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🔑 Newsletter #32 - How to build a new kind of journaling app?
+ Matthew Hartman (Partner at Betaworks Ventures)
Hey there! Welcome to my email newsletter. My name is Leo Luo, a student entrepreneur at the University of Michigan. I write about founder stories, trends, fundraising, and unique behaviors in the consumer startup space.
All my previous posts can be found here.
Follow me on Twitter @_leoluo
↺ What you might’ve missed in the last three weeks
11/29 - Story of Carewell (e-commerce platform for caregivers) + Elizabeth Edwards(Partner at H Venture Partners)
11/22 - Story of Motion (Superhuman for web browser) + David Goldberg (Partner at Alpaca VC)
11/15 - Story of Monet (Gen-Z dating app) + Jason Stoffer (Partner at Maveron)
Check out all the startups and investors I have featured in the past on
this Notion board
🍽 Today’s menu
Startup story - Wellnest (Joyful journaling app)
Investor POV - Matthew Hartman (Partner at Betaworks Ventures)
What I’ve been reading - 5 articles about startups and investing
Who’s ballin’ this week - 6 new fundraising/developments in B2C space
Jobs - 12 full-time jobs and internship postings
Feedback - help me to deliver better content to you
🔥 Startup Story
How to build a new kind of journaling app
(Image credit: Wellnest)
If you have been following Consumer Startups for a while now, you know I am a big fan of the mental health space. As a college student, I have seen first-hand my peers’ often silent struggles with anxiety, depression, and a myriad other conditions.
In August, I featured Mantra Health, a digital health startup that works with universities to provide better mental health services. This week, I had the pleasure of catching up with my friend from Michigan, Tommy (CEO and Founder of Wellnest), to learn more about their unique approach to tackling the mental health space.
Tommy has a very personal tie to this problem. He lost his dad to suicide toward the end of his freshman year at Michigan. “Many things came with his passing. Most notably it involved lots of pain, community, and love. I was supported by a community that offered me endless guidance and love, while shocked by the magnitude of close friends and family who shared how mental health has affected them or their loved ones. People I had known my entire life were silently living in this reality long before I was thrown into it,” Tommy explained.
A few months after his Dad’s passing, Tommy began organizing mental health awareness campaigns. He sold shirts, hoodies, and donated all the proceeds to the Brain Behavior Research Foundation, a fantastic organization doing research on mental health. He began to hold these events regularly until his junior year at Michigan when he decided to leverage his computer science degree to brainstorm solutions with friends to really make a difference in this space.
🚗 Product Journey Part I - Pre-MVP
Tommy and his team started the project by interviewing a lot of people at the University of Michigan. They had an original hypothesis that they could potentially build a marketplace to match college counselors with students who might need help.
They had three key learnings:
Students loved the idea and it was clear the demand from students was strong
Counselors at Michigan were often overwhelmed with appointments and they were not able to accommodate more students
There was often a lot of downtime in between counseling sessions and counselors often gave students physical CBT journaling worksheets for students to complete
After the interviews, they decided to do focus groups to better understand how people cope with mental health. They put signs up on campus and incentivized would-be participants with pizza and snacks (pizza is a great way to get college students’ attention lol).
They were able to gather a couple of key insights:
People didn’t want to go to therapists even when struggling and preferred to talk to a friend or write about their struggles
People often found talking about their struggles with mental health therapeutic
(Wellnest flyer for focus group)
🚗 Product Journey Part II - MVP and Beyond
After interviews and focus groups, they realized their initial marketplace idea was not going to scale due to capacity constraints from the college counselor side. Instead, they decided to focus on building a self-care journaling platform.
“We found tons of resources and worksheets that counselors use to help their patients write things down at home. We loved this idea and wanted to expand upon it. We envisioned an application that helps people talk through their thoughts, with the goal of making them more self-aware. This naturally embodied the function of a journal, but with the help of some questions and prompts that can get you on the right track,” Tommy explained.
Their MVP was a simple web app. They launched it with the primary goal of testing what kind of content people would like. For example, they learned that people liked talking about gratitude and self-confidence.
**Link to their original product hunt post
(Wellnest MVP web app)
Following the web app, they also shipped out a mobile app which was officially launched on the Apple Store as of a few days ago.
Current traction: since the Beta in late August, they have acquired over 2000 accounts which have over 6000 journal entries, at a 25% monthly retention.
Biggest challenge: Find more ways to motivate people to journal.
Next steps: 1. explore analytics and help people to see what they are talking about 2. add features to make the journaling process more fun
Goals: reach 5K entries per week in four months and get to 40% monthly retention
🤔 Biggest setback so far
“Our biggest setback was losing our CTO in May. We had to part away with him because he was not as committed as we needed him to be. We had different views on how to move forward with the product. There are four people on the team and I am the only technical person on the team. It was really hard, and we didn’t know what we were going to do for a couple of months. To make up for this, we got an intern who has worked with us in the past few months and helped us tremendously with our iOS app.”
“In the next two to five years, we want to be the “Headspace” for journaling. We've been characterized that way many times by our users and I think that's a great place for us to be. The journaling market in general is very fragmented. There are no clear winners so we think that there's an opportunity to do that.
In 10 years, we want to be the first step that people take when they're starting to struggle with mental health. I think there's a lot of room for therapy to grow, and I very much respect all of these platforms that are creating accessible therapy for people. However, we don't believe that most people are going to start with it. There needs to be a good stepping stone so we think that people are going to manage their mental health on their own and we want to be that resource for people.”
