Talent Ventures Landscape
0xD16B
June 7th, 2022

In today’s talent ventures landscape, talent has realized the power of leveraging their brand and their reach more than ever before. Talent has leveraged their brands to create their own businesses, invest in startups, receive equity stakes in startups/businesses, and more. Typically, talent would get paid for social posts and/or promotion in exchange for a certain dollar amount. These types of deals still occur. However, after 50 Cent’s equity deal success with Vitamin Water, Ashton Kutcher’s success with startup investing, and George Clooney’s success with Casamigos (just to name a few), some talent started to realize the power of equity and long-term value creation versus paid sponsorships only. In this article, I’ll cover examples of the talent-led businesses being built, deals being done today, current trends, and where I believe opportunity exists in the market.

Talent-Led Businesses:

Since the talent ventures landscape is booming, I’ll cover the most recent happenings in each section. Below is a list of talent that is building their own businesses.

Lori Harvey - SKN by LH: Lori Harvey is a fashion-forward “It Girl” with near perfect skin and real culture relevance. Her skincare line is a five-step system of companion products including a goji berry cleanser, white tea toner, and vitamin C serum.

Mr. Beast - Mr. Beast Burger: Mr. Beast is a popular Youtuber with 95.8M subscribers. According to Forbes, Mr. Beast was the highest-paid Youtuber in 2021 with $54M in earnings. Jimmy Donaldson is known for being philanthropic. He's donated millions since launching his YouTube channel back in 2012, Business Insider reports. In March 2020 alone, as millions lost their jobs, Donaldson gave more than $1 million in supplies to food banks. In December of 2021, he partnered with Virtual Dining Concepts and launched 300 virtual kitchens, dubbed Mr. Beast Burger, partnered with Virtual Dining and gave away food and cash as part of the marketing. He also uploaded a corresponding video titled, "I Opened A Restaurant That Pays You To Eat At It." The locations are delivery-only with a menu that serves burgers that are short with a wide circumference, Smashburer inspired, and crinkle-cut fries. The menu also includes sandwiches.

Mr. Beast also launched Feastables. After a lifelong battle with Crohn’s Disease, Jimmy was inspired to create a portfolio of candy and snack products that he’d be proud to eat with his friends. Feastables is a plant-based, gluten-fee chocolate-bar brand serving consumers across the country through online and in-store channels. The company's marketing plan has allowed fans to participate in several sweepstakes and giveaways, collectively valued at over $1 million dollars. Each candy bar comes with a special code that customers type into a website, and some codes lead to prizes. Among the prizes during the first launch were a Tesla and a lifetime of chocolate from Gopuff. Jim Murray, Feastable’s CEO, is the former President of RxBar and helped shepherd the company to its 2017 acquisition to Kellogg. Feastables has received funding from Alexis Ohanian’s 776, Sugar Capital, Color Capital, Shrug Capital, and Nik Sharma.

Kevin Hart//Dwayne Johnson/MJ - Tequila: A number of A-list talent have launched their own tequila brands. Kevin Hart launched Gran Coramino. Hart’s tequila differentiates itself as a cristalino, a form of clarified aged tequila. Dwayne Johnson (The Rock) launched Termana Tequila. The tequila is produced in limited quantities using traditional production methods, featuring notes of vanilla and roasted agave, balanced with rich, warm oak, and a smooth finish. Every bottle of Teremana is dipped by hand in black wax before being hand-packaged at the brand’s distillery in the small highland town of Jesus Maria, Jalisco. According to the Spirits Business, Teremana Tequila has sold more than 600,000 nine-liter cases in 2021, solidifying it as “the fastest-growing Tequila ever. Michael Jordan is a part of the ownership group for Cincoro Tequila along with 4 other NBA owners. Priced at $120 per bottle, it is one of the more expensive tequilas on the market. It's aged 8-10 months in used American whiskey barrels at an underground cellar in its distillery. Cooked agave is joined in the starting lineup by hints of vanilla on the nose and complemented by spices and dried fruits.

