The Startup CPG Podcast

Ben Zises
Foreign to kind of get excited about investing in a net new consumer brand today. I think you need to have some proprietary IP and I will also say and unique distribution advantage. And so while 10 years ago when it was sort of maybe the early days of kind of the D2C brands, if you will, you know, you might just, you could have gotten away with just being a higher design, better for you, better for the environment. Today, those are all table stakes. What you really need is to go beyond that and you need not just unique ip, but couple that with a unique distribution advantage. You need some secret sauce on both of those things to differentiate and get consumers excited.

00:55
Caitlin Bricker
Hey. Hey everybody. I'm Hannah Dittman, operations and finance correspondent at Startup CPG and the founder of Ready Basics. As a former CPG investor, I'm especially excited to host this investor spotlight with Ben Zesis from Super Angel Fund. If you've ever wondered how great angel investors spot winners before anyone else, this episode is for you. We're sitting down with Ben, who's spent over a decade placing some of the earliest and smartest bets in consumer. Ben shares how he evaluates founders at their earliest stages. What separates good ideas from fundable ones and why clarity, conviction and communication matter more than perfect numbers. We dive into how he spots telltale signs of strong founders, what makes a pitch deck stand out, and why consistent investor updates can make or break your next round.

01:36
Caitlin Bricker
We also explore the markets catching his eye right now, from supplements to new forms of consumer wellness. And how angels can build an edge through discipline and pattern recognition. Whether you're raising your first round, refining your deck, or trying to think like an investor, Ben brings rare insight from someone who's lived the full journey from prolific angel to institutional consumer investor. Enjoy. Hey everybody. Welcome back to the Startup CPG podcast. This is Hannah and today I'm here with Ben Zeissas, an investor from Super Angel Fund. Ben, welcome to the show.

02:11
Ben Zises
Thanks so much for having me.

02:12
Caitlin Bricker
Can you share your title and a brief background of your experience prior to super angel and what led you to investing in the first place?

02:19
Ben Zises
I started founder and GP of Super Angel Fund, an early stage fund investing in consumer prop tech and future of work. I grew up in New York City. I was an entrepreneur like, you know, early in my career. Started businesses in elementary school, actually high school, college and kind of first job out of school was in the real estate world doing store leasing. And yeah, like I think a lot of people familiar with, you know, maybe residential leasing or office leasing, but retail store leasing was Representing building owners and mall owners or tenants and helping them search or sort of market their vacant retail space. And kind of having the entrepreneurial mindset. I did the job for six months.

03:05
Ben Zises
One of my clients wanted to find, you know, 10 new, it was a Verizon wireless store and they needed, you know, to open up new shops in New York City. And I, I was having to rollerblade the streets of New York City at night actually to write down addresses and collect information and write down the phone numbers from, you know, signs in the window. That's how building owners were marketing their space, just, you know, putting an advertisement in the window. But of course that was so limiting and so I couldn't understand why there wasn't an online platform, you know, to sort of marketplace to search and advertise for retail and just like there is for residential. I'm sure all of our listeners are familiar with Street Easy and Zillow or Trulia at the time.

03:44
Ben Zises
And so, you know, kind of the entrepreneurial mindset, I decided I'm going to build it because it doesn't exist. And I ended up spending four years sort of launching this prop tech startup called retailmls.com and you know, that was kind of the whole founder journey. I raised early stage venture and you know, I like to tell that story because that was obviously a very formative experience for me, but from the founder side. And so that's kind of like my early career story, which even though unfortunately that company wasn't sort of as successful as I wanted it to be, it actually gave me just exposure to venture from the founder side and early stage and fundraising.

04:21
Ben Zises
And just as that company was sort of coming to an end and we could certainly have a whole show as to what I did wrong and all the lessons that I learned. But I ended up just kind of paying attention to the companies that were successful at that time. Going back, that was sort of like 2014 actually talking 11 years ago when I was winding down my prop tech startup and I had been a customer of dollar Shave Club, which was, you know, high growth consumer product company, and I was one of their early adopters and I ended up just randomly hearing about another consumer company that was trying to do the same thing but for a different category of the toothbrush space.

04:59
Ben Zises
So, you know, met the founders of a company called Quip, which I'm sure some of our listeners have maybe been a customer of or have heard of a toothbrush subscription company. And I just made my first angel investment and that was kind of what kind of got me into this 11 years ago, made a small angel investment in this consumer brand called Quip and just totally discovered and fell in love with angel investing. And everything that kind of happened from then kind of led me here. So that's kind of my. My origin story, if you will. Kicked off my angel investing career 11 years ago.

05:32
Caitlin Bricker
I love that. I feel like a wealth of knowledge and there's no other better way to learn than trial by fire and learning the hard way, I think. So it's a great perspective to have. I would love to dive in a little bit more into your background and lessons learned and your angel investing journey and what you've built it up to. But before we pivot into that, I'd love to also get an introduction and overview of your current fund, Super Angel Fund. Kind of just walk through the general investment criteria, positioning and how you're operating it right now.

06:02
Ben Zises
Yeah, absolutely, get into that. But it might help just to kind of finish filling in the lines here. So I made my first angel investment in 2014 because it really, that sort of really formed my strategy, which is actually still very, you know, going back to when I was angel investing and now doing it full time professionally. The strategy really has been a little bit iterated on, but very consistent from the very beginning. And so I'll keep going with the story and kind of get into the specifics of where I am today and how things are run here at Super Angel Fund. But so I made a small angel investment in this company, and I really just tried to be as helpful as I could be. And there's a famous quote from Naval Ravikant, the founder of Angelist, prolific angel investor.

