Episode 131
October 25, 2019

Ideation as a Discipline

Jump into the world of Madrona Venture Labs! Our deep dive conversation with Ishani Gujral illuminates the ins and outs of a VC Lab. The best part: she guides a fun-sized ideation session on the fly. Get ready for the worst ideas ever!

<iframe height="52px" width="100%" frameborder="no" scrolling="no" seamless src="https://player.simplecast.com/d1de1378-5115-42ca-aa4b-3239ad3a8b16?dark=false"></iframe>

this episode sponsored by

Jump into the world of Madrona Venture Labs! Our deep dive conversation with Ishani Gujral illuminates the ins and outs of a VC Lab. The best part: she guides a fun-sized ideation session on the fly. Get ready for the worst ideas ever!

Brian: [00:00:00] Welcome to Future Commerce, the podcast about cutting edge and next generation commerce. I'm Brian.

Phillip: [00:00:05] I'm Phillip. And wow enthusiasm today, I'm stoked.

Brian: [00:00:09] Me, too.

Phillip: [00:00:10] We have an amazing guest with us, somebody who we connected with a couple months ago at Future Stores in Seattle. I believe, Brian, that's where he met Ishani. And I've been waiting for this episode for way too long. So please welcome to the show Ishani Gujral, from Madrona Venture Labs. How are you?

Ishani: [00:00:29] Hi, Phillip. Hi, Brian. Thanks for having me.

Phillip: [00:00:31] And thanks for coming on the show on our little show. This is... We were reading your bio in the preshow. And I just have to literally read it verbatim because it would sound made up. And I don't want to force you to have to give your own sort of LinkedIn list. But this is what I found on the web for you, "Ishani is a diehard generalist, despite her engineering degree. She's designed cold chain systems for AIDS medication, built supply chains that Tesla, and launched and scaled operations of 3-D laser cutters at Glowforege. She now helps entrepreneurs build awesome companies at Madrona Venture Labs."

Brian: [00:01:08] Wow.

Phillip: [00:01:09] You might be the most overqualified person to have ever been on our show.

Ishani: [00:01:13] That sounds really cool when you write it down, but... {laughter}

Phillip: [00:01:18] I need you to rewrite my bio, which basically says Florida Man and podcaster, so I'm not doing myself any favors. Tell us a little bit about yourself. I mean, that's that's an impressive list. Tell us a little bit about yourself and your role at Madrona and who you are.

Ishani: [00:01:37] Yeah. So I'm an engineer by training. I went to school and got my engineering degree, and I think very quickly realized after working on designing actual physical products and actual physical products in those cold chain supply chains that I picked a field that was really narrow for my temperament. I was always really curious. I was always the person in these meetings who was raising their hands obnoxiously and asking a lot of questions that really at the time weren't part of my job. And a big shift happened when I joined Tesla in 2015, right as we were launching Model X. And Tesla is really the kind of environment where it was big, but it was also really fluid. And it allowed me to really expand my role from something that was very focused on engineering, where I was working on the factory line to something that was much broader in terms of orchestrating and creating and scaling a supply chain. So that was a big step up in scope for me, and I loved it. And I kind of vowed to keep that journey going. So next, I moved to Glowforge, which was at the time company of 30 odd people. We had had just the largest crowdfunding campaign in history, raising 30 million dollars in 30 days. And we had sold 10,000 laser cutters, and now we had to actually build them. So that was a problem on a completely different scale. Now, we were taking things from sort of the architecture of a product and trying to figure out how do we build this into something that's real? How do we build this into something that's high quality, and how do we get this into the hands to our customers who have been waiting, you know, at times for years? So I launched my maiden product there and then launched a couple more products as part of supply chain and ops, again, a broader step level and realized that building stuff is something that I really enjoyed and I wanted to continue doing it at bigger and bigger scales. So getting into Madrona Venture Labs last year was really serendipitous because I was ready to move on and build something bigger. And what's really bigger than thinking about building a company? So here at Labs, I'm a product lead. I traditionally wear a lot of hats. I spend my time doing financial modelling, I do consumer testing, I do product market fit... I operate in companies in later stages. But really the heart of my job is I support great founders to build big and good companies.

Brian: [00:04:18] Interesting. It's really cool. I would love to hear more about your time at Tesla, but I'm assuming you can't tell us anything from that experience. {laughter} What's the best Elon Musk story that you have?

Phillip: [00:04:36] Don't say anything. Elon listens to the show. We don't want to get you in trouble, alright?

Ishani: [00:04:41] One thing I will say about Tesla is that it was an excellent early company to work at. It was kind of a place that really hammered down some of the principles that I ended up using at Glowforge, and a lot of the principles that I end up using here, which is sort of thinking really creatively about solving problems and being bold in the steps that you take instead of just thinking about incremental improvements or reasoning by anecdote.

Phillip: [00:05:08] And today you help incubate some of those ideas and bring those products or ideas to life at Madrona Venture Labs.

Ishani: [00:05:18] Yeah. I support phenomenal entrepreneurs who come through our doors and, you know, build amazing companies.

Brian: [00:05:26] Tell us a little bit more about Madrona Venture Labs as opposed to Madrona Venture Group. What's the difference? How did MVL come about, and how does it work?