Tom Brady - The superstar NFL quarterback has been in build mode the last couple of years. Tom Brady founded Autograph, an NFT platform that brings together the iconic brands in sports and culture to create unique digital collections. The platform recently raised $170M at a $700M valuation. He also founded TB12, a health and wellness company aimed at empowering anyone to live pain-free and perform their best. Inspired by the training method of Tom Brady and co-founded with longtime Body Coach, Alex Guerrero. They hired Grant Shiver as CEO, a successful executive enterprise builder, and former Vice President of Private Brands, Product Development, and Global Operations at Lowe's Home Improvement. He also started Brady earlier this year, his apparel brand. To top it off his sports media and production company Religion of Sports, cofounded by Tom, Michael Strahan, and Gotham Chopra just raised $50M in Series B funding from Shamrock Capital and others.

Troy Aikman - Eight Beer: The media personality and former Dallas Cowboys Super Bowl Champion recently launched 8 Beer Brand, named after his number with Cowboys. It will have 90 calories and use only organic grains like Hallertau Taurus hops, which are rich in antioxidants. That’s fewer calories than Miller Lite’s 96, Bud Light’s 110 and Budweiser’s 145. Doug Campbell, the former president of the Ommegang brewery in New York, is Aikman’s co-founder at Eight.

A$ap Rocky - Mercer + Prince Whiskey: As a fashion icon and style symbol, A$ap Rocky has released a rare whiskey. The bottle’s packaging and presentation features a unique design that captures two built-in drinking glasses on both ends. Rocky sees Mercer + Prince as a statement piece for your bar cart, he explains, but the spirit, retails $29.99 per unit, is made for sharing. Rocky described the whiskey as a social bottle. Distilled and aged over four years in American white oak barrels, then blended in Canada, it boasts a fruity aroma, mixed with whiskey’s signature smoky-sweet taste with the Japanese Mizunara oak that adds complex notes of caramel, cinnamon, baked apple, and vanilla. The alcohol can be enjoyed both as a cocktail and neat.

Courtesy of Mercer + Prince
Courtesy of Mercer + Prince

Russell/Ciara Wilson - The House of LR&C: The husband-wife duo launched the company in 2020 as a way to house their fashion brands - Good Man Brand; Human Nation; LITA by Ciara - under one roof. House of LR&C stands for Love, Respect, and Care. Sustainability and giving back are core tenets of the fashion house, which gives 3% of profits back to charity and the company is certified as a B-Corp. Christine Day, former CEO of Lulumeon, serves as the company’s CEO. The company has received funding from Harlem Capital, Fanatics investor Ames Watson Capital, Lightspeed Venture Partners, and Darco Capital.

Kevin Hart - Hart House: Kevin Hart is building in the fast food industry with sustainable, affordable and crave-able products in mind with the Hart House. The quick service restaurant called is set to open its first location later this summer (2022) and will serve only plant-forward food while providing high quality jobs in an environment that’s accessible to all consumers and available within minutes of ordering. The Hart House menu features 100 percent plant-based burgers, chicken sandwiches, salads, nuggets, fries, tots and milkshakes that are completely free of hormones, artificial colors, preservatives, and high fructose corn syrup. Hart strives to ensure the quality of the product can appease even the biggest carnivores. Hart House poached Chef Michael Salem, the former head of culinary innovation at Burger King.

Startups Building Around Talent:

There are startups that leverage talent to plug them into either existing infrastructure or operational ability to build businesses.

A-Frame Brands - Building a portfolio of Talent-led brands designed to meet the everyday needs of underserved communities, striving to create solutions for unaddressed problems that disproportionately impact millions of people, whether that be due to their ethnicity, their gender identity, their age, accessibility, or who they love. Launched skincare brand Kinlo in partnership with Naomi Osaka, launched babycare brand Proudly in partnership with D. Wade/Gabrielle Union. Led by Ari Bloom, former founder of Avametric, and A2B Ventures, and worked in merchandising for both West Elm and Gap and A2B Ventures, Hill Harper also is a founding team member.

