The DTC Party’s Over. What Happens Next?

Now-established players have learned that Instagram advertisements and influencer campaigns only scale to a point: they can net no more than a few hundred thousand of a brand’s “first best” customers. This has driven a shift toward physical retail and prompted founders to agonize over if and when to peddle their wares on Amazon, making direct to co... See more

Now that a few high profile DTC brands have been punctured on the public market and the economy is crashing, VC-driven DTC business model will likely go into its own recession. Without DTC, there is an opportunity for a variety of smaller, more sustainably funded players who do not seek hypergrowth.

A lot of DTC brands, across categories, adopted “reviving the middle” strategy in the form of good quality items at affordable prices and excellent service. The downside of this model is that it’s costly, and most of these brands emulating it are VC-funded and not yet profitable. Scaling this model is also a challenge, as costs of supply, productio... See more