Kobie Fuller — Upfront Ventures

Wednesday, May 25, 2022
Every pitch today involves community.  Upfront partner and former CMO Kobie Fuller tells us how the best brands are giving users the tools to be brand advocates and how those same brands are tapping into the community to get insights.
We also talk about being black in venture and what inspired Kobie to build Valence, a network for black professionals.

Today I am chatting with Kobie Fuller. Kobie is a partner at Upfront. He’s also the co-founder and chairman of Valence, a community for black professionals.  Before Upfront, Kobie was a principal at Accel, he was the CMO of Revolve and he started his venture career at Insight. Kobie has invested in Exact Target, Oculus, User Testing, The Wave, and many others. Kobie- Thanks for being on the podcast.

Thanks for having me.  Great. Well, I thought we’d start some of your investing and maybe starting with Insight and what does an associate who’s kind of early in their career, what are they doing at insight?

Yeah. Well, when I was at insight, I mean, that was back in 2004. So I joined during fund IV,  $740 million fund, and the role was essentially just cold calling and trying to source interesting investment opportunities that hopefully the senior partners would chase after.

So. In any given week doing at least a hundred outbound cold calls to founders in specific categories that I thought were potentially interesting at that time, Or I just take, you know, lists of companies that were on fast-growth lists and just go straight down, you know, calling one by one each company to see if there’s anything interesting for us to invest in.

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So you’re applying both vertical sourcing approaches as well as horizontal with some sort of significant indicator around growth. And then what could happen is that by taking that horizontal kind of slice that overall markets, maybe you find initialing company within a given sector that then.

Starts to put you on this whole path of going vertically deep in that category to make sure that you’re finding in investing in the best company in that category versus one that happen to pop up through some horizontal sourcing tactic. And then work to pitch bag of money that essentially you’re trying to invest in this business. So it was just a lot of sales being quite honest.

Hmm. What do you think about insights doing.


I mean, it’s a dramatically different business in terms of the. Size funds they are managing. I’m not sure what the latest fund is, but it’s several billion dollars,

 so that they staffed up in a meaningful manner where they can go super early to super late and have the fund resources to be able to do so.

So again it’s a great platform. I have a lot of respect for the senior leadership there. Great. So tell me about some of your current thesis areas. Maybe I’ll pick on research ops, as I know that’s a place that’s a core focus of yours.

Yeah, So it’s been an area that I’m spending time on for. Many years lived it firsthand without CMO at revolves. And we’re going through a period where we want to think about rebranding the company, thinking about also the idea at the time, the website. Total all-black background transitioning into a white background.

Black background is from a UX perspective is very risky approach to take for many different reasons. And also design-wise, it makes it really tough to design for and part of around doing that you know, we went through and did a full-on usability research study, focus groups, getting a sense of why people love the brand.

What do they not like about the brand, And there’s nothing that you can get from going in Google analytics or any of the quantitative data stores we have around our customers to truly get a sense of how they feel about the brand.

And what do they say about. So it took really asking our customers firsthand to get a sense for what was their perspective, all that qualitative texture. And so when I was at Excel partners, saw the need for tooling that really helped in that area and And that’s what drove me to invest in user testing, which essentially allowed companies of all sizes to be able to tap in and watch videos of real users, interacting with our products and being able to extract insights And for me, is how. In a world where brands really need to be very much in tune with the user experience and customer experience overall, is that much more integral in terms of how you differentiate yourself from one brand to another, and apps have taken it to the next level of the guards and making sure that they are in tune with the guards to consumer preferences.

If you’re not understanding the voice of the consumer in a way where you can develop product and design for this what’s going to happen is you’re going to wake up one day and realize that you’ve been leapfrogged by someone else who asked. So the whole customer experience industry is one where I don’t know, it’s a $30 billion market size growing incredibly fast.

