Transcript
WEBVTT
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Hello and welcome to the consumer VC. I am your host, Michael but
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and. On this show we talked
about the world of venture capital and innovation
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in both consumer technology and consumer products. If you're enjoying this content, you
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could subscribe to my newsletter, the
consumer VC DOT sub stackcom, to get
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each new episode and more consumer news
delivered straight to your inbox. Our guest
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today is Natalie Gordon, founder and
CEO Babylist. Baby List is a baby
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registry and ECOMMERCE platform that combines content, commerce and data to serve millions of
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expecting a new parents. We chat
about why Natalie decided her baby list when
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she just became a new mother,
how reading the lean start up impacted her
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decisionmaking, to solving the chicken neck
problem of market places, finding product market
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fit and her unique approach to partnerships
with brands. Without further ADO, here's
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Natalie. Natalie, thank you so
much for joining me today on the Consumer
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V. See. How are you
doing? I'm great. It's so great
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to be here. My Oh,
it's an absolute pleasure, absolute pleasure.
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So talk to me a little bit
about the beginning. What was the initial
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insight that led you to found babylist? I love that question. It was
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eleven years ago. The reason I
know it was eleven years ago is because
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I haven't eleven year old and my
son is now playing reblocks like he's eleven.
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But when I was pregnant with him, I was expecting him, I
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was creating my own baby registry,
I was getting ready for my own baby
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shower and it was like that very
classic moment there must be a better way.
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I was going through the experience.
I knew I was not going to
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find everything in one store at that
time, that was babies R us,
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and knew I wanted things that some
independent stores also the Cursey, the Stroller,
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the baby carrier. Also we there
were some things that were incredibly important
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to our family. People contributing a
month of a diaper service was incredibly important
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to us. Someone actually coming over
and walking our German shepherd at seven am
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for the first couple of weeks was
incredibly meaningful to us, and so that
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was really the inspiration for baby list. It was this better baby registry that
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works across retailer and let's you ask
for like the things and the things that
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are like not actual products but are
deeply meaningful to families. And so I
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actually at my backgrounds and software engineering. I'm a software developer. I had
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been an engineer and Amazon for about
four years. I had worked on another
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startup in the language learning space for
about a year and that wasn't going that
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well and I had the idea for
baby list. And then it was around
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the time of the lean start up
by air grease and I read that book
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kind of towards the end of this
language learning start up and I was like,
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Oh, this is like so clear, like everything I did wrong and
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what I would do if I could
do it all again. And so,
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following that method, really got to
this minimal viable product and launched it within
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two weeks of actually having my son, and then it was something that just
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grew from there. Slow and study
for that first year and then, once
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I moved to it full time,
just bigger and bigger and bigger until we're
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here eleven years later. Amazing.
Amazing. I mean what was also a
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like started a business going through also
that phase in life too, when you're
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just about to have your first child. There's a ton going on. Obviously
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you could understand like the pain point
that you were experiencing, but would love
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to just kind of also, you
know, get into a little bit about
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why it was so important for you
at that time to start babylss. It
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it makes sense. It was really
important to me, I think, in
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a really emotional way. It's not
like it was something that was taking away.
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It was something that would during this
very kind of isolating, lonely time
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when I had a newborn at home. Things were very hard. I had
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this like very interesting intellectual thing that
I was creating that I got to work
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on for a number of months.
I had a goal where if I could
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work on it for forty five minutes
in a day, that was a successful
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day. I could do the customer
service that needed to be done, maybe
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fix one bug, maybe send out
one email to a blog to talk about
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babylst just like very small aspirations day
by day. But what it actually meant
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to me? It was hugely significant
to me at that time of life because
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it is hard. I was home
with a newborn. At some point,
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maybe six months after my son was
born, I hired a babysitter with the
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money baby list was making and then
I would walk around the corner and work
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in a coffee shop for two and
a half hours while she watched my son
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and then I would come home again. And so it really did just like
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ramp up during that first year in
a way that was so meaningful to me
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and actually very complimentary to that life
stage. That's really, really impressive to
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I just can't even imagine, you
know, being at home, having to
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take care of your newborn and as
well as starting this new business, which
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of obviously has done incredible did you
always want to be entrepreneur? No,
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it was I don't even think it
was something I could consider or imagine.
