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Meta's looming layoffs & path forward, Airbnb answers concerns & more | E1606 — Transcript

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0:00hey everybody big news this week the
0:01Wall Street Journal is reporting Molly
0:03that meta the Facebook Corporation is
0:05going to be laying off thousands many
0:08thousands of people this week my lord
0:10it's getting intense out here in Silicon
0:12Valley it's real I mean we had said last
0:14week that if Google and Facebook if meta
0:17and alphabet started doing this it was
0:18real so it is real we have a ton of
0:22charts though to show the the evolution
0:25of meta over the past few years we're
0:28going to go real deep on meta's
0:31Evolution hiring stock market drop
0:36stock BuyBacks and then there may or may
0:39not be a shocking Jay trade shocking J
0:43trade and then pursuant to our
0:45discussion last week about Brian chesky
0:48making All the Right Moves and throwing
0:52off
0:52billions in free cash flow
0:55he's at the top of his game on a product
0:57basis as well big product news coming
0:58out of Airbnb yeah crushing it and
1:01speaking of somebody We are rooting hard
1:03for to crush it apparently we are former
1:07Peloton CEO John Foley is back
1:10and Jason is shopping for a new rug at
1:12his new startup d2c startup called
1:14ernesta we're gonna break that down too
1:15it's going to be a great show it's going
1:18to be a great show stupid
1:19this week in startups is brought to you
1:21by notion is one place for notes docs
1:25projects and everyday work that goes Way
1:28Beyond a Wiki get started for free at
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1:43this week in startups hey it's Monday
1:46Molly how are you it's Monday I found a
1:50nice had a nice restful weekend with
1:51family I didn't look at any social media
1:53it was amazing yeah 5K training for the
1:57Turkey Trot yeah how about 100 to 5K I
1:59did well I mean slowly so that's right
2:02miles I'm gonna guess your time uh three
2:05miles times maybe just a nice jog 11
2:07minutes 34 minutes we don't have to talk
2:10about my time I live in one of those
2:12neighborhoods where you either go
2:13straight up or straight down oh oh
2:15that's different yeah walking run down
2:19I hike it back up so it's fine don't
2:21worry but you know what that means that
2:22when I finally get to the Turkey Trot my
2:24time's gonna be amazing because all I
2:26ever do is walk uphill quickly the
2:28Turkey Trot 5K or 10K it's a 5k my mom
2:31sent me all my Marathon pictures this
2:33weekend that was quite nice of her
2:34because this is the New York Marathon
2:35and I started getting motivated because
2:37you know I've actually
2:38um the weight loss kicked in again a
2:40little bit so I've been getting a little
2:41fit and I actually was on the treadmill
2:43and I just started running and I was
2:44like what's going on here my uphill
2:46walking turned into running so it is
2:48possible that you could oh yeah I mean
2:51it builds strength and then you run down
2:52and then you you know whatever I mean it
2:54just listen it feels great it just feels
2:56it's like sometimes you need a little
2:57extra endorphins yes exercise is pretty
3:00really important like you know mom being
3:02in town or whatever or whatever is going
3:04on or whatever's going on in the world
3:05yes yes I'm glad you have one of us had
3:07a restful weekend yeah I highly I highly
3:11recommend it
3:12uh okay so I disclaimer disclaimer
3:15disclaimer uh I'm not gonna be the CEO
3:18of Twitter at the end
3:20um and I'm not going to talk about uh
3:22any of the details of Twitter you know
3:24there's plenty of places on Twitter you
3:26can you can read about that so it's kind
3:28of odd to that to be the top Tech story
3:30we're not talking about here but
3:31obviously my friend bought the company
3:34and uh yeah I was an advisor to it uh
3:37but people are making a lot out of it
3:38that they probably shouldn't uh it's my
3:41involvement has been greatly exaggerated
3:44of course if that if I say my
3:47uh involvement has been greatly
3:49exaggerated people like well you're
3:50flexing there's no winning there's no
3:53winning in the situation they're winning
3:54I literally I find it both difficult and
3:59a giant relief to not talk about it like
4:02it's sort of both of those things at
4:03once it's like you know what at least
4:04whatever happens as the storyline plays
4:07out like I didn't have to say a word
4:10so like you know what I recognize I put
4:14you in an hot spot I appreciate you uh
4:16having my back to the you know extent
4:19you can hear on the Pod but you know
4:21listen if you want to hear a bunch of
4:23people randomly talking about it without
4:25a lot of actual information there's
4:28plenty of podcasts where you can do that
4:29you have Twitter for that right or every
4:31other person or Twitter or any number of
4:33places you can you can get involved in
4:35rampant speculation which I would say is
4:37that about 14 accuracy right now but
4:40let's get into the number one story