06:43
Ben Zises
And he says the best way to build a brand in this business, referring to early stage investing, is to help other people. And I just want to let that sink in for a second. That's the North Star of which sort of how I've operated from day one, going back to 2014 and making my first angel investment. It was, hey, let me make a small. You know, at the time, it was a lot of money. It was a $10,000 investment for me, late 20s. It was a lot, big commitment. But I said, let me do everything in my power to help this company. And kind of one thing led to another, and because of my prior founder experience, I was able to help with their pitch deck with fundraising and. And just being helpful kind of led to just other doors opening.

07:29
Ben Zises
So I started making other, you know, hearing about other consumer brands maybe, or they heard about me. That I was angel investor and I started to see more and more deal flow and I just started writing small checks into consumer founders and trying to be as helpful as I could be. I try to be their biggest champion, their advocate, anything I could be really to be helpful. Fundraising was the primary driver of how I was sort of supporting these companies, introducing them to my network which just kept growing. And again I had raised capital from 30 plus investors. So, you know, kind of just opening up all the doors that I could. And I angel invested for six years and built a portfolio of about 30 brands. And you know, one deal kind of leads to the next.

08:10
Ben Zises
And I just totally fell in love with it, like I said. And so, you know, sort of almost six years angel investing in consumer brands and kind of living by this strategy of just helping people, word of mouth spread and the deal flow just continued to grow and these businesses started to become breakouts and category leaders in their sectors. And in 2020, like a lot of people, I went through kind of like a, you know, a little bit of like a moment of what am I doing with the rest of my life. And it's important to note that I was angel investing kind of as a side thing. I was working full time in a traditional real estate investment role in a perfectly successful sort of real estate company that I helped start as well.

08:48
Ben Zises
But my passion was all working with founders, spending every minute, kind of before work and after work, angel investing, supporting these founders. And that really I was sort of running two full time jobs and I decided that A, if you want to be the best in the world at something, you need to be doing it full time. And B, it was really just, I felt like I really had, you know, a pretty good eye for which brands maybe could resonate. And I decided that I really, yeah, I wanted to do what I loved for full time professionally because of course angel investing is only money out the door. But running a fund, you sort of, you know, earn some management fees as you go. And I decided in late 2020 that I was going to do this full time.

09:27
Ben Zises
And that's when I Launched Super Angel Fund 1. Kind of Love the name. It really speaks to going back to where I started. As far as my strategy or what differentiates me is I'm very much angel, you know, and I run a fund, but I operate very differently than a traditional sort of institutional sort of venture fund, if you will. And I'll speak more to that now, which is, you know, most investors of early Stage brands and companies for that matter consist of either sort of a part time angel or a traditional sort of venture fund.

10:01
Ben Zises
And I think what separates me and super angel very sort of very distinctly from the pack is that I'm really a hybrid where I invest as angel, but with the capacity of a fund and the ability to kind of leverage not just my own money, which of course I invest in the fund as well, but really the LPs that invest with me. And so in 2021 I launched fund one. I went out and raised over $10 million from a hundred plus investors. And I continued investing in lots of great brands, but also I started expanding more into these commerce tech companies as well that sell into the brands because as you would sort of imagine, I had really unique insights from the brands as to which tools they were using to manage different functions of their business. And thankfully I sort of expanded.

10:47
Ben Zises
I didn't never stopped investing in brands like a lot of people. I will say like a lot of consumer investors, they sort of ditched CPG for a while now.

10:56
Caitlin Bricker
Yeah, CPG became the very ugly duck.

11:00
Ben Zises
Yeah, four letter word. Like couldn't talk about it. Like no one wanted to. I never once stop because I mean I just think there's so many people that are, you know, sheep. They just follow the herd, you know, their LPs tell them they can't do it and so they don't do it. Whereas for me I don't have one sort of anchor or lead LP that's giving me strict requirements and constraints. And again going back to the differentiator is yeah, large funds have very strict requirements as to ownership targets. They take a long time to make decisions. Angels on the flip side have a lot more flexibility and can move quicker. And I do that, you know, full time and so versus the hobbyist who's not able to track these companies.

11:41
Ben Zises
I'm able to support them and track them in a really unique way and offer that speed and agility when it comes to funding their business.

11:48
Caitlin Bricker
That's awesome. That's really great perspective and touching on a lot of different topics there. As far as check size go, I know you're talking about like your dynamic and kind of your IC process being very nimble and efficient, being in your space. Angel, operating essentially from a larger fund base. Are your check sizes angel check sizes or do you write more similarly size to institutional checks?

12:14
Ben Zises
Yeah, so historically my average check has been especially since Fund 12021 and I launched Fund 2 earlier this year. It's been a 50k first check size, which I think is much more, you know, in line with like angel check. And I do that at scale and the sort of differentiator with respect to my strategy and especially what I sort of pitch, if you will, to LPs is for me, what I do is I try to make a somewhat small investment as early as possible in the life of a business at the stage where I'm really evaluating the founder first and foremost as well as the market opportunity. And sometimes they're not. There might not even be a product or a name beyond that. So I make roughly 50k initial investment.

12:56
Ben Zises
I stay really close to the founders I invest in, which is by design strategic. But also it's just kind of the role I like to play. And what it does is it unlocks sort of relationship and information as to what's going on in the company. And if I start to see the business perform and I start to get more data points that give me more comfort, what I do is I then double down, triple down, even quadruple down or more. And between the pre seed and series A stage, I like to build what I call like, build a position in the company, almost like a public market investor buying shares in a stock, which of course you can do on your brokerage app. You know, you could buy shares in a public company stock Monday through Friday, 9 to 4 when the market's open.

