Each week on The Cap Table (TCT) we highlight investors, operators, founders, and industry leaders in the private markets to share their tribal knowledge of how to get onto “the cap table.” Know someone we should feature? Let us know here!
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Just in time for Black Friday, our guest this week is the marketing brains behind one of Wall Street & Silicon Valley's favorite brands. We’re thrilled to be joined by Chris Benedict, co-founder of Felix Gray, the venture-backed NYC-based blue light blocking glasses company that’s become a household name among engineers, bankers, investors, e-sports pros, and others who spend a lot of time in front of digital screens.
After spending the first part of their careers in consulting, banking, and asset management staring at computer screens for hours, Chris and his co-founder, David Roger, went on to create blue light blocking lenses to help people manage Digital Eye Strain (DES) and Computer Vision Syndrome (CVS), which are caused by staring at digital devices for extended periods of time.
With deep experience as a quant analyst, founder, advisor, and investor, we sat down with Chris to discuss all things D2C, E-commerce, and cap table related, including:
Bootstrapping vs. venture backing for early-stage founders 💸
How an eyewear company got into a tech accelerator 👓
A behind-the-scenes look at his deal with Barstool Sports 📈
Cap table advice ⼏
The state of E-Commerce in 2030 🔮
TCT: Thanks for sitting down with us, Chris. Let’s jump in.
How did you start out with regards to your career?
I graduated from Ohio University in 2010 with plans of attending law school. While studying for/taking my LSATs, I was also trading to make some extra money and learn “trial by fire” as I’ve always had an interest in financial markets. Knowing I wasn’t getting into a target law school (2010 was pretty bleak for recent grads and everyone was going to law school) I took a job at an investment bank investigating and identifying trends in block trades between trading shops around the world. While I wasn’t a traditional banker or trader, I was exposed to the intense environment and the work really opened my eyes to just how big the financial services industry was.
Around the same time, I got a scholarship offer from the hockey coach at OU to come back as a graduate assistant and build a youth hockey program. I had been bitten by the financial markets bug, so I focused studies on financial economics, worked for a consulting firm producing research on the generational shift of wealth, and took out student loans to leverage trades during boring lectures (wouldn’t advise doing this, but it worked out). This was in 2013 and yes, I even scalped a BTC trade for like 30%... what a dummy. I also did a lot of extracurricular studying, consuming financial blogs, papers, watching LBO modeling on Youtube, literally anything I could get my hands on. There was a Bloomberg terminal in the journalism building that no one ever used so when I wasn't at the rink playing hockey, I was parked at that bad boy.
From there I went to Chicago and was hired by UBS Global Asset Management to run Market Data and Analytics which was used in everything from portfolio analysis, asset flows, biz dev, competitive positioning... you name it. I was essentially the gatekeeper for any quantitative data point in regards to the $700b+ under management at the time. It was a new role straddling traditional finance and technology with exposure to portfolio managers and the executive team where I was encouraged to make and break things.
Never did I think I’d be in the eyewear business.
$700bn is close to the entire GDP of Switzerland, that must have been very high-stakes. Speaking of Switzerland, are there any particularly crazy stories you can share from your time working at the Swiss flagship bank?
None that I could share without an NDA, but every day and every late night at UBS was exciting, across the spectrum. In all honesty, it was a pretty serious, professional setting. While proficient excel modeling and computer skills were absolutely necessary, I was also building technology to fast track anything that could be fast-tracked, which required a considerable amount of deep thought and focus. I met with the CEO, numerous MDs, and portfolio managers on a weekly basis, and everyone expected everyone’s A-game. You really had to want to be there to last there. I found the work fascinating and wanted to be there.
The only downside was that I was barred from owning/trading any security that the firm had a position in, which was basically every security on the planet.
In 2015 you co-founded Felix Gray, which is completely different from the buy-side quant work you were doing at UBS. What inspired you to make such a drastic career change?
I’ve always had 20/15 eyesight, a personal attribute I really enjoyed (and it was useful for constantly monitoring 4 million data points at work). However, by year 2, I noticed my sight was getting blurry and I was getting headaches, so I went to the eye doctors to see if I needed a prescription. It was there I learned that I didn’t need a prescription, but staring at a monitor tree 80 hours a week was taking its toll, and my ability to do my job very much relied on sharp eyesight. This also led me to learn all about optics technology and realize there’s a reason some lenses cost $500, and it’s not necessarily because that’s what it costs to make them.