A-Frame/Kino
A-Frame/Kino

Pietra - Pietra provides creators with everything they need to turn their passion into a creative business, in one place. Pietra allows creators to connect with suppliers, design their products with product designers, and set up your e-commerce website all through their company. Pietra also provides warehousing and logistics for Creators to give them an end-to-end solution for their business. Pietra has been a launching pad for over 20,000 creators including Hailey Sanu’s (YouTuber with 1.3M followers) ILYBaby apparel brand and Ella Rose’s skincare line Skin by Ella Rose. Pietra and UTA launched a $500K Creator Fund that is helping support select talent in launching their own product lines and commerce brands using Pietra.

Syllable - Acquires, incubates, operates, and scales consumer product brands through contemporary branding, operational excellence, omni-channel growth. Partnering with the world's most notable celebrity-influencers, Syllable works with select partners to imagine aspirational experiences for a contemporary global audience. Syllable has partnered with actress and Fabletics founder Kate Hudson to build plant based supplements company Inbloom. They also partnered with model Emily Ratajkowski to build a skincare hydrogel mask company Loops. Led by serial entrepreneur and company builder Aditya Julka.

Popchew - Popchew creates the next generation of fun food brands and experiences. Popchew provides the operations for creators to build, launch, and grow brands nationally in just weeks, powered by its partnerships with local restaurants across the country. Popchew has launched Bitcoin Pizza with crypto influencer Anthony Pomp and Youtuber Zias to launch Wing Szn.

Merch - Merch is a back-end software, fulfilment, and ecommerce company. Merch’s all-in-one design, software, fulfillment and manufacturing relationships allows any brand or business to be able to create apparel, products, and items with no heavy lift. They have worked with brands such as Peleton, TikTok, and Doodles. The company is also beginning to work with creators and talent. They have worked with Kygo and Gary V. With Merch, talent would be able to incubate an apparel business, CPG business, liquor brand, etc. with just handling their marketing for their products. Merch handles everything else. I am in the process of incubating a business with an upcoming actor and building a handful of businesses in partnership with a management company in collaboration with Merch.

Talent-Investment/Advisory/Partnership:

Talent has also found strategic ways to do business in the sectors they’re passionate about. Partnering with brands as advisors for an equity stake and/or investing in companies for an equity stake and becoming a shareholder/partner.

Denis Shapoalov - Brust: An up and coming tennis player exploded onto the scene in 2017 with a pair of titles on the ATP Challenger Tour before debuting at the US Open and reaching the fourth round. He’s been a mainstay in the top of the men’s game ever since. Denis is a coffee lover and stated that he does not believe he could live without it. Denis signed onto Brust as a shareholder and advisor. The brand created a unique beverage for those looking to enjoy the taste and benefits of coffee while adding meaningful calories in the form of grass-fed protein.

Jay-Z/Meek Mill/Lil Baby/& More - Mitchell & Ness: Mitchell & Ness is set to be acquired by a group of investors led by Fanatics, Jay-Z, Maverick Carter, Meek Mill, and Lil Baby. The D’Amelio Family are also part of the new ownership group. The deal is worth $250 million, per Sportico, which also reported that Fanatics will own 75% of the company and the other investors will combine for the other 25%.

Bob Iger/Rich Paul/TCG - Funko: The group is part of a consortium investing $263M into the pop culture, toy and apparel brand Funko, representing a 25 percent stake. The investment is being led by Peter Chernin’s The Chernin Group, with online retailer eBay Bog Iger and Rich Paul, the founder of Klutch Sports Group and the head of sports at UTA. Iger and Paul will serve as advisers to the board, with Paul helping Funko expand its presence in the music and sports categories.

