Kofi Ampadu: Sku'd Ventures

In this episode, Kofi Ampadu of Sku'd Ventures joins Joel Palathinkal to discuss his journey from Kraft Foods to entrepreneurship and venture capital. Kofi shares his decision to raise a fund for pre-seed CPG companies and highlights the importance of networking in VC. He reflects on his experiences at General Mills and launching a beverage company, covering market entry strategies and distributor partnerships. The conversation also touches on marketing for DTC companies, QR code impact, and beverage industry trends. Kofi discusses CPG investments, health and wellness innovations, and the merging of hardware and software in consumer goods, concluding with insights on fitness tracking devices.

Episode Transcript

(00:00):
And then in CPG or physical products companiesyou need a lot of margin play because marketing

(00:08):
is what's going to drive people to buy it andyou need room to be able to market.
So if you don't have that margin plate, itbecomes like really difficult.
So one of the things that I think it's made mea better CPG investor because I know all the
pain points, because a lot of times I talk tofounders who don't have great margins and they
say the classic business school line, which iswe're going to hit economies of scale and

(00:32):
that's never really true.
Welcome to The Investor, a podcast where I JoelPalafinkel, your host, dives deep into the
minds of the world's most influentialinstitutional investors.
In each episode, we sit down with an investorto hear about their journeys and how global

(00:52):
markets are driving capital allocation.
So join us on this journey as we explore theseinsights.
So we should be live in a second here.
All right, so I think we're live.
So welcome again to the show Kofi.

(01:15):
So excited to have you on to everyone on theshow.
Excited to have a really awesome guest.
Kofi is a new friend of mine.
We spoke a couple of weeks ago, really love hisbackground and his ecosystem.
And I'm excited to learn a little more aboutyou, Kofi, your journey and your career and how
you pivoted into venture capital.
Just for your background, the people in thiscall, some of them are potential emerging

(01:38):
managers.
A lot of them are looking to break into VC.
So I think we can just myself and everybodyelse can just learn a lot from you and your
background.
And I know you work closely with a lot ofstartups.
So that is really, really important to be awareof too, kind of just the mental models and just
ways that we can support founders and then justboth sides of the table, I think you have a lot

(02:01):
of perspective.
So why don't we kick this off?
Maybe we can start with you sharing a littlebit about your background and how you broke
into VC.
What did you study and what were your thoughtprocesses as you made those pivots?
So why don't we start with that and then we'llkind of take it as we go?
Yeah, for sure.
I'm sure you've heard this before, but I had anunconventional into right.
I think every VC says that.

(02:25):
So for me, my journey took took some turns.
Originally I went to school for industrialengineering and packaging science So after
undergrad, I actually was working withinindustry.
I was an ops and engineering at Kraft Foods.
I was there for about four years, kind offigured out that it's not the path for me long

(02:48):
term because I realized that the path that Iwas on, I wasn't really a decision maker.
I was an implementer, right?
Where if you know anything about the consumerproducts, space, marketers make a lot of
decisions and like everyone else just kind ofimplements.
So I decided I'm gonna leave and go back toschool.
So I went to Carnegie Mellon, got my MBA, andafter I got my MBA, actually went into strategy

(03:13):
consultant.
So I was a consultant at Accenture working withbig CPG and big retail clients.
I loved that role, it was fun being aroundfolks who I always felt like they were smarter
than me right.
It's always good to have smart people in theroom with you, right, because you're constantly
But after a couple of years, I realized thatokay, now I'm a decision maker, but I don't

(03:39):
really own anything because as a consultant,you usually implement things and you leave or
you make strategy decisions and you leave, butyou don't really own anything, right?
The parallel I like to make there is there'ssome smart consultant from BCG O'Mackenzie that
told Apple, you guys should get into the phonegame, right?

(04:00):
But they're not saying I came up with theiPhone because they don't own that, right?
Like they just made the recommendation.
So I left strategy consultant behind and justjumped 10 toes down into entrepreneurship.
I actually launched while I was at Accenture,my third year at Accenture, I actually launched
a startup.
It was a beverage company, this is what I yeah,so I worked in CPG, consulted for CPG.

(04:26):
So one of the compound like the knowledge thatI already knew and so launched a beverage
company, ran that beverage company for a coupleof years.
We had decent traction, raised some angelcapital but I quickly realized that it was a
lifestyle business and I couldn't really scaleit up.
But so I decided to kind of ramp that businessdown and I had a friend who had an idea for a

(04:50):
more traditional tech startup.
It was a marketplace for airline miles and heknew I was itching not to go back to
consulting.
He said, hey do you want to join me as a cofounder for this thing?
And I was like, yeah, sounds good.
It sounds like I don't have to actually go backto being a consultant, right?
So I joined him, we worked on the idea, we hadearly traction, we ran into a wall of trying to

(05:14):
raise, we raised angel capital, but we weretrying to raise venture capital, we raised a
little bit of pre seed capital, but it wasn'tenough money.
And when we went to so I've spoke to a ton ofVCs in New York and everything they said
actually came true which was this is a toughindustry to kind of work in and what if the

(05:37):
airlines come after you, right?
Like VCs always say, what if Google builds it?
What if the airlines come after you, right?
And for me, it actually came true, right?
So, I.
Yeah.
We got we got a couple of cease and desistfrom.
Oh, wow.
Okay.
From the big airlines.
From the big airlines, right?
So, worked with, talked to my lawyers and theysaid, you know what?

(05:58):
You may have to kind of ramp things down,right?
So after we decided to ramp things down, I didsome soul searching, which was what do I want
to do?
I knew I wanted to stay within a startupecosystem.
And I think everyone like this was about fiveyears ago, right?
Like venture is sexy.

(06:19):
I knew I've tried my hand at being a founder.
I don't have an idea that I'm super, superpassionate about.
I said, you know what?
I want to be a VC.
I didn't know how hard it was to become a VC.
I went through the circuit of like interviewingfor a bunch of different firms.
Would make it through the process until acertain point and then I would lose out to

(06:41):
someone who worked at Goldman Sachs or camefrom Stanford.
And while going through that process, I kind oftook a step back and told my set to myself,
you're an entrepreneur, you're a founder, youhave grit, can, you can build something out of
nothing.
Why are you waiting for someone to give you ashot?
Why don't you just do it?
Right.
And part of me just doing it was I was able tokind of, got married.

