Anna Barber of M13

Welcome to the Puck Venture Capital and Beyond, the show that examines the changing landscape of our world. We'll have candid conversations with VCs, entrepreneurs, and thought leaders grappling with our current challenges and providing solutions to key problems we face as a nation. I'm Jim Beer, president of CMBG Advisors. This podcast brings change makers to the table to discover the inner workings behind their decision making strategies and ultimately to how they got to where they are today. I think there's a future where most people won't have just a single job, but rather they'll have a bunch of different roles that they play with different companies and different projects, maybe even across wildly different skill sets.

Today on the Puck, we sit down with Anna Barber, a partner at the investment firm m thirteen, focusing on early stage startups and seed investments. Anne and I discussed the shift from an old school singular career path to the multi career trajectory, the recent changes in investment behavior, and the role emerging technologies play in shaping our experiences in today's hyperkinetic world. I'm excited to have Anna Barber from m thirteen here today. And before we get started, Anna, can you just tell us a little bit about yourself and your background? Hey, Jim.

Thanks so much for having me. I'm I'm really happy to be here. I'm an investing partner at m thirteen. And immediately prior to M13, I was at Techstars where I was running an early stage accelerator. But my background is really operational.

I was a founder a few times. I worked as a talent manager in Hollywood, so I have experience working with talent and producing films, and I was also VP product at a couple of different ecommerce companies. And then way back in the day, early in my career, I was at McKinsey, and I started my career as a corporate lawyer. So got a very eclectic background, which, you know, right now I'm applying as an investor and supporting early stage companies and helping them grow. Well, I find that interesting on a lot of levels, including the fact that I started my career out as a corporate lawyer.

So welcome to the Puck. As we kick off today, tell me what you're up to and what m thirteen's up to and what you're excited about these days. Yeah. M thirteen is a consumer technology fund that was started by Carter and Courtney Reem, who were also former operators, and that's a real hallmark of our firm. Carter and Courtney started a company called Veeve Spirits together.

It was one of the fastest growing small companies in America, and they exited Veeve and then decided they wanted to get into investing, which they started about seven years ago with fund one. They've now grown the team. We're now on Fund Three. We just closed a $400,000,000 Series A fund. And we're focused on the future of consumer behavior.

So we're thinking about what does the future of digital health look like? What does the future of consumer fintech look like? Ecommerce infrastructure, how are people gonna buy things in the future? And we're really interested in the future of work as well. How is work changing, which is something that's, you know, really undergone a lot of transformation in the past couple years.

And in addition to that, we're spending a lot of time thinking about web three and how web three as a technology approach allows for new business models across all of those areas that we're interested in investing in. So as you're looking at companies today in those areas, anything you're particularly excited about? Yeah. I'm really thinking a lot about, like I said, work. You know, having had such an eclectic career myself and done so many different things and started over so many different times, I've been thinking about this idea that in the future, security doesn't come from having a job, that the idea of income security may come, in fact, from diversification of income.

So I think there's a future where most people won't have just a single job, but rather they'll have a bunch of different roles that they play with different companies and different projects, maybe even across wildly different kind of skill sets. So we call this, there's sort of an emerging idea around portfolio careers and managing portfolio careers. And so thinking about how to support portfolio careers, how do you, if you have a portfolio career, how do you plan for retirement? How do you think about career advancement? How do you look at training?

How do you network? You know, how do you smooth out your income so you know what you're gonna make every month? So all of those opportunities around work, I think, are really, really interesting, whether it relates to how we find jobs, how we manage our income, you know, and even, like, how do you fend off loneliness? You know, a lot of people that are working alone as a freelancer, right, it can be very lonely, right, especially with remote work. So there's also, I think, a lot happening around creating community when you don't have that water cooler at work anymore to fall back on.

So, you know, that's one area we're really excited about. Another one is ecommerce, you know, and how we buy things. I think consumers today are really concerned about sustainability. I think we've seen what we saw in the pandemic was supply chain disruption. A lot of companies that are making physical products are really rethinking, how do I bring manufacturing closer into the consumer?

