Before “DTC” was a well-known concept, Henry Davis wrote his thesis on how those who establish a clear value proposition will be the winners of the ecommerce space—he was right.
“I had a very strong thesis about direct-to-consumer brands, known as branded ecommerce at the time,” he says. “My thesis was that the winners in this space are going to be people that use their channel as a value proposition, not solely as a means of distribution. That thesis is a part of everything I have done for the past ten years.”
One of the most notable things that's shaped is Glossier. As a VC in London, Henry met a woman named Emily Weiss, who was then running the beauty blog Into the Gloss. He moved to New York City to work with her and help launch Glossier, a beauty consumer goods company that recently raised a Series E of $80 million. As the President, COO, and CFO at Glossier, Henry elevated the company from an idea to a billion-dollar business. Seeing how much technology shaped the success of Glossier, Henry next set out on a mission to provide accessible, quality technology to all ecommerce businesses. He is now the Cofounder and CSO at Chord Commerce, previously Arfa, a “commerce-as-a-service” software company that recently raised an $18 million Series A.
In this Q&A, Henry discusses the weight of the founder crown, the large role technology plays in customer experience, and the benefit of seeing customers as emotional, moral stakeholders in your brand.
What is a key piece of advice you'd give to a new ecommerce founder on day one?
Being a founder is supposed to be hard—if it wasn't, everyone would do it. Remember what made you start this business. I know that’s cliche, but you started because you had the vision to deliver a product, a brand, an experience, and a community to the world. Every decision you make subsequently should be focused on doing that. If you focus on that, that will both give you the energy in those dark days but also keep you focused and humble in the good days.
Before being an operator, I didn't realize how heavy the head that wears the crown is. The burden you carry as a founder is different from the burden you carry as an executive. It's a different kind of stress and a different kind of reward, both financially and emotionally. I would want all founders to hear that what you’re doing is emotionally difficult, and it's supposed to be. Spending time with other founders can at least make you feel less alone.
What did you learn as the president, COO, and CFO at Glossier that you brought to your startup Arfa that became Chord?
The number one thing I brought to Arfa is how much time, energy, money, and effort we put into technology to be able to deliver the customer experience we want to deliver. When we were selling Glossier products, the product was one piece of the overall offering that we were selling, and technology had a big part to play in there. We put a lot of resources and energy into technology, and I wanted to make sure it was not a barrier to great brand experiences, as it had been up until that point.
On a slightly more nuanced level, make it possible for people to do unique and brilliant things. Technology shouldn't be something you use to do just good enough. It really is the way, if the eyes are the window to your soul in real life, "yourbrand.com" is the window to the soul of your brand. It is the most unfettered, pure relationship you have with a customer, equal probably to a brand store, and it should be built with that passion.
What do you think made Glossier such a well-loved company?
Glossier was always focused on including people and making sure the customer was a part of the brand in every way. They weren’t just a customer, they were a stakeholder. Stakeholder brands are how I think about the best brands. As a customer, you own a piece of this business, emotionally and morally, because you've been included in the journey.
So, when customers are sending feedback, through product reviews or comments on social media, messages to customer service, or feedback by behavior—listen to that, absorb it, process it, and then answer it.
I've met a hundred plus direct-to-consumer entrepreneurs and none of them started their brand purely so they could sell products to make money. They start because they want people to have something that they feel really good about—and that's the key.
How and why did Arfa transform into Chord?
We started Arfa to try and create brands that target underserved communities that are underserved for a variety of reasons. These can be issues that no one wants to talk about, the fact that there are fewer entrepreneurs in that generation or ethnic groups that have specific needs in products that aren't being met.
We launched two brands under Arfa to make products for these communities. One was an all-gender sweat brand called HIKI, created to understand the real needs that sweat creates. We launched sweat products that expanded to all people's sweat problems, not just armpits. We also launched a wellness beauty and lifestyle brand focused on menopause and perimenopause called State Of to serve another population that hadn't been seen for the lived experience that they were going through.
We realized in Arfa that we can affect society in a positive way and that we can create more change by supporting brands, not by being the brands. There are only so many brands we can launch a year, and also the market opportunity as a software provider is bigger. It was a nice moment where mission and capitalist truth came together, and we decided we should just focus on supporting the brands rather than being the brands.
We ended up acquiring a BI business to complete our stack, and we thought it was a good time for a new name: Chord. The logo is made up of three concentric Cs, but if they rotate it's one really thin C. The whole point is how do we make something complex feel very simple.
What is one piece of advice you would give a founder in seed-stage investing and pitching?
Not a single venture-backed business in history ever got to where they are without being told no a fairly substantial number of times. Don't let the no dishearten you—there's a reason they said no. There's feedback in a no and you should understand it. If you're brave enough to say there's a different way of doing things, you shouldn't expect that everyone would agree with you. Getting knocked back is just part of the journey.
The other bit of advice is every time you raise money and you close a round, take a vacation. You've just been through something incredibly emotional, whether you realized it or not. A well-timed vacation creates time and space for yourself after those particularly difficult moments. By the way, the least pressure you ever have as an entrepreneur is the minute you've just fundraised, so that's the perfect time to do it.