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I never thought that was a path
for me. I couldn't even picture it.
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Maybe things are different now with shows
like shirt Tang or maybe more podcast
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but it was something that I never
thought, Oh, I'll be the founder
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of a company and I never thought
I would be a CEO of a company
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this size. And it takes a
lot to stick at something for eleven years.
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And and actually I got really lucky
in the audience that I chose to
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build this business for, because people
who are becoming parents are phenomenal to be
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able to serve every day. It
is the most inspiring audience to write content
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and build products for people who are
welcoming a baby, having this incredibly significant
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life stage and all of the people
that really want to support this family.
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What was your method to actually build
an audience from scratch? What was what
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was that process like? Yeah,
I when I'm asked that question it's like
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there were different eras and then what
worked in one era was not that important
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to the next era. So when
someone very early stage is asking me for
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advice, I can give what worked
in the early stage ten years ago,
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but which it might be very different
than what's working for us right now.
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I would say at launch, using
this leane startup method, before we had
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actually launched, I had emailed I
believe it was ten pregnancy blogs or parenting
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blogs specifically with like a very personal, tailored email saying take a look at
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this registry that has pis that I
think you would have chosen, and I
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believe that launch maybe five of them
actually like wrote about baby list out of
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the gate, and so that was
I would say that was year one.
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It was like that hustle. We
had a very significant inflection point a couple
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of years after that, real success
with Pinterest as they were opening up their
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paid advertising channel. If you think
about baby last it actually works quite a
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lot like pinterest. We were able
to get a lot of traction with a
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lot of our fantastic content on Pinterest, and so that was a significant way
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that we could scale. And then, I think now everyone's gone to a
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baby shower that use baby list and
that viral component is so important and I
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always knew that it was there even
ten years ago, but now it's something
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that's completely quantifiable and part of our
model as well as just the, I'd
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say, at scale, great performance
marketing. What did you decide that you
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needed to raise that your capital and
what was the reason? What was that
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process like for you? I love
a question. We've really had a less
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traditional path and I like talking about
our funding because I think it's a really
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good example to founders and entrepreneurs.
We've never really needed to raise capital.
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There have been a couple of times
in our company history where we've chosen to
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raise vent your capital. Were raised
a seed round coming out of the five
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hundred startups accelerator program about nine years
ago, raised from a strategic and then
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raised our forty million dollar round in
fall. Two Thousand and twenty one,
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I would say, for almost every
year of our business we have been profitable
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and we've had this like very sustainable, profitable business and even US raising the
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serious C in fall two thousand and
twenty one. The goal is that we
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still maintain that, that we still
really are building this business, that we're
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what we're doing sustainable, what we're
doing is for the long term. That's
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really helpful, since you've been profitable
for seems like the entirety, or close
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the entirety, of baby list.
was that ever like an issue for investors,
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and I mean that because that's you
are so kind of grow, grow,
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grow, growth minded and, you
know, let's think about profitability may
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be way later. was that that
ever come up as maybe like an issue
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for you? We're not really.
Yeah, it would come up as complete
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confusion. It was like no know
who to compare you too. Like that,
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we've also really been growing as well
as being profitable. It's like very
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confusing. It's like when's your payback
period, the like. What's you your
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burn ring were like not here,
like let us educate you on our business
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model. I think something really interesting. When you're talking to VC, and
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I can say this with someone I've
run this business for eleven years, I
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understand our business model. I have
some insights on what works and what doesn't
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work, and you talk to an
investor and they really do understand businesses across
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domains and have all of that and
I do think that entrepreneurs can really get
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in trouble if they take that advice
in an unfiltered way without really saying like,
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what would actually work for this business, not what's wishful thinking for this
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business, and so I think that's
something that's come for me. There's a
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level of confidence after having run this
business to really put things through that filter
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where there's a lot of very valuable
insight that investors are seeing on their end,
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but it's really important to know what's
going to work for this business now.