(07:07):
So that got me to be, I became an accreditedinvestor based on the fact that my, at that
time, my combined income with my spouse made mean accredited investor.
And I asked my, I asked my spouse, can, can Iactually start angel investing?
Right?
And she's like, yeah, if that's what you wantto do.
I started actually doing small checks, right?

(07:29):
So my first, I remember my first, my firstangel investment check was a check for $5,000
and And then gradually kind of scaled up thecheck, started building muscle memory around
the things that I was really interested in.
And for me, again, going back to the fact thatI like to compound my experiences, I said, I

(07:51):
know CPG, I've done deep research in thisspace.
I don't think a lot of investors really playwithin that landscape.
And it's something I can take advantage of.
So started Angel Investing and then last yearraised a small fund, skewed ventures with the
sole purpose of investing in pre seed CPGcompanies.

(08:15):
So as of this week, I've done 14 deals, 12 ofthem are public, two of them are in stealth.
But I'm just super blessed and happy that kindof took that roundabout journey, right, where I
think those bumps and bruises are going to makeme a better investor.

(08:36):
So really, really excited to be here to kind ofshare my story and impart any words of wisdom
on anyone listening.
You probably don't know this because I probablydidn't lead with this, but I worked at General
Mills for a short amount of time.
Where were you at Kraft?
So at Kraft, I was actually in New York.
So they had a facility in Tarrytown, New York.

(08:59):
And it's funny enough when I was at Accenture,did a project at General The coldest it was
Which office?
I was in Minneapolis.
Okay, got it.
Yeah, yeah.
It was brutally
So check this out.
So I was in Hannibal, Missouri.
Dunno I if you know where that is, but it'soutside of St.
Louis.
It's the middle of nowhere, but believe it ornot, that's the birthplace of Mark Twain.

(09:23):
So they had a big plant there and I did asummer internship there.
A lot of people might not know this, but at theend of my intern, I did an internship there and
it was the same thing.
Was like a process engineering role.
So I
was working, I think I was working on like milkand cereal bars.
I did milk and cereal bars.
There was people that would work, I think inthe taco shell areas and they would make salsa

(09:47):
and people would come home smelling like onionsand salsa.
But
it was really good because I really learned howto think through the Like I learned a lot about
the supply chain, like just seeing how aproduct turns into a commercialized object that

(10:09):
gets on the shelf, just kind of understandingthe whole life cycle.
And then I got to present my findings from theinternship in Minneapolis.
And the biggest reward was they gave me aWheaties box with my face on it.
Yeah, it's still at my parents' house.
So still at home.

(10:29):
So that was a lot of fun.
But I think it's a good career.
I just think kind of like what you're saying, Ithink I felt like I wanted to do something a
little more technical and I think that was morelike process based.
So, it is kind of like consulting, I guess,because if you work in consulting, you're
looking at trying to streamline processes,trying to provide cost savings.

(10:51):
And that was kind of the project that I did, Iwas really proud of.
Learned a lot.
I'll say in that experience too, I learnedExcel pretty well.
Like I built some of my early Excel, MicrosoftExcel skills like from that job, because we
were putting together all these spreadsheets,forecasting our results.
So that was really helpful.
But I see kind of the touch points of how thatkind of fed into your later career.

(11:19):
I mean, did that, you got some experienceworking at Kraft, then you did consulting and
now you've got a fund with that whole thesis.
So I feel like had you not gone to Kraft, youmight've had a different fund probably by now,
right?
Yeah, for sure.
And then I think what's also good is networkingwith different VCs is getting me interested in
other segments, right?
Where I don't think I'm going to stay narrowlyfocused.

(11:41):
I think eventually I'm going to kind of expandout the thesis, but it's been a great learning
experience for me.
And one of the things that I always tellfounders whenever I talk to a new founder is I
feel blessed and lucky to have this rolebecause at the end of the day, even if I don't
invest in someone's company, I'm learning aboutsomething new, right?
Like we have a front row seat to like what'sgoing to be happening in the future because

(12:04):
we're working with smart people.
Get to converse with intelligent individualswho constantly trying to imagine what the
future looks like.
Yeah.
And you've been full circle because you've beena founder as well.
So you really empathize with founders now asthey're building companies.
So I think, so what was the biggest learningsthat you took away from launching the beverage

(12:27):
company?
What were the pain points?
Was it the, because typically, when you watchShark Tank and that's probably the best example
that I see of like the physical goodsbusinesses because in Shark Tank, they have a
lot of physical product companies.
And the biggest issue they have is really beingable to buy enough inventory.
So it's a good problem because you got a lot ofdemand, but then you just don't have enough
money to buy the inventory to actually buildthose products and ship them.

(12:52):
So was that a problem?
And then, you know, what were the otherproblems?
Like did the beverage go bad or expire at acertain time?
Guess we'd love to learn a little more aboutthat.
Yeah, so we came out.
So expiration was definitely a big issue forus.
Was a new What
kind of beverage was it?
It was a cold pressed beverage.
So if you think about the name of the companywas H2 Melon, so it was different melons and

(13:18):
it's so essentially our tagline was it was likethe fruit in a drinkable format right we didn't
add anything to it we essentially kind ofjuiced the entire melon and we went through a
process called high pressure process And at thetime, this is how crazy it was when I launched,
I launched the brand with my co founder.
Yeah.
At the time, there was only one facility in theTri State area that did this processing and it

(13:45):
was in Connecticut.
So what we had to do was and imagine when weinitially first kind of soft launched the
brand, I was still a consultant, right?
And luckily as a consultant, I'm travelingMonday to Thursday and then Friday I'm at home,
right?
So while I was supposed to be at the officeworking, I would actually be at a commercial

(14:06):
kitchen in Columbia University juicing fruitwith my co founder who at the time was working
at KKR but he will take certain Fridays off,right?
So we can kind of juice together.
And then right after we finish juicing, we haveto make sure we get it to the facility right
away.

(14:26):
So we will rent a refrigerator truck fromChelsea, New York, drive down to Connecticut
and then drop it off at the facility.
And we eventually moved into a co manufacturerwho handled all of that.
But for the soft launch, had to do everythingourselves.
And one of the issues we had was we had fortyfive day shelf life, right?