And there's a lot of changes happening also in kind of last mile delivery, in moving three p l's, and moving delivery networks closer to where consumers actually are. So between sustainability and kind of changes around supply chain and also just changing consumer behavior around wanting to consume less and have it be in a more sustainable fashion, which is leading to a lot of kind of circular economy and reverse logistics businesses. I think there's some great opportunities around e commerce today. So when you say reverse logistic companies, do you mean or you might have food come to your home and delivered, but then you'd have the containers picked up as opposed to throwing away the bags, for instance? That would be an example.

Exactly. And another one would be furniture. You know, there's a company based here in LA called Furnish that is essentially you know, you might consider it rental, but it's subscribing to furniture. And the idea is you can have high quality furniture. You just don't necessarily have to own it.

So whenever you're dealing with these reverse logistics businesses, whether it's picking up the containers, whether it's something like rent the runway where you're taking back clothes and someone else is then using them, these are very operationally complex businesses, which some people shy away from. I personally find operational complexity done well can create a real moat for a business. Interesting. You mentioned this notion of people having multiple careers. I know there's the gig economy, and I also know that wealthy people will obviously have money from their normal job, but then they'll have to invest it.

So then in a sense, that creates a second career that complements their life. But it sounds like you're seeing more of a revolutionary change in this. Can you go a little deeper into that in terms of where you see the puck going? Yeah. Absolutely.

So I think if you think about income as coming from multiple sources, some of which are you're monetizing your time. So let's say we were both lawyers, so, you know, you have to keep track of your time, like, in six minute increments, which, frankly, I think is one of the reasons so many lawyers leave. Because, man, that is just having that clock over your head all the time is so challenging. But, you know, so there's this idea of monetizing your time that you get paid for a skill and you deliver a skill to a company, then there's also the whole creator economy. So that's the idea that you can build an audience.

And through that audience, you can sell products, you can sell services. There are other ways of kind of monetizing that audience online that might provide you even with passive income that could complement your active income that you're getting from selling your time. So you're either selling your time, you're selling your advice and your expertise and your recommendations, and you could combine those two things to have kind of different income streams. And then there's passive income things like investing, as you mentioned, which I also think there's a number of companies and vehicles that are opening up investing to more of our retail audience. So for example, there's companies now, like DoorVest is a company in our portfolio that allows you, you know, to invest in real estate in a fractional way.

So you don't have to buy an entire property. You can invest fractionally in a property if you wanted to diversify your portfolio. So I think we're gonna see more participation across all of these different income streams where it's monetizing your time, it's kind of selling your advice, your recommendations, your expertise to an audience, and it's kind of passive investing in a small way to together make up an income. One area that I can see that playing out is coaching or even people that are writing and that are starting their own publications, podcasts, because there are, with social media and the Internet, opportunities to reach people all over the world. Is that a big part of the trend that you see happening?

Absolutely. I think, you know, we used to call them influencers, I guess. Now we call them creators. But Mhmm. You know, anyone that has a message or a point of view to share with an audience, whether it's about how to learn a new skill, how to be more efficient with your time, you know, how to cook, how to invest.

Right? Everyone has something to offer the world, and there are platforms emerging today that allow you to take that skill and that point of view and that message and turn it into content. You can live stream. You can create videos. You can post blogs.

You can curate a store. You can, you know, now provide financial advice. You can, you know, make recommendations across a whole category of products and services and turn that skill or that point of view or that message, you know, into kind of a mini business. Now for most people, it's not gonna be their entire income. But you could see if you're a home cook, you know, or if you have a cottage industry, you know, making a product, you can turn that into an online business while you also earn income from other sources.

So from an investment perspective, are you focusing on the platforms more like the Ebays and the Amazons that are, you know, marketplaces for people to come to to do this, or are you focused on the companies that are essentially marketing through those platforms? Great question. We are definitely focused on the infrastructure layer, so the platforms. So I think there's some interesting things happening in knowledge worker marketplaces, vertical knowledge worker marketplaces that we're looking at. And I also think Web3 offers some really interesting ways of earning income to the kind of new worker, you know, the emerging worker, whether it's through participating in a DAO or earning tokens for doing specific activities.