That is going to necessitate there being tools that are more than just. You know, survey and research products like Qualtrics and survey monkey and others have developed, but they’re going to be more, I think a full-on stat that a product manager or a research ops team, which is more and more becoming an organization within companies are prioritizing getting small, to have research.

We’ll need to make sure that they’re able to extract these insights from customer, that users at scale orchestrate the way in which those insights are extracted in a manner where it doesn’t step on the toes. The sales team, the marketing team, the CS team who may be talking to that user already, you got to make sure that you are all in coordinated organization, as you’re talking to someone so precious as your customer or user.

 So it’s an area that I’m incredibly excited about because there hasn’t been much tech developed in and around this area.

And I feel like we’re going to start to see, a full on staff that is supporting the extraction of quality insights and sharing it with scale.

for user testing, for example, where there are certain insights or inflection points that really made them stand out and scale.

 I think it was. A combination. They were just really early to the category. I mean, , they have the domain usertesting.com, but they started out as a pay as you go model that went on to do quite well, but it wasn’t until they started noticing habitual usage in a manner where it really kind of just five-year being a recurring SAS relationship where it started becoming interwoven into the fabric of an organization about how they figured by extracting these insights is research at large. And that’s where you started seeing a lot of the growth in that business happen over time And so tie this customer insight to brand building and what you’ve seen work for building brands.


So I look at the best brands are ones that know how to build community, community, being those individuals that are assembled together in a way where they have some commonality. And that commonality happens to be your brand at the center. And you, as the brand are able to really gather those individuals are the tools around how to talk about your company in a way where it’s very clear what you stand for, your mission, your vision, your values of an organization.

And. Companies like Jim sharp, for instance, I’ve done a very amazing job at bringing community together of people. I like working out in the gym in a manner where it went beyond just the clothing, but it was very much, a lifestyle that they all truly embodied together and they saw this brand as one that uniquely saw them more than a little lemon or a Nike, because they all kind of had a very similar ethos of going to the gym, working out really hard, being comfortable kind of being a gym rat And it started developing almost a tribal source around how the community of customers truly engaged in a way where it was more than just a commerce experience, but it was just a lifestyle Whereas to become incredibly powerful is how do you tap into that community to then get insights, ask them, how do they feel about your product? What do they like? What do they don’t like? These community forums and venues are just rich with data for you to be really in tune with the guards to are we truly serving our community in the way we think we are?

 And it’s these conversations that start happening at scale, whether it’s in your own and operated forums, was it a Reddit forums with on discord? The, like where going back to the, research ops staff, I think there was an exciting area to build technology.

That’s extracting insights of scale out of all of this massive amount of qualitative text So it all intertwines in a way where the best brands know how to put these pieces together in one orchestrated fashion will have long-term defensibility and just know their customer in a way that they had never known before.

 It also allows. Your community or users to do the marketing for you. They become the advocates, the folks on the front lines that are actually speaking your brand values.

 do you see influencers fitting in with community? Do you think influencers , and community are synonymous or do they fit in.

I think there are one piece of the community everyone’s an influencer. Everyone can be an influencer and everyone has some level of influence. So whether it’s. Someone of the magnitude of a Steph Curry or the local point guard down the street, Steph Curry can be almost like a silver bullet for under armor in terms of being able to get the awareness out there on their live shoe.

But if you’re the local pizza shop and you somehow have the ability to tap into the local point guard that everyone thinks is the coolest kid in town, that will be your advocate and saying like, eat pizza here like That’s an influencer someone that literally has bought your products and wants to share with your friend, that’s my throw influence.

And then person may only have 50 followers on Instagram, but that may be enough to get some incremental conversions you’ve never had before. So I think the way the best brands operate is they look at everyone as an individual possibility to influence one another. And there’s this degrees of influence and the way in which you actually devote effort towards engaging with those influencers can be at the level of having to spend millions of dollars for someone that’s the rock, or just incenting them by almost just making sure that they feel like they are recognized and seen.