Around the same time, I was traveling back and forth from Chicago to NYC every other week for work, and by chance, met another 20-something-year-old operations analyst, David Roger, who had worked for Tony Hsieh that was going through the exact same thing with his eyes, learning the exact same things about glasses. He was a few months ahead of me in this process and, perhaps most importantly, also loved to ski. We met up, had a few drinks, talked skiing, talked about how all our friends and colleagues working in front of screens shared the same problem — this was right when DTC was becoming a thing, and we thought “why stop at making frames affordable? The lens is the most important part!” Recognizing we had complementary skill sets and a track record of building things in real-life settings, we set out to create a pair of glasses with a clear, optometrist-grade Blue Light filtering lens and handcrafted Italian acetate frame at an affordable price delivered to your door, which had never been done.
The rest is history. And while Blue Light has since been adopted by the eyewear industry, the incumbents don’t synthesize a naturally occurring ocular pigment and bake it directly into the lens like we do… They take shortcuts and toss a label on it.
Felix Gray started out as a bootstrapped business that’s now raised several rounds of venture funding. At what point did you decide FG was a venture-scale business, and how did you get into a tech startup accelerator with an eyeglasses company?
We bootstrapped the business for the first 8 months. I forwent my second-year UBS bonus, lost my 3 for 1 stock options, cashed out my 401k, and we raised a very modest party round, enough to make exactly 1,000 pairs of glasses. We had a sketchy Ecom site that broke all the time and no marketing platform. So during those first 8 months, we literally pounded the pavement partnering with companies like Google, Uber, LinkedIn, Credit Suisse, etc to hand-deliver our glasses to anyone at the office dealing with eye strain for a two-week trial. We would then pick them up and collect all kinds of feedback. What we found was that after 1000 trials at 25 different companies, something like 25% of those who wore them wouldn’t return and instead insisted on buying them on the spot. These were some of the top engineers, designers, and analysts in the world so it was a nod to product-market fit and we knew how to improve the next batch.
Now, for how we got into Entrepreneurs Roundtable Accelerator (ERA): integrating a global supply chain and putting the product wheel in motion requires capital and we needed to build the rest of the site, start marketing, etc. We applied to ERA thinking there wasn’t a chance given their focus on traditional tech, but after meeting with Jon and Murat, sharing the story, sharing the traction, we got in. To be honest, I think they just respected the hustle and knew that, if nothing else, we’d go down with the ship trying to make this work.
What I liked most about ERA, aside from the quality of people, is that they made the environment competitive, and that kept the fire under our asses burning hot. We took the money, my co-founder David focused on operations while I focused on acquisition, and we were very keen to be the founding team in the cohort that smashed their KPI’s every week. The team that did so got to ring the gong each Friday and those with the best track record of doing so throughout the program got the coveted stuffed unicorn toy - which we did. We’re actually in possession of two of them, but that’s a different story.
What advice do you have for other folks working in banking, asset management, or more ‘traditional’ finance roles when it comes to founding a venture-backed startup?
If you have the itch, just do it and stop worrying about the uncertainty. How’s 2020 looking compared to how you thought it would? You’re surviving a major shakeup like everyone else. If you believe in yourself, put the chips on the table and make your bet. If you’re unsure about the volatility, keep gunning for that VP role — you can have a nice life doing that too. No one should make that decision but you.
I often get asked if it was scary doing a startup and the answer is no. If you’re able to make a statement at a top firm of any kind you're probably pretty employable and the risk of being broke forever is practically zero. I didn’t leave Wall St because I didn’t like it, I really liked it there. I left because I wanted the challenge of building a product I needed instead of buying it.
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We’ve heard Felix Gray on the Joe Rogan Podcast, and we’ve noticed Dave Portnoy from Barstool Sports wearing Felix Grays in all of his media appearances. Could you tell us about some of these influencer marketing deals, maybe a bit more about how you ended up partnering with Barstool?
Flashback to college… I was really into blogs with a niche following, ZeroHedge for example. It was like the literary wild west to me. As a sports fan that grew up in locker rooms, the Barstool blog was always in rotation. Years later, I got to know a couple of the bloggers while living in Chicago, and a couple of years after that, FG started right as the Chernin investment was made and Barstool really took off. Aside from admiring how Dave (and eventually Erika) were able to build a media empire from the little cult blog, working with them was simply ‘trading the trend’ so to speak. Through the years I’ve been the first to jump on and sponsor new content before it officially becomes an ad spot; it’s fun to contribute to new content that makes people laugh and while it might not be the prettiest form of advertising, it’s good for business.
