Steven Himmel of Vanterra Capital discusses how the pandemic reinforced their investment thesis in mission-driven consumer companies. He emphasizes the growing importance of ESG principles ("ESY Investing" - Environment, Society, You) as consumers prioritize health, wellness, and sustainability. Ecommerce operators should understand that financial resilience and strong cash flow are paramount, even for high-growth direct-to-consumer brands, as investors are increasingly scrutinizing profitability alongside growth.
Key takeaways
Investors are doubling down on mission-driven brands. Brands with strong ESG (Environmental, Social, Governance) frameworks will attract more capital as consumer awareness shifts post-pandemic. Identify how your brand contributes positively to the 'Environment, Society, and You' to align with investor and consumer values.
Prioritize cash flow and financial resilience. Even in growth-focused sectors like DTC, “cash is king.” Ensure your business model supports sustainable profitability alongside growth to be attractive to investors and resilient against market shifts.
Align your brand with evolving consumer values. Post-pandemic consumers are increasingly focused on holistic wellness, sustainability, and ethical consumption. Brands that authentically integrate these values into their products and messaging will gain a competitive advantage.
Understand the balance between growth and profitability. While growth is crucial, demonstrate a clear path to profitability and strong unit economics. Investors are looking for businesses that can achieve both, not just top-line revenue growth.
Showcase your brand purpose beyond profit. Clearly articulate your brand’s mission and how it resonates with societal and environmental well-being. This creates stronger brand loyalty and attracts impact-focused investors.
Vanterra Capital was better positioned than many businesses going into 2020.
“The pandemic just pushed us to double down on our thesis,” said Steven Himmel, partner at Vanterra Capital, on the latest Glossy Podcast. “Everything that we were focused on before is even more relevant today.”
With its venture-specific fund, launched about two-and-a-half years ago, Vanterra invests in mission-driven consumer companies, which on the fashion side include Naadam. “A big focus for us is what we call the ESY [Investing]: [companies that are] better for the environment, better for society and better for you,” he said.
And those businesses are set to especially resonate in the post-pandemic world: “As the media cycle scales down the Covid conversation, we believe it's going to scale up the conversations around better-for-the-environment initiatives... It will [create] more of a 360[-degree] awareness around: How are you living? That’s in terms of: What are you eating? How are you treating your body? How are you treating your mind?”
Himmel broke down how that shift will impact Vanterra's future investments in fashion and beauty brands.
What does this episode say about finance & fundraising?
Investors are doubling down on mission-driven brands. Brands with strong ESG (Environmental, Social, Governance) frameworks will attract more capital as consumer awareness shifts post-pandemic. Identify how your brand contributes positively to the 'Environment, Society, and You' to align with investor and consumer values.
What does this episode say about founder & leadership?
Prioritize cash flow and financial resilience. Even in growth-focused sectors like DTC, “cash is king.” Ensure your business model supports sustainable profitability alongside growth to be attractive to investors and resilient against market shifts.
What does this episode say about brand & content?
Align your brand with evolving consumer values. Post-pandemic consumers are increasingly focused on holistic wellness, sustainability, and ethical consumption. Brands that authentically integrate these values into their products and messaging will gain a competitive advantage.
What does this episode say about dtc strategy?
Understand the balance between growth and profitability. While growth is crucial, demonstrate a clear path to profitability and strong unit economics. Investors are looking for businesses that can achieve both, not just top-line revenue growth.
What does this episode say about finance & fundraising?
Showcase your brand purpose beyond profit. Clearly articulate your brand’s mission and how it resonates with societal and environmental well-being. This creates stronger brand loyalty and attracts impact-focused investors.