(14:47):
So it was essentially a ticking time bomb whenyou gave it to grocers, right?
Because it had to move, right?
It had to, you need high velocity.
So even if it's cold, it could still go bad?
Yeah, so the thing is the recommended shelflife is forty five days, right?
I've done experiments where I drank it afterthree months and it was still fine, right?

(15:08):
Borderline, yeah, mean, definitely wouldn'tpass the FDA.
Yeah I didn't want to like put it out and thensomeone drinks it and they get sick.
I think one of the things that we so one theshelf life was a big issue and so to be able to
increase our velocities in store we would haveto do in store demos and that's not cheap

(15:31):
right.
So you always see an uptick in sales whenyou're actually doing in store demos because
the hard thing about being a consumer brand isor new food item is no one leaves their home to
go grocery shopping with your item listed ontheir list right?
Like it has to, they don't know about you, theyhave to try you to then decide that this is

(15:55):
something that's worth ending up on my shoppinglist.
And to be able to get people to do that, youhave the demo and it gets super expensive.
Our shelf life was crappy.
Our unit economics was not the best like at thetime our unit economics I think we were our net
margins were around like 20%.

(16:16):
Right.
So it was just such a tough business to be inand I think a lot of people made money off of
us but we didn't make any money.
Right.
Like we the grocers made money because they ourdistributors made money but us as the founders
it was just such a tough business to be in andthen we were going to have a hard time scaling

(16:37):
it when we actually went try to go the ventureroute to raise capital right.
Like investors the same thing I tell foundersnow right and investors were saying your
margins are not there.
You're going to need a lot more.
And in CPG or physical products companies youneed a lot of margin play because marketing is

(16:59):
what's going to drive people to buy it and youneed room to be able to market.
So if you don't have that margin plate, itbecomes like really difficult.
So one of the things that I think it's made mea better CPG investor because I know all the
pain points, because a lot of times I talk tofounders who don't have great margins and they
say the classic business school line which iswe're going to hit economies of scale and

(17:23):
that's never really true, right?
How did you come up with the, how would youthink, how did you think about melons as the
first product and was it watermelon or did youhave a couple different?
It
was watermelon and then we were moving intocantaloupe as well.
So the original idea actually was my co idea.

(17:45):
Right.
It was he was a former football player incollege and he was in pretty good shape in
college and as I mentioned he was working infinance now he was at KKR so he let himself go
a bit and when he decided he wanted to kind oftrim down he started juicing.
Yeah.
He did research around just the watermelonitself and realized okay it's a super fruit,

(18:13):
it's a super food you can really juice anentire watermelon right including the seeds and
it still tastes amazing right like you can'tjuice a whole orange because it's going to
taste a little bitter because of the wine butyou can juice an entire watermelon and it was
one of the reasons we also went with watermelonit's 98% water so we knew we were gonna get the

(18:36):
entire juice right we didn't have to add waterinto it it was one of those things where it
became a no brainer we had what we thought waslike an amazing name, amazing brand around it.
Built a decent team.
So at our heights we had a team of about eightpeople.
We had four full time and then we had fourbrand ambassadors who would help out with demos

(19:02):
and manage other people who were doing demos.
Sure.
And how did test out the product?
Did you get some feedback, I guess in thebeginning or did you just kind of use your
instincts and just kind of launch it and seewhat they said?
Did you do surveys or taste tests to see?

(19:22):
I mean, one thing is there's no, even to thisday, there isn't really a watermelon juice or
any melons.
Coconut, I feel like is super crowded, but Idon't think there actually is watermelon juice,
unless you go one of those juice smoothie spotswhere they have like the fresh mangoes and
watermelon.

(19:44):
So I think from a logistical standpoint andjust kind of all the points that you mentioned,
I think all of that makes sense.
But like, what were the customers saying, Iguess did
way we actually tested it out.
So there was actually, we had a competitor.
Oh really?
Okay, we had a competitor.
It's called watermelon water.

(20:05):
So the spelling is watermelon water with novowels in it.
Oh, got it.
The funny thing about that is we actually wegot the trademark for the name watermelon water
a bunch of Cindy and a bunch of differenttrademarks.
But they essentially got around that because
they took

(20:27):
out the vows.
I was hoping you would have been able to do acease and desist.
Yeah, no.
It takes money to go after someone right.
I know.
But the way we tested it was we actuallystarted out as far at the farmer markets.
Sure.
So what we did was we started when we starteddoing it at Columbia and Juicing we made sure

(20:52):
that we had like the right labels, regulatoryinformation and then we just showed up the
farmers markets and we were selling and thiswas at the time where you can sell a 12 ounce
bottle of cold pressed juice for $8 and no onebats an eye.
Yeah.
Right.
So we were selling this stuff for like $8 a popand no one like no one complained about it.

(21:18):
I remember the first location we got into, Iliterally showed up to for those of you in New
York, I literally showed up to Westside Market,a Westside Market location with two cases.
And I told the store manager, I said, hey, wejust, we just created a new product.

(21:39):
I think it's going do well here.
Can you just stock two cases and see how itdoes?
Yeah so gave them two cases free, obviously didsome guerilla marketing kind of hustled got
some friends to go in there to also buy some ofit to make sure high velocity and then yeah the
following week the manager said hey can youbring back some more cases this time I'm

(22:00):
actually going to pay for it.
And then I used we use that location to then goto other Westside Market locations to go to
other local grocers and say, hey, we're inWestside Markets because it gives you that
legitimacy, right if
you
go to a mom and pop kind of natural food storeand you tell them I'm in this brand name
location it gives you legitimacy and they wantto carry your product right so we did a lot of

(22:25):
groundwork and then eventually we got adistributor that was able to get us into over
300 locations in just New York.
And then nationwide we had an e commerceplatform where we were shipping product as
well.
So you have some revenue, mean, and also withwatermelon, I remember I never juiced it, but I
would just blend it and just throw some vodkain it, like over the summer, like the

(22:48):
summertime, it's like a fun summer drink.
But I like kind of the pulp, when you guys havethe juicing, that's great because it's super
lightweight.
It's kind of a refreshing drink.
So can you educate us on just how to work withdistributors?
So do you have to kind of pitch them and havethem be convinced that you're going to, like

(23:12):
your products are gonna sell?
Is that how it works?
Because you're competing for a shelf space, I'massuming, right?
So the distributors have to kind of give you achance and assume that your products are gonna
sell, but if you don't sell enough, could thedistributor just stop working with you?
Yep.
So distributors are like pitching a distributoris like pitching a VC.
Okay.
Some of them can literally tell you you're tooearly, right?