And because of the way these Web three businesses are structured, it can be incredibly decentralized, and there's no kind you know, you don't have to get quote unquote hired If you're working inside a Web three community and earning tokens, you show up, you're in the community, you do the task, and you're automatically rewarded. And that's really exciting because even the existing labor market places have some kind of centralization. So the idea that we could, you know, really decentralize work out into these kind of micro communities is exciting. The other thing that I think is really relevant here is Gen z and the kind of how Gen z wants to work and how Gen z wants to act and behave in the world. Right?

They are way less interested and impressed with the idea of being inside a big name company and having that kind of security. That's not what they value. As a group, they tend to value independence. They tend to value culture. They value community.

They value learning and self discovery, and they wanna have more autonomy. And so these new business models are, you know, really in tune with what Gen z is looking for in the workplace. When you talk about Web three and you talk about this kind of evolution in these marketplaces, do you see avatars and the meta where people go to concerts, buy things, hang out, productize in kind of these virtual malls? I mean, is that part of what you see happening? I think that is happening.

That's not personally, like, the part of the market that I'm interested in. I'm actually interested in the part of the market where you might not even necessarily know that what you're interacting I do I do think what's happening with the metaverse is exciting, and we're gonna have a big future. Living in the metaverse, meeting people in the metaverse, owning land in the metaverse, fashion in the metaverse, gaming in the metaverse. I think all that is happening. I think that there's just a lot of uncertainty right now about how that's all gonna play out.

And so it's an area where we're being a bit more cautious about how we step in. So are you seeing companies that are actually building these products right now? And can you give me an example of how I might, not even knowing it, post a question on the web and have somebody give me an answer and have financial transactions going on behind the scenes that I'm not even aware of? I don't think that scenario is possible because I think you actually need to know you're inside a specific community and what's going to happen in order for that to happen. But Right.

You know, maybe someday. There are situations where payment rails are being built on top of blockchains, and you might not be aware that you're making a payment, and it just looks like you've paid an invoice, and the blockchain is involved underneath. Interesting. So that is starting to happen more and more. We've seen some bumps in the road with respect to the economy.

A lot of talk about inflation, a lot of talk about interest rates going up. Just taking the last few weeks, have you seen any change in investor or investment behavior? Yeah. It's really interesting because I think we've known this is coming for a couple months. And just in the past few weeks, we've seen the asks at series a start to come down.

So I saw two situations in the past week where I received a deck, and it said the company was raising 15,000,000. And so I'm going in my mind, alright, 15,000,000. So they're probably looking for a $75,000,000 valuation. And I'm doing the math in my mind and saying that seems kind of expensive for where this company is at, and the company had come back and said now they're raising 10,000,000. And so what must have happened in the interim is, you know, that founder got some feedback, just like I was thinking that that was too big of an ass.

So we're seeing valuations start to come down and, frankly, I think rationalized to sort of bring in line valuations with traction, you know, with where the company's at. I think what we were starting to see at the end of last year was companies raising beyond where their traction really was in anticipation of future growth. And now we're not sort of counting that anticipated future growth. We're seeing companies raise more on where they are today versus where they think they will be able to be in three to six months. My experience looking at the last few years is that, especially with PPP money, if you were a company with rare exception, there was a way to get some type of liquidity.

And as a person who who runs a company that actually helps companies restructure or get through those difficult times, it's been an unusual period because we haven't seen liquidity tighten up. Do you foresee there being some tightening in the liquidity market for portfolio companies such that some companies just won't be able to raise money in today's world? I think there's uncertainty. So I think we're advising all of our companies to be conservative and to hire only when growth demands it. So you should hire when the market's pulling you, and there's revenue that needs to be serviced, and you need to grow the team in order to serve the revenue.

So we're encouraging people not to seek growth at all costs, but to grow smart and to grow their teams in accordance with, you know, again, kind of matching their spending to where their revenue is as opposed to kind of getting ahead of the game. I still think companies with solid business models that are showing strong growth and customer engagement are gonna be able to raise. I think what we will see is valuations coming down because companies won't be raising on future potential anymore. They'll be raising on what they've accomplished. So if I'm understanding you, just like with rents in real estate, if you buy at a certain cap rate, sometimes you build into that model that rents need to go up in order for you to make the investment.

For a company that isn't seeing natural growth in the market anymore, they're gonna have to be able to demonstrate that they are able to get growth in a sense, a stable market as opposed to assuming that the market's gonna continue to grow. That's right. So imagine you see a revenue chart going up, and the last half of it is a dotted line that just continues. I'm not gonna value the company at what that revenue dotted line is gonna be in six months. We're gonna value it today.