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No, totally. Do you remember
ever getting any point of views from
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investors who just were, you know, educated or quite know of baby list
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that you thought that actually wouldn't work? That definitely would not work in our
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land of business. I would say
this last round of fundraising I met incredible
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people, women with two month olds
pretty much everyone, and actually use maybe
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less either as a registrant artificover,
which felt fantastic. There are certain ideas,
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if they're spreadsheet ideas, it's like, wouldn't it be better if we
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had like a longer LTV? And
it's like over, some be better.
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You're right, it's completely correct.
And then I'd feel like, but do
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you see, like all the value
were providing for people, like up until
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having the baby, and like here
is how we extend that lifetime and we
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really do into parenthood. And so
ideas would come like that, like Oh,
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would like, wouldn't be great to
turn this into a diaper subscription,
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and I think that could be a
great idea for someone else's business. It
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would be. It'd be like,
of course, but like that, that's
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not going to work with like what
we do, and so I actually appreciate
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that energy and advice. I do
think it's up to the entrepreneur to have
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the right filter for it. Going
back even your question about investors being confused
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by the profitability. Now profitable companies
are in vogue. We were really to
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being profitable before it was before it
was cool. What were some of the
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moments did you look back that you
think we're like actually huge unlocks for your
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business, and maybe you were not
obvious at the time, or obvious or
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obvious. I think that one was
when we really chose to invest in our
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content, and you you mentioned our
content and I said, actually, it
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wasn't there from the very beginning and
the way we actually launched it. We
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had fantastic intern and she did users
survey with our users about their favorite products
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and then turn that into kind of
the very first version of like best diaper
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pals, best baby bottles, these
guides. And this was at a time
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when what you would find in the
Internet would be a twenty seven slide slideshow
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on best rollers. So not very
helpful and the goal at that time,
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I think, really was content marketing. So this is a way to do
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content marketing and how we're going to
be introduced to our audience. But I
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actually feel like the commination of this
content, plus commerce and audience has actually
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been so critical to US getting to
this stage in terms of our core user
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experience. So when you're going through
this experience, we actually are the most
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helpful source to make all these product
decisions, and that's something I hear all
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the time from our users. and
to how we're able to work with partners
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because we really have that trust.
It really was critical to moving us past
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just being this tool to being really
influential and really helping on this other level.
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Another was this was small and I
think is something that we've been able
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to really scale up in the past
year and have big ambitions for it in
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the future. We're great at helping
you make these product decisions. We know
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this audience, we have a lot
of data and we knew bottles for this
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very high consideration category. Giving someone
a bottle is actually not a great gift,
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and so we brought to market the
baby list bottle box and it's five
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of the top rated bottles in one
giftable package, so you can actually try
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out your bottle. So we're hearing
from parents has how like how am I
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going to know what bottle might be? Be Pre first, and so you
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try it out and then you can
actually buy the whole set. And our
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our merchant, who's still with us
here at baby list, when we initially
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talked about as she was like none
of these brands want to want to be
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in a box with other when like
competitors, and I was like, well,
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just like get them on the phone. And she's brilliant and I think
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in the initial phone call got like
four out of five yesses because everyone genuinely
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thinks they have the best bottle,
they're just like bring it. So I
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think for us, like this was
really proving we could make things that weren't
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great gifts great gifts. We could
really extend our value proposition of helping you
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find the right products for your family, like actually to life and like bring
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something to life that didn't exist.
And I really love how you're able to
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kind of convince brands to actually participate
in the bottle box. That psychea well,
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if you think you really have the
best bottle, why would you want
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to be our bottle Bo right?