Ishani: [00:05:39] Yeah, totally. I think the difference is a really good starting point. So Madrona Venture Group is what you think about when you think of a traditional venture capital firm. They have a fund. They deploy their capital, and they are doing it at certain stages of companies as investors Madrona Venture Labs on the other hand, is a startup studio. And what that means is we're actually in the business of creating companies from scratch. We're working in the trenches with, again, phenomenal entrepreneurs. We're coming up with and testing new ideas. We're building products, and we're really laying the first bricks of what would hopefully someday become a strong venture company. So we have a process for ideation. We have a process for validating those ideas. And after we're running through hundreds of these ideas and projects, we end up with injection of capital through VC funding and spinning out the very few companies actually make it through this really rigorous process. MVL was born from MVG. They are a lead investor in our fund. And we work in the same building. We have a really close and I think symbiotic relationship. They help us better ideas. And oftentimes these are the people that we end up going to to make sure that these ideas and projects are ready for the market and ready for the investors.

Phillip: [00:07:01] But I thought that all venture capital was in Silicon Valley. {laughter}.

Ishani: [00:07:07] Seattle is, I think, a thriving place, especially if you look at retail.

Brian: [00:07:14] Yeah.

Phillip: [00:07:15] Don't get Brian started in Seattle. All right. We get it. We get it.

Ishani: [00:07:18] I'm a massive Seattle fan. I moved here from Colorado. And I love it.

Brian: [00:07:26] And it really is better. It's definitely better.

Phillip: [00:07:31] Yeah. Hard to argue these days. The coffee is definitely better. One or two notable companies have come from Seattle. So I will help rep Seattle. There's nothing nice to say about West Palm Beach, especially. You know, we have this thing called Mar a Lago not too far, but I digress. I think that there's an interesting sort of emergence in the way that the flow of the types of investments that venture has been involved in. If you look at the horizon over the 40, 50 years, and you see things like semiconductors was, you know, a big focus of venture in the 80s and 90s. And but it's all shifting. And then you had you know, you had a bunch of, you had a spate of just technology proper. You see things that are disruptive and transportation and apps. Right? And now we see a lot of marketplaces. But it is interesting how much of it is skewing towards commerce these days. And and I find that to be... I mean it's what we talk about on the show, but I find that to be a really interesting place for making bets on entrepreneurship. We've talked about this on the show a little bit, which is it's validation that to an entrepreneur that they have...they're onto something. And it could be huge to have a company like Madrona back them. So I'm curious what you think about the trend towards commerce, and what you all, or what you personally, might see in commerce to make it an attractive investment.

Ishani: [00:09:12] Yeah. [00:09:13] Being in the business, I'm sure you guys see not a week goes by without some major declaration on the state of retail. "Retail's dying..." "Retail is having this resurgence..." But I think if you really zoom out, and this is supported by the research that we've done at Labs, is that retailers and commerce have always been large and dynamic, and they've always been really heavily influenced by the technology of the time and heavily influenced by sort of ever changing consumer preferences. And the last decade, you know, technology has almost completely democratized the space in the way that it's never been done before. So what were very clear barriers in the past to entry, you know, from a cost standpoint, from a resource standpoint, really have nearly vanished. So that allows entrepreneurs to come in with a low barrier of entry and do things that they really couldn't in the past, like launch DTC brands. So [00:10:15] we think, and I think the industry as a whole, thinks that commerce is going through a massive revolution. You see retailers who are connecting with their consumers, being authentic. And of course, on the back and economic side, stronger players succeeding. And then you see retailers who are not, who are failing to understand the consumers, failing to meet their needs, failing to deliver omnichannel experience successfully sort of being wiped out.

Brian: [00:10:46] So is Madrona in particular interested in retail? You said you've done some some studying of...

Ishani: [00:10:52] Yeah, I can speak for Madrona Venture Labs. Madrona Venture Group has made previous investments in retail, and does. At Medrona Venture Labs, we do look at retail. When we look at a space in general, we are looking for spaces that are large with large markets, and we're looking for spaces where you can see big change and disruption and innovation happening. So retail checks both of those boxes. But as you guys know, retail is such a massive space. It doesn't just include something that's more on the front page of retail like the DTC brands like Casper or someone. It includes much more tactical tools and sort of everywhere in the between.

Brian: [00:11:38] I think that right now retail and commerce is getting a lot of attention in the media as you said. It's also getting a lot of attention from venture, maybe more than it ever has. You're seeing more specialized firms on the rise. Firms like Forerunner and others. How do you feel all this injection of capital is impacting retail right now?

Ishani: [00:12:04] Oh, I mean, I think it's very clear, right? If you just follow again, if we were to take the example of DTC, you start with legacy brands that started around a decade ago where there really wasn't that much competition. It wasn't a space that was really explored. These were the trendsetters, the Warbys... And now [00:12:24] I think after seeing the success stories of companies like Warby Parker in the last decade, you've seen a massive injection of dollars to try to replicate that model in different spaces. And what that has meant is that the road in this DTC space has become really crowded. You're competing basically on three platforms for a limited number of eyes and the bidding is getting higher and higher, which makes the model of ten years ago, the model of five years ago, not successful today. So it in a way, I think venture is making things harder for retail. But at the same time, it's forcing us to do what venture does best, which is innovate. [00:13:05]

Brian: [00:13:06] I wonder if that's why we're seeing so much explosion right now, so much retailpocalypse, because it's getting a harder and harder to compete and therefore more and more innovation is happening. It's like this big exponential snowball that we've got rolling now.

