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Memo: The Smartest In The Room
Apophenia is a word that I’ve long considered to be one of the most important in the English language. Both a normal phenomenon and an abnormal phenomenon depending on one’s mental acuity, its connotation is complex. It’s the ability to find meaningful connections between unrelated ideas. Ideas and community are the fuel of this phenomenon.
Apophenia’s role in history is understated. The Age of Enlightenment propelled mankind forward in remarkable ways. At the core of that time period was the invention of the European coffee house. Caffeinated by imported goods and free of the dulls of Renaissance-era alcohols, academic and social ideas took shape in rooms dominated by men who spoke powerfully and dutifully as if it were their singular contribution to society.
The European coffee house, or the “penny university”, democratized information synthesis in ways once exclusive to universities. It promoted conversation, debate, and authorship among active participants and nosy listeners alike. Ideas were valuable. Imagine a ship with a minor leak near the bow. Only a fortified wooden board can provide the stability that the ship needs to endure the tests and rigors of sea. Like hardened planks of sea-worthy wood, Enlightenment-era ideas plugged the hulls of ships constructed by others. One person’s idea completed another’s. It was rarely the smartest person in the room who received the ultimate credit for the end creation. But if you were in that coffee house long enough, you’d likely leave with a creation of your own.
In theory, digital forums are this era’s coffee houses. Revelations once found in the “penny universities” of 18th Century London are digital communities of shared knowledge today. In Nick deWilde’s The Social Architecture of Impactful Communities, he explains:
Individuals typically “hire” communities to accomplish transitions that require human connection. A startup founder who wants to become a better leader applies to Leaders in Tech to get the type of honest feedback needed for professional growth.
This is partly why ideas are valuable: they can serve the function of community. Ideas can solidify into a hardened mass, capable of keeping another ship afloat. Yet, there are endless essays written anchored by the idea that “ideas don’t matter.” These wise writers will go on to explain that if you cannot execute on those ideas, your words or thoughts lack value. These authors espouse the value of execution. Make no mistake, hustle culture rode the same wave. So, I beg to differ.
Consider the late American paleontologist, biologist, and historian of science Stephen Gould:
My talent is making connections. That’s why I’m an essayist. It’s also why my technical work is structured the way it is. How do the parts of the snail shell interact? What are the rates of growth? Can you see a pattern? I’m always trying to see a pattern in this forest and I’m tickled that I can do that. … I can sit down on just about any subject and think of about 20 things that relate to it and they’re not hokey connections.
It took Gould years to realize that this was a skill. Sometimes, the smartest people in the room are ones who think through societal problems, industry shortcomings, or game-changing innovations. These ideas make their way to mainstream news outlets, sizable Twitter feeds, or to industry mavens who repeat soundbites with little need to cite where they’d heard it. And because of these ideas, news outlets earn more clicks, Twitter followings grow, and industry mavens collect compensation for their appearances. So why is it that some ideators need to execute to prove their worth, while others earn perceived value merely because they’ve found an audience?
The ability to harness ideas and turn them into inventions, infrastructure, products, or art is a rare skill that should be valued. This is certain. But the opportunity to do so is not always evenly distributed. Many of the best thinkers are builders in their own rights but for a myriad of reasons, their ideas aren’t always attributed to them.
The communication medium of the era plays a sizable role in how ideas are attributed.
The most notable Greeks were orators. Leaders of the American colonial era wrote voluminous treatises and letters. Alexander Hamilton, one of the most prolific creators in history, wrote 85 articles and essays between 1788 and 1789. The early 1900s saw the rise of radio. Franklin D. Roosevelt transcended the power of addresses made by most of the prior presidents by using the radio to instruct and inspire Americans. In the 1960s the television took center stage. A handsome John F. Kennedy ruled a televised debate while Richard Nixon was the winner to most who were tuned into the radio transmission.
The internet pioneered a new type of thought leader in the early 2000s. Today, we are in the midst of the rise of text-based media, whether by way of Twitter or newsletter. The same methods that once thrived in the coffee houses of Europe live on on platforms like Reddit, Twitter, Substack, Slack, and private forums.
In the spirit of highlighting the smartest in the room, here are a number of business leaders, executives, and consultants within the 2PM ecosystem that have the ideas that move industries forward.
When Naj Austin made the bet on Ethel’s Club in 2018, she should have been able to easily raise money based on the idea that the marginalized deserved a community-minded place to congregate. That same year, The Wing raised $117 million to expand its services to its core demographic, while Austin was essentially scraping by to build on her collection of ideas.