Not that we don't think the company is gonna continue to grow, but you're not gonna get advanced credit for that, you know, in evaluation. So being focused on Southern California and the consumer market, what do you see as some of the strengths and unique aspects of this market? Wow. You know, it's so exciting what's happened to LA since I got into investing back in 2017. You know, I think LA was always an exciting market, and we've built a great community here of investors and founders who, I think, really support each other.

And there's a real sense of camaraderie and wanting to see the market grow. And if one of us is successful, we're all successful. And that's one thing I really love about this community here in LA is just that generosity of spirit and that willingness to support each other. It's great to be part of that and to feel like we're building something together in LA. I think what's happened recently is, really, the market's diversified.

The tech market here is diversified. We've got so many different interesting nodes of the tech community here in LA. We've got the deep tech community, you know, out of Caltech and UC Irvine, the biotech market. We've got aerospace. We've got a big contingent of kind of aerospace founders and a lot of innovation in that sector.

We've got, of course, the entertainment industry, right, the heart of LA, the entertainment and media industry, which is generating a lot of new technology ideas. And we've got e commerce, so many consumer brands, DTC brands launching here. It's really a great place for emerging consumer brands, and now we've got web three coming into that. And so all of these different communities playing together and supporting each other, I think, you know, makes us a really vibrant place and a fantastic place to start a company, a fantastic place to invest. So we're just really excited about what's happening in LA and having watched it over the past five years emerge and develop.

It's just been really wonderful to be part of that. In the area of landmines or challenges that entrepreneurs should be aware of, based on your consulting experience and business advice, are there areas that they should be a particular concern in these days? I think that we're still trying to figure out what is this new world we live in. Right? We just went through this massive disruption.

You know, people are still trying to figure out what a consumer behavior look like post pandemic. We don't even really know how the work world is shaking out. So I think everyone has already thrown out the old assumptions and is kind of looking for what's new. And when you think about customer acquisition, for example, the world has totally changed, you know, Apple's new rules, Facebook's new rules. You know, there used to be this predictable way of spending money acquiring customers.

Those rules don't apply anymore. So we're in a whole new world of how do we acquire customers. We're in a whole new world of how do we play with Web three. We're in a whole new world of how do consumers behave post pandemic. There's so much uncertainty that I think it's causing all of us entrepreneurs, investors alike to kinda take a fresh look at things and really keep an open mind and not make assumptions based on what things were like in the past, which, by the way, is an amazing place to be an innovator.

You know, what really drives me, what I love, and why I get up in the morning is because I wanna help entrepreneurs who are making the world better. Maybe it sounds naive or a little Pollyanna or something, but I really believe the role of technology is to improve our lives, to make life better. And to make life better, not just for the 1%, for the people at the top to really have an impact on lifting everyone up and making the world better for everyone. And I think when you have these periods of upheaval and uncertainty, that is a great time, you know, to see opportunity and innovation. That makes total sense.

And when you look at this technology that's being developed, are there any particular new technologies that you see coming out that one might not imagine? We talked about a while ago plant based food, for instance, in a consumer product space. Are there other things coming out that people may not have heard about that you see as exciting? Well, just because you mentioned plant based food, you know, I was really struck a month or so ago. I heard a talk by the founder of Bowery Farms, you know, who was saying he thinks in twenty years, we will look back on how we grow meat today and will be horrified that we are doing it this way because it's all gonna be grown in the lab.

So I think that's incredibly exciting. I think the electrification of the economy is incredibly exciting. I think it's moving really quickly. You know, I think we're getting off fossil fuels. I think that's really exciting.

And I think this idea of thinking about what does it mean to be a company and to have employees, you know, and and how people work. I think there's a lot of change coming there, you know, as we were talking about earlier, you know, with companies relying more on freelancers and part timers and, you know, not having headquarters. And so how we work together and how we form groups of people to do work, I think, is really gonna be changing. You mentioned a few minutes ago, this change that took place in terms of customer acquisition. For those people that don't know how material that area changed, can you take a minute and explain to people kinda what the change has been?

