Why there still haven’t been more billion-dollar acquisitions for direct-to-consumer commerce startups

However, there’s another side to this. The pickup and delivery apps (Instacart and the like) are likely to outperform as they capture the high-margin consumer brand marketing dollars, but without the physical retail infrastructure. Building your own distribution via DTC marketing and relationships also gets more important, with Facebook and Shopify... See more

Again, DTC companies almost certainly have higher cost structures than a website, and do get some sort of returns from scale, but those returns are limited; this is where it seems Softbank specifically went wrong. Indeed, this is the broader takeaway from Softbank’s investments: what characterizes the Vision Fund’s mistakes in case after case is a ... See more

Meanwhile, the more recent rise of social media — plus digital publishing and the continued growth of e-commerce — has given brands strong incentives and tools to build direct relationships with their clientele, skipping the retail middlemen and keeping the rest of their margin.

The optics of successful liquidity events for Blue Nile, Zullily, Chewy and Zappos, and the incredible traction in the 2000s of The GAP as a public vertical consumer brand established meaningful consumer business outcomes. These potential to repeat history through a new crop of Direct to Consumer upstarts paired well with the pent up venture capita... See more