13:38
Ben Zises
And I don't think, you know, I'm sort of bringing that approach to very early stage, you know, angel private investments. And so, well, I'll start at 50k. There's quite honestly dozens of examples where it's grown substantially. My investment has grown to mid six figures, even seven figures. You know, I might end up with 500k, a million dollars, and in a few cases, $2 million invested in a single company. But it almost always starts with a much smaller initial check. And over time as I start to get comfortable with the business and their traction and that's where I sort of grow that position. And again, I just want to say a differentiator, a traditional fund might have to put a million dollars in and own 10%. But when a startup's only raising 500k, there's just simply no opportunity for that fund to participate. Right.

14:28
Ben Zises
So I sneak in the door early with my first check, unlock that information, that seat at the table, get access to the signals and then kind of double down when it makes sense. So that's the strategy.

14:40
Caitlin Bricker
Yeah, that's a really unique approach.

14:41
Ben Zises
And I Don't want anyone to steal my approach. No, I'm kidding. I'm a big believer in just like it's hard, I tell founders all the time, like keeping things close to the vest. I think the benefits are, I think you get a lot more benefit by like sharing and being more transparent with people. And I just think it's a lot harder to copy someone's strategy or business model than people often think.

15:03
Caitlin Bricker
For sure. I feel like we wouldn't have strategic acquisitions if it was easy enough to copy all these ideas. Right. That wouldn't even exist.

15:10
Ben Zises
Absolutely absolute.

15:11
Caitlin Bricker
So you kind of come in with a small check, you watch the traction and the development of a company. You double down on your bets as you continue to see growth and things going up into the right and in the right direction or as a need presents itself. And you've had a lot of entrepreneurial experience, you've clearly worked with quite a lot of entrepreneurs given your approach is a little bit more volume based since your check sizes are smaller. So you've probably seen quite a broad swath of different founders and brands and experiences. What are some of the lessons you learned in angel investing that you think institutional investors could benefit from learning from you? Or founders that are early days kind of getting in touch with angels as they go on their journey?

15:52
Ben Zises
Wow. Yeah, a lot of great questions there. So, yeah, for sure. Let's say my strategy is definitely a little bit of a volume game relative to other funds where maybe they only make 30 investments. And I had a hundred companies in fund one, I'll have a hundred companies in fund two. Interestingly, I just published my quarterly newsletter and quoted the head of research and data at Carta and another sort of research firm where there was just ample data based on like simulation of 20,000 plus venture fund outcomes that showed that funds that actually make more investments have a higher likelihood of success and that the truth is people should actually be making a lot more investments than they do on average. And it just validated my strategy. So was happy to kind of share that with my network in the last newsletter.

16:44
Ben Zises
But as far as sort of advice for both LPs or institutional funds and founders, I'll start with some advice for founders that I, I give, you know, regularly as to how they can be successful fundraising. I think, I think there's a few things. One is the number of companies that try to raise money versus the number of companies that successfully raise money. I mean, it's, the ratios may be 1 to 100. As far as who's Successful, Right. You really need to be in the top 1% to successfully raise kind of venture capital or, you know, angel funding, friends and family funding. I mean, the amount of people who have an idea versus the percentage that actually go out and do it and execute it is very small.

17:23
Ben Zises
And the percentage that is able to raise capital from, you know, not their rich uncle is even smaller. And so my point is you need to be in the top 1% at least. And I say top 01 percent and so just sort of backing into it. What that means, in my opinion, is that every single touch point you have with potential investors needs to be that kind of quality. And so let's start with the most basic piece of material. I call it the common application. When you're applying to college, pretty much every company has a pitch deck, right? Everyone's got a pitch deck. There's obviously examples of founders who have moved to maybe a written memo, but for the most part, I would say the majority of early stage companies need to have, should have, do have a pitch deck.

18:05
Ben Zises
Well, okay, that's a little bit of a window into the founder, how they think, how they write, how they present information, how they communicate. And while there's no silver bullet to be have a successful fundraise, you better show up with a top 01% pitch deck. Okay? And of course, that's subjective. I might think a deck look is a great one and you might think, you know, we might disagree on what's a great pitch deck. However, there are some basics when it comes to a pitch deck that I think we would all agree on and I think like an extremely well organized, well written, well articulated. And I'm going to give you the number one word I use to describe a great pitch deck, because a lot of people think, I mean, that they should go hire a Designer and pay $10,000.

18:48
Ben Zises
And the truth is that's not the case at all because it shouldn't cost you anything to have a great pitch deck. What I'm looking for comes down to one word, which is conciseness. I want to understand what you do as quickly and as succinctly as possible, and I need you to be able to articulate it in a way that's digestible. You send me a block of text, you show me a pitch deck with all this garbage on the page, you're simply not going to be able to cut through the clutter and capture both, you know, investor attention, employee attention, customer attention. It's a great, you know, sort of filtering mechanism, if you will. To how the business, you know, the future potential of the business.

19:26
Ben Zises
And so I personally, someone who's, I see 100 decks a week, you know, I'm filtering an enormous amount of inbound deal flow. And, you know, that's just one way to quickly separate out, you know, the 99% versus that 1%. And also seeing that volume gives me a perspective where, you know, a hobbyist angel investor might only see a deal on a month from a friend from college or a, you know, a distant cousin. Right. And so they just simply don't have that perspective potentially. And they could always get luck to sort of be able to compare and contrast one off the other. So for me, I really do put quite a lot of weight on the quality of a pitch deck.