The founder of Ethel’s Club, a new social club for people of color, she only solidified the idea for the space at the end of 2018. Less than a year later — after a wildfire word-of-mouth marketing effort, ongoing press coverage, and the backing of high-profile investors — she’s opened her first location. [1]
What most impressed me about Austin was her ability to pivot to digital services for the Ethel’s Club community as the pandemic began to disrupt physical retail businesses like hers and The Wing in early 2020. Austin’s agility paid dividends and she is now currently raising for her next venture, Somewhere Good.
You can follow Naj’s ideas on Twitter.
Before Brittany Chavez had a sustainable eCommerce platform to build her marketplace on, she’d already taken her idea of a resource for her community “Shop Latinx” and built an audience around it with her Co-Founder Miles Montes. Their Instagram account has reached over 60,000 fans and customers of what the media calls “Etsy for Latinos.” Halie LeSavage of Morning Brew explained why her Techstars-backed venture could work:
As 2020 keeps reminding us, Gen Z and millennials are adamant about shopping their values. And Latinx shoppers are a powerful consumer group: They’ll drive $1.9+ trillion of U.S. spending by 2023, per Nielsen. [2]
If there is one thing that I have learned about Chavez, it’s that: she’s resilient, she doesn’t stop until her ideas take shape, she welcomes the ideas of others, and she gives the credit where its due. Her collective of 60,000+ consumers and fans will agree.
You can follow Brittany’s ideas on Twitter (and here until Twitter fixes her original account).
I first met Sherrell at the National Association of Black Journalists in Miami, Florida in 2018. Seated with Trapital’s Dan Runcie, we each explained our ideas and what we hoped for our independent media companies to a small room of attendees. At the time, her latest venture The Plug was in its infancy. Today, it is one of the most depended upon industry resources in technology. Consider this report by the Seattle Times from August 2020.
She didn’t see her newsletter becoming a media business unto itself, but The Plug — which takes its name from a colloquial term for someone who knows everyone and “has the hookup on everything,” Dorsey says — took off.
She earned a master’s degree in data journalism from Columbia University’s Graduate School of Journalism, focusing on how data can help “tell better stories about underrepresented groups in technology,” Dorsey says, explaining her thesis. [3]
Sherrell is building one of the most pivotal companies in human resources. And though every technology firm now wants to hire her away from her idea-turned-creation, I suspect she will have more impact independently.
You can follow Sherrell’s ideas on Twitter.
Credited with launching the profitable content division at the famed Derris PR agency, Grace Garcia Clarke is one of the most curious and free thinkers in the space where agency and media intersects. Our first interaction was a December 2019 debate within Paul Munford’s Lean Luxe community on the merits of the botched Peloton advertisement and what it would mean for the company’s fortunes.
Formerly an operative at Derris, she’s now independent and highly coveted. Brands tap her for communications, industry research, and her eye for understanding what stodgy businessmen do not. An example of this is her well-researched product rundown for New York Magazine’s The Strategist where she wrangled the opinions of dozens of Generation Z TikTok users to publish one of the publication’s best converting articles.
No products sell faster on TikTok than beauty products, whether it’s a DIY eyebrow lamination kit, men’s shaving powder, or a shower jelly that costs exactly $1. And because the app is dominated by teens, many of these things are easy on the wallet (or the allowance, as it were). To find out what lives up to the hype, we spent hours exchanging hundreds of DMs with TikTok influencers. [4]
When given the autonomy to make decisions for companies that she partners with, they benefit. I should know; she is a frequent collaborator at 2PM.
You can follow Grace’s ideas on Twitter.
Andrea Hernández is a consumer packaged goods oracle. Her work with Snaxshot is the fruits of an idea that she’s long held: an editorialization of the data behind food and CPG trends. A native of San Pedro Sula, Cortés, Honduras, I have watched her audience around Snaxshot begin to transcend its niche. Hernández is also the founder of Mood Food Snacks, so she has a keen insight into the larger market. A recent report by Morning Brew featured her ideas around CPG and distribution through the pandemic and beyond:
We will see the rise of “dark stores” like Amazon, which recently launched their first online only Whole Foods in Brooklyn that will only focus on fulfilling grocery orders made online, and DoorDash, which launched DashMart. [5]
When she writes about CPG, I listen. Her ideas have been incredibly valuable and Snaxshot will grow because of them.
You can follow Andrea’s ideas on Twitter.
This list could go on. The idea of ideas is misunderstood. Whereas the largest audiences of the early-internet era were the victors with the spoils, the newsletter era is surfacing new ideas at the core. The convention of pattern matching is slowly giving way to the merit of the thinker.
Of course, great and monetizable ideas are still filtered and featured by mainstream sources. CNBC, Vogue and the LA Times will continue to get the credit for the work of smaller audiences. But if there’s one thing that I’ve noticed, it’s that this era has begun to shorten the distance between the originators of keen thoughts and the grand audiences that want to hear them.