LeBron James/Maverick Carter - Lobos: Many have seen LeBron James promoting Lobos, the trendy, new tequila. Lobos is founded by Diego Osoro. Dia Simms, Diddy’s former President of Combs Enterprises and his spirits businesses will serve as the CEO of the company. Lebron James and his partner Maverick Carter invested in the company to become stakeholders because of the quality of the tequila, core company values, and the opportunity to build a strong consumer brand with diverse leadership. Arnold Schwarzenegger is also an investor,  as well as star Anthony Davis.

Miguel - T3MP0:  A digital studio that creates web3 communities for A-List talent and brands, announced it has tapped multi-platinum, singer and songwriter, Miguel, as its Global Creative Director. Miguel represents an exciting new opportunity for top talent and brands to supercharge value to their fan bases by leveraging technologies and platforms such as (NFTs), (DAOs), and the metaverse. As T3MP0's creative director, Miguel will extend his extensive collaboration history into partnering with the world's biggest talent and brands in the web3 space.

Pharrell - Doodles: Doodles are a collection of 10,000 NFTs (non-fungible tokens) that are made up of hundreds of exciting visual traits designed by Burnt Toast. Hand-drawn Doodles include skellys, cats, aliens, apes and mascots. The Doodles collection also includes dozens of rare heads, costumes, and colorways of the artist's palette. Doodles launched in October 2021 and has since gone on to become one of the most valuable NFT collections on the market. To date, it has generated nearly $500 million in secondary trading volume, per data from CryptoSlam. Pharrell will join Doodles as Chief Brand Officer. In his new role, he will help shape the collection’s approach to music, artwork, consumer products, animation, and events. Additionally, he will serve as executive producer on an album of Doodles-inspired music called "Doodles Records: Volume 1," which will be released in partnership with Columbia Records. The album will include “major recording artists,” per a Doodles spokesperson, and feature artwork from Doodles artist Scott “Burnt Toast” Martin.The Doodles album will be available to stream via various platforms, but will only be sold via NFTs. Seven Seven Six, the VC firm of Reddit co-founder Alexis Ohanian, led a funding round in the project. It’s the first capital raise for Doodles. Doodles recently introduced former Billboard President Julian Holguin as CEO.

Kevin Durant: Coinbase & Weedmaps: Weedmpas announced a multi-year agreement with Kevin Durant and Thirty Five Ventures as well as a sponsorship deal with Boardroom. As part of Weedmaps’ mission to power a transparent and inclusive global cannabis economy, the strategic partnership will aim to further deconstruct the negative stereotypes associated with cannabis while elevating the conversation around the plant’s potential for athlete wellness and recovery. Basketball star Kevin Durant and his company Thirty Five Ventures signed a multiyear deal with Coinbase to promote the cryptocurrency platform across his businesses. Durant will appear in advertising as a face of the brand. Coinbase will also link up with Boardroom for digital ads and sponsored content about crypto, and put money into Durant’s foundation to support his youth programs. The crypto sponsorship market is hot as FTX also teamed up with Steph Curry, Tom Brady and others giving them equity in the company for strategic promotion.

Trends/Opportunities

Trends:

The above demonstrates a quick market map of certain deals, talent-led businesses, and investments in the talent ventures landscape in the last two years. Drawing the trends from the different segments and the market, I conclude a few things:

