Consumers have lost a lot of friends over the past few years, at least in venture. Once coveted by VCs, consumer internet companies have hit major hurdles. Privacy changes like Apple’s iOS 14 updates further drove up acquisition costs, which were already rising in crowded categories. With mobile apps saturated and no new platform in sight, many investors shifted to the stability of enterprise contracts. The pandemic triggered rapid lifestyle changes, and rising interest rates pulled back risk capital available for new players. Even existing companies felt stuck, unable to exit amid a closed IPO market and tougher M&A environment. In short, VCs had a million excuses to avoid consumer tech.

Amid this upheaval, however, a crucial shift occurred: consumers transformed from buyers into economic engines. Beyond gig economy roles like driving for Uber or shopping for Instacart, consumers created content, launched side hustles, and started to own the value they generated. This shift made a strong case for consumer tools: frictionless products with a clear ROI, monetary or otherwise. Pokémon card collectors on Whatnot don’t just buy and sell, they can build their own following. Creators on Instagram and TikTok can now capture the value they create by opening a Stan store, a business-in-a-box for creators to engage and monetize their communities. Stan uses a consumer-grade experience to meet users where they are on their journey; in doing so, they empower consumers to grow as business owners and own their economic destiny.

Further, this shift reflected a broader trend of consumers prioritizing their own time. Consumer apps once obsessed over “share of wallet” and “mindshare.” They relentlessly measured session duration, DAU/MAU ratios, and found ways to make their offering as addictive as possible. But consumers are sick of giving their time away to extractive platforms that ultimately undermine their health, wealth, and happiness. This change comes at a paradoxical moment for US consumers:

• Consumers have better health data, but a broken system: Thanks to consumer education and wearables, consumers have more data than ever about their health, and yet society faces a massive health crisis – paired with a complicated system that leaves consumers disillusioned and at a loss. Consumers want to control their physical and mental health journeys and support their loved ones. Solutions in this space can take a lot of forms, including health navigation tools (e.g., Solace Health), providers (e.g., FirstMark-backed Parsley Health and Ro), or mental health apps (e.g., Finch). Ultimately, the players who do this well will see high levels of engagement and, increasingly, payor interest.
• Individuals are empowered, but under pressure: Increasingly, consumers seek self-reliance amid an unstable world. At the same time, many feel overextended – desperate for tools supporting individual economic gain and resilience. Tools that have a clear ROI and organic adoption can grow like wildfire, whether for consumers directly or in the workplace. For example, MagicSchool gives teachers AI tools to cut down time spent on lesson plans, test materials, and student feedback. Another FirstMark portfolio company, HopSkipDrive, gives parents time back and peace of mind in a way that Uber could never achieve, even with a similar service. Both MagicSchool and HopSkipDrive are focused on the end user, but in doing so they create enough value for school systems to drive large enterprise sales.
• Consumers are connected, but lonely and anxious: Consumers crave experiences, connection, and opportunities for self-expression. However, many existing platforms leave them feeling overstimulated and (counterintuitively) disconnected. One of FirstMark’s most recent investments is in POSH, a social media platform dedicated to in-person connection – reducing the friction for event organizers and attendees alike. Platforms like POSH structure often-chaotic social dynamics and pair it with network effect dynamics that compound consumer value over time.

Consumers want tools that help them to do more, faster, and better. Technologies like NLP and Generative AI empower users to reclaim time by streamlining everyday tasks, offering personalized curation, and fueling creativity, productivity, and community.

There is a common narrative that consumers are fickle – hard to reach, harder to retain. And to some extent, it’s true. Trends are fleeting, and consumers tend to resist platform lock-in. At their core, though, consumers are solving for relatively consistent goals: convenience, connection, and empowerment. Whether navigating their personal lives, managing households, or running small businesses, consumers gravitate to platforms that meet the moment. The best consumer companies understand this reality, moving aggressively to employ new technologies to address pressing societal needs, often creating entirely new markets in the process.

What Brought Me Here

This shift in consumer empowerment resonates with my own career, which has always centered on helping individuals maximize their potential – from customer loyalty in consulting to fintech at NerdWallet and now as an investor in consumer-centric companies. I want to back the infrastructure and applications helping consumers do more with less.

My first venture investment was in Wyze, a smart home company that started out with low-cost security cameras. From the outset, Wyze CEO Yun Zhang talked about making friends with users. Everything the company did was oriented around how to create peace of mind for users – from the pricing (as low as possible!) to user experience and data transparency. Many venture investors dismissed the business as a low-cost hardware provider. They underestimated how the hardware install base would serve as the foundation not only of a huge, sticky subscription revenue business but also of a trove of video data that enables AI-driven insights for users, all while maintaining strong privacy protections.

In many of my software investments, I focus on supporting founders through rapid go-to-market growth. At NerdWallet, I saw first-hand the opportunities and challenges associated with serving consumers at scale. One key challenge was to balance personalization with the broad applicability of financial advice needed. Instead of writing longer articles (not consumer-first), we built calculators and quizzes that provided personalized answers to life’s biggest financial questions. NerdWallet’s consumer-first culture has been a valuable orientation that I look for in founders, who must balance pressures from employees, investors, and other stakeholders. This mindset benefits B2B and B2C companies alike, particularly with the expansion of bottoms-up growth strategies within enterprise environments.

Joining FirstMark

At FirstMark, we are committed to partnering with consumer founders early and growing with them through market cycles. New York is a powerful place to build a consumer-focused business – there is an independence, dynamism, and hustle inherent in the city that reflects the energy I’m feeling from consumers more broadly.

Before I joined the firm, I met the founders of Pickle, Brian McMahon and Julia O’Mara, through FirstMark’s Derek Chu. Brian shared that in the earliest days of the company, he and Julia did many rental deliveries themselves. In fact, they did so many that they became experts on which exact subway car would minimize their time out of the station upon reaching their destination. All I could think was: “There’s that New York hustle!” No other city would allow them to hand-deliver to so many customers in such a short amount of time. As a result, they could learn quickly and grow even faster. Founders building here can harness this urgency to create powerful consumer experiences.

FirstMark has been a staple of the New York venture ecosystem for more than 15 years, backing legendary consumer companies such as Pinterest, Airbnb, Shopify, Upwork, DraftKings, Discord, and Ro. While many firms hesitate to back consumer companies, we’re open for business. We are deploying $1.1B behind the ambitious founders ready to make their mark on the world. If you are a consumer founder, not only do we welcome you in, we are excited to help you compound value for your users over time. Feel free to reach out anytime at [email protected].