Ishani: [00:13:26] Yeah. And again, it really depends on who the players are and how well they know their customers. Because some folks are, there's some that I would consider as a consumer lost causes regardless of how much they're competing in that space. But I'm talking about even brands that are innovating and brands that are moving forward. The channels through which they communicate to their consumers are so crowded that it's really damaging.

Brian: [00:13:53] Yeah... Go ahead, Phillip.

Phillip: [00:13:56] I was gonna spin this and a totally different direction. So if you want to finish up a thought there, Brian, go ahead.

Brian: [00:14:02] No, I was just thinking you have legacy brands like JC Penney who are like, oh, we need to do something and fast, and they've been dying for 20 years. {laughter} But now they're launching like these new outdoor focused brands at men...

Phillip: [00:14:20] You know, though I'm going to go on the record. I'm going to go on the record. OK? I want to hate JC Penney as much as anyone else. It's getting harder to. I think there might be a turnaround story. If they can keep it going, and they keep partnering with people who are doing interesting work like Thredup, who are bringing interesting innovation to the world of resale, or re-commerce is what I think they like to call it. If they can provide that in stores and have penetration into the real world, I think that they might differentiate them in a world of every other department store that's doing it better. Look at Everlane, right? The CEO of Everlane was just on... Which was a digitally native brand that thrives on radical sustainability and transparency. And that's what their differentiator is. They're launching physical stores now because they're saying it is not cheaper or easier to be an e-commerce only company. So all of these companies that are doing these really interesting things online. I mean, you've got Goat at Barneys. These might be ways for troubled retailers to actually maybe turn it around. So I'll go on the record saying I'm bullish on JC Penney, Brian.

Brian: [00:15:42] I think that's a pretty hot take.

Phillip: [00:15:45] OK.

Ishani: [00:15:46] That's a correct point to make in terms of stores. And it is a trend that you are seeing with even digitally native companies like Everlane with ads being more and more expensive. Cutting through this noise is really hard. And ultimately, DTC brands are direct marketing companies. So, you know, you're doing the math between rent and CAC and sometimes rent in New York or San Francisco or major metros with high visibility customers to is making a lot of sense.

Brian: [00:16:13] Yes.

Phillip: [00:16:15] Yes, yes. Yes. A hundred percent. And by the way, the spin back towards local... We forgot about having real relationships with real people as we've digitized every part of the customer journey. I think that's something we talk about a lot. So there's no better way to build a real relationship to actually see someone in real life. Speaking of in real life, Ishani, we were at your office in real life a couple, six or eight weeks ago. And you led us through an ideation session that was very transformative for me as I'd never done anything like that before. It was something that I think that you do a lot of professionally, and maybe you could talk a little bit about our session. And I think we might try a little bit of that here on the show today. So tell us a little bit about what we did when we were there at the Labs.

Ishani: [00:17:08] Yeah. So I guess let me take a quick step back to talk about what our ideation sessions are and what really makes them successful. At Madrona Venture Labs, we are constantly in the business of coming up with strong ideas, receiving ideas from entrepreneurs, and really putting them together. And we host ideation sessions with potential founders, potential entrepreneurs, experts in the industry regularly. And there's a couple of things that are important when we do those sessions that we keep in mind. And I wonder if you noticed these when you were there. The first is really, and this is so cliche, but suspension of judgment. It's so hard, you realize, to be vulnerable in a room if you don't trust the people around you to not laugh at you when you ultimately come up with your stupid idea and share it with them. So that's something that is really important to cultivate. We try to do that by making these conversations as organic and low key as possible. The next thing that we try to do is really curate the mix of people in a way that is productive to the conversation. So having people who come in and who are able to look at a problem from different angles. So, for example, we had a real estate ideation session, and we had a mix of people who are engineers, who are landlords, who are property managers, architects... And I think this helps us avoid looking at the problem through the same lens, not that we've been looking from, but also like the people who we have learned from, I've been looking at. And I think the last one which I played the role this time for our ideation session is having sort of a strong moderator. Something that I realized in my ideation sessions, and I'm really guilty of this, is when there's a really great session going on you can see that your brain gears...and the brain gears are the people around you... I don't think that's a real word... But in all the enthusiasm it can be really easy to sort of take an off ramp to a tangential topic that may seem more interesting at the time.

Phillip: [00:19:17] Yeah.

Ishani: [00:19:17] I've been guilty of that so many times, and it can still lead to a great conversation. But the intent of ideation session is to balance a great conversation with really a strong output of ideas at the end and a great experience for the people who are attending. And that's really the role of someone who's a good moderator. So if they're really good and if they're artful, you as a participant shouldn't even notice that your conversation is being guided. But you'll step out of the room feeling really energetic and like you had a really productive conversation. I thought we had a really great ideation session. Do you want to walk through it now, or do you want to do an ideation session here?

Brian: [00:19:59] Oh, I think we should do an ideation session. I do have one question before we jump into this, and I'd love to hear your view on how companies that already exist, these retailers and merchants and commerce focused tech companies and agencies that listen to the show... Do you have some recommendations about how they could leverage this, not just to launch a new company, but within an existing organization?