Check out Wellnest!! I am a big fan and I highly recommend everyone to download it and try it out.
🔥 Investor POV
Matthew Hartman (Betaworks Ventures)
(Image credit: Matthew Hartman)
Matthew Hartman is a partner at Betaworks Ventures, a seed-stage VC that invests in surprising new consumer behaviors and trends powered by frontier technologies. Betaworks Ventures also invests in new categories through Betaworks camps, a structured pre-seed investment program(e.g. AR, voice interfaces, etc).
After graduating from the University of Pennsylvania, Matthew started his career building the technology platform for Trammell Crow Company (acquired by CBRE) before joining Hot Potato (acquired by Facebook). He co-founded ReferBoost, a profitable b2b company in the real estate and social media space. In the past, he has invested in startups such as Anchor, Gimlet Media, Product Hunt, and more. It was so fun connecting with Matthew and learning more about his view on early-stage consumer investing.
🚀 Consumer trends that excite Matthew
Product that extends our brain and supercharges us
“I describe this as the fixing internet category - products that extend our own brains and supercharge us where the goal of the technology is to help the individual versus to make a more addictive news feed. Roam is a good example.
We are currently doing a camp right now around fixing the internet. We just accepted four companies and are still looking for more - apply here”
Metaverse and digital third places
“Metaverse is interesting because it's a place for a lot of synthetic media to live. I think virtual places like Rec Room and Fortnite make Instagram feel slow and asynchronous. I think what people are starting to feel is that the sense of presence is more than just posting and waiting for likes but rather being in a place.
💡 Key learning from being an operator
You don’t have to build a VC-scale business to be considered successful
“Prior to VC, I started a company called ReferBoost to help property managers leverage social media. I didn’t raise venture capital because I was concerned the market size wasn’t “venture scale”. I purposely built a product that went deep into a narrow vertical. It became a lifestyle business and eventually became part of apartment.com’s suite of products.
Success isn’t limited to having a billion users or selling your company for a billion dollars or (even worse) raising X amount as a success metric. I think entrepreneurs are starting to see, as I did, that success can (and should) also be defined as creating something people want, finding a smaller set of dedicated customers for that use case, and delivering a great product that fulfills its promise.”
Don’t hold on to the equity too tightly
“At the time, as a first-time founder, I held on to my equity too tightly. There was a person who was interested in working with me and I was nervous to bring on a second person because I was both afraid of letting this person down and didn’t realize that the way you grow -- both as a person but also as a company -- is by letting go a little bit.
I see this with first-time founders who are concerned about not owning 100% of the company. The reality is that you can put in a vesting schedule and you could say ‘we both think this is a risk. Let’s try six months and see how this goes’. I think ultimately things of consequence get built by teams and thinking about how you are building your team is really important.”
Sharing information during negotiation can create value
“I used to think that negotiations with big companies were about sharing as little information as possible so that you could get the thing you want. I’ve learned over time that it’s much more beneficial to share more information. Yes, it opens you up to potentially being taken advantage of, and you have to manage that, however, what you learn as you start to share is that you can find more opportunities for value creation by sharing the information.”
👥 Most interesting founder Matthew has met
“Esther Crawford is the founder of an app called Squad, which is like Houseparty except you share your screen and it is for private groups. What I think is so interesting about her is that she has spoken very publicly about how she wants Squad to help bring you closer to your friends. She's very interested in real human connection.
I think that she's a person where the market came to her. She has a very good nose for an interesting technology like conversational software and is able to tie that to something that means more than just an app, a place where people can feel safe to be themselves.”
📚 Matthew’s favorite books
“Timequake and The Sirens of Titan are two good examples of Kurt Vonnegut’s books. I like them because they combine two interests which are sci-fi and really entertaining prose. They are super creative and belong to a category that isn’t quite just fiction but also isn’t quite sci-fi; it’s somewhere in between.”
Feel free to reach out to me if you are an early-stage founder that is currently fundraising right now.
I would love to help and pass on the deck to investors in my network!
👨💻 What I’ve been reading
The Mistake Most First Time VC Fund Managers Make
Contrary’s How to Start a Startup Guide for College Students
Airbnb: the disaster artist (great story about Airbnb)
🏀 Who’s ballin this week
Fantasy startup Esports One raises $4M more
Wellory raises $4.5M for its ‘anti-diet’ nutrition app
Teen banking service Step raises $50M, adds TikTok star Charli D’Amelio to investor list
Bizzabo raises $138M for a platform that helps you build and run virtual conferences
VSCO acquires mobile app Trash to expand into AI-powered video editing
AutoX becomes China’s first to remove safety drivers from robotaxis
😍 Jobs & Internships
Apply - Zetta Venture Partners - Platforms Associate (SF/NYC)
Apply - Substack - Product Manager (SF)
Apply - Maze - Product Manager (Remote)
Apply - Intuitive Ventures - VC Associate (Bay Area)
Apply - Public - Product Manager (NYC) **I am interviewing them next week!
Apply - 10X Capital - SPAC Associate (NYC)
Apply - Cloudflare - Summer PM Intern (Remote)
Apply - Plaid - Software Engineering Intern (SF)
Apply - Lyft - Summer Product Design Intern (SF)
Apply - Shuffle - Social Media Intern (Remote)
Apply - NEXT Ventures - VC Intern (SF)
Apply - Laconia - VC Intern (Remote)
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