20:05
Ben Zises
And again, it's really just seeing a founder articulate their business so concisely, you know, and I think you had sort of before we got on the phone, we talked about some, you know, interesting questions, which is like advice on what should be in the pitch deck. It's not that hard, right? Obviously you want to understand, especially for a company that doesn't have maybe a product or financial performance to show you really want to understand the founders, the team, their background, the market size, the market opportunity, what the product will be and what their go to market and distribution strategy will be. You know, it's not rocket science. I think, you know, people generally have a good understanding of what should go in the pitch deck. It's really just removing as much fluff and words.

20:47
Ben Zises
And I understand you want to tell me everything there is to know about how, you know, this concept came about and why you're so special. But it's actually much harder to write a shorter pitch deck, of course, than a longer one. And so that's one element that I really look for. But the other best strategy I recommend to founders, fundraising is to actually put every person they've ever met in their life on an email list and start sending investor updates well before, you know, you launch. But if you're fundraising, what you want to do is show this consistent pattern of kind of doing what you say you're going to do and your commitment to the business. Right. Because going back to my earlier point, very few people who actually conceive of an idea actually go out and execute it.

21:25
Ben Zises
And so if you're able to show me 3 months, 6 months, 12 months of consistent sort of updates and performance and just doing what you say you're going to do, you'll immediately stand out from the crowd and fundraising for early stage consumer brands often is a numbers game in some way, which is you want to get your business in front of as many people with capacity to invest as possible. And so again, going back to like not keeping things close to the vest, you know, my approach is actually not only share with everyone you know, but I would ask them to share it with everyone they know too and kind of put it out there to the world, collect feedback and that'll help inform the actual product itself and so bring people along for the journey.

22:05
Ben Zises
And I do think that is a really strong tactic for fundraising for early stage companies.

22:10
Caitlin Bricker
That's great advice. And yeah, I feel like it can be scary as a founder, you know, you, especially if you don't have capital yet because you feel like so much of your plans are ideas and without the money someone else could just take the idea or your competitor might have the idea and you can't move quick without the money. Or, you know, I think there's a lot of anxiety wrapped up when you've put all your eggs in one basket and you've committed your life and your career essentially to something. So I think it's a nice push to remind people that it takes a village to get the money and it takes a village to get the product out there and off the shelves as well. So great pieces of advice if staying on this thread of founder perspective.

22:48
Caitlin Bricker
If you were to go be an entrepreneur again, having all the hindsight and the learnings that you do now, what are some things that would be really top of mind for you that you might be doing differently or would be very keen to get right in the first phase of your journey?

23:05
Ben Zises
So I would say few things. One is the sort of pretty much every market, it's. The world's never been a noisier or more competitive place than it is today. And I would say every day that goes by it just gets more and more of those things. So the bar just is higher and higher when it comes to. And we'll sort of. Obviously this is a startup cpg. So even though I do invest in some other areas, you know, consumer is the largest focus for me. So we'll sort of keep it tailored to that audience. But especially for a consumer brand starting today, some advice I have and sort of things I've seen go wrong that you can kind of maybe get ahead of is to kind of get excited about investing in a net new consumer brand today.

23:47
Ben Zises
I think you need to have some proprietary ip and I will also say and unique distribution advantage. And so while 10 years ago, when it was sort of maybe the early days of kind of the D2C brands, if you will, you might just, you could have gotten away with just being a higher design, better for you, better for the environment. Today those are all table stakes. What you really need is to go beyond that and you need not just unique ip, but couple that with a unique distribution advantage. You need some secret sauce on both of those things to differentiate and get consumers excited. And so you can't just have an influencer strategy. You can't just say you're going to be on Facebook and Google or TikTok.

24:33
Ben Zises
And a great blog post written by one of my friends, co investors Brian Sugar recently was all about how almost start with distribution first and how the product is secondary. And there was a lot I agreed with that approach, which is arguably it's a lot harder to kind of come up with some untapped distribution advantage than an actual product. And so I think actually both are extremely hard and you do need both. But yeah, I would really just think long and hard and yeah, with consumer products you really don't get too many chances to make, you know, to get it right. Some other companies will say like oh, no one saw your first launch, pretend you're launching again six months later.

25:09
Ben Zises
Just you know, like people forget with consumer brands I think you really, it's kind of worth it to maybe spend a year, two years, potentially even more to kind of create some defensibility around the product, the IP package, you know, everything needs to be exceptional out of the gate and roadmap. You need to be set up for the long term upfront. So those are some sort of things and pieces of advice is really think through distribution doesn't just mean just getting a paid celebrity as an advisor because that's just a short, might get you a short term hit. And I mean the amount of, you know, the graveyard of celebrity backed brands, you know, growing every day, there's always the wave.

25:50
Caitlin Bricker
It's like PTC is the hot thing. Celebrity brands are the hot thing. Influencer collabs are the hot. It's like it's always something.

25:57
Ben Zises
Yeah, I never got really everyone knows, you know, someone with a million followers on Instagram today, like that's just nowhere near enough. Yeah. If that celebrity is sort of built in from the beginning, really part of the founding story and they're putting their own money and they're a true co founder, that's one thing. But oftentimes they come in later and kind of, you know, maybe get bored after a few posts. And even Mr. Beast, I think he tweeted one time how he was just blown away how hard CPG is and how the nuances around retail, merchandising and all the different areas of you know, just kind of the things you need to know are, you know, take time and it can't be outsourced and figured out in you know, no.

26:39
Ben Zises
And just reading a few books or you know, scrolling Instagram like these there's experts who've been working in you know, this industry for a long time and they, they still have new things to learn. So you just. Operational excellence is really crucial for any brand today. The other thing just to kind of a little advice and what I've seen go wrong for brands who are commercially successful but maybe not financially successful. And that, and that's a big thing to focus on which is the goal. Unless you're kind of doing this for fun and not looking to kind of make a return on your time or your money. The goal is to have a profitable, a good investment. At the end of the day, you know, it's as hard as ever to start a business and you know, the way we get rewarded is financially.