In this way, ideas have never been more valuable, because it’s no longer thought to be binary – it never was. There aren’t ideators and executors. Rather, ideas exist along a spectrum where novel thoughts can lead to opportunity. These intangible assets are a currency, now more than ever. And it’s time that we begin to recognize the smartest in the room while they’re still inching along. They won’t be for long.
By Web Smith | Editor: Hilary Milnes | Art: Alex Remy | About 2PM
No. 334: The Relevance of The Letter
This week, The Atlantic’s Kaitlyn Tiffany wrote a nuanced and worthwhile report on the history of the newsletter industry. The length of the history depends on whom you ask. To her point, Substack would like you to believe that their team pioneered the movement. She argues, correctly, that they’ve successfully adapted it for a different audience. They’ll likely see great, longterm success. One glance at Substack’s paid leaderboard screen and you may understand the point that the author made throughout. In her piece, she writes:
“[Newsletters have] been a thing,” says Ann Friedman, who has written a weekly newsletter since 2013, has 40,000 subscribers, and is widely recognized as one of the leaders of the first newsletter boom.
In many ways, Tiffany’s article was relevant to a few thoughts that I’ve been managing for some time. She aptly stated the argument that while Andreessen Horowitz’s $15.3 million investment into Substack signaled a beginning, it became a useful tool to make newsletters “cool” to other groups. She provides a bullet-by-bullet history of some of the most important names in the newsletter industry’s history. The report is worth your time.
Backstage at September’s Destination D2C, a dozen or so colleagues convened to chat about the professional world, a passion that each of us pursue in our own ways. We each shared a few things in common but the most important was our interest in the direct-to-consumer industry. Now memorialized in Modern Retail‘s “The Rise of the DTC Bro,” that backstage scene was a significant moment and one that would not have been possible without the aid of the mainstreaming of newsletters as a media platform, to Kaitlyn Tiffany’s earlier point. Cale Weissman began:
It started with Paul Munford, founder of the luxury newsletter Lean Luxe, alongside Web Smith, founder of the site 2PM, who sat beside Helena Price Hambrecht, the founder and CEO of Haus. Then came Marco Marandiz, a DTC strategist and consultant, who sat down and joined a conversation about their clients. After that, Nik Sharma, whose Twitter profile describes himself as “the DTC guy,” joined the fun.
What, perhaps, the Modern Retail reporter didn’t see in that scene was the disproportionate amounts of rejection tolerated by each member of that seated group. Helena Price Hambrecht, a now well-known direct-to-consumer founder, began as a creative. In her own right, Hambrecht is a master communicator.
She proved herself quickly but for those of us who knew her before the bottles shipped, she was already proven.
But before Haus launched to a sellout crowd, the brand that she cofounded faced an uphill battle. No one wanted to fund her idea. Early on, reporters privately panned her concept and approach. I know, personally, that she pitched over 500 times to complete her $1 million seed round. That’s an extraordinarily high failure rate. Traditional VCs consider: geography, industry, age, gender, and more. Pattern matching provides comfort and a bit of insurance. Hambrecht was not a pattern match. However, the next round that she raised would close within days. In a comment to 2PM, Haus founder Helena Price wrote:
Our first $1 million took eight months and about 500 pitches. We heard a lot of no’s. There were plenty of dark points and moments of doubt. That said, if you truly believe that there is an audience for what you’re building, you’ll find those people in VC too. I tell people raising, now, that they probably haven’t met 90% of the people who will ultimately invest in them. You just have to keep getting intros and sending cold emails and you’ll eventually find your people.
She proved herself quickly but for those of us who knew her before the bottles shipped: nothing had changed, she was already proven. She just didn’t match the idea of a retail executive and manufacturer. As for the idea of a eCommerce industry leader or thinker, few of those of us who sat backstage matched that pattern either. Marandiz, Sharma, Munford, nor I are the prototypical resources for the higher rungs of the commerce and media industries. You wouldn’t find a single one of us on this list of industry insiders. There are several of the list’s members who subscribe to 2PM or Lean Luxe, however.
In an industry that glazes over contributions of those who don’t match the proverbial pattern, the newsletter movement has provided a platform. What each of us shared in the moment was memorialized by that paragraph. Before we were publishers, we were operators at some point: founders, directors, managers, builders. And that hard-earned experience was the wind the pushed our personal projects forward.
