COSMOFACTORY

Deanna: [00:00:00] This episode is about venture capital, community building and collaboration. It's about consumer beauty, tech and social media tech. It is about identifying and supporting standout brands, and it's about early signals of what will define the future of our industry. Today on the Cosmo Factory Podcast, I am joined by Ode Ro, founder at Fab Ventures and Fab Community.
Odile. Welcome to CosmoFactory.
Odile: Thank you [00:01:00] so much for welcoming me. I'm so excited to be with you.
Deanna: Yeah, no, I'm excited for this as well. Thank you. Um, in recent years, as your title suggests, you have built two notable cosmetic industry institutions, fab community and fab, co-creation studio ventures. The community came first and I think, um, in fact, the first time that you and I met in person, was it the launch, uh, for the New York City chapter of Fab community?
Uh, and I think it was in early 2018. So I wanna start there. What is FAB community?
Odile: Yes, that's true. We met in New York. Uh, at that event, um, it was founded actually in San Francisco. And, uh, the, the insight was that I saw so many events in the Silicon Valley where, you know, VCs were listening to founder pitching, and it was not a relationship, adult to adult that I was thinking there is a need.
Some, some place where founders can meet investors and say the bad stuff, you know, and share their vulnerabilities. [00:02:00] And that's how it began. So it began at my house in San Francisco, you know, with 90 people. The first time my husband was thinking, oh wow, we, we, we will be robbed because we don't know all these people.
And then we were invited by, uh, Google, uh, uh, Twitter, name them all, uh, Silicon Valley Bank and others. And we have now 19 chapters, uh, worldwide. Some of them in Asia, like ul, that is protective. And Tokyo, we've got in, uh, Europe, uh, Berlin, London, and, uh, Paris of course. And the most active, um, chapters are maybe New York, LA and San Francisco.
We've got also Austin and Miami. The idea is to have conversations who are. Founders and investors share their insights about one specific topic. So, so the last one in San Francisco was about AI and, uh, how ai, uh, is important for all founders. Uh, the one before was about multicultural fund scaling from abroad, uh, like in the, in dermatology and, uh, college, [00:03:00] in, uh, in la.
So very different people and multicultural, uh, people.
Deanna: Yeah, no, that's wonderful. And I know that one of the reasons why the community concept has become prevalent in beauty is that communities tend to speed up innovation and problem solving, but I. I think there's more to it than that. I'm hoping you can tell us really about the, the full value of collaboration rather than competition in these spaces.
Odile: That's true. I, I've got a feeling that especially in this period of uncertainties, uh. Founder can be so lonely, don't you think? I've got the feeling that you need to look good with your stakeholders, with your investors, with your employees, because if they know all the truth and they think the company will die in three weeks, it's not the best way to motivate them.
So. You need to have this place of collaboration with other founders and, um, uh, priorities evolve. So you need to learn from others in the conversations to be part of the world. Uh, you remember, uh, Dina in [00:04:00] 2016, I think it was, you know, pain media, Facebook, all people were obsessed by that. Now it'll be maybe TikTok shop on, uh, Amazon and search on Amazon and the whole ecosystem.
It's evolving so fast that you need to be part of. You know, conversation.
Deanna: Right. Right. No, that makes very good sense. And if I have this right, the, the same idea of. Collaborative support and, and ongoing innovation really is fundamental to Fab Ventures, which is not really, if I can say so out loud, it's not really a conventional venture capital fund. I'm hoping you can help us understand the operating model of Fab Ventures.
Odile: Many VCs will, will talk about their pipeline and seeing that for 1000 founders reaching out to them, they, they choose one. Uh, I, I will say that I have a lot of. Proactive calls. So I spend all my time on the funders and trying as an next operator and CEO of a big brand, uh, working with L'Oreal to help them with my skills and my network.
But to [00:05:00] be humble, I must acknowledge that the best, uh, added value is not by me. I would say it's more helping each others, um, you know, like. Let's say that one of them is about to sign with Sephora. He will call another from the outside of the meeting. We've got every quarter to ask some advice and some input, and as you know, maybe he's not aware that he will have to pay for the inventories and it's costly.
Uh, energy consuming because it's big teams and they're pretty much lean and alone in their company, and a lot of things that they don't anticipate that will happen maybe in six months once the product are on the shelves. So that's, that's maybe the best value added, uh, of, uh, the F founders together. And the mo mostly they describe them as a tribe or a feminine, and I like that, that that's the idea.
Deanna: Yeah, no, that makes good sense. Uh, you mentioned a, a quick example there, but I'm wondering if there are more specific examples of the brands or businesses that, that are now or maybe even have been in the fad portfolio. I'm, [00:06:00] I'm hoping to hear examples that, that might help us really understand what makes a brand stand out and, and what sorts of innovations makes sense in beauty right now.