Now “the Barstool deal” that I believe you’re referencing was the Davey Day Trader Global sponsorship (DDTG). That was honestly just business as usual, but with unique macro circumstances. COVID hit, advertising dollars ran for the hills, and Dave needed a gambling fix. To me, this hit all the sweet spots: there was unprecedented volatility in equity markets, there would be frustration, there would be margin calls, there would be sensational one-liners, Dave already wore FGs; the sports and finance internet communities were about to collide in epic fashion. So as soon as Dave gave us a shoutout in one of the first streams, I got on the horn, Ubered over to his apartment to drop off some glasses for an unboxing video, and we turned it into DDTG’s first sponsorship. I’ve been relatively quick to spot trends in finance media — I was one of the first Morning Brew sponsors, I was the first sponsor for The Cap Table, etc., but anyone on Twitter or Reddit knows that the appetite for finmeme content has grown considerably over the last few years.
Ack_Butter @AckButter@stoolpresidente @felixgrays What’s style you are wearing Dave?
Portnoy wears Roebling in Amber Toffee for those wondering at home.
With DDTG you had one of the most influential personalities in media diving headfirst into trading his own money for the world to see all while every advertiser was pulling spend out of the internet. That was a marketing opportunity to double down on, or a contrarian trade if you will. There was certainly some risk, we all know traders with real money on the line can get vulgar when emotions run high, but it worked really well. I was told that a certain EVP of an F500 called it the single best example of gorilla marketing he’s seen in his career — I’ll take his word for it, but it was really just a continuation of how I like to advertise.
Seems like you’re an expert on public financial markets and do a lot of investing and trading there. Do you do any investing or advising in private companies?
I’m still fairly involved in the startup scene in roles ranging from advisor to investor. I try to get to a hackathon at least once a year, I’m an LP in the Kairos 50 fund, I still work with ERA to help in company selection for each cohort and give growth workshops for each class that comes through. I also do a bit of pro bono passion project advisory in fashion with VFILES, in the music media space with Project M and Revolver Magazine, and in the weed space with Sundae School. I’ve made a lot of friends, be it through colleagues or investors or fellow portcos, so I enjoy staying involved and being helpful wherever I can.
The year is 2030. What’s the state DTC?
Who knows, man. I don’t really think of it as being in the DTC or Ecom business. One year Ecom is hot, the next year it’s not, sometimes it’s only hot if it’s connected to a media platform, then a pandemic hits and it's hot again. I suspect that cycle will continue through 2030. We make a damn good pair of glasses, better than 99% of what’s out there and much more affordable. I think founders should focus on building the best product they can build and making sure their customers get real value from it. Otherwise, the market has a way of weeding out what's right and what's not and will take it from there.
Thank you for your time and thoughts, Chris! We look forward to the continued success of you and the various companies you’re involved with!
Deal News 11/21 - 11/27
Nykaa: led by Fidelity. Nykaa is an online marketplace for different beauty and wellness products.
StreamHERO: $550,000, led by Adventures Lab. StreamHERO integrates non-intrusive banner ads into broadcasts and places call-to-action links into the chat.
Respira Labs: $295,000. Respira Labs is building an AI-powered sensor platform to track, predict, and prevent chronic lung disease.
Inclus: $256,206, led by First Fellow Partners. Collaborative risk management software.
Elevat-iot: $9,500,000, led by D4 investments. Elevat-iot is an industrial IoT platform helping manufacturers across a broad range of industries gain visibility across their deployed fleets.
Superpeer: $8,000,000 A new video platform for streams and 1:1 video calls
Altana Trade: $7,000,000, led by Amadeus Capital Partners. Altana Trade is an AI partnership that uses global economic data to make trade safer, more efficient, and more profitable.
Weavr: $4,000,000. Online platform for creating, integrating, deploying and running digital payment flows
Hellosaurus: $3,500,000, led by General Catalyst. Hellosaurus is an e-learning platform that offers creative programs, fun activities, and video classes for kids.
UpCodes: $3,355,000. UpCodes helps the AEC industry deliver code-compliant buildings.
Opteran: $2,808,613, led by IQ Capital. Opteran operates as a natural intelligence company.
EarlyBird: $2,400,000, led by Network Ventures. EarlyBird is empowering parents, family, and friends to collectively invest in a child's financial future, starting at the earliest age.
Productfy: $2,350,000, led by Point72 Ventures. Productfy is a secure and advanced platform for building financial applications.
Serenade: $2,100,000, led by Amplify Partners, Neo. Serenade is a platform that enables to help write, refactor, and navigate code with voice.
Friday: $2,100,000, led by Bessemer Venture Partners. Friday is a remote work orchestration platform that frees you up to do your best work (from home).
Phood: $2,000,000, led by New Stack Ventures, Story Ventures. Phood is a startup developing an AI-powered food waste prevention platform that aims to reduce food waste.