Sharma, once the Director of eCommerce for Hint Water (and then Vaynermedia) is often a co-writer to the prolific David Perell. A public relations executive by trade, Munford launched Lean Luxe within months of 2PM launching. Marco Marandiz made his name publishing now-famous Twitter analyses of DTC brands like Away and Glossier. He began doing so while leading product at HomeAway. And before I managed commerce for media publications Gear Patrol and Uncrate, I cofounded Mizzen + Main. Still, those credentials often fall short.
Just three months ago, 2PM was featured on a National Association of Black Journalists (NABJ) panel with successful (and lucrative) newsletter publications: The Plug, Inevitable Human, and Trapital. The topic was on “building paid subscription media companies.” But the common thread throughout was easy enough to observe: without the critical mass of a newsletter audience, our ideas would likely be re-packaged at a traditional outlet through on-the-record or off-the-record conversations with professional reporters. Newsletter publishers strive to own the distribution of their ideas and the communities around them.
So when I read the article by Modern Retail, I wasn’t upset. Weissman is a great writer and he likely meant no harm. But I was confused by how no one saw what we did. I am not sure that many readers understood how proud we were to be sitting there in the first place. Just three years prior and that scene wouldn’t have happened. To me, the moment felt like an enormous privilege. In each instance, we found our own ways to deliver our practical and experience-driven ideas to a very competitive ecosystem. And on that day, the founding team at Yotpo recognized the validity of them all. It was an important moment.
The Pre-Substack Era
Goal: publish 180 letters. Reassess. Launching 2PM, Inc. in 2015 was a hail mary of sorts. In December of that year, I was no longer co-running a DTC operation. Instead, I was advising and / or building eCommerce operations for publishers. As a side project, I started 2pml.com as a way to maintain accountability to myself.
2PM was a simple proposition: understand everything to get better at the one thing.
I wanted to get better at my profession. At the time, my focus on one task was leading to more blind spots than tangible progress. As such, I was missing out on the practical knowledge that follows reading, thinking, and hard analysis. The first 2PM email published to 11 people; I’d monetize it after 180 letters out of necessity. Building this company became my full time job.
By understanding how 2PM’s commerce-adjacent industries interact to negatively or positively impact one another, I was able to map the best steps for the projects that I was attached to – then and now. With 2PM, I hoped to duplicate those same abilities for other industry colleagues. It is a simple proposition: understand everything to impact that one thing.
If there were any blindspots in Tiffany’s Is Anyone Going to Get Rich off of Email Newsletters? [1], there may be one. There is a growing collective of former operators who spend the majority of their time honing their publishing skills. They understand commerce and marketing and branding and logistics and data science. They’ve shipped packages, negotiated distribution deals, and led performance marketing efforts. And readers appear to be drawn to the raw perspectives of those who are discussing industries from within the walls. Whether you’re reading Emily Singer’s Chips and Dip, Magdalena Kala’s Retales, Richie Siegel’s Loose Threads, Jenny Gyllander’s Thing Testing, or Paul Munford’s Lean Luxe, the presence of operational experience is felt.
The Operator-First Publisher
So yes, Substack left out relevant history on their July 17th “A better history for news” blog. Of course they highlighted Ben Thompson and Jessica Lessin, luminaries of the indie paid subscription industry. But Substack may have missed another trend. Substack concludes their homage to publishing with:
One hundred and eighty-four years since the New York Sun first went on sale, we are standing on the cusp of a new revolution in the news business. The time for mourning the loss of the old media model is over. Now is the time to look ahead to the next two centuries.
The revolution itself is not new. But it is reaching new types of thinkers looking for a platform to move their industries forward. Will it make publishers rich? Maybe, maybe not. But publishing as a platform is altogether different than sending newsletters alone. Gyllander just completed a sizable angel round from many of Silicon Valley’s best and brightest. Her subscription-based approach is fresh, credible, and engaging. Siegel just successfully held a one-day retail conference that wouldn’t have existed without his Loose Threads newsletter. Munford fills Lean Luxe social events each time they are held. While not a paid-subscriber driven platform (for now), he’s successfully monetized through weekly sponsorships. And 2PM is launching its first members-only forum for commerce and media executives: Polymathic. Each company has tremendous opportunity ahead of them.
The era of the operator-first publisher is a fascinating one to observe. In some ways, it’s leveling an exclusive playing field within media tables. But at one table, in the backroom of Yotpo’s well-appointed venue, a group certainly stood out – literally and figuratively. We carried ourselves differently and we looked different. Non-traditional voices in business-adjacent media are positively impacting traditional media circles. And the hope is that those newsletter-turned-platforms continue to provide new ideas to the executive levels of established digital industries. 2PM is once again observing a quiet movement from within.
Read the No. 334 curation here.
Report by Web Smith and Edited by Tracey Wallace | About 2PM