(23:33):
Meaning they want to see some traction, theywant to see some excitement and you can
approach distributors in two ways, right?
So let's say you want to get into a WholeFoods, you can't get into a Whole Foods through
a self distribution model.
Meaning Whole Foods has their own dedicateddistributors that they work with.
So when Whole Foods decides they want you inWhole Foods they can then go to a distributor

(23:57):
and say we want this brand here so thedistributor is going to work with you right
because at the very least they know hey thisperson has inroads with Whole Foods Northeast I
don't have to necessarily sell them into thatlocation, right.
And then the other side is you can go to adistributor and then pitch them on your
product, right.

(24:17):
And again the way it's similar to VC is it hasto be a product that's different than what they
have in their portfolio, right.
If we necessarily couldn't go to WatermelonWaters distributor and say hey can you
distribute H2 melon because they already haveit, they already have a similar product in
their portfolio, right.

(24:37):
So it
could be competitive, it's just very similar toVC right.
You can't invest in Lyft if you've alreadyinvested in Exactly
and so once you connect with a distributor,they have they usually have like standard terms
right so at the time when we connect when weconnected with our distributor they had

(24:59):
standard terms which was we want to make 15%off every bottle right.
And so you kind of do the math backwards whichis for the category that we were in, grocers
want to make want to double whatever you sellsell into them, right.
So if you sold them a bottle for $4 they'regoing to sell it for $8 right.

(25:19):
So you kind of do that math backwards and thenfigure out how much you're going to get from a
margin standpoint, right.
You can obviously negotiate with them, right.
But the tough thing with also working with thedistributor is sometimes a lot of the cost is
still on you, right.
Because when you go to a grocery store and yousee that there's a two for one promotion,

(25:43):
right?
Like the grocery store is not eating that cost.
It's coming from the manufacturer, right?
Oh, interesting.
I thought that ate into the grocers because youhave a cost, right?
Like the landed cost, but then the grocer haslike a retail cost.
Yeah, the grocer has a retail cost, but theyurge you to do promos.

(26:07):
They urge you to do promos.
Yeah, they'll urge you to do promos oroftentimes you want to.
Like a volume discount.
Yeah oftentimes you want to do a promo right.
So a lot of times like people so it's actuallyfunny where when you get into retail it's
expensive to stay into retail and stay inretail right because sometimes they'll slot in
fees right because you have to pay for the realestate that you're in right.

(26:30):
I tell CPG companies like Walmart, Target,Whole Foods they're not building new shelves
and new aisles, right?
Like they have to remove someone from theaisle.
They have to remove someone from the shelf.
So like how can you convince them that you'regoing to do better turns, right?
Because all a grocer cares about, right?

(26:51):
Like yeah, Whole Foods has like the wholeorganic and kind of natural food mandate.
But at the end of the day, if we really look atthe bottom line, Whole Foods cares about what
product is going to get the most turns, right?
Because if you have a product that literallyhas like high velocity, they make way more

(27:14):
money than if you have a product that like, andthen you have a product that cures cancer and
is going to sit on shelf for three months, theymake no money from it, right?
Regardless of how net positive that product is.
Sure.
No, that makes sense.
I mean, there's, yeah, makes me realize howmany different layers that you gotta handle

(27:35):
when it comes to the different players, right?
Because that all just eats into your margin.
Exactly.
And
then there's the cost to create it.
So what happened to the competitor?
Are they still in the market?
Because I've never seen them.
Yeah they're still in the market.
I honestly assume the market I don't thinkthey're doing as well.
They were there was a time where they weredoing really really well they had like they had

(28:00):
celebrity investors right like I'm not sure Ithink a private equity firm may have bought
them.
Sure.
I'm actually not not sure but yeah theydefinitely ate our lunch though I can tell you
that.
Yeah And was the biggest issue just kind oflooking at the bottom line is that kind of,

(28:20):
because I mean, you had sales, you were gettinginto the stores, sounds like you had revenue.
Obviously, you had more capital, you can reallydo a lot of crazy Facebook, TikTok campaigns
and all that.
But was it more just the unit economics notmaking sense?
I think unit economics didn't make sense.
And like full transparency, I think we suckedthat market in, right?

(28:42):
Like, I was not and I'm not a marketer.
And I often tell CPG companies this, softwareengineers, what software engineers are to tech
companies, great marketers are CPG and DTCbrand, right?
Is you need someone who can think outside thebox of how can we build enough around this?

(29:06):
How can we build enough excitement around thisthing that people want to buy it?
Right.
And we just were not able to do that.
Like the product was good.
As I mentioned, there was always an uptick whenpeople tried it, right.
It's expensive if you're trading demos forsales, it's just an expensive equation to be a

(29:28):
part of.
Yeah.
So the DTC companies that you're looking atnow, what is the marketing stack that they're
using?
What do you think converts better?
I mean, it's probably different for differentproducts.
So, you're right.
I mean, I think that's a really importantlearning that you just need enough of capital,

(29:51):
a buffer to be able to market it, right?
Because I mean, just getting it into the storeisn't enough.
So what are like some of the funnels thatyou're seeing to get people to raise awareness?
I mean, are a lot of them DTC or is it really acombination of both?
I guess it's a combination of
both.
I've done investments that are purely DTC.

(30:14):
Yeah.
Right.
But I think a lot of and we're seeing this as asea change where a lot of companies that were
DTC are realizing that it's not a it's notreally a sustainable model.
You have to be omnichannel, right?
Like you have to like because DTC usuallycaters to people who live on the coast, right?

(30:34):
There's a whole section of America or thecountry that also buys things and you have to
kind of cater to them right.
Even if you look at like the DTC OGs like WarbyParker, Bonobos, they all have physical
locations right and you have those physicallocations for a reason.
It's some people still want to see and touchthings before they buy it.

