L.A. is a mecca for makers in the arts, communications, entertainment, manufacturing, music and beauty/ fashion. The first fashion and BeautyTech meeting was full of learnings for me, with LA entrepreneurs and investors sharing their thoughts about influence and how to scale production.
First, you can feel the good vibes! In the room, stylish people, bold entrepreneurs and lifestyle influencers.
You can feel the quality of life. There’s the pleasant weather of course, and there’s plenty going on in art, food and entertainment to provide inspiration, infused with endless influences of L.A.’s diverse ethnic population — whether it’s African-Americans, Latinos (Mexicans being the largest group), Middle Easterns and Asians (including Korean, Thai and Filipino communities).
We are not in New-York were the look is polished. Neither in the under-dressed casual San Francisco.
When we talk about Beauty and Fashion as a way to express oneself, Los Angeles is the city where you can experience it. Yes, Multicultural leaders, happy to meet different communities. Mixing with other tribes.
San Francisco has a way of thinking, with a tech focus. Los Angeles is a town where industries organically come together to create new models of working.
There’s a huge community of amazing creators, LA is an intellectual creative community at the core. Industry in New York was built on finance, but the currency here is
May be a few years ago, people were just talking about entertainment. Then about Snapchat or The Honest company.
Now, as a veteran business angel and successful venture capitalist said to me: «all people say they have a fund, as in the 90s, all people were in the movie production! »
Be ready to have a lot of change makers in LA, especially Direct-to-consumer brands.
I MET NEW VENTURE CAPITALISTS:
Let’s talk first about VCs. I met different talent talking about their venture.
For sure Upfront and Greycroft are the reference for many, and have already proven who they are.
I’m very interested by the new funds as inventing a new way to found and fund companies.
Some of them come from creative agencies and agents.
When you look at the Lady Gaga future line, or what celebrities such as Ashton Kutcher have built backing great companies and founders, you don’t forget that the best Business Angels are people with a true passion and interest for the startups they support.
Some Investors/LA Business Angels could focus on cars, music, or consumer goods (Juices with CBD were mentioned 3 times to me in 2 days) just because they love it! And some on health, femtech, beauty (in a more holistic way), urban movements, and new fashion trends.
Whatever. If founders avoid corporate ventures in early stage as limiting their potential exits, they adore celebrities being part of their equity!
If celebrities don’t have time for guidance, they always have time for raising their voice and put forward the startup and make a few connections when needed.
Again, good vibes matter.
Some of the new Funds come from digital expertise and growth hacking, having worked for platforms and startups .
I’m happy to meet people sharing our vision with David Sanghera. We believe that it’s vital in early stage not only to have a market fit and edge in the go to market strategy, but to have state of the arts skills in growth acquisition.
Growth hacking is not the core of the conversation in San Francisco. People talk first about the product, algorithm, and AI.
In LA, all people are aware that not being at the top in the execution in growth, gaining new customers and keeping them… could just kill the company. It’s not the cherry on the cake!
All the VCs I met challenge the massive amount of investments in D2C business models. Three years ago in the Silicon Valley, there was disappointment in the performance of food delivery startups (massively funded at that time, with more than $150 million for some of them): scaling fast in a competitive environment generated huge costs of acquisition, with a lot of execution issues, and a high churn rate at the end as not enabling to build a community.
I believe all the more in the verticals of Beauty and Fashion, there is a need to focus on the quality of the products, the customer experience, and grow the community.
It’s the recipe for a sustainable success and build new global champions.
I’m perhaps an optimistic. I believe there could be 2 ways to grow a business,
-Glossier and Prose hair to take only 2 examples may be huge global brands in the future, and appeal to corporations in the next few months.
-But not all brands can achieve more than $ 1 or 2 billion revenues, even being in 100 markets.
I’m excited to see people sharing my convictions. Yes, being exponential is Silicon Valley signature. But early stage needs focus.
Y Combinator founding partner gave this advice to Airbnb founders: «Just focus day and night on the guest and host experience, then scaling will be easy. »
I believe most founders need to raise a reasonable amount of fundings helping them to build their products & services and to scale.
Focusing first on the customer experience and organic growth. Limiting their cost of acquisition.
Being the best in retention as obsessed to build advocates and the life time value of their customers.
Being the best at the fundamentals of a community: sharing a purpose and values
Staying in LA for a few days just reinforced me in my conviction that the best model for funding and helping startups to scale at a seed stage, is a Co-Creation Studio.
-with a focus on a few verticals, where you have a strong expertise, a low number of startups and a high impact.
- with a rigorous ( even if creative) method of growth hacking to scale, learning from customers.
That’s why I founded FaB Co-Creation Studio.
I MET NEW FOUNDERS IN LOVE WITH THEIR COMMUNITY AND THEIR PRODUCTS
When I’ve been working with L’Oreal, we spent a lot of time reading, watching and analyzing customer insights.
Then making sure that our product was the best one on the market.
I like the way L.A.’s founders looking at their target.
First, it’s people they engage with on social media. They chat with them. They have a Slack channel and Insta stories. They even meet them in real life.
It’s like a tribe. They learn from them. They make them participate in key decisions.
They are about organic growth. Not first paid media and then the advocates and word of mouth. Paid media is here only to help.
It’s like founders know from the beginning that the best NPS (net promoter score) is the recipe for a sustainable success.
They care about their legacy. Not doing a fast growth and quick exit whatever the future after their leaving.
Secondly, they are in love with their products.
When I began my career working with Chanel, I would love when Francoise Montenay CEO was sharing stories about hand-crafted shoes to make sure they were beautiful high heels but comfortable to wear.
Working with YSL Yves Saint Laurent, when Terry de Gunzburg, makeup artist (then creating her own luxury line) I learnt what why the fushia N19 was so successful in Asia, with hundred of palettes to make it absolutely gorgeous on lips.
And at Lancôme, I remember hours of work to make sure with labs to have the right texture, soft and moisturizing, easy to blend, fast to absorb, not too greasy, never leaving the skin shiny.
It took us many years to be better than a competitor serum, but then Genific became a huge franchise with million dollars of revenues and million loyal and happy customers.
We all agree on the pursuit of global environmental sustainability.
Meeting the criteria of 100% vegan requires transparency, right from sourcing base ingredients to independent testing.
Working with certified and transparent bodies is the only way forward to formulating niche cosmetics.
That’s why I was so excited to hear Angel Anderson founder of Nailsnaps, and the Founder of Rituel de Filles talking about their long term partnerships with local suppliers. And also describing their worst day in their entrepreneur’s life: they had received a bad batch of lipsticks by overseas suppliers denying the issue.
Yes, product matters!
A great product makes your customers happy and they’ll come back.
Consumer goods (and beauty) is not a software with a few bugs to correct. We put products on our body. It’s as important as what we eat and drink.
« Let’s iterate and improve. And we’ve got the data. AI will help us to scale fast. » works later…
In LA, I like the fresh new attitude, proposing a new way to look at things and improve people’s life.
Tech empowers human. And AI will enable great brands to grow faster.
But let’s not forget that first and foremost we need happy customers that stay in the brand and love iconic products as improving their daily life.
LA, I’m excited to come back very often in the months to come.
The West Coat and especially this city are the place for new ideas and invent a new way of living.
Caring about our impact. Caring about the customers. Believing in organic growth first and influence, and having loved products and brand to create value.