Mindful Leadership

By Karla Mora

The founder journey is always filled with ups and downs, but these past few years, being a founder against this backdrop of disruptive external factors, the pressure has mounted. In response, there has been growing emphasis across the VC community on the importance of supporting wellness and the mental health of startup founders. We agree this needs more attention and we’re committed to creating a VC culture that values vulnerability, directness, and steady presence - because we know this enables us to discern what needs to be done and respond effectively. This year, in the wake of macroeconomic uncertainty and a banking crisis in the startup venture sector, we began offering monthly mindfulness meditation to our portfolio Founders, led by our Managing Director Kate Dillon Levin, who is a certified mindfulness teacher.

A huge part of the joy I find in early-stage investing is partnering with startup founders and supporting them in the early years of their company’s growth. We often find ourselves extolling the many virtues of our portfolio company founders during team meetings - they are so impressive, courageous, creative, and visionary. And yet also vulnerable.  I’m a founder myself, and while there are incredibly exciting and rewarding moments, the journey can also be lonely, heavy, and all encompassing. Founders bear a tremendous weight in service of their vision. And while we might all understand there will be highs and lows, successes and failures - meeting those changing tides with compassion and calm is easier said than done.

As founder mental health becomes an increasingly important topic, new resource lists and commitments like the Founder’s Mental Health Pledge -  which we are signatories to - are being made available. When Kate offered to bring her mindfulness teaching skills to Alante founders, Leslie and I were instantly supportive. I always wanted one of Alante’s greatest strengths to be our culture. We value non-traditional, under-represented backgrounds and paths. We value and make space for work life balance. We don’t expect perfection, but rather partnership and communication.  It's okay to say ‘I don’t know’ and it’s okay to misstep. It’s all part of the creative journey. The sooner we can be present for what is happening, the sooner we can move forward with a solution. Mindfulness provides a tool that empowers us to be productive in our vulnerability. To help us observe if our desire to act comes from a place of fear, or confidence. To know when it’s time to pause, or time to move.

While we’ve personally experienced the benefit, the evidence supporting mindfulness for leadership and well being is available anecdotally as well as in peer-reviewed journals. What I love that Kate always emphasizes in her sessions is that while mindfulness practices can make us better as individuals, it also has a ripple effect on the people we love and work with. We practice in service of others as much as for ourselves and that’s a powerful way to lead and bring innovative technology into the world.

Specific to the founder journey, we know that a business may only be as viable as its leader’s ability to manage the highs and lows of the arduous work of founding a business, especially these days.  Mindfulness practice can help manage burnout, reduce defensive reactivity, and increase compassion - both for oneself and others. And all of this enhances creativity, resilience, and our capacity to connect with others. So in our opinion, making our founder’s well-being a priority is a responsible VC practice. We hold space for founder meditation monthly. It’s absolutely not required - and we are conscious of the perceived power dynamic between investors and founders- so we are sure to make that abundantly clear. Sometimes many show up, sometimes none, and that’s perfectly fine with us. The point is that the resource and community is there if they ever decide they need it.

Alante was founded for purpose so we understand the passion - and pressure - to create and realize a vision. We love working hard AND we practice meeting our edges with compassion. We are a work in progress, but this culture is our north star.

To learn more about Kate’s teaching practice for founders, email her at kate@alantecapital.com.

Happy International Women's Day!

Alante Team: Tess Krasne, Lisa Bougie, Leslie Harwell, Karla Mora, Breana Teubner, Kate Levin, (not pictured, Jordan Goldfarb)

By Karla Mora

On this International Women’s Day I reflect on how grateful I am to work alongside this incredible group of women! We are only as good as the company we keep and let me tell you, this company is pretty great.

Fast Company recently reported that only 4.9% of VC partners are women and of that percentage, women of color make up less than 1%. They shared “In the past five years, 73% of all women-led funds have been founded. Of these, around 90% of women-led funds are considered emerging funds. Most are in the process of either raising their initial fund or are poised to raise Fund II in the next 1-2 years.” Let that sink in. Women are so underrepresented that they have to create their own firms, and leap over the high hurdles of being an emerging manager, just to break into this field.

In this environment, it’s no wonder that in 2022 only 1.9% of VC funding went to all-women led companies, and 17.2% to teams led by at least one woman. This industry can do better… it all comes down to how you build your investment pipeline... and it’s time for this industry to cast a wider net.