(30:55):
And then to your question around like what'sbeen working really well when it comes to dgc.
I think SMS has been working really well.
Interesting.
There's just SMS and email has been workinglike really really well and then if you're like
a new brand and you're launching TikTok hasbeen pretty decent where you can I think it's

(31:20):
easier to get discovery and get engagement onTikTok, right?
The tough thing that now is becomes how can youtranslate that into a sale, right?
Like it's nice to get people excited about whatyou're doing on a social media platform, but
then and build awareness, but then how do youactually translate that into into cash?
And I think SMS and email does a great job ofthat because your call to action, right?

(31:45):
You can entice and stay top of mind withpeople, right?
By reaching out to them to say, hey, and one ofthe things I see a lot of brands do really well
is when there's a subscription, when they havea subscription service or when you order a
product, they know how much they know how manyproducts you ordered and they know what the
consumption cycle is.

(32:06):
So they will send you a text and say hey areyou running low on this product?
Do you want to reorder?
Right?
I think that's working really well and then
oh that's cool yeah
and then even from the DTC standpoint or from aproduct standpoint in CPG like barcodes have
been really big the last year which is you buya product or you go to the store and there's a

(32:33):
QR code I say.
There's a QR code on a package that you canscan and it gives you useful information,
right?
Because oftentimes these brands are not bigenough to have commercials.
Not big enough to have certain ads.
But using that barcode, they can give you somuch valuable information.
You could even use that barcode to redeem acoupon.

(32:55):
You can use that barcode to reorder.
So all of those things in tandem has beenworking really well for CPG companies.
What are some that you think or I guess whatare some of the CPG products that you think are
really hot?
When it comes to food, there was probably maybea summer ago, there was like a young, it was

(33:17):
like a tender coconut drink.
And the traditional coconut flavor actuallytasted pretty good.
So if you ever go to Brazil, or if you go toIndia, they have the green coconuts that are
really soft.
So what they do is I think they make a smoothieout of that.
And the original one was tasty, but then theyhad like a chocolate flavor and it just did not

(33:37):
taste well and it just super thick.
So I wasn't a fan of that.
But I guess, what are some beverage startups orbeverage genres I would say that you think are
because I feel like some of that stuff is alittle trendy too.
I felt like coconut water was like a hot thinga few years ago because it was known for

(33:58):
quenching your thirst.
But I don't know if that's still a big thing.
Seems like there's whenever I go to the grocerystore, there's like four or five different
coconut water brands.
So maybe I'd be interested in the beveragespace, which we just had somebody from ZX
Ventures a couple, couple weeks ago.
So you know, definitely on like the beverage,you know, trend here, but I'd love to hear your

(34:22):
take on kind of beverages and then also justgeneral CPG brands.
Know, what are you seeing that's really hotnow?
Yeah, so I'm gonna plug two beverages from myown portfolio.
One is called a VEK.
It's a premium drink mixer.
I think it's gonna be one of the biggest, likethe biggest beverage beverages out there in the

(34:44):
next over the next like five years.
And the reason is it is a it's premium, it'sless sugar, right?
Like when you think about the alcohol or theliquor space, they're about 60 to 70% of
liquors are considered premium, right?
And it's the inverse when you think about themixer, right?

(35:08):
So meaning if you buy a premium, if you buy apremium, liquor, what you can mix it with is
your options really, really narrow, right?
Either Fever Tree, which has a ton of sugar or,there's another Q drinks, which is it's okay
right but it's not and what I like about Avecis they've taken a spin on all the the most

(35:35):
popular mixers and done their own version ofit, right?
So there is like a ginger, there's a ginger,there's a ginger version that goes really well
with whiskey, right?
They have a jalapeno flavor, right?
Different flavors and what I like about it forme specifically because I actually I'm not

(35:56):
drinking I don't drink is you can use it as amocktail right and I think we have a lot of
people nowadays that are trying to be morehealthy, right?
So they're sober curious.
And I think it feeds into two things, right?
Where when you buy it, you don't necessarilyneed to use it on occasion when you're drinking
a cocktail, you can just have it by itself.

(36:18):
So that's one that I'm really excited about.
And then obviously there was a big news I thinkyesterday or two days ago, Ali Pop, the soda
company actually raised $30,000,000 I think ata 200 I think it's like at a $200,000,000
valuation right.
So that's big for the space right where it'salways and I think it's always great when

(36:41):
you're in a certain space and someone raises ata large valuation it kind of validates like
what you're doing.
And then so that's the beverage space and thenI think outside of the beverage space like CPG
broader like for me CPG is a large landscape.
So what I really try to focus on three things,right.

(37:04):
So one is I try to focus on health andwellness, right.
Because going back to my days at craft, likebig CPG has been chasing health and wellness
and they haven't quite been able to nail it,right.
There's UC where there are things that weconsumed eight, five years ago that we thought

(37:24):
were healthy that you find out it's actuallynot healthy right like think about naked juice
and like you thought hey I'm having a smoothieor and you realize it's full of sugar right so
health and wellness is big for me.
Sustainability So anybody building building acompany that is looking to kind of slow down

(37:49):
what's happening with our environment, ourclimate, I'm really interested in.
And then the third space that I'm reallyinterested in is what I call specific
demographic focus or cultural nuances, right?
There are a lot of and for that space, it isokay, imagine you grew up in another culture
and there was this particular thing that youconsumed or you use that you love and then

(38:14):
you're trying to then bring it to the masses,right?
I get excited about that because one, there'salready a built in audience, right?
Like the third generation, the third culturefolks who are from that culture are going to
gravitate towards it.
And then anybody that uses it and benefits fromit is going to evangelize that product, right?

(38:34):
So I'm looking across sort of those focal areasand it gets me like really really excited.
I just recently I recently invested in asustainable sustainable chocolate company where
what they're doing is they're actually makingchocolate in the lab Right.
Oh, nice.
So think about like beyond meat for chocolate.

(38:55):
Yeah.
And the reason that excited me is I'm from, I'moriginally from Ghana and my wife, my wife is
actually from the Ivory Coast and our twocountries combined produce close to 70% of the
world's cacao.
And
it is like a big, it's a big issue fordeforestation.

(39:16):
Are instances of child labor to get this kindof precious raw material and raw foods So out,
anybody who is working on how to slow downdeforestation gets me excited, right.
And obviously like everyone loves chocolate,right.
And if there's like a way to make it in a laband for us to enjoy it, I'm all for it.