Ishani: [00:20:27] Yeah, [00:20:28] I think I'm ideating in the way that we do really does two things on a macro level. Directly, it can help be a platform for people to bring up themes that they're seeing in the market, problems that they've identified, you know, an opportunity that they see and communicate that with the rest of their organization, for which sometimes they really aren't good platforms. I think more indirectly, and this to me is probably a little more important, is that it fosters this culture of creativity and vulnerability. If you're able to sit in a room with someone once a month, once a week, for half an hour and really share your hypothesis on what's going on in the market, share your hypothesis on what may be an interesting way to innovate your product, maybe not even as an owner of that product, and if that is encouraged, my assumption, and this is based on seeing innovative companies, is that you are more likely to innovate and grow as a company because that's part of your DNA, that's part of your culture, and you are investing real time and therefore real dollars in ideating and thinking outside the box. [00:21:40] So to do it well, I think the stakes and the bars can be a bit higher when we're ideating. We're ideating as colleagues at Labs. When you ideate at a big company, you're probably sitting next to your employer, you're sitting next to your team. And [00:21:57] I think there's a real challenge in making that a safe space for people where you don't feel like you're going to sound stupid for sharing your idea in front of people who may be writing your review next week. So leading by example for leaders, I think could be a really great way to foster this culture of creativity and vulnerability and again, by sharing ideas that may not be fully vetted out. [00:22:22]

Brian: [00:22:24] That's really good advice. Well, I'm really excited to share my stupid ideas right now. So let's jump right into this. {laughter}.

Phillip: [00:22:31] Yeah something, something, no judgment zone. Right?

Ishani: [00:22:39] I definitely mean it. And I have struggled with this, personally. It's so easy to say that, you know, we're just all going to be stupid. But no one really wants to sound stupid, I think, at their core. So it's always an uphill battle. I will tell you my story. I joined a meetup that we have in Seattle where we almost exclusively brainstorm about ideas that are stupid. So that could almost never be industrialized. That could never really be sold. Last week, someone came up with an app of a cat where you stroke your iPhone and it purrs. I think there is room and space and really joy in ideating and using that part of your brain. And sometimes great things can come out of it. But really, you are exercising a muscle.

Brian: [00:23:30] I feel like Allbirds needs to do that idea. {laughter}

Phillip: [00:23:35] Allbirds. You know, it's funny. They just launched a video game.

Brian: [00:23:39] That's why I brought it up.

Phillip: [00:23:39] Yeah. You're their mascot. Their lamb, who's like a super lamb. It doesn't matter. {laughter} Ishani, you had suggested some guidelines around ideation to point out in a certain direction. What are those guidelines?

Ishani: [00:23:55] So we generally ideate around a topic. You know, you want to be a little focused. So you don't want to say, "Let's ideate about all the problems in the world." You probably, what we typically do is we'll say, "Let's ideate in the retail tech space," or "Let's ideate in the bigger categories, like entrance tech space." For today, I think because of our time format, because we don't have three hours, I say let's go a little narrower and see how this goes. How about we ideate in direct consumer brands in retail? And maybe the tangentially associated things, but not the broad retail and commerce as we know it.

Phillip: [00:24:37] Ok.

Brian: [00:24:38] Ok, so who were you even more more specific, like all the way down to the DNVBs? Or do you want to stick with like the broader DTC category?

Ishani: [00:24:48] I think we can go to DNVBs, which I have to say, despite someone who has worked in this category a lot. I'm terrible with abbreviations. I had to look it up before, and I know what DNVB is now.

Brian: [00:25:04] Yeah, oh, yeah. For our listeners, DNVBs are digitally native vertical brands. So there're a bunch of them out there right now. They're the hot venture backed brands.

Ishani: [00:25:15] Yeah. So let's talk DNVB. And this is basically the structure of ideation session is I can take on the role of a moderator and a participant. But really this starts off as a communication where we start by exploring, you know, what's going on in the space, what are big themes, what are big problems, what are major opportunities? And then we move on into the fun part, which is really coming up with some ideas to solve them. And maybe at the end we can vote on these ideas. I'll give each of the three of us a hundred dollars, and we can assign them any way we want to any of the ideas that we come up with. How does that sound?

Brian: [00:25:56] Oh, it's like a fantasy football draft. I love it.

Phillip: [00:26:00] I love it. This is great. This is great. This is great. Well, I'll go ahead and contribute a big problem that we've been talking about the last year or so is if you are a DNVB, like you said, you're you're effectively only as successful as the amount of traffic you're driving to your brand and to compete nowadays, there're rising customer acquisition costs on social media platforms. So there's a big problem just trying to get traffic and to raise the stature of your brand and raise awareness that you exist in the world. So that's a big problem.

Ishani: [00:26:37] Yeah. Something that I've said both seen directly and see in companies now is also that DNVBs, young companies in general that are highly energetic, highly motivated... I haven't seen phenomenal tools to be able to process some of the information that specifically when you are doing things like core analysis and looking at your customer segments. A lot of the work seems really, really manual, which is fine at the time because you're in this really energetic environment. You're one person wearing 35 hats. But if you look at some of the really sophisticated tools that have come into the space, being able to truly understand, identify, and target your customers, it's something that I've not seen done really well for companies of that size. I've seen enterprise solutions, but really not for something more nimble.

Phillip: [00:27:35] That's really really interesting. It reminds me of... To build on that problem, attribution models are starting to get fractional. So if you do have a software suite that tries to attribute how much you spent to acquire a customer across the whole journey, it's a fractional attribution model. And those aren't perfect. And those tools cost a lot of money for you to not have good data. So it seems to be a recurring theme of that problem.