Alante Capital welcomes entrepreneurs of all backgrounds and proactively works to have an inclusive pipeline. Our commitment is that at least 50% of our pipeline companies are led by individuals from historically underrepresented groups. We will invest in the best-in-class companies, and with an inclusive pipeline, we believe this policy will result in an inclusive portfolio. To date, 100% of our portfolio includes individuals from underrepresented group in executive leadership positions, 73% include female founders with 55% being companies led by an all-female founding team.

We define underrepresented people as: Women, Nonbinary, Black, Hispanic/Latin American, Asian/Pacific Islander, Persons with Disability(ies), LGBTQI+, and/or an Immigrant. We track our pipeline weekly and have consistently found that 66% of founders in the pipeline come from underrepresented backgrounds. When we see this number go down it’s our job to make sure we are reaching out beyond our network, ensuring that founders know how to find us… and we make ourselves accessible. Our apply page on the website makes sure that we can be reached regardless of if the founder knows someone we know. We consciously remove internal bias in investment decision making process… I’d certainly rather see someone with a thought-out idea, understanding of the customer/problem, and proven ability to work hard, than just a credential from an Ivy league university or investment bank… we are certainly not perfect in removing the barriers to entry in venture capital, but we are trying, constantly evolving, and committed to doing better.

I reflect on where we are today.
73% of the companies in our portfolio were founded by women. Today we take a moment to celebrate them, acknowledge the hills they climb, and admire the grit, ingenuity, and spirit they bring to their work. It’s our absolute honor to partner with these phenomenal founders.

Meet the women leading the exciting technologies enabling a sustainable and circular future for the apparel and home goods industries! 

Mango Materials Co-Founders: Allison Pieja, Molly Morse, Anne Schaur-Gimenez

Indyx Founder: Yidi Cambell

Lizee Founder: Anna Balez

Treet Co-Founder: Sonia Yang (and hi Jake!)

Novoloop Co-Founders: Jeanny Yao and Miranda Wang

Sway Co-Founder: Julia Marsh (and hi Matt!)

WINDOW Founder: Oladoyin Oladapo

ZZ Driggs Founder: Whitney Frances Falk

Accelerating Brand Engagement with Startups to Unlock Sustainability

I remember when Patagonia first started marketing its fleece pullovers made from recycled plastic bottles. I ran right out and bought one - so cool! It was rare to hear about a brand launching a tech-driven innovation expressly purposed toward sustainability or circularity in the 90s, and even well into the 00s. These days, though, something has shifted.  

Apparel brand sustainability commitments have mainstreamed over the past several years, some galvanized by coalitions and others by executive leadership flexing the long view - internalize environmental costs/risks now and reap the benefits later. When I was studying economics in graduate school, this was basic arithmetic - the cost of mitigating climate change would be far less than the cost of climate disaster and chaos.  News of greenwashing lawsuits and the billion dollar price tags on cleaning up climate catastrophes are two easily visible ways we see this today. But the apparel industry is getting hit on seemingly all sides with challenges that necessitate a systematic solution: climate and pandemic related supply chain disruptions, hoards of losses stemming from e-commerce returns, a fast-moving consumer culture that evades traditional marketing plans, a generation demanding cleaner products at the same convenience and price point, an impending regulatory storm… Oh yeah - and you have to do all of this inside a video game, too.

Fashion - we feel you. It's a lot.

To date, much of the corporate action has been organized around setting Science Based Targets and/or attaining B-Corp status resulting in programs set in place to measure, disclose, and ideally reduce GHG emissions and to transition to preferred fibers. There’s been a lot of action advancing renewable energy and using materials with lower environmental impact, and this is all great!  

And… it's exciting to see an acceleration of brands pushing the river a bit harder, investing in, funding, and piloting startup innovation that advances sustainability through a systems lens and reimagines its outmoded value chain. Innovation that includes impact across the whole apparel ecosystem from design to production, distribution and sales, use, and waste recovery.  We’re seeing technologies using advanced data analytics platforms to radically improve demand and assortment planning, fit technologies that engage customers to buy smarter, DNA markers to improve traceability, lab-grown performance materials using bio-waste, AI-driven resale platforms… This is not your 90s fleece made from recycled plastic bottles or a renewable energy credit (REC). 