(39:38):
Yeah, I've been involved in a couple ofinvestments, lab growing different types of
meat and alternative proteins.
So I think that's a really hot industry.
What else do you think is an exciting trend forlab grown products?
We've seen fish, meat, I think some seafood,anything, any other kind of products that

(40:02):
you're seeing?
Because that's really exciting to, and how didit taste?
Does it taste very similar to the regularchocolate?
It's similar ish, right?
It's always hard.
Like the real thing is the and I think that'swhat's hard.
I was just actually tasting was tasting of likeI had a vegan jerky company that I spoke to and

(40:23):
got some of their product and I was tasting itand I was like, man, I don't know how it
compares because like you remember, you knowwhat the actual thing it's supposed to taste
like, right?
And I think what it's hard because especiallywith a lot of like these products, we don't
realize how complex they are, right?

(40:44):
Like they're made up of so many different partsand to be able to get all of those compositions
right, right, becomes like really difficult.
So like still like the taste and oftentimeswith a lot of things that are happening it's
the taste that's going to win over the consumerbecause at the end of the day you can have the

(41:08):
most altruistic product in the world But if itdoesn't taste, it doesn't feel if there's no
sensory there, the sensory is not there.
Like you're not gonna be able to move it.
And then like another company that I saw thatwas like lab grown as I've seen like lab grown
like diamonds.
Oh yeah, I've heard of that too.
So I've like it was like this.
I think people are trying to do a lot of likeinteresting things on how do we how do we slow

(41:34):
down on like the impact on our environment andimpact on our climate by trying to replicate
some of these things in the lab.
Now I think the ultimate test is going to be,do we actually meet the consumer taste and
demand, right?
Like, is this like, can you floss with a labgrown diamond?
I don't know, right?

(41:54):
Can you stump with that?
Like that's something that you would have totry to like figure out.
So the big thing with food, especially labgrown meats is the texture is an issue.
So I don't
know if you would.
It's like, yeah, it's like a mush kind of like,it's like, it's like, so it'd be good for like
animal feed, or it'd be good for meatballs, youknow, you could probably, you know, like you

(42:15):
could do pasta, you know, hamburger helper,probably, you know, but I think with chocolate,
were you able to get the same texture?
Like what was off with it?
Was it the taste or the texture?
I
got the right, like taste, like the taste feltclose enough because one thing you also have to
realize a lot of the chocolate that peopleconsume is like full chocolate, right?

(42:39):
Like it's been like it's been bastardized wherethey've added so many things to it, right?
Like real chocolate is supposed to be likereally, really better, right?
Like when you get close to a chocolate aspossible.
Sure.
That like the taste, I think the taste wasclose.
Now it becomes like, is the texture and is thissomething where people can, people can look at
it and consume?

(43:00):
I think you have to get close enough that youfeel comfortable doing a blind taste test.
And I don't think they're there yet, but Ithink it will get there.
Okay.
That's interesting.
And then what about with health and wellness?
What are some other products categories thatyou think are gonna be emerging in the next

(43:21):
couple of years?
I mean, you haven't really talked about, arethere better types of soaps or cleaning
products that are using more natural products?
Do you think, are you bullish on that or is it
just For me with health and wellness, what I'mseeing that's gonna like really take off is
around like mental health,

(43:41):
right?
Yeah.
I think we've seen a lot around like the healthand wellness aspect when it comes to cleaners,
when it comes to soaks, right, when it comes tocosmetics, when it comes to like personal care.
Now it becomes, is there anything around likemental health, right?

(44:02):
So I invested in a company called PIM, whichstands for prepare your mind.
And the whole goal of the company is how can wekind of de stress people.
So it's a chew that you have twenty minutesbefore maybe you go into something that's going
be a stressful meeting.
Yeah.
Right and it's it's it's one of those thingswhere I think I personally think it's important

(44:28):
because we live in a we live in a reallypressurized kind of stressful environment and
society right where I think a lot of people tocope with that stress are self medicating right
either through drugs or through alcohol.
Right and if there's a way to get someone offthat regimen and to do something a little bit

(44:50):
healthier, I'm excited and I want to like learnmore about it.
So anytime someone pitches me something aroundhealth and wellness, I'm super, super
interested and I want to know, I want to knowmore about it.
Right.
And then, another thing that I think is likereally interesting around health and wellness
is how can we take like the the treats that welove, right?

(45:11):
So think about candy, think about some somefamily recipe that is either really sugary,
salty and make a version of it that tastesbetter right.
So an actual beverage company that I investedin is a company called Agua Fresca and I'm Agua
Bonita they're making a better for you AguaFresca right.

(45:34):
And the what got me excited was there was anauthentic founder story right.
The founder both founders have have Mexicanancestry and their family actually consumes
this beverage regularly but it is also verysugary right it is like a lot of people put a

(45:57):
lot of sugar in it and they wanted to make abetter for you version and what it hit it hit
on a lot of points for me right so I mentionedhealth and wellness sustainability and specific
demographic focus right so the health andwellness aspect of it was let's make a drink
that is like what we used to enjoy as kids oror without families that is better for you

(46:19):
right.
So it's healthier, it's less sugar.
And then from a sustainability angle they'reactually so she was the this founder is the
first person in her family not to have to pickfruit for a living right in California.
And so her family has a lot of connections tofarmers.

(46:41):
And so they're actually using upcycled fruit,right?
So the fruits that would otherwise be discardedbecause they don't look good enough to have in
a grocery store, right?
But they still contain the proper nutrients.
So that's
There was a company that actually was reallykilling it with that same model.
I forget the name of it, but they, you mightknow that, but they did really, really well.

(47:04):
They just took like the ugly looking fruits andsold them for a fraction
of the Is
there like, is it, it's not a 100, yeah, I knowwhat you're talking about.
Like they deliver it, right?
Looks like ugly fruits.
I think that's what it is yeah.
Yeah something like that yeah.
Yeah.
So it hit this company hit on all of thosethings for me and it's one of those things
where at the end of the day like if you want tobe really really healthy, only drink water.