Brian: [00:28:04] One of the things that's been quite challenging is for them to know where and how and when to put in actual physical space. And so there are some plays here that are starting to help with this. Things like BrandBox and some sort of one off stuff from Cushman & Wakefield. And there's a little bit in this space, but I feel like there needs to be a lot more data around this. So I feel like there might be opportunity for questions around how to go and actually build out your physical presence.

Ishani: [00:28:45] Yeah. And I know that there's starting to be pop ups and stores that are again, changing their inventory. There's one in New York whose name I can't remember, but it's really phenomenal.

Phillip: [00:28:55] Showfields.

Brian: [00:28:56] Showfields. Yeah.

Ishani: [00:28:58] Is that the one I'm thinking of? But the idea is that, you know, you could have a physical space that could be like a cohesive brand. The one I'm thinking of is run by women for women. And they basically feature... It's basically modern consignment store. I think it's an interesting problem to have, too. Something that I've also been seeing... We've talked about this in DNVBs as well, is because the space is getting so crowded, things like, "OK, you need to have an authentic relationship with your customers. You need to have a solid product. You need to have a great experience." All that stuff is really table stakes.

Brian: [00:29:34] Right.

Ishani: [00:29:34]  [00:29:34]It's become so crowded that if I were to think of starting a company in this space, there would have to be some sort of competitive moat. If I start selling my organic toothbrushes, and 50 other people can do it really easily now, I have a massive uphill battle just getting eyes, you know, everything else after that. [00:29:54] So something that I saw that was really interesting recently was in 2006 a company... Have you guys heard of Hubble?

Phillip: [00:30:02] Yeah.

Ishani: [00:30:03] So they're a contact lens direct to consumer brand. And I thought what was really interesting about that is that, again, they're innovating and all these things that direct consumer brands and DNVBs are traditionally innovating on, but there's a moat around the engineering and the product. This is something that actually requires... It's a highly skilled product. It's something that requires a good amount of engineering. It's something that involves a good amount of quality control. It's something that you really absolutely have to get right. Which I think makes it harder for someone to replicate as easily. [00:30:40] So I've been thinking about, what is the next level into this DNVB where you can go and make something that is maybe solving a bigger problem, maybe something that would be considered a higher risk in execution, but still meets those criteria of large market, somewhat regular use from a customer, still radically changing the consumer experience? [00:31:02]

Phillip: [00:31:02] Yes, that's definitely a need. Interesting side note, there are some that are cropping up to sort of compete with Hubble like Hopi contacts, but they're in Dubai. Maybe one of the things that we see in saturation in footwear and mattress companies... Like the overwhelming number of brands that pop up in certain areas that have sort of solved supply chain. The outgrowth of a capability that's built in to a certain region, like getting foam mattresses and sneakers from China seems to be no problem anymore. Maybe getting personal health care products that are manufactured in the Emirates is the next revolution in supply chain and sourcing for direct to consumer brands. So like building out specific capabilities within certain regions that have that solved.

Brian: [00:32:04] Interesting.

Ishani: [00:32:05] Yeah. I am ready to share my first idea in our conversation, but we can still keep talking about themes and problems.

Phillip: [00:32:11] I have one, [00:32:12] too, actually. One thing that I sort of hate as a consumer is when I'm shopping at a particular company, or I'm shopping with a particular company, I feel like I'm never truly aware of where the company is located, where their factories are, how many people work for them, what the average employment salary information is, and I think that these are all inputs into a score of whether I feel like I'm contributing to their good that they're putting into the world or not. Do they pay their employees a fair wage? This might be an interesting insight for me as a consumer to then be able to find others and shop by my values. [00:33:07] And so I think that, again, not to bring Everlane back up.... It's just the last story that I read right before we started the show. But it's fresh in the mind. You know, they are sort of radically transparent and in those sorts of metrics. And maybe we might be better... I would feel better as a consumer if I could have that kind of transparency from everybody.

Ishani: [00:33:31] Yeah, I think that's a really good problem that you just touched, which is [00:33:36] there's this greenwashing and sort of ethical washing that is so prevalent now that words like sustainability really lose their meaning. Being able to you know, if you look at a brand that has a nice green leaf and says, you know "We're sustainable," that means nothing. It's not a regulated term. They don't actually have to do anything to be able to say that. [00:33:58] So being able to... Ok, I'm going to share my idea prematurely. And I guess the two things that I want to emphasize that I didn't at the beginning is I mean it when I say this is a judgement free zone. So there is a point of time where we can judge these ideas for, "Are they financially viable?" or "Are they venture backable?" All those fun things... But now's not the time to do that. The second one is that you have to come up with a name for your ideas, and the funnier the better. So for yours, Phillip, that you just talked about I'm thinking of something like maybe an application, maybe a platform, something like "Where you at?" What brand...sort of an impact report card that could be either a plug in or something that is very easily accessible, as you are browsing. So I see this with the EPA, so the EPA, for example, has a rates all product. So you can actually go see your L'Oreal shampoo verses in an Aveda shampoo and how different they are from an environmental standpoint, in terms of how good or bad they are for you. But most people don't really end up doing that because that means you're going on a separate website, and you're typing a product, and you're checking it out. But really being able to marry your interface with a brand and being able to look at a brand and at the same time being able to almost have a fact checker or report card and saying, you know, are they actually green? Are they actually ethical? Are they actually, you know, participating in our carbon medication strategies and how much I think would be really cool.

