular, I again, focus on the platform. Platform companies, companies that are not just going to be a single brand, but they will serve an …

AI assessment note: “At Felicis, we are focused, particularly in this category, more on the seed stage”