27:24
Ben Zises
Oftentimes obviously there's fulfillment and all this incredible about getting your brand seen and used and tasted by, enjoyed by so many people. But you really want a financial success in addition to the commercial success. And I think there's a lot of brands out there, CPG companies that I'm convinced will see will have commercial success. The product they'll create will better tasting, better to use, more enjoyable, better for the world. But question then becomes, can it be done in a way that makes it a successful investment and a viable business? And that comes down to capital efficiency, financial discipline, cash flow management. What I like to see on the founding team, someone with like an ex who is extremely financially sophisticated.

28:07
Ben Zises
You can't really just get away with hiring a fractional CFO to kind of manage your books and give you the information you need on the financials. You really need a founder or someone on the C suite to kind of be living in the financial model 24 7, 365 because there's just too many variable costs and too many moving pieces that you can't wait a week for your fractional CFO to kind of run some numbers and get back to you like the world's changed on a day to day basis like that Needs to be a skill set that's really inherent from founding at the top. And so it's really a tough situation when you see a brand reach, what I call is like magic, kind of like hitting an inflection point where it's, you know, it's. It's going viral and everywhere.

28:46
Ben Zises
It's seeing so much success which is on its own, like you've achieved the impossible by breaking through the noise. But again, it needs to be coupled with that financial discipline. You know, what I want to look for is, you know, the founders with that background, you know, CPG founders who come from, you know, the finance department of other merchants and brands. Because it's sort of. It's just native to kind of like how they operate and kind of almost. What's the word I'm using? Almost just like orchestrate the business, you know, reverse engineer it in a way of like. Well, because we need to see these sort of metrics, then we need a product that will be X, Y and Z. And I've seen that a few times. And you know, we're sort of. Yeah.

29:26
Ben Zises
Creating this unit economic structure based on what's going on in the world and customer acquisition costs and all the consumer behavior and all that.

29:36
Caitlin Bricker
Yeah, that's all great advice. Wealth of knowledge, I feel like. And all very sound. You know, I've said it a million times, but I think because everyone is a consumer, everyone thinks they can do consumer professionally or invest in consumer and understanding business fundamentals and what makes any industry ticket is critical to being successful in it, and consumers no different. Just because it's a little bit easier for people to wrap their heads around the final product, it doesn't mean the back end of any of that is any less sophisticated than any other industry. So I'm glad you touched on that. You know, you've talked a lot about the things kind of hinting at the things that founders should focus on and what you might be looking for.

30:17
Caitlin Bricker
But you know, especially on the early side when you're like first making a check in and maybe the. There isn't a ton of traction there yet. And obviously we've mentioned the pitch deck and we'll get back into that at the end of this conversation. But what are you really looking for in a diligence process? You know, like, what are kind of the unlocks if you look back at investments you've already made, what were the kind of diligence unlocks for you that you felt like got you so excited that you were like, I Definitely have to be into this.

30:44
Ben Zises
Yeah, I talk about this all the time. People, you know, LPs in my fund. People want to know, especially since I've, you know, been fortunate to invest day zero in companies that have gone from nothing to hundreds of millions and billions of revenue. And I've sort of written the first check in more than a few of these now. Companies like Quip, companies like Caraway, the cookware brand, you know, first investor before they had a name, and many others that people could see on my website at super angel vc. But as to my selection criteria, there's a few things and I've can dig in more details, but high level, I'd say I'm going to give you three bullets here. I like to say kind of one. Unwavering.

31:23
Ben Zises
I look for a founder who's got unwavering ambition to build what I say is like a multibillion dollar company. And of course if they only get to a few hundred million, I'm not going to be upset about that. But I think the key there is just really someone who has enormous ambition, relentless, willing to sacrifice all the things that you need to in order to kind of be successful, which is a lot. I mean it's really not for everyone. Like one of my founders, just to give anecdote, I mean her company is her baby. I was on the phone with this founder within an hour before she gave birth, her first baby. And it was just, I was, were on the phone strategizing and I was helping her with a fundraise that she was working on and were just talking through dynamics.

32:07
Ben Zises
But I just remember thinking at the time like the reason I invested in you is because the level of commitment you have to this business, that even in a moment like that, such a life milestone moment, like you're literally prioritizing your company. And of course it's not an expectation at that moment for her to be on the phone with me, but it's just like gave me, you know, reinforced kind of like what I just said, which is like that the sacrifice and that unwavering ambition and obsession. And so that's sort of the first bullet when it comes to like a founder or what I'm looking for. And I ask a lot of personal questions in the diligence period to kind of try to understand the root of that, which is where it comes from and making sure that it's authentic.

32:50
Ben Zises
And so the next thing is sort of like a relentless pursuit of perfection and product obsessed. So what I've had to See from great consumer founders is, and I know, you know, perfect is the enemy of good and all that, but consumer like you kind of need to be a 10x better solution to get consumers to pay attention. And so kind of being obsessed with the product and never being happy with like. One of my founders texted me a photo of a packaging, a retail packaging of the product. And he was just collecting feedback from me and asking me if like some. The most tiniest, minuscule kind of shape of this packaging. He was just questioning and obsessing over and it just, I loved that, just seeing this founder's kind of. Yeah. Attention to detail in a way that's just unparalleled.

