By Natalie Dillon & Simran Suri
This is the second of a 2-part series focused on Maveron’s point-of-view on consumer investing. You can read the first post here.
At Maveron, we see evidence of a few major societal shifts that define what we are calling “the Age of Personalization” today, ranging from health and knowledge to productivity and power redistribution. Note that while we’ve identified these four shifts today, we also believe that we’re in the early innings of the Age of Personalization, so others should emerge over time. These changes are not just advancements in technology or behavior, but structural changes in the ways consumers think, learn, spend and live. As early-stage consumer investors, we believe there will be countless value creation opportunities that stem from these major shifts. We’re excited to share our preliminary thoughts on some of these opportunities below.
Investing in the Age of Personalization
Obesity is a sensitive topic. It’s perhaps one of the most stigmatizing forces in our society. Framing it as the metabolic health crisis that it is allows for a more nuanced discussion about all the factors that contribute, ranging from an individual’s wealth and zip code to their culture. Doing nothing is no longer an option — obesity is the second leading cause of preventable death in the country.
GLP-1s provide a real path to a solution, even though they don’t work for everyone. For those who do qualify, it’s an opportunity to kickstart a profound transformation. Weight loss is no longer an exclusive club that only a select few gain (and retain) access to. This has already begun to impact our collective psyche around body image, with discourse ranging from negative (it may cause us to focus too much on weight versus health) to positive (it’s life-changing and revolutionary!). While social narratives around obesity continue to shift under the influence of GLP-1s, the drug class’s positive health impacts on conditions ranging from heart health to Alzheimer’s are undeniable. Given how closely interrelated obesity is with other leading causes of morbidity and malaise, the stories of GLP-1s resolving cardiovascular, fertility and even addiction issues abound. Although many of these data points are still anecdotal, there are clinical trials in progress that (we hope) will be validating.
We believe the areas of GLP-1-driven value creation will be even more far-reaching than healthcare. How might consumer purchasing patterns and preferences impact industries ranging from apparel and food to dating and live events with widespread weight loss? The second- and third-order impacts of GLP-1s could present a wave of compelling investable opportunities over the coming years.
Information is the most valuable currency and AI increases access to it in unthinkable ways. While this begs plenty of questions around internet safety, data privacy and intellectual property, it also increases our pace of innovation exponentially by enabling new forms of education, as well as personalized application of those learnings and insights.
For consumers, this can be productive. You can get quick answers, explanations, analysis, data points for almost any question or topic out there, from financial models to coding projects to home renovations. This can also be cultural. Rather than following trends, anyone can set them with numerous ways to visualize ideas, create content and share information that are now easily accessible to all. And they are being used by all — the majority of OpenAI’s revenue comes from consumer subscriptions to ChatGPT, not enterprises.
We believe there will be many great investments in niches that leverage the mega LLMs built by technology incumbents like Google and Apple. It remains to be seen where additional value creation opportunities will arise, but we have no doubt that there will be plenty. As we continue to track consumer preferences, spending and behaviors around AI, we also plan to keep a close eye on the various business models employed. It’s unclear if any companies in market today have unlocked defensible business models, but we believe the world-defining, generational consumer AI companies will have deep brand loyalty and value propositions focused on personalization, in addition to clear economic moats.
There are multiple shifts converging to create new forms of labor. We’ve seen the rise of gig workers, lending new types of flexibility to both the corporate, entrepreneurial and blue collar worlds. We’ve seen the rise of business-in-a-box solutions, enabling members of our society to build careers from the comfort of their own homes by leveraging a wide variety of crafts, from making jewelry and selling it on Etsy to designing deck templates on Canva. We’ve also seen the rise of AI reinforcing both of these trends.
Productivity and capitalism go hand-in-hand — it’s a tale as old as time, and one frequently associated with exploitation and the devaluing of oneself. But with technology’s influence, we’re on the brink of a new relationship between productivity and capitalism. Workers are increasingly gaining ownership over productivity and, in turn, their livelihoods and net worths. They’re able to dictate how they work, when they work and what they earn on their own terms. This isn’t exclusive to white collar workers either. AI’s role in industries like construction, transportation, manufacturing and home services is creating safer jobs, increasing take-home pay and improving overall efficiency.
At Maveron, we see this shift is in scope for us because workers are no longer necessarily seen as cogs in a wheel or parts of a larger corporation. We believe the future of labor defines workers as consumers, with individual needs, preferences and goals. We’re seeing firsthand that labor can be personalized. Vertical software may have previously been exclusive to enterprise-focused investors, but we believe that it’s a core part of the next generation of consumer investing.
Just as productivity is moving back into the hands of the people, so is power. As technology has democratized access to information, wealth, jobs, culture, media and more, it has simultaneously shifted the axis of power. What was once centralized in the government, large corporations and financial institutions is now decentralized. Driven by increasing polarization and distrust of institutions, power is shifting back to the people.
This has certainly not been without growing pains — Covid, last year’s SVB crisis and the upcoming presidential election are a few salient examples of disrupted legacy institutions and stakeholders. But we believe that increasing polarization and distrust of institutions gives consumers an opportunity to shape their own futures with their own preferences, desires, goals and dreams. There are opportunities to set precedent, to shape narratives and to meet tomorrow’s generation of consumers where they want to be. This could take the form of new brands, products, social norms or customs or even cultural events.
What’s Next from Maveron
While we’re still in the early innings of some of these shifts, we are already seeing meaningful spend being directed towards these areas and consumers making conscious life decisions with these shifts in mind. It’s clear that the Age of Personalization is here to stay. We’re excited to find new companies and teams to back as we enter this new generation of consumer investing. We’re also committed to sharing our thinking as these markets continue to evolve over the coming years. Stay tuned for more work from the Maveron team, including research, investment theses, blog posts, events and more as we do our homework. If you’re thinking about investing or building in the Age of Personalization, we’d love to hear from you!
