Caldbeck: Physical grocery stores will endure for at least 20 years
Ryan Caldbeck · a16z Podcast | Who's Down with CPG, DTC? (And Micro-Brands Too?) · Feb 26, 2019 · at 13:40
CircleUp CEO Ryan Caldbeck discusses the long-term viability of physical retail during a discussion on consumer goods and e-commerce trends.
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“I think grocery stores are here for the very, very long term. Very long term meaning next 20 years at least.”
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More from Ryan Caldbeck
Caldbeck: Future CPG brands won't reach multi-billion-dollar scale
“There will be more of them, but they will get to a smaller level. So what I mean is it lasts 10 or 15 years, the brands that won, Chobani, et cetera, you can build multi-billion dollar businesses. I'm skeptical if that's true in CPG going forward.”
Caldbeck: Quantitative VC will emerge in CPG, but is impossible in tech
“In CPG specifically, there will be quantitative VC firms... We think that that is possible in some industries in the private markets. We don't think it's possible in tech.”
Caldbeck: DTC customer acquisition costs often jump tenfold within two years
“We see a lot of DTC companies raise money, you know, with a CAC, let's call it 10 dollars, 30 dollars, and then over the course of the subsequent two years, it raises literally sometimes by an order of magnitude, and that is just killing their profitability.”
Caldbeck: Direct-to-consumer is best used as a product iteration channel
“So when we say it doesn't work, I think it is an incredible channel for iterating on a product. I think it drives innovation. I can find my consumer base and I can test a new product. Next month I can test a different product. That's very different than the of…”
Caldbeck: Traditional retail data providers cover under 5% of CPG brands
“You've got a couple retail level sales providers that on average track 20, 30,000 Products or companies rather each. There's about a million and a half out there. A million and a half, and they cover less than five percent of them.”