The Role of AI in Saving Struggling Consumer Investing

The Struggles of Consumer Startups in the Venture Downturn

Consumer startups have faced significant challenges in recent years, especially since the onset of the venture downturn in 2022. The year 2023 was particularly disastrous, with only $130 million in investments made by VCs in direct-to-consumer companies. This marked a shocking 97% decline from the peak of $5 billion in 2021. Other consumer-facing sectors, such as e-commerce and media and entertainment, also experienced significant decreases in investment. The struggles of high-profile consumer startups like SmileDirectClub, Warby Parker, and Allbirds have only exacerbated the difficult landscape for these companies.