Brian: [00:35:36] In that same vein, I think there's another really big problem right now, and that is... It's a marketplace problem, so I wouldn't call this specific to DNVB. [00:35:46] I think there's a huge problem with authenticity and verification of materials. And I think there are a couple of startups out there that are looking to solve this problem, but I haven't seen anyone actually do it well yet. We have a huge authenticity and a quality problem just shopping on the Internet in general. [00:36:03]

Ishani: [00:36:03] Could you expand on that, Brian?

Brian: [00:36:05] Yeah. So right now, like on Amazon, when you go shop on Amazon or pretty much any marketplace, most marketplaces, it's very difficult to know what you're actually getting. Do you trust the data? Do you trust that you're getting the thing that you're actually purchasing? Like, for instance, when I went to go buy Birkenstocks on Amazon recently or in general. My wife had been sort of searching around, and there's a whole bunch of shade being thrown at the Birkenstocks that are sold on Amazon right now. Like a lot of people out there are saying that they're fake. We ended up buying directly from the brand itself because we didn't want to purchase Birkenstocks that were not real. I think that there's a huge problem with sort of a verification of authenticity and of even just data. I bought something on a Wayfair recently. It said it was made in China. And when we got it, the box said it was made in Malaysia. [00:36:59] There was a massive sort of like transparency problem in terms of what you're actually buying when you go buy something on a marketplace. [00:37:06]

Ishani: [00:37:06] Yeah. That's really interesting. I didn't really think about it. But you're right. It's actually fairly common when I go on Amazon or Wayfair and look at the comments. And it's a) you don't know how much you can trust the comments, but you he see stuff saying this really isn't real. It looks really different from the pictures. Quality control is hard.

Brian: [00:37:29] It's not just the quality control, I think it's more than that. It's specific to marketplaces. It's verification that any data is actually real. There's a whole site out there dedicated to whether or not reviews are real on Amazon. And so the reviews are one aspect of it. But the actual product itself and verification that... I think that there just needs to be some sort of way that branded manufacturers and DNVBs can sort of make it easy for customers to know if they're actually getting a product that they've said that they were buying.

Ishani: [00:38:03] Yeah.

Phillip: [00:38:04] Well, to build on a Ishani's idea with, "Where You At?" If there was something that could contextually know that you're looking at something that is really a rip off, or a knockoff, or a derivative of the actual authentic product and suggest to you in the stream of the purchase decision, you might actually be prompted to go for the thing that is coming from the actual brand, that's sold from the actual brand, that you know that supports the workers that have built that brand... You know Birkenstocks, by the way, is a 200 year old currently. And so maybe you're more prone, in that moment of purchase consideration, to change the purchase from the quick, easy Amazon thing to another opportunity that might present itself along the way.

Ishani: [00:38:55] Yeah. Yeah. [00:38:55] I'm almost also thinking in the case of marketplaces like Wayfair, or even Amazon, like a verified click button the same way you see for profiles on an Instagram or a Twitter, and the fact that this supply chain has been authenticated, and it's not just garbage. [00:39:16]

Brian: [00:39:16] Yeah.

Phillip: [00:39:17] Like an extension of certified B, but for...

Ishani: [00:39:21] Yeah, of course that comes with its own challenges. But I do think that's going to be a growing problem with more and more vendors entering these marketplaces, which are relying on the brand of an Amazon or the brand of a Wayfair to sell these products.

Phillip: [00:39:34] And not for nothing, It doesn't always wind up with the cheaper, easier to acquire product or service. I think of we recently had Chelsea Clements from... She's at Green Growth Brands now. But she was at Jeni's Splendid Ice Creams for a long time, and she was talking about how they own their own relationships with their suppliers and their dairy farms. And they are the sole vendor that those dairy farms sell to that are there in Columbus, Ohio. That leads to expensive, expensive product. A nine dollar pint of ice cream is what the outcome is. Right? And as a consumer, you know, some people just want you to order ice cream, and you probably are going to win that.

Brian: [00:40:17] Actually, you just had on something that's actually very much in the same vein as what I was just talking about before, which is authenticity of emerging ingredients, if you will. So if Green Growth Brands, you know, as a CBD and weed company, one thing that I think that is a challenge right now for people looking to buy weed, and this not contained to weed, but anything that's a new sort of untested or untried product that anyone can produce or is easy to produce, I think that authenticity of what you're getting is also another problem. When you go... If you went and bought an edible, or something along those lines, at a store, how much confidence do you have that what you're getting is what they say that they're giving you in terms of THC content and so on? And then also I think this extends out to medical products or even new materials in terms of what's actually being put into your pill or whatever. Interesting problem there, as well. I definitely don't have confidence, yet.

Ishani: [00:41:39] Yeah.

Phillip: [00:41:39] If we have 10 minutes left in this... {laughter} Should we get to pitching out a bunch of different ideas and kind of round robin it?

Ishani: [00:41:49] Yeah. Yeah. Let's quickly recap some of the themes and problems to contextualize. I think the big ones that really resonated with me were the problem of the channel. So the current channel being crowded and very saturated. There's a tools problem of how many tools are actually effective for emerging brands at this size? There's attribution problem that you talked about, Phillip. There's a CAC that almost goes back to channel, but really talking about how does real estate fit into these brands reaching their customers. And then there's the problem of authenticity that we talked about, of how much of what is being marketed to you is actually real. Do we have a fact checker for the product, the supply chain, the messaging? You guys have anything that I missed?