Yes. Absolutely. So both Facebook and Apple changed their rules, so it became much more difficult for brands to access customer data and build look alike audiences that they could then market to. So for example, I'm a brand, and I've got a profile of a customer who's, let's say, 35 years old, you know, married with kids, and lives within x miles of a major metropolitan area and has an income range of around 75 k, let's say. So it used to be possible to build an audience to market to with those attributes.

But, of course, we're all concerned about privacy and rightly so. We don't necessarily want our data being used so that brands can market to us. And so both Facebook and Apple tightened their rules, making it more difficult for companies to access that data and not know who you were personally, but to be able to serve you and add based on those attributes. And so the result was, of course, it became more expensive for those companies to acquire customers because they couldn't use that data that they had been previously using in order to reliably and predictably acquire customers. So the customer acquisition costs for a lot of these companies went way up.

So what happens when that happens, it becomes harder for small brands to get launched because they've gotta pay more to acquire their customers. And then they also have to look for new channels and new ways of reaching their audiences, which is one reason why the creator economy has taken off so much. Because if you've got an individual who has an audience already and who's excited to talk about your brand, that's a great way of getting in front of that same audience, you know, without having to buy ads. For a small apparel company that's trying to build market share, what are some of the creative ways that these brands are working around that challenge now? So some of the things that are really interesting is what's happened on TikTok, for example.

So TikTok has become, like I think it's like the wild west of customer acquisition now. You're seeing so much traffic, so many views, you know, built on TikTok that if a brand can get traction in the TikTok environment, that could be a huge boon for them in launching their products. So we're seeing companies kind of think about TikTok, how to use TikTok as a customer acquisition vehicle, and also just focusing more on organic sharing, on getting people who already have an audience to adopt and talk about their product, to focus on events, to focus on content marketing, on PR, and some of these nontraditional strategies that are less predictable, but may ultimately lead to acquiring customers more affordably. There's a company that we just invested in recently that's addressing this problem because we see this opportunity, which is it's called Bounty. And what Bounty does is at checkout, you've just bought something.

Bounty says, would you like to earn cash back for talking about this product on social? So I just bought this package of gum. So I obviously like it, and now I'm being offered the opportunity to post to my friends about the product that I just bought, which makes perfect sense. Why should your own customers not be promoting you online? That's exactly who should be speaking for you.

You know? And in a lot of ways, it's more effective than traditional advertising because it's more authentic. Thinking back to newsletters before podcasts, we had people like Amway who would go door to door selling products and then setting up groups of people that they could then have Tupperware product parties with and otherwise. When you talk about people having these different income streams and ability to kind of build out their careers, I'm wondering, do you see people essentially, like influencers or otherwise, being able to market to their friends and create these clubs almost in the Web three universe that didn't exist before? Yeah.

Absolutely. I'm not sure I necessarily see that as Web three, but I do see it as kind of modern marketing. And I love that you mentioned Amway. I mean, I think multilevel marketing all gets a bad rap. But the reason it gets a bad rap is because in the old multilevel marketing, there was always this concept of a buy in.

So you had to kind of pay to be part of the network. I think the new model is not that. It's sort of isn't requiring you to buy in to be part of that network. So it's kind of more advantageous to the the creators or to the consumers that are gonna be promoting the products. But I I think that's absolutely a great future.

If you think about it, it's just organic growth. It's just viral growth, you know, with a platform underneath it to make it easier. Makes sense. One of the things we like to do in terms of the puck and and where the world's going is also understand from a personal perspective, what are those causes that you're passionate about, and how do those passions influence some of your investment decisions? I'm really concerned about climate change, and I think I'm doing a lot of work there.

And I'm thinking about how do we need to change how we consume. So I talked about electrification. I talked about sustainability. So that's an area I'm really focused on is climate change, and I think about that really through a commerce lens, through how are we changing the way we consume, the way we eat, the way we dress, the way we buy products. I'm also really concerned about income inequality.

I think what's happened in this country with the growing difference between the top and the bottom, it isn't healthy. And given all the technological advances and the fact that we have the ability to live longer, we have the capabilities of feeding and housing everyone, we shouldn't have such a big disparity between the top and the bottom. So from an investment perspective, I'm very interested in microlending, in new income models, whether it's gig economy or freelancers. So both new solutions for generating more income for people and also creating a social safety net, which isn't necessarily an investing philosophy. It's just something I'm I'm personally thinking a lot about and concerned about.

