Forerunner Ventures, a pioneer in the consumer startup sector, has been shaping the industry’s landscape for the past 13 years. That’s the exciting intersection of invention and culture that our firm was founded to explore. Most importantly, it has made strategic equity investments in an ever-growing list of high-profile success stories like Warby Parker, Bonobos, and Glossier. In an evolving market where traditional paths to public offerings are increasingly complex, Forerunner Ventures is adapting its approach and exploring all available options.
Founded in 2010, Forerunner Ventures has built a business around matching disruptive business models with major changes in consumer behavior. As a brand-led firm, the practice has honed a design-potent practice that’s forte includes these design-forward brands that really speak to consumers today. Since going public through a SPAC themselves, Warby Parker have publicly belittled SPACs. By contrast, Glossier remains private. This serves to underscore the contrast of two divergent paths companies can take as they grow and mature.
The VC landscape looks very different from just a couple of years ago. In the past, firms could count on significant liquidity events in at least three years’ time, but those days are gone. As the market matures, Forerunner Ventures is changing with it to stay ahead of the game. They now work under a 10-year fund lifecycle model, the industry-wide best practice.
The other reason is because companies are waiting so long to go public. Under the traditional venture model, that’s more or less 10-year fund lifecycles. In fact, a partner from the venture capital firm Forerunner Ventures once put it this way—your company now needs to be worth a double-digit billions to confidently pull off an IPO, or even enter the public markets. Getting to that level isn’t instant.
With startup timelines stretched longer than ever before even thinking about going public, Forerunner Ventures has been particularly active in the secondary market. The firm is highly active in buying and selling interests in its portfolio companies. This playbook ensures they’re equipped to succeed in this new landscape. This flexibility provides them the ability to adapt and react to changing market conditions while still properly supporting their investments.
In the last several years, Forerunner Ventures has had sky-high success with companies like Chime and Ōura. Chime, the digital banking fintech company, recently filed to go public confidentially, a sign that it’s preparing to take its business public. Ōura’s CEO has said recently that the company is not considering an IPO in the near future. This underscores the diverging approaches firms are taking in the lead-up to IPOs.
Forerunner Ventures is as dedicated as ever to spotting and empowering the next wave of consumer behavior shifts. The firm’s capacity to match these new business models with these regulatory shifts has been highly effective in their investment approach.
Even with the hurdles created by a decreased number of traditional public offerings, Forerunner Ventures remains bullish on the future. A representative from the firm emphasized their long-term vision: “We haven’t even gotten to the thought around our table about selling, because we’re here for the growth that’s happening.” This new vision represents a radical and impressive commitment to fostering companies. They accompany these businesses on a journey—helping them prove the potential before they’re able to achieve it.
As they go, we’re all lucky to have Forerunner Ventures helping to determine what the future of consumer startups will look like. By adapting to changing market dynamics and leveraging their extensive experience in identifying consumer trends, they are positioned to continue their influence in this evolving landscape.
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