  • Talent is leveraging their brand to work with companies that build in areas they are passionate about and solve problems that the talent is passionate about. LeBron James invested in Lobos for the taste of the product but also, because of the core company’s values, and diverse leadership within the consumer brand.
  • Operational talent is highly important in talent-led businesses. High-quality operators with demonstrated histories of building are important to scale the businesses and for the businesses to become successful. Christine Day is going to be instrumental for the House of LR&C, bringing in experience as the former CEO of Lululemon.
  • Successful talent-led businesses will connect with the talent’s audience. The Honest Company, Fenty, Skims all connect with Jessica Alba, Rihanna, and Kim K’s audience, which is a part of the formula of the three company’s success.
  • Talent businesses done right creates a massive opportunity. Talent has a unique marketing opportunity and funnel not even certain large companies can create, depending on the talent. For example: Mr. Beast's Main channel got 273.2 Million views in last 30 days of April 2022 vs. ABC's Oscar's broadcast averaged 16.62 Million viewers. The last 30 days Beast got 16.5X the Oscars (and the Oscars sold 30 sec. ads for $1.7 - $2.2 million). The power of distribution for talent-led businesses can be extremely powerful and create massive purchase opportunities. When this is combined with a product that connects with the talent’s audience, with differentiation, an authentic story, and a great operating team to help scale the business, then the probability of building a successful talent-led business increases drastically.
  • In the article, I only covered the most recent talent businesses being built, there are so many more. From a consumer perspective, there may be a point at which the market becomes oversaturated with talent businesses because of the rate that so many are being created - when almost every talent can spin up a business, consumers start to question how special the products really are. This is especially true if the product is being sold at a significant premium, and there’s no clear differentiation.
  • Superfans will still be frequent buyers of their favorite talent’s products, the broader population may start to wonder and question why talent is creating a specific business. Talent with a truly authentic story behind their brand that connects with their audience can maintain an edge.
  • Certain sectors were white-space opportunities for talent to build, advise, and invest at one point but have become crowded. The tequila space has become massively overcrowded. Not mentioned in this article is also Mark Wahlberg’s investment to become a partner of Flecha Azul Tequila and these are just the talent tequila deals in the last couple of years. I believe the beauty/skincare space was a white space area a couple of years ago but has become a little more crowded in the past year (Human Race, Kinlo, SKN, Loops, Florence by Mills, John Legend’s Unreleased Skincare brand with A-Frame, Hailey Bieber’s Rhode, Kim K’s new skincare line, just to name a few).

Opportunities:

The question then becomes where are the white space opportunities for talent to build businesses that also connect with their audience?

Vitamins: The global dietary supplements market size was valued at USD 151.9 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 8.9% from 2022 to 2030, according to Grand View Research. Increasing consumer awareness toward personal health and wellbeing is expected to be a key driving factor for dietary supplements over the forecast period. The working population around the globe is struggling to fulfill the daily nutrient requirements owing to hectic work schedules and changing lifestyles. There aren’t many talent-led vitamin businesses to my knowledge. I believe there is an opportunity to create a talent-led vitamins business that could be successful. Vitamins is a need, not a want and with a continually growth rate in market size and consumer want for something different that meets their needs, a talent-led business could be built in the sector. In addition, the health and wellness space connects great with talent because of storytelling and marketing.

Food: Food is a major influencer category and has grown over the past year. Tiktokers, Twitch streamers, and Youtubers have popularized food reviews and trying new food places with their videos. Talent has been involved with food from both a strategic and investment perspective, Daring foods with Cam Newton/Kygo, Immi with Animal Capital/Kyo, Rick Ross - Wingstop, Beyond Meat/Kim K. However, there are not many food companies that are built by talent. As covered earlier, Mr. Beast has built a company, Celebrity Chef Spike Mendelsohn built Eat the Change, Kevin Hart is set to open Hart House, and Shaq has built Big Chicken but there aren’t too many more to my knowledge. Snoop Dogg and his son is building a Bored-Ape NFT themed dessert restaurant in collaboration with Food Fighters Universe. Popchew is building an entire business around the concept of connecting creators with existing infrastructure to create food brands, one of the firsts. Food is one of Gen Z’s top spending priority, and over 24% of Gen Z’s ordered delivery 3+ times per week. The food delivery market alone is massive at around $200B. Consumers, especially younger consumers, make spending money on food delivery a priority within their budgets. With the storytelling and marketing machines that already exist on socials (Twitch, Tiktok, Youtube) for food, and with consumer spending power and consumer food curiosity, the rise of ghost kitchens, I believe there is an opportunity to build a health-conscious food brand. Consumers more so now than ever care about eating healthy and what they put in their bodies.

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