When we think about sort of the LA tech community, I think, you know, we have a responsibility here to serve the whole community and lift up the whole community. So one of the things I'm most involved with here in LA is called Pledge LA. I'm a founding advisory board member of Pledge LA, and it's our initiative as a tech community to foster diversity, equity, inclusion in the tech world. And we've had some great initiatives through that program, including a program that brings underrepresented investors in for summer internships and venture capital funds. And we've actually seen that those people have gone on to have full time jobs and not only here in LA, but around the country in venture.

And I think we've actually really moved the needle in terms of diversity. We've made a measurable impact in terms of improving the diversity of the investment community, which then also fosters more diversity among the invested founders. The other exciting thing we've done with Pledge LA is built a founders fund that invests in founders from traditionally underrepresented backgrounds You talk about You talk about this income inequality and and the concern, and it sounds like you're doing some wonderful things to try to address it. When you think about what's going on with REI and Starbucks and Amazon and kind of these discussions about unionization, for instance, and the ratio of CEO pay kinda down to worker pay. Do you see the leaders in technology discussing these issues and having a concern?

Is there gonna be some top down change as well? You know, Jim, I hope so. I sometimes worry that we have a structural problem in our economy. People talk about this with respect to politics that the system is broken because it's controlled by the donors and that once you enter congress, you know, you're really captive to your donor base, and it makes it hard for you to go in and kind of do the right thing for your constituents and for the country and really think long term. I think the equivalent in the economy when you think about it is public companies answer to their shareholders.

Right? And so the shareholders really, you know, at base, what they're looking for is they're looking for a return. They're looking for quarterly revenues to just keep going up. So that makes it really difficult from the c suite for those people to make these tougher decisions to do things like raise wages, which is obviously gonna hit profits. So I sometimes worry that we have a structural challenge to improving our society overall by the way that our, you know, economy is set up to focus so much on quarterly returns as opposed to long term health of these businesses and health of our communities.

So I don't know if that answers the question, but, you know and I certainly don't have a an answer to how to fix that structure, but I do see that dynamic playing out. Right. It'll be interesting. I mean, I've been reading a fair amount about the twenties and the gilded age and some of the changes that took place because things got out of balance, and there were some, you know, real structural changes that took place. I wonder if some of the Gen z and employee changes that you're seeing, I wonder if there is gonna be some pushback on the shareholder short term profits because employees now are really demanding more of that life work balance and equity, and that that may ultimately change the system a little.

Do you see any possibility of that happening? Yeah. I mean, I think the poll has to come from the shareholders, and it has to come from the employees. And I think companies are hearing loud and clear that employees are looking for something different. I mean, look at how difficult it is for some of these service industries to hire entry level workers right now.

Right. So something's gotta give. That makes sense. And I heard, you know, just recently some crazy statistics about, like, 70,000,000 boomers are retiring in the next, like, five years. And so when we look at these changes to supply that, you know, people are retiring and they've got money and they wanna go out to eat.

There's increased demand for people to serve in these restaurants, and yet, they want more money, and there's fewer of them relative to the people eating. It's gonna be interesting to see if wages also have upward pressure just because of supply and demand. Absolutely. And I mean, I'd have to believe that that's not a perfect feedback loop, but that eventually that feedback loop is gonna work to foster that. You know, there's some interesting businesses kind of addressing this.

Right? So retail employees counter people that are, you know, redoing retail sales. They have an issue because they're not participating really in the upside of what they sell. So they may sell a lot in one day and, you know, they still don't get paid anymore. Over half of people that work in these retail sales jobs are below the poverty line, you know, which is unbelievable.

So there's a company we've been chatting with that is helping brands connect with those retail salespeople so they can participate. So if I sell a certain product, I'm gonna get a bonus, not from the retailer, but from the brand. That's an example of how technology can help with some of this income inequality is by you know, so imagine that in a restaurant scenario. Well, I mean, I guess it's a little bit harder in a restaurant scenario because who would the suppliers be? If I'm understanding what you're saying, if I order a vodka martini and the waiter says to you, well, you need to try our new x y z vodka, and you buy that vodka and boom, that vodka has a different margin or as a royalty program or something right where where they kick back a certain amount of money.