Notabene: $1,765,000, led by Castle Island Ventures. Notabene helps businesses perform crypto transactions that are regulatory compliant.
StartBox: $1,455,744. StartBox is a MedTech company that aims to eliminate Wrong Site Surgery by mitigating its root causes
STAGE: $1,150,000. STAGE is the first streaming network devoted to the entire world of theatre.
Detected: $802,460, led by EmergeVest. Detected is an agnostic business verification platform.
Purdy & Figg: $668,515. Purdy & Figg is an eco-friendly hand sanitizer brand.
Ensuredit: $380,000, led by Venture Catalysts. Taking Insurance To The Masses
AlgoBulls: $300,000, led by Venture Catalysts. Algorithmic trading platform
Feedsauce: $199,896, led by Ikram Fildow. Feedsauce is a platform that allows brands to get custom product photos in 72 hours.
The Wine List: led by Haatch. Wine education, a subscription-based startup looking to educate those who want to learn more by providing incredible and interesting wines.
Cruz Foam: led by CP Ventures. Cruz Foam develops structural foams intended to help end the global issue of plastic pollution from oceans.
Catamaran Bio: $42,000,000, led by Lightstone Ventures, Sofinnova Partners. Catamaran Bio is a biotechnology company that specializes in allogeneic immune cell therapies.
Gatik: $25,000,000, led by Innovation Endeavors, Wittington Ventures. Gatik is a startup developing technology for deploying autonomous vehicles for short-haul logistics.
Skipcart: $21,000,000. Skipcart connects our crowdsourced drivers to restaurants, retailers, and e-commerce allowing a solution of on-demand anywhere.
HMBradley: $18,250,000, led by Acrew Capital. HMBradley is a digital banking platform that develops programs to reward savers.
Carbice Corporation: $15,000,000, led by Downing Ventures, Toyota AI Ventures. Carbice is developing a product used to dissipate heat away from product packaging to stop electronic devices from overheating.
Pier: $14,500,000. Pier is a digital insurance distribution platform, acting as a stipulator for pooling risks.
WeGift: $8,000,000, led by AlbionVC. WeGift‚Äôs cloud-based, open API solutions allow businesses to transfer value to consumers, in real-time and globally.
Glue Loyalty: $8,000,000, led by Unicorn Technologies. Glue is an automatic loyalty management platform for small businesses with an enhanced members club and advanced features.
Lunewave: $7,000,000, led by FM Capital. Lunewave provides Luneburg lens-based antenna and automotive radar sensor system.
Force24: $6,396,673, led by YFM Equity Partners. Force24 is a marketing automation company.
Mother Raw: $6,100,000, led by Forage Capital Partners. Mother Raw is a line of plant-powered dressings, marinades, dips, condiments, and quesos.
RevLifter: $4,544,950, led by Gresham House Ventures, Maven Capital Partners. RevLifter is an AI-powered technology provider helping brands increase revenue through real-time personalized offers.
Socialeads: $1,750,000. Socialeads is a platform that analyzes social media content for context, life events, and personality dimensions.
Resilience: $750,000,000, led by 8VC, ARCH Venture Partners. Resilience provides end-to-end biopharmaceutical manufacturing and development solutions.
Boulevard: $27,000,000, led by Index Ventures, Toba Capital. Boulevard is a business management platform developed to help streamline the operations of appointment-based businesses.
Vooks: $21,900,000. Vooks is a subscription-based streaming service exclusively dedicated to animated storybooks.
WithMe Health: $20,000,000, led by OMERS Ventures. A medication guidance company personalizing medication experiences for employers, employees, and their families
GT Medical Technologies: $16,000,000, led by MVM Life Science Partners. GT Medical Technologies has developed a unique therapeutic approach to the treatment of brain tumors.
Cheribundi: $15,000,000, led by Emil Capital Partners. Cheribundi sells a brand of cherry juice beverages.
Current: $131,000,000, led by Tiger Global Management. Current is a leading U.S. challenger bank built to meet the needs of people who have been overlooked by the traditional banking industry.
Well Health: $45,000,000, led by Lead Edge Capital. Well Health provides a communication platform that connects patients to healthcare organizations through text, email, phone, and live chat.
MeUndies: $40,000,000, led by Provenance. MeUndies brings together sustainable fabric and innovative design to make soft underwear and loungewear for its customers.
AppsFlyer: led by Salesforce Ventures. AppsFlyer is a mobile ad attribution platform that allows advertisers to analyze which campaigns drive results.
Sources: Crunchbase, LinkedIn, Twitter
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