Phillip: [00:42:41] No, I think that covers it. I'm like jumping up and down excited. I want to tell you some ideas.

Ishani: [00:42:47] Ok, why don't you start, Phillip?

Phillip: [00:42:48] Ok, thank you. {laughter} Ok, so the first one is a modern phone book. OK. So I think that as businesses skew more towards local, and we see that more research is moving away from Google and Google Maps, which is probably like where a local discovery happens today. We also see brands investing more on direct mail. I think that we, and it's by the way, it seems to be working for them. They're going to print catalogs. They're doing direct mail again. I feel like something that might be coming back around is a resurgence of the phone book, but a modern version of the phone book. And so discovery could happen at the local level with a modern day phone book that curates local businesses that are owned and operated by craftsman, artisans, entrepreneurs who live and work in your community. So a modern phone book as a discovery mechanism.

Ishani: [00:43:51] Yeah. That's really interesting and hyper local, too. I have something that's similar to yours, Phillip, which by the way, you need to come up with a name.

Phillip: [00:44:00] Oh, I called it Booker, which is not the most lovely name. But that's what you get.

Brian: [00:44:06] Love it.

Ishani: [00:44:07] So mine's "Truckey." So I think...

Phillip: [00:44:11] Oh nice. {laughter}

Ishani: [00:44:13] So I'm thinking almost like an Amazon style, deal driven, DNVB .... truck. So something that, again, is able to take advantage either of the local DNVB brands that are smaller and more artisan, or some of the bigger ones that are trying to offload some of the inventory in a different platform that maybe forces you to... Force is a bad word... Maybe allows you to engage with the brands in a different way than what channels right now do. So maybe you have to check in a couple times a day. Check in to see if there's deals going on, and that allows you to the road of discovery of some new brands as well. Shop directly from basically DNVB brands and manage it in one platform. Truckey, the DNVB .... truck.

Brian: [00:45:08] I love that. So I can pick any of these topics to pitch an idea for?

Ishani: [00:45:14] Yeah.

Brian: [00:45:14] OK, so here's my idea. I think that there should be basically a pitch book for towns that people can launch stores in. So it gives you all of the population information, demographics, everything to treat towns like investments. You should be able to know what the average cost of rent is, what the average cost of whatever it is for your specific industry. It's basically bringing the real estate process one step closer to the retailer, or like 20 steps closer to the retailer. It's kind of like a combination of PitchBook and Zillow for a retailer so that they know when and how and where to launch a new brand and how they can do it in a very targeted way.

Phillip: [00:45:59] Like productizing HQ2, where they were going to cities and pitching?

Brian: [00:46:03] Yes. Exactly.

Phillip: [00:46:04] Oh I see.

Ishani: [00:46:05] I think that's really interesting, Brian, because you [00:46:07] can... I'm sure digitally native brands have some degree of information on their customers where they've been shipping products to since that's their main way of delivery. But if I am Warby Parker, I probably just have Warby Parker's information and being able to consolidate consolidate that on a higher level you'll probably be able to see trends and themes and patterns that could add value to the entire ecosystem. [00:46:33]

Brian: [00:46:33] Yeah. And I also think that there's a lot of hidden gems out there in terms of cities and towns to put stores in to. I think that retailers, we need to get closer to that data. And it also will maybe allow us to get more creative about how we put physical spaces in to... Like the size of store. I just think that there's a lot there in terms of a lot of space still left in terms of being able to make wise and informed decisions.

Phillip: [00:47:10] I'm going to... You're selling us on the idea. You're not just pitching the idea. I'm going to cut you off because we're three minutes away from the end of the show. Do we do all of us get one more stab?

Ishani: [00:47:20] Yeah. One more stab. Brian, what's the name for your idea?

Brian: [00:47:23] Let's call it Townie.

Phillip: [00:47:29] {laughter} I love it. That actually...

Brian: [00:47:31] Truckey. Townie. Booker. These are the best names ever.

Phillip: [00:47:31] Yeah. I love this. This is great.

Ishani: [00:47:36] Phillip, do you want to go for the last?

Phillip: [00:47:38] Yeah. {laughter} So the Channelizer is a means for a customer to tell you at the end of the purchase process you can reward them for being able to attribute all the ways that they were touched along the purchase path. Every time they purchase, they're asked by a brand at the end of the purchase cycle, "Hey, would you take a short, five second survey in the next five seconds, quickly, like a game, choose which of these five places you've seen us. And if you do that, then we give you some dollar amount off your next order." I think it's fun, engaging, its gamifying the actual survey experience, and it helps you more accurately, from the customer themselves, figure out where your investments have been paying off, so that you can do direct channel attribution in a smart way. Channelizer.

Brian: [00:48:35] Go ahead, Ishani.

Ishani: [00:48:38] Ok. And going to say Where You At? Is something that I am putting my hat down on. So basically maybe for the context of this idea it really checks the supply chain and the authenticity of what you're claiming in terms of materials and in terms of sourcing and in terms of labor. But an idea that I have is A Store For Me. So as a young millennial who's buying all these DTC brands, can I just tell you how much of a pain it is to manage my six different subscriptions, ranging from toothbrush to have something completely different? But if I were to be able to again have a platform that is clean, minimalistic and engaging, where it is really just a store for Ishani. It understands me and maybe can go through my emails. We're all fine with that these days. Right? It knows what Ishani likes, it knows Ishani likes really simple toothbrushes, but she likes really complex and high tech cookware. And I'm able to keep track of the direct brands that I'm buying and manage my buying and maybe subscriptions where they are on that directly instead of going in seven different web sites. But also allows me based on what I'm buying, to expose me to new brands. And I kind of realize as I'm saying this is that Instagram does this in a back hand way. I think this is really just putting the customer in the driving seat.