Alante regularly partners with MBA students at the Berkeley Haas School of Business on research projects and scoping studies. In Fall 2022, we organized a project to look at how brand engagement with sustainable innovation was trending over the past few years.  The students scraped all publicly available information, identifying pilots and partnerships that fell into the following categories: Biomaterials, Sustainable Materials, Chemicals/Dyeing, Recycling/ Reuse Platforms, Sustainable Design, Recycled/Repurposed Materials, Packaging, and Transparency/Traceability. From the information we were able to gather, we found that in 2022, brands launched 4.5 times the pilots and partnerships than in 2019 - a great acceleration in the trend. Taking a more granular look, pilots and partnerships in Biomaterials increased 5.5x,  in supply chain Traceability they increased 6.5x, and in Recycled Materials they increased 12x. The data is not exhaustive and is limited by what was publicly available and what launches were deemed compelling enough to market publicly.  But if anything, this data reflects an underestimate, and still the trend lines are dramatic.  

The rise of brands engaging with innovative startups coincides with the growing understanding that “Sustainability,” these days, is about risk management.  And it is foundational to Alante’s thesis, that technology and innovation must and will transform apparel supply chains as sustainability and profitability converge on the horizon around decarbonization, supply chain resilience, and regulation.  Since we launched in 2017, we have had a front row seat as apparel brands accelerate demand for sustainable innovation. While we are used to seeing launches by the usual suspects - Patagonia, Adidas, Levi’s, Kering Group - it's exciting to see launches from brands like lululemon, Savage x Fenty, Madewell, Macy’s, Oxford Industries and others. 

We’re delighted to see that the pace, depth, and volume of brand engagement with innovation that improves sustainability has increased dramatically over the past few years, and from what we hear from the brands and startups we talk to regularly,  we expect continued acceleration. We know there is a lot more work to do and a lot more opportunity for impact, but what has us most excited is that the movement to reform the apparel industry has gathered enough momentum that change will happen far more rapidly than what we’ve seen these past 10 years. 

We are grateful to Haas Business School students Kira Erickson, McKennan Bertsch, Vivian Hare, and Nishal Gupta for their great and hard work on this project.

Alante Portfolio Company, Flyp, Raises a $10M Series A

By Kate Dillon

Alante portfolio company, Flyp, is on a mission to save $200 Billion+ worth of goods from ending up in landfills by using its AI-powered platform to enable millions of online re-sellers, and we’re proud to be helping them do it.  Here’s why.

A sobering statistic: Every year 100 billion apparel products are made, and  ~⅗ end up in landfills within 12 months,[1] costing the planet roughly 10% of global CO2 emissions. This is partly due  to throwaway culture, partly due to the preponderance of e-commerce returns (which are not guaranteed to be simply restocked and resold - many go straight to landfill or incineration), and partly because the technical infrastructure hasn’t been here to mainstream and facilitate resale… it hasn’t been easy enough to sell.

Enter Flyp. 

Flyp founders James Kawas and Dani Arnaout identified a critical gap between the massive amount of inventory and product waste in the apparel industry and the people who can sell it, so-called “power sellers” who are part of the exploding $15bn resale market. 

Flyp developed the first and only platform that allows individual consumers and businesses to offload their pre owned items to online resellers who will sell it for them on marketplaces like eBay, Poshmark, Facebook and others for a commission. Think of Thredup or The RealReal, but instead of a centralized company doing the selling, it’s done by a network of thousands of small, stay-at-home (mostly women) online resellers.

The key to this platform is Flyp’s AI-enabled matching technology which uses Pro Seller's historical sales data to algorithmically match inventory with the Pro Seller who is the best fit to resell it. Flyp also provides a fully free automation suite that saves resellers 90% of the time needed for inventory management and sales management across channels. 

By 2025, resale is projected to occupy 61% of the secondhand market, resulting in a total market value of $47 billion[2]. As this sector takes off, an emerging significant challenge is access to inventory, and Flyp’s unprecedented matchmaking and automated toolset has already succeeded in moving over 160 metric tons worth millions of dollars that would have ended in landfills, and is growing quickly at a 400% annual growth rate.

Using technology to accelerate a growth sector while avoiding environmental harm and creating inclusive access to circular business/consumption is at the heart of the Alante investment thesis. We invest where we see potential to move high-impact systems at scale, and resale enables individuals and brands to mitigate waste on their environmental, social, and financial balance sheets.

Flyp’s impact is fully visible and tangible in every transaction that occurs on the platform. Standardized metrics for circularity are evolving to meet the complexity and integrity of systems-level change, however we know that extending a product's lifecycle is a critical part of preserving its embodied energy, including GHG emissions, water, and labor.