(47:30):
Yeah.
Right.
But water also gets like really boring right.
So if you decide you want to have a beverageyou're trying to reach for one that has maybe
less calories, maybe has less sugar, right?
And so I'm always excited about like these newbrands that are coming out that provide you
with that alternative, right?

(47:52):
But the healthiest option in the world is tojust drink water, right?
But not everyone's gonna do that.
What about CPG products that are hardwaredevices that pair with software?
I mean, I'm a nerd when it comes to that kindof stuff but I don't know if that's up your
wheelhouse if that gets you excited like thenext kind of AuraRing that kind of gives you

(48:13):
some analytics on yourself.
You interested in those kinds of products aswell?
And does that fit under CPG or is that,
that's tricky part, right?
That's like, it's always like, is it hardwareor is it CPG?
So I made an investment and this is like a preso this company hasn't they haven't launched
their product yet but what got me excited isthe founder is trying to the founders trying to

(48:39):
make a home studio or salon quality hood hairhood for you to like dry your hair if you have
like curly curly hair.
And what got me excited about it was I've seenit like lived experiences with like my family
members have never been able to get the rightlike get the right at home product there the

(49:06):
product the products that exist right it's yeahI thought about it like there are a ton of spin
bikes that existed right but none of them werelike studio quality like a Peloton where you
can have in your home right so it's it'ssomeone who's trying to build a build a
beautiful product right I consider it hardware,I think it's going to be really hard but what
got me really also excited is the way they'regoing to be going to market right.

(49:31):
So they're going to be going to market with notthe hero product but with other products that's
going to be able to help them seed, see thecommunity, right.
So I do look at hardware but I, I scrutinize ita lot more.
Yeah.
Right.
Which is who are you going to fit like what I'mdoing right and one of the ways that I also

(49:54):
kind of think about when I'm investing in acompany around like the thesis is I think about
in the long term where are you going to bedistributed right.
So if you're like a hardware brand that I thinkeventually you're going to be at Walmart right
you're going to be at a Target I'm stillexcited because those are where my products are

(50:14):
sold right.
But if you're if you're like I don't think Iwould have invested in the iPhone if someone
pitched me the iPhone right.
It's purely too technical right and I couldn'tpotentially I couldn't add any value as an
investor.
And since I'm investing so early, I also wantto be an extension of the team, right?

(50:35):
And add some value to what folks are building.
Yeah, I mean, two things that I've beenthinking about recently is, and you just tell
me what your thoughts on this, but, you know,why don't we have the back to the future
jacket?
You know, I mean, I was thinking about it theother day, you know, I have a really heavy
jacket when I go out, but it would be cool if Icould wear kind of a thin jacket that was

(50:57):
heated, you know, I mean, so that's one thingthat I've been thinking about.
And I don't know what your concerns are withthat.
But then the other thing is, you know, we'restill when we when we take photos, we still
have to hold our phone, right?
So we're kind of still going like this.
So why don't like our AirPods, like the AirPodsjust have a camera in it, know, that way maybe
you tap it, it takes a photo because it'salready in your eye view.

(51:18):
So I don't know what your thoughts are on that.
Like, you know, think it's gonna happen.
Yeah.
So I have this whole thesis around like Apple.
Yeah.
I think eventually we're not gonna have phones.
Yeah.
Right?
Like they started with the watch where thewatch is kind of connected and tells you
everything.
Yeah.
You have your AirPods in.
If you have your AirPods in you literally don'thave to look at your watch.

(51:41):
Don't have to look at your phone right.
And I think that's really what's going tohappen is we're going to get to a time where
the phone is antiquated where we have all ofthese other devices around us that are
connected, right.
Maybe I don't know if you heard Apple is goingto be getting into like augmented reality as

(52:05):
well, right.
So whatever headset they come out with rightmaybe that becomes that is as simple as like
having a pair of glasses on that can do itright.
So I think that's going to happen and then toyour point about the jacket I feel you, I hate
wearing
a black mean, the 80s, Remember, Star Wars, wehad to have holograms.

(52:26):
So I'm still waiting for taking phone calls andjust doing a hologram photo, a hologram call
instead of holding because it's a weird formfactor, right?
Especially, I actually don't like taking photossometimes because I kind of lose the vibe a
little bit when I have to hold the phone and golike this.
I'm kind of out of the moment where it shouldreally catch it in real time from your because

(52:49):
when you look out, that's really what yourmemory is, from like your bird's eye view.
When you have positive and negative memories,you're gonna think about it from like your eye
view versus kinda holding it like this.
I think obviously there's still memories, but Ithink it would be great to kind of mimic as

(53:09):
much as possible, like the actual experience.
And it takes away from the experience too.
You're not really enjoying time with yourfamily because you're trying to hold the phone
and everything versus imagine just kind ofhanging out with your friends and it obviously,
maybe when you do record, maybe it illuminatesso people know it's recording.
But even from a safety standpoint, there's beena lot of times where there could be a safety

(53:31):
issue and it takes like five taps to unlock thephone and turn on the camera versus if you're
in a harmful situation or something needs to berecorded, to let other people be aware, it
would be great if you could use that almostlike as a dispatcher thing, dispatcher system
as well.
But holograms are from the 80s, the jacket isfrom the 80s.

(53:54):
So, we're still not there yet, but it'd be kindof cool.
Have you tried the Facebook Ray Bans?
I haven't, no, I saw it when it came out, buthave you tried it?
I haven't tried it, but it looks, I mean, itlooks good.
I just don't know if I wanna give Facebook anymore information.
I hear you, I hear it.
Well, we got a question here.
You got a couple minutes for one maybe or twoquestions.

(54:16):
So we got somebody here talking about, and youprobably deal with this a lot, CPG and really
handling production.
That's the biggest eater of the margin, reallyjust getting your costs down.
Getting it landed and shipped and then gettingit out to your customers.
But what are your thoughts on CPG andoutsourcing it overseas, pros and cons,

(54:41):
concerns?
So I think it's similar to anything.
You have to kind of conquer or be really,really good at one thing first before going
overseas, right?
Like if you and oftentimes when companies wantto expand right like I've seen this a lot with
like cosmetics like cosmetic startups andthey're like we're gonna go to China because a

(55:04):
lot of the Chinese consumers love cosmeticsright and it's not a plug and play where you
can necessarily do the same thing you do in TheU.
S.
And go do elsewhere so I think expansion isgood you just have to understand the market
that you're going to expand into right which isokay what marketing tactics do I need to use

(55:25):
right like how do what's the best what's thebest channels to use right and there I think
there are interesting ways to maybe potentiallytest if you can go international.
Like airports are a great distribution channelright.
So if you can get into like a Hudson News atthe airport, if your product fits into that

(55:48):
retail channel and see if you can collect dataaround like what type of traveler is grabbing
your product and then maybe you can use thatand extrapolate that data to say okay we're
going to go to Amsterdam because there are alot of Dutch people who come through the
airport and they grab our products right orwe're gonna go to China because there are a lot
of Chinese consumers who grab our product but Idon't think expansion is a bad thing.

