BAM Ventures

🚨 A managing director at BAM Ventures, Shamin Walsh has backed buzzy brands including sweetgreen and Flexport over her career spanning nearly two decades. She joins us for 2024’s last edition of VC Wednesdays.🚨 ✒️ How would you describe your investment thesis? We try to invest in companies where our $500,000 check could potentially yield a venture return, even if the company exits for $300 million. That's typically what an average successful outcome looks like — a sub-$10 million post-money valuation. People often shit on consumer (investing) because they look at exit valuations, but ignore entry valuations. An example is PrettyLitter, which we got into at a $4 million valuation, which then became profitable and didn’t need to raise again, and we exited for over $500 million. Any investor would be happy with that return. ✒️What’s the #1 thing you look for in early-stage consumer investments? Founders who understand their demo, the way they think and how they spend their time and money. Many products fail because they don't align with real behavior. For example, if you’re making a granola bar for kids, parents care about sugar content, not calories. Products don’t sell themselves. Founders who understand how people think, integrate products into daily habits and know how to get people over that decision hump are what I look for. ✒️ With consumer startup funding slumping, what are you looking out for? We’re founder-driven, so it's about who can cut through the noise. Merit Beauty's Katherine Power is the perfect example. She knew how to communicate an offering in a sea of choices — five-minute beauty for non-contour masters who want to look put together quickly — which has resonated. We also look for founders with alternative distribution advantages. For example, Merit had SEPHORA distribution locked in, and Bird&Be is distributing through clinical practitioners, avoiding the paid marketing trap. We also love overlooked super-fan communities. MX Locker thrives in the dirt bike community, where it's a lifestyle, not a hobby. ✒️ What’s a consumer trend that has lost its sizzle? And one that’s untapped? The non-alcoholic beverage space. The trend of drinking less is enduring, but there are hundreds of brands now, and we don’t need that many. One that I’m eyeing are the downstream effects of Ozempic. It makes you constipated, so maybe there’s potential in fiber products. There might also be changes in dining and fitness habits. It's interesting to see how it'll impact people in the long run. ✒️  What’s a pitch that sticks out in your memory, and why?  Nicholas R. Green of Thrive Market. People thought Amazon or Whole Foods Market Foods could do the same thing. But he articulated that Thrive offers curated products for specific diets at better prices and understood that people don’t shop by searching for every specific product — they want the heavy-lifting done for them. #VCWednesdays #vc #venturecapital #startups #TechonLinkedIn