 I love hearing your marketing CMO perspective. Anyhow, let’s tie this to a specific company. I know you’re super excited for Marty. So why don’t you tell me, what did you see in Marty? What was your thesis?in essence, what Louis and Karrie that you’ve found as a martyr you’re trying to do is create a platform that is allowing consumers access to brands. They recognize these are food brands they use for shelf stable food brands at price points on the order of 40 to 70% off in a time where food prices are just going through the roof because these products, if they were not being offered through Marty at four years, service set off would be taken by the brand who for some reason may too much of it decided to change the packaging around.

So can’t sell it to reach. Or it’s getting too close to their end of shelf life and are faced with a couple options. They can liquidate it through channels where they have no idea where the product has had to do. They could be sold to other retailers that are very much known to be like, discount food.

 Maybe like some stigma with regards to how it’s being marketed, represented if a brand wants to have this elevated sort of nature to them

So sending your leftover product to Marty is the same use case as sending your leftover product to the nine, 9 cents store. it’s very, very similar. Except most brands, they probably would not be proud to say, oh, they’re the nine, 9 cent store. it’s not brand elevates.

But they have to get rid of the product. Cause most of the times, honestly, they try to donate it, but it’s processes to donating it that take long time to go through.

It’s not easy to donate the food. And that’s just not something that made you realize that there was actually is a whole sort of processing you to go through the dirt and sort of scale or make cases. And this is why we have an issue with regards to food waste. They just throw it in the landfill. And this is just one of the major contributors to climate change.

This, this food waste being tossed, landfills are burned. So Marty is trying to. Take that food and essentially it’s saving it by being able to send it straight to the customer at 40 to 70% off So it’s a brand elevated experience. That’s doing good for the planet And it’s playful brand they developed and it’s fun to shop on.

Yeah, it’s stealing like crazy. If I understand it nicely,

Yeah, it’s still all right.

if you , so you and a couple of other folks at upfront have backgrounds of CMOs.


And maybe we’ve already touched on this, but like, do you have any thoughts on just how the role of the CFO has changed?

Yeah. Well, it’s one where I feel like way back in the day, a COO is someone that would sit in a conference room and try to come up with the most creative ad campaign and the best CMOs, the ones that were the most creative and brilliant, like, it was like more of the artistic side marketing, those overly influenced on. Then I feel like come like mid two thousands to once they start seeing early explosion of data. People started thinking about, oh, like the CMO and the marketer. It’s all about how you do the quantitative side of marketing and use that to, drive growth and maximize, you know, caps, LTV.

And it was formulaic kind of growth hacking type role. But I think more and more people realizing today, it’s like, it’s a balance. If you think back to the conversation, we’re just having the round customer experience and the voice of the customer and the brand.

Like those are all really important things that are on the quality of side of understanding what your customers and users are doing.

But it’s one where the. A lot on their hands in terms of what to figure out because the consumers are moving incredibly fast. The world’s changing constantly. And the amount of data that’s being shared is exploding and everyone demands a incredible experience that leaves them inspired and not underwhelmed to the point where then suddenly they cancel the brand because we’re also living in a world, cancel culture.

So it’s a little bit of a scary job right now. I think we’re seeing most, but it’s also probably one of the more exciting jobs could have right now.

 Well, how do you describe the up-front brand?

How about describe the up-front France? That’s a good question.

I could cheat and tell you what sister said, but.

, I’d say the way. Describe the brand is one where we all love the whole aspect of company building and going on journeys with founders that are incredibly passionate mission-driven and just want to build something truly, truly great,

And we’re doing it by. Getting on that journey of the earliest of stages. And right now it’s getting involved at the seed stage. In some cases, the seed stage could be just an idea in a napkin and then incredibly passionate founder. How about your own brands?

 My own brand. I’d like to ask someone else how they perceive the Kobe branders cause it’s interesting how I would think what my own brand is versus what someone else would say my rent is.