Odile: The best example I will have will be Bubble because in, in four years I've seen them so much evolving. I invested, uh, you know, I met her, by the way, in, uh, Venice Beach, uh, close to, to where I am at, uh, Jaina. And, uh, she was late. And, uh, I was thinking, oh, that's, that's very strange. And I was enthusiastic after, because she was sharing, she was about to sign with.
Four key influencers with very different interests and communities. And she was, um, a strong believer and she still is, that the community is everything and then you need for sure the best products that you can have. So then she signed with Walmart because she discovered that the Gen Z and Gen Alpha don't have a credit card, which is not easy to sell to them.
And then she entered in many, uh, retailers that, you know, target CVS in more [00:07:00] upscale positioning. But what is interesting is, um, she has taken the opportunity that now with the post COVID years and all the uncertainties, uh, a lot of people don't want to afford the same basket that they had in dollars before.
And in a unit for sure, they will purchase the same products. But they want more affordable products. So at the same time, she has five to a broader target, but she's smart. So she invested also a lot in research, new products, new packaging. She's, for instance, at the A, a D that you know very well, Gina, uh, with the dermatologist.
And that means she's more about science and innovation than she was before. So she's true to our roots. And her DNA, but at the same time, she has evolved. Another example I could have is, is in, um, uh, hello Biome, uh, in, uh, the microbiome, uh, segment. Uh, you know, as a young man, she's a doctor and PhD and she created a D two C brand, but she was humble and shy.
So not the best maybe to be a beauty influencer. [00:08:00] And we say that to her and she was smart enough to pivot to a B2B model where now she's helping. Beautiful brands like Neutrophil, uh, Kayin or L'Oreal brands to understand the microbe of their customers and to help them, to guide them in the routine and the, uh, the, the products.
So that's where I will say people can evolve and, and, um, understand What makes a brand standard is to understand that the market evolves.
Deanna: Yeah. Yeah. No, that's wonderful. And I know that, um, you know, you've touched a little bit on social media technology, certainly with, um, the microbiome example there. This is what I would think of as, um, very much beauty tech. Um, but it, it reaches the consumer, doesn't it? I'm wondering if there are other ideas in beauty tech or even social media technology that you see reshaping beauty today.
Odile: I, I have invested in many companies in social commerce, so I love the, the, the topic that, that you've got in mind. I always say that the gen ai, or [00:09:00] maybe I'm biased because I've got my elder in computer science in San Francisco, but the gen ai, it's like the same revolution as internet and, and for brands that means a lot.
That means you can customize. Personalize your content according to your target and leverage your communities and, and transform it into revenues. So for instance, I invested in two sisters Xme. They're now in San Francisco. They were in Seattle, uh, nectar Social ai. Uh, they help, uh, key brands and, uh, they were enough kind to, for instance, to talk to the five founders that can't afford to, to, to use their solution, but.
Educate themself about what's going on because they need one day to use this kind of tools. I invested in, uh, Transo, they're the best on TikTok shop. They're still in, um, Seattle and is an ex Amazon, uh, same for buy with in retail media with, uh, ultra and, um, and, uh, Sephora that are using that kind of tool.
So I will say that social commerce has a long way, uh, you know, to, to [00:10:00] evolve and, and it's an interesting space at the moment.
Deanna: No, it's so interesting. So it strikes me based on, on some of what you've told me today, that your investment team is choosing to work with founders whose vision aligns with the direction that our industry is moving in, right? We're thinking about social commerce, we're thinking about the way consumers are purchasing, but there has to be a degree to which.
Your decisions are influencing the future of beauty on their own. I'm wondering what you think about that line really between sound financial investments, but then the responsibility of actually shaping outcomes in our industry. How does that, how does that work for you?
Odile: First, I, I back multicultural founders, as I said. So we don't talk about inclusiveness any longer, et cetera. But from the beginning, even if I don't claim it, I think diversity makes us more performing and stronger. Uh, the second thing is, um, I back change makers. When I say change makers, I was [00:11:00] in beautiful corporations, uh, working on incremental innovation.
Uh, here they're about disrupting the industry in a good way to better serve their customers. So that means. They need ip, they need, uh, patterns, uh, they need to explore and to, to disrupt with, with true innovations. Uh, for instance, uh, we've got in mind together, Kay 18 Air that was acquired by Unilever. I was one of their first investors and he was the first one to educate me to the Tism and the water on, on the hair.
Now it seems very banal and I saw even Korean brands trying to mimic them, but at that time, that was pretty much innovative in the way to talk. To people and to her stylist. Um, the same at the moment, I'm, um, an investor in something that could be curious for you because normally I invest only in the US companies I invest in damn damn Tokyo.
So it's Japanese beauty. Um, many founders, it's Korean beauty that is [00:12:00] hot, not Japanese Beauty. And I, when I've been the CEO of Lancome, I had to trial every three months to Tokyo because the quality of the ingredients. The quality of the packaging and the ritual, uh, with the wisdom of the Japanese, uh, um, beauty is, is amazing.