I could see that happening. That's right. That's exactly the example. So it'd be Grey Goose. Right.

Runs a program with the waiters or the bartender. Alright? And if you sell that product, you're gonna get compensated. So it can create all kinds of perverse incentives. So you have to sort of think that all the way through.

But what I like about it is this idea of directly incentivizing the people that are on the front lines or doing the selling. In the past, I've seen that in the old days going back to, like, the Amway example. There was a place called Cal Stereo, and again, they would have their home stereo speakers that they manufactured. It'd be a thousand dollar speaker, but on sale for $500 because their margins were completely crazy because it was their own speaker. I think it's always existed to a certain extent, but it sounds like what you're saying is that these brands are getting more sophisticated in the way they're working with the salespeople to push their products.

Absolutely. And there's a real time feedback loop. So you could log in at the end of the day, and you could see what did you sell that day and what was your incremental income as a result. Whereas, I think some of these older programs, you know, just took a long time to get the feedback. Very, very interesting.

So, you know, when you look at all these trends together, I think what we're seeing is the disintermediation, like, of retail in a way. Right? And putting the power in hands of individual creators, individual salespeople to get compensated for what they're promoting, for what they're selling, you know, and generate additional income. What we're seeing is, like, decentralization of kind of sales and marketing broadly, which also fits in with kind of web three, the whole theme of web three being decentralization. Sure.

If you wanna be an optimist, we could say decentralization is gonna put the hands more in the power of individuals and the consumer and ultimately, you know, should result in people on an individual basis doing better from an economic perspective. So that's the dream. In terms of the companies that you're investing in or that you have invested in in this new pandemic time period, are you seeing people starting to go back to the office in some material percentage, or do you think that this new way of working is really gonna take hold and and continue to expand? Yeah. We think it's hybrid slash hybrid remote all the way.

Right? And, of course, that only really applies to knowledge workers, to office workers, you know, not to people who are on-site delivering services. So health care, retail, hospitality, etcetera, obviously. But knowledge workers, we think remote or hybrid is here to stay. It's interesting.

And, actually, we recently invested in a company called We Care, which is a network of in home child care providers that is sold as a corporate benefit. And what's exciting about this company is that they operate this network of in home day cares that are located near where people live. So if you are a worker who's going in two days a week and staying at home three days a week, you don't need childcare near your office downtown, which is the old model, because you're not going to your office every day. So you need it out where you are. So there's new business models being built around this idea of workers being at home sometimes and being in the office sometimes.

As you're talking about the knowledge workers, I'm wondering if one of the reasons that the hybrid model is gonna be so attractive is that, if I want the very best worker for my company and that person wants to live in Hawaii, but I'm limiting myself otherwise to, let's say, somebody lives in Los Angeles, because I want them to come into the office two or three days a week. I mean, I can see a real board sitting around and saying, look, there may be a advantage of having them come in two or three days a week, But even if we have a retreat once or twice a year and we do things online, we want the best and the brightest. And if we can find them anywhere on the planet, we should continue to do that. I think that is the dream. Everyone feels they're gonna be able to get the best talent and let them live anywhere.

We just have a portfolio company that hired a director of operations who is in Colombia. And this is an operations person. It's not a coder. It's someone who's helping lead operations, and they're located in Colombia. So the challenge with that is, like you said, you've gotta be bringing people together.

We do it, and I'm 13, we do it every quarter. We have people in LA. We have people in New York. We have people in Miami. We come together as a company every quarter.

It's hard. It's a pain. We have to fly, but you have to do that because otherwise you can't create that culture. And so I think these companies that are so excited to be able to hire all over the world and have more choice and be able to get the exact right person, they need to also understand that in order to execute that well, you need to work at it. You need to have face to face time.

You need to bring people together because what we see otherwise is you hire new people in this environment, and they never really get onboarded. They never really feel like they're part of the culture. And that requires being face to face and it requires being really intentional about how you do meetings, how you build trust, how you communicate. You know, it's not easy, but I do think it's here to stay. I mean, Airbnb just told their employees they could all stay remote forever.