33:37
Ben Zises
And so that was one example of like being able to appreciate someone's product obsessiveness. And then this third bullet is what I say is like the ability. I'm really looking for a founder because you can't know everything, especially when you get started, but someone who has the ability to learn new things quickly and absorb information fast. And the example I give there is, I remember talking to one of my founders who was about to hire their first employee and they needed to understand how to compensate them properly with stock options. And for anyone out there who's experienced anything with employee stock options, it happens to be extremely complicated. I mean, I wish there was a better way, but like there's so many tax implications and market standards and different ways that you can kind of get. Give shares to early employees.

34:25
Ben Zises
And this founder had never kind of gone through this before. And I think we were on the phone with the founder on a Friday by. He didn't know anything about how this worked. But by Monday he had read everything and was smarter than like a lawyer who's been studying this and working with companies for a long time and just sort of watching this person in two days, over the weekend kind of become an expert so deep on something so nuanced. Like that's an example of being able to evaluate someone's ability to learn new things fast. Right. And so for me it's. The diligence process is so founder heavy. Yeah. So those are some of the things I look for the other secret sauce. So when it comes to due diligence, there's, you know, for me there's lots of data points.

35:08
Ben Zises
I'm sort of collecting and trying to get as smart as I can as quickly as possible on the companies that I look at. So I'm doing reference calls. That's a big thing. And if there is a Product, I'm ordering it, I'm tasting it, you know, I'm talking to customers, I'm following them, social media, I'm doing competitor research, you know, making sure the numbers, their corporate documents are straight.

35:26
Ben Zises
But one more piece of diligence that I do often that most people I think miss or just for whatever reason don't put enough weight on is if a company has taken money before I've met them and been around for maybe, you know, even six months or a year, what I like to say is I like to ask them if they've been sending out investor updates to their existing investors, and if they have, I ask them to send them, send that to me. If I could only have one piece of diligence, that's what I would ask for, which is their prior investor updates. Because to me, that is going to be the single if looking back now 10 years in. The single common attribute of successful companies is ones that have sent consistent written, call it quarterly, monthly, roughly.

36:09
Ben Zises
I always recommend quarterly but consistent quarterly updates. You know, I don't know exactly why, but I do think it's just representative of like respecting your investors, your ability to communicate, discipline, your level of commitment. And so it's a big thing for me that I expect from the founders that I invest in and like to see as part of my due diligence process. And going back to an earlier piece of advice I gave, which is even if you don't even have investors, you should start writing investor updates. You know, people who will be potential investors. And it's just, it's a great habit to get into. And it becomes your best marketing materials for whenever you need money again.

36:48
Ben Zises
Because the worst thing which every investor has experienced is not hearing from a founder for a year or more and then getting an email saying, hey, we'd love to catch up, we're actually raising another round. And it's like, you're only coming to me when you need more money. Like you're not telling me what's going on in between that. And so that's terrible hygiene to do that as a founder. And I think it doesn't serve them well at the end of the day, kind of just going, giving updates or going to investors when you're fundraising. I think you really need to be doing that consistently and you'll end up being in a much better position to raise money in the future if you've been updating people along the way.

37:28
Ben Zises
Even if things haven't been going up into the right, it's just because you've shown respect and a level of kind of appreciation and commitment and so that's some other advice for everyone out there.

37:41
Caitlin Bricker
Yeah, no, I think that's a great perspective and interesting and often. Yeah. Overlooked portion of the diligence process. I have empathy for founders because I feel like, you know, if you're wearing a million hats and you're moving so quickly, it might not be something that's on your radar, but it's a great call out to have front of mind for people that some investors really focus on that and it's a way to keep yourself organized and honest as well. Almost like you're building up to a little board meeting.

38:09
Ben Zises
Tremendous empathy for founders, especially solo founders as to like how stretched thin they are. But it's no excuse because at the end of the day you're the CEO for a reason and you just need to, you know, figure out a way to better manage your time. Hire people to take things off your plate. And those are all, you know, parts of building a successful company. And if you're unable to kind of show that you have the time to step back, you know, send a few bullets and a lot of founders think they need to have had, you know, world changing news to share with investors and that's not the case. Like incremental updates are still valuable and so it shouldn't take that long to do these.

38:51
Caitlin Bricker
Yeah, that's a great advice and I think most founders probably do have it for themselves and like you're saying, are maybe a little bit nervous to share.

38:58
Ben Zises
Sometimes founders think, oh, no one responded to my last update, so no one's reading it. And I would just tell you that's a, everyone's reading your updates. Keep sending them.

39:07
Caitlin Bricker
Yeah, no updatings. Idy kind of pivoting to a little bit more of your market perspectives. You know, CPG and consumer investing. I've, I've spent my whole career in consumer now for over 10 years. I scary to say and even within my, even my small chapter, I feel like I've seen so many waves in the pendulum swing. I've seen, you know, things come and go and when things get hot, especially on the investing side, you can really tell when kind of there's a trend happening. Is that how you're thinking about what types of CPG companies you're looking at or are trends and waves a little bit less relevant to your sector focus? You know, is there anything out there that's really getting you excited or from A market perspective. How are you thinking about things these days?

39:50
Ben Zises
Yeah, obviously market's always changing. Keeps it exciting. Yeah, I think trends are important but I think it's sort of making sure you're maybe investing in trends that are here to stay, obviously versus fleeting. And you know, one example I'll give in my portfolio is creatine happens to be the fastest growing supplement on the market. You know, there's the founder that I'll speak about in the moment, in a moment, this founder, Dan McCormack who started Create, which is becoming sort of the leading emerging brand in the creatine space. He innovated with the form factor being a gummy and this is consistently kind of performed in how he's operating the business across every discipline. But he, his vision is that, you know, the market's going to basically a hundred X in the next maybe 10 years.