Well, this goes to user research. I actually usually ask the question the other way we were just talking about brand. I usually say, how do your friends describe you?

 one of the first. Whereas people say like nice, almost too nice.


Yeah. people definitely use the word nice, empathetic,

Positive. I’m always thinking in a very positive manner.

Despite what may be going on in any given circumstance. I’ve definitely had people describe me as intense. Uh, That’s partially because of the, former athlete in me uh, where I can have a lot of that intensity and focus,

Nice, positive and intense are a great combo, but let me bring them back to investing. and the metaverse in particular, I know you invested in Oculus.

I would love to hear more about that focus area for youyeah. I mean, I was a geek game where I caught a referred to myself as a nerd athlete growing up at constantly playing video games. And for me, it’s exciting to see that the quote unquote Mehta versus starting to get a lot of mainstream attention in terms of where our lives may be going in terms of, you know, moving more to the digital.

think honestly, some people almost realize what the metaverse is, where the metaverse, the way I describe is probably aware like the digital almost takes over the physical in terms of how you’re spending time in. communicating, connecting with others and a, truly synchronous fashion different than obviously kind of email or text cards when we’re having right now.

Like zoom, I think zoom is an iteration of the metaverse and we’ve been living on it given COVID for the last couple of years. So lots of people want to wonder, it’s like, oh, what’s the metaverse thing. I don’t know what that is. Like if you’ve been working from home on zoom last couple years, like I think that is very much a version of the metaverse.

And for me, it’s, very exciting because it allows for those folks who want to build on the metaverse and really start developing tech stack on top of.

That allows for new things to be done that were never before possible, whether it be games with one another, potentially have the opportunity for, therapy and mental health treatment. Being able to see a friend or family member because of the medium, incredibly exciting taking the next level where people are thinking about the intersection of metaverse and NFTs web three, that that’s where I’ll be honest.

It starts getting into a realm where I don’t know how much. We’re living right now is truly long-term sustainable versus hype. I think there’s a lot of folks that are chasing after money or they see, wow, the metaverse like can start buying land and these virtual, places, because see a market for it and they see how much things are appreciating.

So why not blow six figures, seven figures on some virtual land, because it can be an interesting asset. Are they going to hang out in that land truly and like have fun with their friends? Honestly, I’d don’t know, I’d say 90% of people that probably for safety in this economy now, probably not. And some of these virtual lands you see, like they don’t look like fun environments.

Like they look like barely a better than like second life back in the day. but um, I don’t know.

We’re super early days on this and I’m excited to see where it goes.

Hmm, but so some of what you said, I think is for you, one of the key parts of the metaverse is it’s that social interaction piece.


So Aidan, my partner, Aidan, likes to say that people can remember the first time they put on a real VR headset. Like they can remember that experience for me, it was a sporting event.

Like, and I remember it super well, but it wasn’t really interactive. Like no one else was watching it. It was like a pre-taped

boxing match.

Yeah. a lot of the early VR experiences they were single-player you’re in there by yourself consuming something immersive, but you’re slow. Okay. Why am I going to want to hang out in here?

Like I’m here by myself. This almost feels scary and you’re almost kind of worried, like, okay, I’m missing versus setting. Is someone in the real world to like poke me or hit me? Like, what was that like sometimes take headset off to.

Remember the fact that you, are in your living room or some space physically, because you get so immersed in There’s one session, That’s a solo player mode where it becomes incredibly different. I remember the first time that engaged in a multiplayer VR was toy box, And the ability to have presence with another individual in immersive virtual setting.

was almost magical. I still remember like, taking a ball and handing it to my friend who was in VR as well and them taking it. And it was like, okay, this

is something different. If there’s hundreds, thousands, millions of people in this virtual setting where we all have presence with one another, and whether we’re having presence with one another watching a concert, which was the thesis behind my investment in the wave, or you’re watching a sporting event it’s just having that feeling of presence.

that to me was always the more exciting play that VR could enable, Yeah. I mean, let’s take the wave. would have been some of the insights that the wave team has had building that out,

Yeah. I think the big insights are, is like, oh, BRS are lots of people don’t have headsets. Yes.