(56:12):
Think what you have to keep in mind is you'reexpanded into a whole different consumer set So
you need to, you can't replicate the strategiesand tactics.
You need to figure out what is actually, whatactually works well there.
So I think studying brands that do well inthose markets are like the first step and then
trying to like test and learn would be the nextstep I would take.

(56:35):
Yeah, no, that's really helpful.
Well, else have any questions?
I know we're out of time.
Feel free to shout it out or post it in themessage here.
I have one quick question.
Go ahead.
If I may.
Mhmm.
Great to meet you, Kofi.

(56:55):
Hope I'm pronouncing it correctly.
Kofi?
It's Kofi.
Kofi.
Yes.
So great information you shared with us.
I really appreciate it.
One of the challenges that I'm facing while I'mreviewing pitch decks and evaluating these the
founders on how well they position themselvesfinancially is that in early stage, I see that

(57:23):
especially when companies are pre revenue, sothey don't have any revenue to showcase.
They come up with all these metrics andprojections, which I feel they're very
subjective.
Right?
And more some of a speculation.
So how do I offset that concern?
Right?
So because they come up with some valuationsand they say, okay, based on the comps, this

(57:48):
is, you know, what value we're on our company.
You know, pre money valuation, post moneyvaluation, this is the amount that we're
looking to invest to to get us as aninvestment.
So how do I offset that concern?
Because everything is speculation.
Even the metrics that they're coming up with isreally based on nothing, on thin air.

(58:08):
So if you can share with us your thoughts onthis and how to prevent and, you know, from a
risk mitigation strategy, you know, how do youdo risk those risks and figure out which is the
optimal solution towards those companies?
Yeah, so I often when I invest, I'm investingin company, although I'm doing pre seed, I want

(58:35):
the company to be at least post product, right.
And when I meet with a founder and they tell mean evaluation that I think is crazy, I just ask
a few questions right which is okay what's thevaluation based on right.

(58:56):
What were your last three months, what wereyour last three months revenue, what's been the
best your best month's revenue and what I do isI take all those data points and then I do a
run rate.
I do a run rate based on the last three monthsthat they've given me.
I do a run rate based on the best month they'veever had and then depending on what industry

(59:19):
they're in, I do a range of their multiple,right.
So some industries the exit multiples areusually three to five times top line right
three to five times revenue and I simply kindof send them that information which is based on
the data that I have.
If your company were to have an awesome yearand every month you made the top line that you

(59:45):
were making on your best month, this is whatyou're going to be worth, right.
I completely understand that valuations are notbased on what you're worth today.
They're based on what you're going to be worthin the future, but you're too far off.
So kind of just working with them through theprocess.
I think what's happening is a lot of foundersgot excited about like the frothy market that

(01:00:09):
we're in and think that they can raise at loftyvaluations but some of them don't understand
that once you raise at a really large valuationyou have to kind of grow into that valuation
right.
So they're in the risk of if they grow and ifthey invest if they raise at this valuation
they may have a down round the next roundbecause they can't meet certain metrics.
So I think it's as simple as kind of laying outthose types of questions right?

(01:00:33):
To see why they're raising at the currentvaluation.
It's different if you ask that question of whyare you raising at this valuation and they say,
I actually have a PO from whatever someretailer or I have a letter of intent or I have
a contract with this customer that is going tonet us this revenue moving forward, right.

(01:00:56):
But I think you just need to dig into why arethey raising at that valuation and it's not
something they picked because hey, we saw thata friend of ours who has a company was able to
raise at this other valuation.
We're trying to raise at the same valuation.
I see.
Okay.
Very, very good points.
Thank you very much.
I'm going to take stock to those points.
Another question that I have, if I may, Joe,one more question.

(01:01:19):
Both are you okay on time for one more?
Yes.
Yeah.
One more.
Great.
Yep.
Do you believe that the type of Fitbit andthose type of devices are really offering the
benefits that were being expected.
And would you consider a product thatquantifies the risk management of personal life

(01:01:46):
insurance?
Is that so what's the question?
So one is really if you believe if the Fitbitand those devices are really offering the value
that they were supposed to and was expected, A.
And B, whether or not you would consider aproduct that creates quantitative and

(01:02:09):
qualitative analysis, real time analysis ofpersonal life projections, right?
Personal life risk management, let's say, thatyou can assess very carefully.
Insurance companies can assess very carefullywhether you are at risk or you're not at risk
in certain areas, right?

(01:02:31):
Those are the questions.
Yeah, so the first part, I think it depends,Like with Fitbit, like Apple Watch, it's all
about the customer adherence.
So if you're wearing your Fitbit every day,it's going to give you some output.
If you're wearing your Fitbit and you sit onthe couch and do nothing, it's you're not going

(01:02:51):
to lose weight, you're not going to right.
So it's customer adherence.
I think all of these things play in tandem withsomething right which is eat well, exercise and
have this thing on to tell you like how muchhow many steps and stuff you've taken right.
So I think I think they work but it's also italso over indexes for like customer adherence.

(01:03:12):
So that's one and then the second one I wouldprobably me personally would not consider that
as an investment and the only reason is itseems more like a b2b play where it's the type
of product that you would need to collect moneyfrom the insurance company or health provider
and I'm strictly focused on things where theconsumer consumer is at the epicenter of the

(01:03:37):
business model.
Okay.
Good answers.
Thank you so much.
All right.
Well, hey Kofi, thanks so much.
Sorry for running over a little bit, but Iappreciate all your support and amazing hearing
your stories.
So thanks for being so generous with your timeand.