Yeah. It's gonna be fascinating. And when you look at the level of loneliness and the socialization skills we all learned having to play well with others, it's gonna be interesting to see how that plays out when 90% of it is online. Although, I think with some of the entrepreneurs that you're working with, there's gonna be more and more creative ways to integrate people into companies and whether or not it's games or virtual happy hours. I think we're gonna see a lot of creativity.

A 100%. And I mean, look, I think a lot of this stuff people think it sounds hokey. You know, what are we gonna do? Online karaoke or whatever? But you kind of have to embrace it.

You've gotta do those things and really make time for it. Even though it feels like not important, it's so, so, so important. You know? And you referred to mental health, and I I just wanted to pick up on that thread a little bit because I I also think in addition to just all the other, you know, upheaval we've gone through the past couple years, we really are in a mental health crisis, especially when you look at what's happening to our young people. You know, as a society and a work world, we really have to keep an eye on that because the downside of this new remote flexible working world is isolation.

There's a lot for people to be afraid of. There's war. There's climate change. There's global pandemic, you know, and I think for our young people in particular, it's created some real mental health challenges that we all need to take very seriously. Yeah.

That's a personal peeve of mine in that. From my perspective, technology is neutral using nuclear energy. You know, know, you can use nuclear energy to light a city, or you can use it to blow something up. I think that iPhones and social media, and this twenty four hour access to social media, psychologically has had so many negative ramifications on people because they're being constantly compared to their friends. They're being shown what everybody else in the world has, and it creates a different level of discontent.

And I think we as a society have to get better at understanding the downsides of these things, and learning to kinda create our own boundaries and ability to just say no, so to speak, as thought leaders. And otherwise, I think we do have an obligation to kind of feel people's pain and understand that these are real challenges that people are dealing with, and we've gotta help them. Any thoughts in terms of how we might do that? That's a great question. I think social media is largely inauthentic.

When you're sitting doomscrolling on Instagram or TikTok, you're comparing your insides to someone else's outsides, and it's very, very hard for people to keep that in mind. So what's the solution? There are companies that are trying to solve it through technology, which is ironic. Right? So how do you solve the problem of technology with more technology?

But there are, you know, intentional social spaces designed to promote mental health. But, honestly, I think the best thing we can do is talk about it, is bring the conversation to the surface, and then I'll take a hard look at how we're using our screens and our social media and lift our heads up and pay attention to the people around us. Kind of like the economic inequality challenge, I don't see a quick fix here, but I just know that we need to elevate this in terms of importance, you know, as one of the things that we focus on as a society, you know, and as humans. Absolutely. I just wanna say that, fundamentally, I'm hopeful about the future.

I think to be an investor, you have to be an optimist. Right? And while we do see a lot of challenges, I'm incredibly excited about the potential for technology to be part of the solution, the potential for entrepreneurs to tackle some of these really difficult problems that we talked about today and make our lives better. And so I remain, at the end of the day, you know, really optimistic about where we're headed. I know it's a wonderful way to end in.

And I would agree with you, it's amazing that each generation has to look and, you know, they're in the middle of a storm and it sometimes feels overwhelming. But if you look back at history, you realize that we do go through these ups and downs, and we do solve what appear at the time insolvable problems. But it does seem like things are happening more quickly, and so from a process perspective, it can feel overwhelming, and we have to remind ourselves that the sun is coming up tomorrow, and we do have this amazingly bright Gen z coming up. They are pushing us. They're testing us.

And I share your optimism that there's a lot of greatness in the future. You know, some of those Gen Z are my kids, Jim. That's what keeps me smiling and keeps me excited about the future. Mine as well. And the only thing I will tell you is standing on my shoulders, they're much brighter and much more well rounded, and they call us out on these challenges.

They see the hypocrisy in the world. They don't take for granted that they're gonna live as well as the generation before them and they see these problems. It's challenging, but it's also exciting. That's right. They are my teachers.

That is for sure. Yeah. Keeps me humble. Keeps me humble as well. Anna, this has been wonderful.

And so thank you very, very much, and enjoy the rest of your day. Thanks a lot, Jim. Great to talk with you. The Puck Venture Capital Beyond is produced by CMEG Advisors. If you enjoyed the conversation and haven't subscribed yet to the show, you can find us on iTunes, Apple Podcasts, and SoundCloud.

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