Popular Startup Sectors during Covid

This is a period of immense uncertainty but also a time for great opportunity. Some of the most well known companies were created during past periods of volatility. Apple and Microsoft were born during the OPEC induced recession of the 1970’s. Netflix survived the Dot.com bubble and came out stronger than ever, and Airbnb was born during the 2007-2008 recession. Fast forward to today and there seems to be two schools of thought on investing during the current Covid-19 pandemic. Either it’s batten down the hatches and conserve cash or let’s use this as an opportunity to double down on our winners and also invest in other startups that are booming due to stay at home restrictions.  As we’ve seen in the public markets there are multiple bulls out there in certain sectors and the same theme applies to venture.   

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DTC Startups – The Bear/Bull Case

Brands aren’t built overnight. Some of the most successful brands (Nike, LVMH, etc) have taken years to achieve the awareness (and more importantly relevance) they have now. In the case of LVMH, there is a key element to owning a piece of European heritage that has driven the company to be the largest luxury goods company in the world. Louis Vuitton owns much of their own supply chain. As an example, over the past couple of years they opened a manufacturing center in Texas to create leather goods here in the US that further allows them to create local stories around their products.

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