 We are still early days.I don’t know what the number is. Looks like 8 million or so Oculus quest twos that are out there. You think about the number of people that have smartphones.

Billions. So if you’re going to create some incredibly compelling piece of content, probably find a way to reach consumers where they are in the billions of devices they have versus the single digit millions of headsets that are out there. So you get access to Justin Bieber who wants to perform the metaverse.

Why would you squander it on only that small, you know, N. The billions of people are out there. And this resulted in just this explosive interest around how the wave, they enable mega artists to reach fans and not to be recorded. Like you seen some of the examples on fortnight or roadblocks, but it’s lives interaction where that Bieber concert he was performing fans could real-time give feedback.

They could real-time augment and adjust what was actually happening while Justin was performing and it’s live motion captureit’s motion captured. He’s moving, he’s singing, he’s dancing and millions of people are in the way of consuming it. It’s pretty crazy.

And let me ask specifically about Metta and the metaverse. Well, we have one metaverse, uh, what direction do you think Metta will take?

Who knows, I guess, was what I’ll leave with first. But theory is there’ll be a variety of meadow verses that have different themes to them that create the reason why people actually want to engage in these immersive environments, whether there’ll be one governing platform that centralizes all of these men in versus in a way, or these Mehta verses will be siloed.

Who knows? I think consumers are going to want to find ways in which assets and their avatars can freely move from one metaverse to the other. I feel like the platforms that have the biggest opportunities to. Create these meta verses. We’ll see probably we’ll not want interoperability, unfortunately, just because that’s kind of how large platforms work.

So this is going to result in there being a variety of like siloed, like large mega meta versus that have micro instances within them that companies create to congregate communities that want to connect with each other in immersive environments in each like mega metaverse may have their own avatar system and, protocols by way, which things get done.

The only thing that may cause there to be some unification layer could be web three and how potentially by taking any wallet that you may be storing assets and in there being the need for them, those assets to be able to be Existing within those different digital spaces that could be the unifying thread.

Yeah. I mean, it will be fun for us at least. Okay. Coby. I want to make sure I talk a little bit about like you personally, I want to talk a little about violence. I want to steal your thunder, but like how many black CEOs are in the fortune 500?

 uh, What’s there right now

I think it’s four.

it’s not enough. Yeah, I believe it’s four.

So it’s that the statistics are pretty invisible in terms of the, you know, the number of black fortune 500 CEOs we, we have all a long ways to go as relates to how, um, the black professional population could at least make significant progress from being significantly represented across all facets of business in this.

Yeah. And is that sort of the mission of valence or do you want to explain it a little bit?

Yeah. part of the vision of the balance is being able to take a technology approach against the problem of helping at least minimize very, very large wealth gap we’re seeing in this country here, where it focusing in on the black professional population in a way where they can get more exposure and access to professional um, senior level opportunities, to being able to be represented for other than the C suite and having rising managers VPs being provided with the tools to know what it takes to actually get to be in the C-suite to um, having founders.

Giving them the ability to access venture funding through network of VCs we have on the platform

So it’s overall. It’s trying to create a system where we take a digital community and connect them with one each other. And then two entities that want to find ways of which they can fund in power hire and put on board positions And so it was an idea that came to me really because I was frustrated didn’t exist.

And I ideated it put out at alpha or was able to recruit a CEO to write a full time,

Yeah. So you said you built it some out of frustration, like what’s been your experience being black in a industry, surrounded by white people, I guess

Yeah, it’s very loaded question. So it’s been, interesting. I’ll just say that. So it’s one where, and this is how many, let’s say black professionals feel the same way. You just can’t give anyone reason to doubt your capabilities, where you just have to work that much harder. I look at it, very similar track and field like you can’t deny if someone on the track is faster than everyone


There’s an objective measure. Being the clock gun goes off, whoever gets to the finish line first wins. So for me, as I looked out at the venture, I was realized to not have the color of my skin, be a significant factor, cigars high, pursuing the industry. I as needed the points of the board, I need to run incredibly fast.