That's genius and I also love that because
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I know, saffly firsthand that when
you receive just one bottle it's like it
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doesn't feel that grave of a get, but if it's actually wrapped up and
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package in a box and you can
actually feel and get a sense of okay,
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this is actually very useful because then
for my baby I know which bottle
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is actually going to work for for
him or her. That's awesome and I
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loved that you pointed out this kind
of content plus commerce and how you're able
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to figure out that piece, which
obviously I mean you can totally understand,
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a huge unlock for for your business
there, if you within would love to
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dig into that a little bit more, because obviously, what you're creating,
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and why? babyless. Even though
your person online, you're you're buying real
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physical products, right. You're never
gonna be able to touch her or have
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like a set of touch or able
to experience a product unless you obviously go
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into a store. Or how do
you think as well about bringing that experience
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the buying instead of clicking, experience
per se online, so that maybe you
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have like a pretty good idea in
terms of what you're getting? So we've
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kind of approached that in a real
channel strategy. Our thesis around really the
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video production we've done for Youtube is
we want you to find that Youtube video
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that's this stroller versus that stroller or
that's giving you all of the spects on
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a specific carciat. We want you
to be able to watch this video that's
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less than five minutes and we want
you to understand that product, the prosing
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and the cons, because all products
have cons. Not Everything's right for your
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family. We want you to understand
why it might not work and really have
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that editorial angle. We wanted to
be better, like when you watch that
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video, you understand that stroller better
than if you actually saw it in a
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store. I think when we look
at there's different types of when we look
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at email and maybe like more of
the fun products, it's actually much more
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about discovery. So it's about like
I didn't even realize that this product existed
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and this is so interesting, this
is aspirational, this is inspirational. That
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has a bit of a different vent. We're actually really interested also in what
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is baby list? What's the baby
list experience in real life? And so
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in January we had a pop up
in La it was called baby list cribs
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and it was phenomenal. And if
you just think about the a registry experience,
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it's a life stage, almost like
going to buy my wedding dress,
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like in something that everyone's going to
do. I'm going to go and I'm
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going to make all these product decisions
and it feels like there should be some
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way to do that, I say, closer to a showroom than a store
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where I can't make fifty product decisions, probably fifteen of which are very high
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consideration, and feel really confident in
my decisions. And so cribs was kind
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of that first time that we explored
that and there's a virtual version of it
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now online, so you can actually
experience what that was like virtually, and
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I will. I'm excited about how
this is gonna continue to grow in the
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future. No, totally, and
I love the fact that it's also a
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virtual you also started creating your own
products, because I mean you're kind of
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shifting them from kind of curated different
brands to your own brands. Was that
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business strategically? Was that a difficult
shift to do in Your Business? That
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was it when I talked to you
through the baby less bottle box. That
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was our very first fray into that. They'll highly successful in that it was
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great for brands, great for users, great business model. That's something that
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we have been able to extend over
this past year. I believe we launched
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a baby less passifire box, a
baby less wattle box, and so for
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us, as we bring products to
market, and Dirk, I three three
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things that I really think are important
and that are real advantages. One is
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we have this incredible data, so
we understand what this category looks like a
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cross retailers, because people are adding
items from just to cross retailers. We're
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we're able to know much more about
what people are actually asking for and purchasing
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outside of what we're directly selling.
We also, in everything we do,
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having this very high level of trust
with our users is the number one thing.
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When we don't have that, then
I think that it'll be very bad
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to our overall business and overall brand. Trust is the most important thing.
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And the other thing is we really
want to take things that are not great
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gifts and we have this opportunity to
make them incredible gifts, because what we
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do is all around this gifting experience
to this new family. What has been
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your approach from the very beginning when
it comes to billing out the baby list
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Heab as you've expanded through eleven years? This is something that I really struggled
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with at the very beginning. It
was hard for me to tell people why
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they wanted to work at baby list. It was even hard for me to
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define roles it. I would say, like at that very bootstrap stage when
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you're five people, ten people,
it was incredibly difficult. Now, kind
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of in a fastforward way where this
is just become more and more of the
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case, we have a consumer brand
that people really now have experience. So
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when I'm interviewing people there are very
familiar with what we do and I think
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also when we're talking to people about
joining the company, there really is this
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like values element to it. We're
serving families. We consider ourselves an anti
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racist organization. Something that that actually
is quite authentic to our culture is we
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pretty good work life balance, and
that even starts with me, and that
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came from a really I remember sitting
in a conference room and thinking about like
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selling the business. This is quite
early on because I felt burnt out.
