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Dealmaker: What Quince’s $10 Billion-Valuation Round Says About Consumer Investing

Dealmaker
Is investing in consumer startups back? Well, it's back from the dead. When we broke the news of fashion e-tailer Quince's $10 billion valuation last week, I thought maybe I was back in 2021.  It wasn't long ago that direct-to-consumer brands like Warby Parker and Daily Harvest and more were raking in investment dollars. But following some startups' disappointing public debuts and low-priced acquisitions, venture funding for consumer startups almost came to a halt in 2022 as venture capitalists moved on to shinier objects like AI.
Mar 10, 2026

Dealmaker

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Welcome back! It's Katie.

Is investing in consumer startups back? Well, it's back from the dead.

When we broke the news of fashion e-tailer Quince's $10 billion valuation last week, I thought maybe I was back in 2021. 

It wasn't long ago that direct-to-consumer brands like Warby Parker and Daily Harvest and more were raking in investment dollars. But following some startups' disappointing public debuts and low-priced acquisitions, venture funding for consumer startups almost came to a halt in 2022 as venture capitalists moved on to shinier objects like AI.

Direct-to-consumer mattress brand, Casper, went public and then was forced to accept a take-private offer at price far lower than its IPO. Shares of shoe brand Allbirds and fashion rental service Rent the Runway are down over 98% since their 2021 IPOs.

Investors stopped expecting billion-dollar acquisitions for companies like Dollar Shave Club as costs for social media advertising soared and fads faded. 

What distinguishes Quince from the pack? Well for one, it has significant revenue, already at about a $2 billion revenue run rate for this year, as I reported. And unlike some of the single category brands, it has a wide array of clothing and other items, so it's less of a one-trick pony.  

Nicole Quinn, co-founder of newly formed consumer VC firm Connect Ventures, said that Quince abides by the new marketing rules. 

"The way to grow a brand used to be through [search engine optimization], Facebook and email marketing." She said that now "influencer marketing and word of mouth are the two fastest growing channels," and that Quince has cultivated these areas. 

One reason investors are once again interested in consumer startups is that online shopping has bounced back to pandemic highs. And today's consumer startups are still chasing growth, but trying to do so profitably, as my colleague Ann wrote late last year.

Quinn, a former general partner at Lightspeed Venture Partners, says she's learned a lot from working with startups like Rothy's and Goop, which gained initial traction but haven't been sold or held public offerings. 

She noted that public investors continued to want to invest in consumer companies. For instance, Wellington Management, which holds public stocks, also invested in Quince in 2023. Quinn said the demand is still there, that it's just a "flight to quality."

There are an array of well-funded consumer startups that have yet to exit including shoe brand Rothy's and soda brand Olipop. Their success—or lack of it—will determine if VCs are willing to dip more than their toe into consumer investing again. 

Menlo Ventures' Venky Ganesan discusses Nvidia's Vera Rubin chip deal and investment into Thinking Machines Lab.

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