Brian: [00:50:09] All right. I got one more. I got one more. This one's called Winner Winner Chicken Dinner. It's one I thought for like 10 years. It's a customer acquisition play. It's customer facing. But it's a subscription service that you could subscribe to as a customer that enters you into, or it aggregates, all contests available from retailers. And so you can subscribe to... You can give your customer information... You can browse and look at all these different contests that are out there and give your customer information to those companies in exchange for being entered into those contests. Effectively, that's a really, really easy way to increase your odds and enter a bunch of different free contests. And it's a really easy way for these brands to get after different customers for a much, much lower cost. Yeah. It's a fun one.

Phillip: [00:51:15] All right. I have to cut us off because we're getting close to time. How do you want to handle this sort of voting piece there, Ishani?

Ishani: [00:51:24] Well, I guess I can get started and maybe you guys can follow my lead. But I'm now as someone who would be investing my money. So the context here would be what are things that are interesting, but also what are likely to be successful businesses with the realities and the context of the world that we actually live in? I'm going to try to invest my hundred dollars in the ideas that we just had in any way that I like. I could give a hundred dollars to one idea. I could split it even be amongst everyone. And I think I'm going to give $60 to Channelizer. I think that's a really big problem. I think it's something that companies are really committed to solving and identifying where and how customers are joining them on the journey. So I'm going to make a big bet on that. I'm going to spend $20 on Where You At? because I'm not really sure how one would monetizes this... This almost looks like a verification badge or [00:52:20] .... tool [00:52:22] to me, but I think it's really important, and I think it's one of those things that is a little early, but I'm interested to see where that goes. And I'm going to invest my other $20  in a phone book.

Phillip: [00:52:35] I feel like I would go... I'm going to hedge a bit. I would give $25 to Channelizer, $25 to Booker, and probably $25 to Townie.

Ishani: [00:52:49] Why?

Phillip: [00:52:49] I really like town a lot. Why? Yeah. The reason being is that I think that there is a data driven way for you to quantify what might be a need to have a digital platform for small town America or middle income America to recruit companies to come in and digitally bid for companies to come in to bring jobs and innovation and retail into their otherwise waning cities. Now that I'm saying that, like it seems like a much bigger bet. It's a big bet. I don't know that it's... Yeah, if we're bidding. So maybe, maybe let's do this. I'll do $30 on Channelizer, $30 on Booker, $20 on Townie. 30, 30, 20. That's 80. I've got 20 left? 30, 60, 80. Yeah. And then the other $20 I think Where You At? is very, very cool. Something I'd use, but I think it probably couldn't exist in the world without venture backing it for some reason or another. Brian.

Brian: [00:54:09] Yeah, I would put $50 on Channelizer, and $50 on Where You At?

Ishani: [00:54:12] Nice. Why $50 on Where You At? Also the same reason, Brian?

Brian: [00:54:17] I think it's a clear problem.

Ishani: [00:54:18] Yeah.

Brian: [00:54:20] It's just it's such an obvious problem. I think that this idea is already probably being solved by somebody, and I would put my money on that company.

Ishani: [00:54:31] As we're ending this ideation, that is something [00:54:35] that... My observation has been through sitting through ideation sessions is looking at the problems versus flashy solutions has almost always been a winning strategy. You know, my hypothesis, my belief, is that if it's solving a large enough problem, you'll find a way to monetize it. It may not be in a venture billion dollar scale. It may not be a hundred million dollar business. But if you are truly solving something that people are struggling with, you'll find a way to monetize that. [00:55:05] Worry about that later. Worry about solving it first.

Phillip: [00:55:07] Yeah. This has been...

Brian: [00:55:08] So fun. So fun.

Phillip: [00:55:08] Unbelievably fun, and I love doing this. This our second time doing this with you, and it's just such a blast. Ishani, I'm so sorry that we have to cap this to an hour. Any last parting thoughts, any ideas or advice that you can share with our audience or a way that people might be able to do this for themselves or take a next step?

Ishani: [00:55:28]  [00:55:28]Yeah. I think, you know, understand that so much of our jobs and our education train us to think in a very boxed in way. And it takes real time and energy. And it has for me, this hasn't been something... Ideating and being creative about solutions, not just at work, but in life, isn't a switch that I've been able to turn on. It's something that's an exercise that I do every day. So if you're not where you want to be, please don't give up. Just keep trying. And if you find new and creative ways, let me know. [00:56:02]

Phillip: [00:56:03] Awesome. Well, thank you so much for joining us. Thank you for listening to Future Commerce. And we want you to lend your voice to this conversation. The best way you can do that is by going over to FutureCommerce.fm and click on any of the episode links and get in touch with us. And lend your voice to this particular episode's conversation in the discuss link. And as we always say, we're not here to predict the future, but we're here to give you tools and insights to help you shape your future. And I think we did that here today. Thank you so much, Ishani.

Brian: [00:56:31] Thank you so much.

Ishani: [00:56:31] Thank you for having me.

Recent episodes

By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. View our Privacy Policy for more information.