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I was like, actually, it's
better for the business itself if I make
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my work much more sustainable, so
I do this for a longer. And
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it really was this shift in US
really encoding that like work life balance was
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important to us. People don't get
emails on the weekends, people have their
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evenings and can still be very successful
here, and I would of that in
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a way that I did not first
see. It's just helped us attract incredible
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talent and they're at this place in
their lives where they have a ton of
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experience, they want to join a
start up that's very interesting and they're at
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a life stage where they're really valuing
that balance, and so it's actually helped
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us recruit amazing leaders, amazing team
members across the board and I think in
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a really fantastic way. That's awesome. I would love to kind of hear
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more about that point in time where
maybe almost sold, or think about selling
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baby list and you were burnt out
and you realize that you maybe need to
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have some distance or have, you
know, worklight balance per se between babylist
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and obviously your life. What were
some of the changes that you made to
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to kind of give you that space, because when I talk to entrepreneurs,
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I think it's sometimes it's really hard
for them to actually give themselves even time
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to actually have that space per se. So how did you then structure,
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I guess, work like balance in
your own terms. I can't all.
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I can name some tactical things,
but I would say that the thing that
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I know about myself, and I
guess not just through this part of my
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career, through my entire cares,
I know what it feels like when I'm
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burnt out. I know my body
feels like. I know what it feels
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like then if I take a weekend
off, and so I'm pretty self aware
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about where I am in terms of
my energy level. And I really think
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about it in terms of managing my
own energy, because when I manage my
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own energy I'm able to like actually
show a better, I'm able to lead
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that meeting better, I'm able to
make that decision better, and so I
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would start with that. In terms
of tactics, there was a time in
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the company history where I really felt
quite burnt out and like once a month
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I would take Wednesday off. I'm
liked, look at it was that small.
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It literally is that small and it
would be really meaningful. I actually
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try. I don't work in the
evenings. I know about myself too that
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I just have this diminishing level of
results. After certain hour I just get
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really dumb, and so I just
stopped and I know what it feels like
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again the next morning. That's not
to say I also if I am going
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to do extra hours, I would
do it on a Saturday morning, and
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so I just I actually think about
it in terms of managing my own energy
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and being selfaware to know what I'm
the most effective. Gosh, that is
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so well put. My I really
love that a lot. Just think about
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managing your own energy. That's something
that I've been thinking about a lot for
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myself and kind of like even when
I think about with my diet or just
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different things, like what actually is
give me energy versus not, especially being
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like a new dad and so like, I always just think about things in
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terms much more in terms of like
energy. So I very much can relate
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in a very, very small way
to that side of things. What has
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been the result with a pandemic on
baby less? What was kind of going
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through your head personally and professionally during
like Mars Two thousand and twenty, and
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how are you thinking about Your Business? I had run this business for ten
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years and and I knew everything about
our users. I understood how baby showers
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worked, I understood how baby registries
worked, I understood all of the social
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dynamics. And with Covid I felt
like I understood absolutely nothing and I had
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no idea what our users were doing. I had not I felt like I
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actually lost that reel thread to like
what actually drove our business. We saw
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it a couple weeks earlier. There
was a very a very visceral memory of
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our leadership team all sitting in a
conference room, all breathing each other's air,
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but actually saying this is coming.
What does it mean to our users?
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What does it mean to our vendors? What does it mean to our
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team members, and actually having that
conversation. But the key thing was I
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I was really worried. It was
my worry was our product is is tied
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to this physical, real world event. So this real world event with many
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people, sometimes a hundred people,
with your grandma, with this pregnant mom
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like did, this event is going
to be the event that does not have
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enduring a pandemic, and so people
aren't going to need a baby or industry.
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So we kind of took that whole
first month. That was also the
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year we were going to learn about
physical retail so we could open in a
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lot of things right away and our
entire team, who we have in ton
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of team members with kids and young
kids. We're all at home. We
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made the right decisions for our team. I was so proud of our team
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continuing to function, but it was
really we need to learn what's happening and
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we need to understand what's actually changed
for our users and if you really think
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about, like what content and audience
and community means to us, we were
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also we had this very engaged audience
and they were going through a pandemic and
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they were about to give birth,
and so our team, like, was
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also able to absolutely write the best
content for our users who are going through
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this time. How to have a
virtual baby shower of like what is going
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to happen in the hospital in this
pandemic, like what's changed, like how
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do you have virtual birthing clads classes, and so our team really responded in
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this incredibly audience centric way. But
we really did see coming out of March,
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like a lot of online retailer stood, was this huge Tel went.