40:39
Ben Zises
And so, you know, a million people are supplementing with creatine perhaps today. And his vision is that could grow to a hundred million people, you know, in the not too distant future. And so that was one that I was fortunate to invest in from the very beginning and then you know, kind of repeatedly more than a few times as they've kind of scaled up. But you know, that's one where it doesn't feel like it's fleeting, it feels like every day. The data, the research continues to be so positive as to the benefits that one gets from supplementing with creatine. You know, that's an exciting kind of space. And actually I've made a second investment in a CPG brand which I can talk about even though they haven't officially launched yet.

41:22
Ben Zises
It's called Man Cereal which will be a creatine protein infused kind of cereal for targeted towards guys. But that's just an example of a, you know, sort of emerging category that I feel has real kind of roots and legs and kind of something that isn't just, you know, like the next kind of fitness equipment or fitness workout program that might be, won't be here in 10 years.

41:48
Ben Zises
And I think just on a bigger level, just supplements in general, I think there's been for various reasons, you know, going to the health and wellness and consumers just, you know, especially Gen Z and younger people just being more mindful and thoughtful around their health and kind of like that is like a flex today is like your health routine and what maybe your skincare routine and these are sort of consumable products that are taken on a, you know, recurring basis as opposed to maybe a one off and so there's that sort of repeat purchase behavior built in. And yeah, I think companies like that have a little bit very similar kind of software like recurring revenue metrics if you will. And so yeah, I think that's just a space that I'm kind of keeping my eye on and have made some other investments.

42:33
Ben Zises
Another supplement brand called Feel Goods, all natural, kind of made in the US supplement for hydration and gut health and immunity and kind of like a modern like emergency which is that you know, chemical type orange droplet that you put in your water before you fly or at least I used to and you know, the amount of kind of ingredients in that are not natural or scary. And so Feel Goods is kind of speaking to you know, creating a product that will resonate and support for those things. But there's always trends and for me I really like to kind of sit back, let the best founders kind of tell me where the world's going and educate me on different categories and sectors.

43:14
Ben Zises
And what I love about kind of the places that I invest within consumer is like, you know, there's great funds that are going to back companies going, you know, sending people to space and all this frontier tech and rocket tech and there's a lot of stuff going on in crypto and biotech and web3 and all that but, and there'll be a lot of money made in there but for me I like to invest in markets that are already exist that are already large, oftentimes growing. And so the world doesn't necessarily need to change for a lot of my brands to be successful. They're just creating kind of better, more modern versions of different products that people already spend billions of dollars a year. Right.

43:51
Ben Zises
I mean consumer spending drives the American economy and you know, for me I just, I like to have a bet in every multi billion dollar CPG category. And I also like to kind of unlike some investors who are okay backing competitive companies and I've heard arguments as to you know, why that's okay. And but for me I have such a personal relationship with the founders that I invest in. It's different going back to like me being angel and not like a traditional venture fund. It's really about like my relationships with these founders is like first and foremost. And again going back to the North Star, I wouldn't feel comfortable being a champion for companies that are you know, going, doing the exact same thing, going after the same market.

44:31
Ben Zises
I like to kind of back you know, one company in A space and then continue backing them over time as opposed to just continue to make more bets in the space. So you know, we'll see how that plays out. But it makes me. That's just where I'm comfortable and I think founders really appreciate that approach as well.

44:49
Caitlin Bricker
Yeah, I mean going back to kind of what we talked about earlier, if you know founders have all this anxiety disclosing and then you're like, it's like a wolf in the hen house a little bit sometimes. Yeah, yeah. I think an empathetic approach and really having a strong relationship with founders is really important to be a competent investor. I that's really what you're offering outside of capital is a relationship worth having in the business and with them. So yeah, I think that's really healthy perspective. I want to make sure we have a chance to dive into this case study question. As you know, startup CPG has the largest Slack community in the industry with now over 30,000 members. I'd love to pull a question directly from our channel and have you answer it as a case study for any founders with a similar question.

45:31
Caitlin Bricker
We've touched on this a little bit, but I'd love to just answer it directly. The recent question is we're what should a pitch deck consist of? How many slides and what should they be and any other advice?

45:42
Ben Zises
Yeah, I've been giving this response for 10 years and even what's amazing is I even took this advice myself from my startup which is, you know, there's lots of different resources for, you know, how to write a great pitch deck. The one that I recommend and have for 10 plus years is you google sepoia business plan. Throw that in Google and you'll find a beautiful kind of outline of what should be in a pitch deck. And I can kind of just quickly summarize it now. I just kind of did it myself here. But what they recommend is starting with you know, obviously the company purpose and I think it's really important to nail the one liner. Going back to conciseness. I'll sometimes get emails from founders where we don't even know what they do after reading you know, three paragraphs.

46:28
Ben Zises
And that's so frustrating because I think a lot of founders get into like you just throwing so many words in and you're throwing AI in and you're throwing buzzwords in but like over index on simplicity, conciseness like we talked about. So really it's worth like obsessing over that one liner and just making sure that anyone can understand what you do, that's really, I think, the key, especially for cpg. Like, come on, this is consumer, right? Like, so this isn't like some obscure nuance, B2B, you know, health care, biotech, you know, innovation here. Like it's something that you're going to want mass appeal or at least somewhat of a mass appeal.

47:04
Ben Zises
And so really company purpose, I would say the problem, right, Just going off of the Sequoia business plan recommendation, right, Describing the pain point of the customer, how it's addressed today, and what's the shortcomings of the current, you know, solutions on the market. And then of course you then perfect next slide is your solution, right? Explain your product and the value prop and where does it go? You know, maybe what you are starting with your initial wedge and then obviously how you could expand that, right? There's a lot of CPG companies that will send a pitch deck for like a new type of peanut butter or, you know, one skew of like a, of a snack. And it's just like to me, I always reference the shark tank. This is not a company, it's a product, right?

