Basemakers Founder To Launch AI-Guided VC Fund

With over 10 years of experience running CPG retail strategy firm Basemakers, and about eight years running his own beverage company, Just Chill, before that, Max Baumann believes he has a good sense of what makes a successful brand. Baumann is now leveraging that expertise and AI technology to become an investor.

Baumann announced the establishment of Back to Back VC last month. The new venture capital firm will be the investment arm of Basemakers, pairing the consultancy and merchandising company’s data with machine learning to guide investment opportunities.

Back to Back VC will invest in brands with over $5 million in net sales, seeking Series A funding.

The VC has not disclosed the size of its first fund, but it plans to deploy check sizes between $500,000 and $1 million, Baumann reported.

“We see this not just as a fund but as an intelligence engine,” he said. “When you look at traditional VC today, they all talk about ‘value-add,’ but not too many of them have a full-service engine that has a provable way to drive sales velocity.”

The AI-powered VC will use a multi-variable linear regression model to analyze the factors that determined the most successful 100 CPG exits over the last 20 years. The algorithm will look at sales velocities over time and margins “to get the highest predictability of success,” Baumann said. The algorithm will also use less concrete metrics, like founder traits and social sentiment, to drive insights, he said.

Currently, Back to Back VC is hiring tech industry professionals, including full-stack engineers, user experience designers, and analytics experts, to oversee the AI model. The fund’s full leadership team has not been disclosed yet. The Basemakers board of directors had been advising on the new project with former Red Bull CFO (and Basemakers board member) An De Vooght has been “guiding the process,” Baumann said.

AI is popping up all over the CPG industry, from helping connect manufacturers and brands to product development. Using AI to determine potential category winners is not unique – it goes back more than a decade, to CircleUp’s “Helios” product – but pairing AI with Basemakers’ data from over 400 partners could give Back to Back a leg up in finding the best product-market fit.

One key metric that Back to Back is focused on is the customer lifetime value to customer acquisition cost (LTV/CAC) ratio, which Baumann says is determinant of strong margin generation and a brand’s long-term success. It’s a contrast to brands that raise investments on the back of “smoke screen velocities” that cloud data by inflating sales gains with demos and discounts, he added.

“The best brands have their options of who they want are the cap table. Our goal is to be able to signal it early and reach out with a compelling enough proposition that, even if they aren’t raising, they can’t say no,” he said.

The new VC firm is not focused on any specific category but is looking towards “fast-moving consumer goods that have high turns and are distributed in grocery,” Baumann said. “On the other side, supplements that have high margins and strong defensibility around their point of differentiation is unique, if you can crack it.”

Baumann has previously invested in Oats Overnight, Redbud Brands, MUD/WTR and tech VC Falkon Ventures, according to his LinkedIn profile. It’s not the first time, he has leveraged the Basemakers platform into other avenues of CPG. Last June, the company announced a brokerage arm, but later pulled back on the business expansion in February when it didn’t bring the expected results.

Back to Back is not expecting to deploy any capital until 2026 as it finetunes the AI model, hires its full team and, most importantly, waits out the macroeconomic environment.

“Right now, there is a lot of uncertainty in the markets,” he said. “We’re not rushing to cut the first check; we’re rushing to build the best technology.”