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It was, I think, driven
because people wanted to be more helpful to
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the families who were having babies.
People, I think we're more likely to
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get you things you really needed from
your registry. People were more likely to
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buy them online, and so this
gift giving actually increased and when we look
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at all of our engagement metrics,
they all actually went up to like new
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levels that we had never seen before. And so I would say for the
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rest of two thousand and twenty,
it was really about our team just hanging
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on to this growth we were seeing
while everyone was at home kind of dealing
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with like everything we are all dealing
with with our individual families. What is
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one thing that you would change about
fit your capital? I think venture capital's
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Great. I think the thing I
would change is probably outside of venture capital.
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I think with venture capital that announcement
of we raised money from this investor
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it, you get the PR from
it, you get the hiring bump from
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it, you and invited to the
conferences, like it really shies this external
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signifier that you are hot company,
you know what's going on, you're going
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to be a great business or you
already are a great business. And like
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I think all of that, all
of that's great. I would say,
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as really the company that was the
bootstraft company, like you're making money,
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you're getting bigger, like that.
Actual the substance is really there. I
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think just having a place actually where
we celebrate those businesses more like is actually
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the thing that I would change.
Totally agree. Actually, you should be
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much more encourage, first of all, like the P word profitability. I
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think of that should be a lot
more celebrated, and also like looking at
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actually revenue and and see how a
company's actually performing versus how much money they've
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they've raised, and being kind of
food and auditor over that. I completely
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agree with you. What's one book
that is inspired you personally? What both
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inspired you professionally? Professionally, I
think I read it about a year ago
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and it was recommended to me by
another CEO. It was no rules,
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rules by Redis, things about Netflix
and their culture. Have you read it?
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I have not. Actually I think
it. When I read it,
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I think I was like Oh,
like, I'm a pretty good CEO,
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like I know what's going on,
I know how to boilt this business.
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I like we have a good culture
and I read that Book and it was
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this DEP illustration of how to just
have a really strong culture, what the
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tradeoffs and it really to me,
I guess at that time it was like
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there is an entirely different level of
like how I want to grow, like
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I actually could see this like new
level of like what it meant to be
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a company leader. I would highly
recommend it. I may make that like
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a professional and personal example. I
read a personally. I recently read dear
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sugar, its an online advice calm
and there's an anthology. It's by Sheryl
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Strait and it was like absolutely touching, wonderful and all levels. I highly
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recommended. That's awesome. That's awesome. You know, it's funny, I
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don't think we've actually had a past
guest mentioned either of these books. So
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you are very original, Natalie.
So a really excited added these for our
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book list. But I found a
question to you well, on advice.
402
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What is? What's what piece of
advice that you have for founders? Oh,
403
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I thought you're going to say for
new parents. That too, that
404
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too, I could use it.
I can use it, I think in
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fice I could really give myself.
And it actually comes from the place of
406
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like not necessarily are like level of
success, but it actually comes from like
407
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this being such a long game.
This has been like a decade plus for
408
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me. I really want to continue
to learn in this job and leave this
409
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company, and it actually is that, like relationships are long, that you're
410
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going to have a chance to make
that business decision again. It's really having
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Anna long term outlook. I think
has made me a better leader and it's
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something I didn't have at the beginning
because I didn't have the context of what
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ten years actually feels like. Natalie, thank you so much for coming on
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the show. This is a lot
of fun, and you so much,
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Mike. And there you have it. It was a pleasure trying to with
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Natalie. I hope you all enjoyed. If you enjoyed this episode, I
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00:31:48.960 --> 00:31:52.039
love it if you'd read a review
on the apple podcast. You're also welcome
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00:31:52.079 --> 00:31:56.119
to follow me your host, Mike, on twitter at Mike Guelb, and
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00:31:56.160 --> 00:32:19.759
also follow for episode announcements at Consumer
VC. Thanks for listening, everyone,