47:45
Ben Zises
And I think investors want to invest in a company. And so even if you don't get to those things for years, create a little bit more of a vision than like a single product. So I think it's important to talk about that. And then there's a lot of, you know, why now? Which is, you know, the best companies are very clear on what has lined up in the world today because we all investors know timing is everything. You know, the research wasn't there for creatine 10 years ago, but new studies have come out that it's, you know, better for you than vitamin C and the mental cognition and the physical recovery and the sleep benefits.

48:19
Ben Zises
Like, this is sort of new things that have emerged that makes now the perfect time for a modern creatine brand to sort of arise and then, you know, the market potential. So like understanding, you know, how big it is, who your customers are, the competitive landscape, because investors are not experts in all of these categories. So a lot of this process is an education process. I love saying to founders, like, I'm so interested, I'm so impressed by you. But like, if you don't mind, like, can you educate me that will help your cause, like send me materials, like, explain to me what's going on in the market and sometimes I can quickly assess it, other times it might take me, you know, a year and I'll be upfront with the founders of like hey, I'm not comfortable yet with this space.

49:00
Ben Zises
I'm not educated enough. I'm not even, you know, I'm not able to even give an opinion. Therefore, I can't make this investment. Like, I need to get smarter. That's on me. So I might miss out on an opportunity. But making sure in the deck, you kind of provide some of the materials as to like how investors who aren't living and breathing in this category can get smart on the space and of course, the competition out there, the business model, how are you making money, what's your distribution strategy and team financials vision, all that sort of stuff. So, yeah, Sequoia business plan, that's the reference point I recommend. It's laid out very simply.

49:35
Caitlin Bricker
Thank you so much. I love the tangible examples and the parallels that you showed. I think that's really easy for people to wrap their heads around applying to their own situation or categories. And, you know, the other thing I will say is every investor is so different. You know, this is a human business and investors have their own biases, their own lenses, their own ways. They like to learn their own anchor points, the things that they've been burned by the past or that have really worked out for them too. So I think really important to understand the investor that you're speaking with and what they prioritize and how they think about things. Because I do think you also want to find someone who sees the world in communication in the same way that you do. It makes.

50:16
Caitlin Bricker
It'll probably make your life a lot easier.

50:18
Ben Zises
Yeah, well said. Absolutely.

50:20
Caitlin Bricker
Well, before we wrap up, I just want to make sure our audience can have an actionable next step to apply all of this amazing knowledge to. You've been a wealth of knowledge and your passion above all is unparalleled. And I think that's. That's so important in this industry. For founders that want to get in touch with you, where can they find you, or what is the best way for them to get in contact? And for operators looking to transition or other people that might be interested in starting angel investing or beginning their investing journey, what advice would you have for them?

50:51
Ben Zises
Yeah, thanks for giving me the opportunity. So, for founders. Yeah, my inbox is always open. Benuperangel vc. My website, super angel vc, has a pitch form right at the top. Right. So just feel free to send me an email, fill out the form. Also on XIS B Z I S E S on LinkedIn, I think there's a lot of investors that will only take a warm intro and I couldn't be more opposite than that. I welcome all, any and all pitch decks come at me, keep coming at me. I think, yeah, persistence is one great filtering mechanism. Unfortunately, I can't respond to every inbound that I get, but I do read everything that comes.

51:32
Caitlin Bricker
I love that. It's awesome that you value people's time that way.

51:36
Ben Zises
Yeah. And also, you know, I've written hundreds of blog posts so Super Angel Blog you can read pretty much all the same Similar advice perhaps always trying to have new things to share. But Super Angel Blog tell that I like domain names with super angel in it. Super Angel Fund will also go to my website. But yeah, those are some places to find me. And I'm grateful for every pitch that comes my way. And you know, there's some, yeah, try to kind of give some advice even if it's not a fit in some cases, kind of put people in the right direction even if it's not an investment fit for me. And then on the investing side.

52:13
Ben Zises
So I've invested $25 million into over 100 companies and a large portion of these businesses are performing active, had a number of exits and yeah, started raising Super Angel Fund 2 in January this year targeting a $15 million fund. Already made 20 investments out of Fund 2, which you can see by going to my website and filtering the portfolio and searching by Fund 2. So anyone who joins the fund, you automatically get a basket of great companies that are already in it. And yeah, that's my story and I'm just really grateful Startup CPG for having me. And Hannah, you've been a pleasure to talk to this afternoon.

52:51
Caitlin Bricker
Yeah, no, thank you so much for joining us. I, I feel like we could have spent hours doing this. You, you're a very knowledgeable person on quite a lot of different subjects and it was a pleasure having you today. I'm sure everyone really enjoyed learning from you and we'll be excited to hopefully check out your blog and your newsletter updates so that they can get some learnings on the time as well. Thanks again for joining us.

53:14
Ben Zises
Honored to be here. Thank you.

53:17
Caitlin Bricker
Thanks so much for tuning in, everyone. If you like this episode, show us some love with a five star review at rain ratethispodcast.com startup cpg I'm Hannah Ditman, podcast host and correspondent here at Startup cpg. I hope you'll join me again as we dig into more juicy topics like ops, finance and all the real talk founders actually need. Come say hi on LinkedIn or ping me on Slack. I'm always eager to hear your questions or brainstorm future episode ideas. If you're a potential sponsor and want to get in on the fun and appear on the podcast, shoot us an email@partnersartupcpg.com and last but not least, if you haven't already, don't miss out on our free Slack community for emerging brands and CPG lovers alike. Join us@startupcpg.com we'd love to have you. See you next time.