So that meant for early days insight doing what it took to actually find those interesting investment opportunities that hopefully result in points of the boards. In this case, realize returns. That clearly shows that I know what I’m doing on the field. And I just had to continue stacking up the points so that people wouldn’t discount me because of the color of my skin, but it still happens. And there’s many instances where if I’m not leading with my resume or people didn’t know who I was.

Having cows interactions where just because of the color of your skin, you’re discounted in a group setting. It’s like, who is this random guy that I don’t even know, like why he’s here, because he’s a look like anyone else here. So I’m just not going to include them in the conversation. Like the amount of times I was in some setting where yeah, it was just assumed that I was just random guy in the room, but not like a qualified investor that actually, you know, belonged in the room.

And honestly, it’s, those instances that just drove me to outwork everyone else in the room and put points on the board to the point was that it was undeniable and unfortunately just the case of how it is to be black professional America these days is that you kind of have those instances where you are judged because of the color of your skin.

And that’s just the facts.

Kind of hope that it’s getting better, but I don’t know.

Yeah. I mean, like we’re definitely making progress, but I won’t lie to you. The amount of stories I hear that not made it to the public, real kind of bad behavior. It still happens. Like where are we stuck? We still have a long way to go.

Yeah. And I think a lot of it is that’s I was going to say subtle stuff is not like explicitly. It’s just like an assumption when you’re in a group.

Yeah. And there’s also explicit stuff too. Like that’s just literally like, is just jaw dropping, shocking that again, like stuff that just doesn’t make it to mainstream breasts that you hear and you’re just like, wow, that’s happening.

 So it’s, um, We still have a ways to go.

How do you keep your mindset positive then

so I actually take the stance trying to stay neutral and this is actually something I learned from my late friend, a guy named Trevor Moab, who wrote a book called it, takes what it takes. And then recently published a book called getting to neutral. I got to know Trevor through actually upfront someone a few years ago.

We had Trevor on stage with my other good friend, Michael Johnson, the sprinter talking about this whole notion of, mindset and mental performance. So Trevor’s background is that he worked with elite athletes and organizations like coach Saban and Alabama to serene Williams to most recently Russell Wilson.

And kosher and get him on this whole mindset neutral thinking. And the idea that if you focus on the negative that you may encounter in your life, negative thinking has a four, seven X impact on performance versus any other thought. And then the additional piece of, if you actually articulate negative thoughts out loud, it actually has a potential seven to 10 X multiplier effect.

 So in Trevor told me this data point. I was like, oh my God. But it was just like kids. That’s something that he latched on to. It was just like, don’t be negative. Be neutral, just like neutralize the negativity, because that will get you his mindset around what you actually have to do next, which is focusing on the next step forward.

So for me, just focus on straight trying to take a neutral mindset and also focusing in on it just takes what it takes I have to realize, okay, if I want X outcome, and it was very clear that data in terms of what it takes to actually achieve X outcome, I used to have to be very aware of what it takes to do.

Don’t complain about it and just do it and do it with a neutral mindset.

Wow. Do you ever get a moment to yourself? Are you like, could you just sort of feel proud of where you are and think your younger self would be so proud to see where you are today

 actually it’s funny that I tried not to always retrospect in a manner like that because I feel like if I become too proud and too like pounding of my own chest, then I feel like that will create a mindset where lose a level of hunger and I lose a level of, really focusing in on like work and I continue to go and the goals I want to achieve and the day I feel like, oh, I’ve made it.

I’m done like the day I say that?

it’s like, oh, I’m just totally done. And instead of anything as more look to just live in the day, cherish each moment

Koby. I have loved getting to know you better. Thank you so much for doing this show.

Yeah, no, my pleasure. My pleasure.