So it's a mix of science and at the same time, uh, tradition and, uh, GI go and, and, uh, again, multicultural, uh, founders because they're not Japanese, but 15 years in Japan. Regenerative farm. Uh, they've got a beautiful place where they, they, they host some events. Uh, they're very Japanese in their way to understand the market, but at the same time, the humidity of, you know, uh, multicultural founders that take the best of science and, and learn from different cultures.
So they enter our. In the US market, uh, with Sephora in New York. The was day when we had an event they were with, uh, you know, like Cabra partnership. Um, and it was [00:13:00] with matcha letter and they were planning that matcha in Japan. It's a ritual of two hours. It's at 4:00 PM and never someone who will drink matcha with latte in the morning like we do in America.
I, I take the best of both cultures and, uh, they, they adapt and at the same time stay true to wood, air and obsess for sure by, by science and innovation. Uh, and from time to time it can be new categories. For instance, I met in 2019 at the same time as I was founded, the community Long lash with, uh, naan Harding, that is a CTO and, and a computer science guy in, uh, computer vision.
And at that time he said to me, I want to disrupt the eyelash. Industry, the eyelash extensions. And as you know, it takes two hours, it's every three weeks and it takes a lot of time, even if people like to talk to their, uh, uh, I will say eyelash stylist. So I wanted to, to offer that to Nordstrom and, and Ulta.
Now there are. Proving that it works [00:14:00] with, uh, uh, saving money and saving time because it's shorter as, as a demonstration and, and result. And, uh, it's pretty amazing. They struggle during two years, to be honest, to developing, uh, the product for Asian lashes because it's not exactly the same shape, and they didn't manage at that.
So I courageously invested in something very capital consuming, thinking Normally I shouldn't invest in hardware, but from time to time I do that because if we don't do that, who will do that later? If you don't have the pioneer and, and the people understanding beauty and now take investors, which is great.
Deanna: Yeah. No, I love it. It's so interesting. You know, I, I have a question about community building I wanna get to in a second, but, you know, some, you're talking about, um, multicultural founders, the idea of traveling, experiencing other cultures, living in other spaces, going into these community spaces to collaborate with other founders.[00:15:00]
There's something about travel, isn't there? There's something about seeing different cities, about seeing different markets, about feeling different cultures, like literally being there and, and having those, it's a different sort of community, but I think it's very significant for our industry. I.
Odile: I totally agree. That's funny because the other day I was talking to a Chris that you have met one day, um, Novo Labs. Obsessed by, as you know, staying younger for longer and more beautiful for longer and, and. It's about supplements and, uh, epigenetic tests about the biological aging and, and the root causes.
He's a New Yorker many years in New Year now in Miami. And, uh, the way to talk to people about, uh, you know, um, the root causes of aging and staying younger are not the same in la. Where people will do the Cold Bath and their infrared, and I, I'm not sure in New York you will do that. You will will more maybe think about Botox and, and how to stay with [00:16:00] dermabrasion and some, uh, medi spa, uh, at the best and in Miami, something else.
Again, because it's maybe about diet and healthy food and sleeping well and tracking, uh, with aura or ring, uh, how, uh, you manage your day, in fact. So it's exactly what you say. Um, the best founders for me are the one that, um, meet a lot of different people and feel the different energies and the different ecosystems because it's never, when we say, when we say the US market.
It's, it's such a huge market that we need to adapt. And the same for Europe. It's fragmented, different regulations, different languages, so you need to adapt.
Deanna: Yeah, absolutely. So let me ask you more about community building. It's clearly central to our conversation and central to your work. I'm wondering, since you've been at it for such a, such a good while now, if you've learned anything about community building in particular that other industry leaders might.
Find useful when the, the folks who are listening now.
Odile: I will say [00:17:00] what we call in the Bay Area in San Francisco, they pay it forward culture. You know, when you as a quick favor, you give your time for a conversation and insights. You'll know maybe one day these people will give it back to you by a new introduction or a new conversation. So. I've got the feeling that in LA it's pretty much the same.
Uh, there is this mix of the entertainment industry, the music industry, the tech industry, uh, Hispanic communities, uh, and, and, uh, same, um, black communities, very different people that that mix and help each other. So. I will say you're stronger together. Uh, and you're more creative with different profiles and different backgrounds, and that's, that's the strength that I know d deny you believe in, because we talk about that in the past.
So, um, uh, that's pretty much what I learned from the community, you know, um, multicultural founders and truly believing that they're the champion of the future of, of [00:18:00] skincare and beauty with different perspectives.
Deanna: Yeah. No, that's terrific. Odi, I thank you for sharing so much great information with us today and of course for being our guest here on the Cosmo Factory Podcast. Thank you so much.
Odile: Thank you so much for the invitation