For Alante, an important measure of circular impact is around sustained,  inclusive engagement, and this is where Flyp’s model stands alone. The company is creating and supporting hundreds of thousands of circular economy jobs for small, stay-at-home entrepreneurs around the country, enabling them to generate millions of dollars in income. On the flip side (pun intended), Flyp provides millions of shoppers with affordable items at a massive discount from retail, creating access to the circular economy and a more sustainable lifestyle.

Flyp currently hosts 17,000 power seller businesses, 85% of whom use the platform every single day for an average of 5 hours a day. To date, the platform has saved 160 metric tonnes of garment waste from landfill and $1mn of goods are being upcycled via Flyp every month, and they are growing.

We are thrilled to be a part of their continued growth. Flyp just closed a $10M Series A. The round was led by an awesome emerging fund manager - Asymmetric Capital Partners, with strong participation from existing investors: NextView, Afore, Interlace, Alante Capital, 1517 and GroundUp, and new investors Gaingels and Tectonic. The round also saw the participation of strategic angel investors including Ryo Ishizuka, Co-Founder & CEO of Mercari.

Learn more about Flyp, and see news on their recent round here.

[1] Forbes

[2] ThredUp

Alante Musings: Market Signals in Rental and Resale

Consumer shopping trends are changing, with first movers like The RealReal, ThreadUP and Rent the Runway proving that there is significant interest among shoppers to buy used, rent, and sell their clothes.

Consumer Platforms

 These new models provide a solution to the insatiable demand of many shoppers to have an ever-changing wardrobe, by reducing the friction around getting rid of items once they’re no longer interested in wearing them. This is a big shift, analogous to a move from owning albums to streaming playlists.

But why does this matter for sustainability? Because both “throw-away fashion” and “shopping therapy” can lead to buying far more clothing than one ever truly needs or could wear, leaving a vast number of garments underutilized in closets or ending up in landfills. Because of the resources it takes to make and recycle clothing, use of each garment is particularly important when addressing sustainability.

All that to say, we are excited to see new models popping up that are meeting consumers’ preferences and shopping habits, while allowing clothes to be worn by many people, many times.

Consumer shopping trends are changing with first movers - like The RealReal, ThreadUP and Rent the Runway - proving that there’s a significant interest among shoppers to buy used, rent, and sell their clothes.

As first-movers, The RealReal (REAL) and Rent the Runway (valued at $1bn Q1 2019) have experienced some turbulence recently on the back of operational hiccups and market moves, and we believe there is room for others to move into the broader space.

The B2B Angle

Established brands are also looking for ways to break into rental and resale, while still owning their customer experience. Eileen Fisher’s Renew and Patagonia’s Worn Wear have been at this for a while and even go as far as repairing and redesigning garments from old clothes.

We are now seeing more and more brands join this space. Some are partnering with startups that provide end-to-end solutions allowing them to offer rental or resale platforms, including The North Face, Ann Taylor, Banana Republic, Vince, & American Eagle. And URBN (Urban Outfitters, Anthropologie, Free People) has just launched their own rental service, nuuly.

We are big fans of this shift and are very impressed by the industry’s adoption of these new business models. We are very excited about the savvy entrepreneurs we meet who are providing brands and shoppers easy ways to buy, wear, and sell clothes in a more sustainable way.

Welcoming our First Portfolio Companies!

Over the last three years, we have witnessed a massive shift in the direction of the apparel industry, a clear signal that sustainability and profitability are no longer at odds with one another. In fact, it is more evident than ever that apparel producers are actively transitioning to a more efficient, less resource-intensive operational model and consumers are demanding more mindfully made goods in new and different ways.

Our job is to find the most promising innovations that support this transition, and we’re thrilled to announce that Alante Capital has made its first two investments and is officially launched.

Initial Investments:

Replacing petroleum-based polymers for a biodegradable alternative to polyester

A clean, closed-loop process to recycle and recover apparel waste to make new fibers from old clothes

Alante Musings: Why the Levi's IPO Matters

Check out our earlier post on the Environmental, Social and Governance aspects of Levi’s IPO!

Hello friends and colleagues,

Karla and I had been waiting with interest for last week’s Levi’s IPO – over the last year and a half we’ve loved getting to know a variety of people at the company passionate about embedding social and environmental sustainability holistically into their business (many other companies, too! But none in the midst of an IPO). People started asking us for our thoughts, so we felt compelled to put fingers to the keyboard and share...