4:42that's happening let's do it the other
4:44one the other one
4:45well I mean this is the big Trend I
4:48think this is we've been talking about
4:49this for a while serious stuff it's a
4:51meta story and I didn't mean that as a
4:53pun you really didn't but according to
4:56the Wall Street Journal meta the company
4:59is planning quote large-scale layoffs
5:02this week that could impact thousands of
5:04employees as of September 30th meta had
5:06over 87 000 employees which was up 28
5:08year over year over Q3 2021 so massive
5:13hiring boom has happened at meta on all
5:16in Friday
5:18you and the Gang talked about
5:19large-scale layoffs looming at Big tech
5:21companies and we said on this show last
5:25week that once we saw big layoffs start
5:29to happen at alphabet or meta Google or
5:31Facebook that that would mean we'd
5:34really
5:35yeah hit an inflection point and it
5:37seems like
5:38we're there so uh these meta layoffs uh
5:40like we said are expected Wednesday I
5:43think they are expected to be
5:45huge like way way more than Twitter or
5:49any of the other big layoffs that we
5:51heard about last week when obviously
5:53there were the Twitter layoffs Open Door
5:55stripe cut a thousand employees lift cut
5:57700 employees like it's
6:00it's getting to the point where I don't
6:02think we can safely say there's going to
6:03be a soft Landing for everybody who it's
6:04laid off from Tech clearly because
6:07also they're not all Engineers right
6:09it's sales and marketing people and
6:10brand people and it's
6:12I think this is the this is the official
6:14sign that we are headed into some tough
6:16times in the industry but I don't even
6:18know if it's a broad-based U.S recession
6:20but it's a tech recession yeah I mean in
6:23tech this is uh a crash let's be honest
6:26this is crash-like behaviors Beyond a
6:28recession recession negative growth for
6:30two quarters we kind of had that then we
6:31had as we talked about the positive GDP
6:33growth but in Tech with these you know
6:3560 70 80 90 stock prices off from their
6:39Peak
6:41and with the significant cuts
6:44we're going to be looking at I think
6:46what will feel like a recession for Tech
6:48and
6:49this is really the result of the free
6:52money that was available and Tech hiring
6:55being leadership was thinking we're
6:57going to hire for two years out or at
7:00least a year and I think there's a lack
7:03of discipline around making money and
7:06profits free cash flow uh employ stock
7:10options comp you know people are
7:12typically giving four percent of the
7:14company's stock away every year and when
7:17the market is going up and the stock
7:18price goes up nobody questions any of
7:20these things but now on the table at
7:22every company is should we be diluting
7:24the shareholders forget about the
7:25employees and the management because
7:27that was the focus for the last 10 years
7:28yeah now people are saying the
7:30shareholders now why Molly would people
7:31be focusing on the shareholders well
7:33because they shareholders are selling
7:34their shares and they don't want to buy
7:35them exactly like the free money is over
7:38on every level as is yes and and
7:43not every easy narrative is true but one
7:45of the easy narratives about tech that
7:47keeps coming around and being kind of
7:49true is growth over Revenue like we just
7:52keep seeing that in every Tech boom
7:54which is like oh we're server profits
7:55hyperscale and then we'll make money
7:57eventually
7:58but eventually always comes around and
8:00sometimes it comes sooner than you
8:02expect and you haven't made the money
8:03yet I think if Bill Gurley said like uh
8:05you know the the Boom is like going up
8:06an escalator and when it when it goes
8:09past it's like going down an elevator
8:11you know like we slowly consistently go
8:13up and then boom right down the elevator
8:15fast to the bottom floor management is
8:17starting to realize we gave we're
8:19diluting the shareholders too much we're
8:21spending too much money people are
8:22getting paid too much money the
8:24entitlement is too high the benefits are
8:26too high and I'm not talking about
8:27health benefits here I'm talking about
8:28like you know kind bars massages those
8:30those Tick Tock videos like here's a day
8:32in the life of a Google employee in New
8:34York and then they're like I you know I
8:35went to get a massage I went to get a
8:36facial I did this all that stuff we
8:39should say because I don't want to
8:41disrespect these employees who got all
8:42those benefits and act like that but
8:44because that is what companies did
8:45because hiring was so competitive they
8:48made perfect choice right it wasn't
8:50about like sports in these big Divas it
8:52was just about like how can we get you
8:53here because it was an insanely
8:55everybody was over hiring thank you for
8:58correcting me or making sure that my
9:00point was clear a hundred percent that
9:03was the choice of management yeah to
9:06create an entitlement culture from The
9:08Boardroom where people had no
9:10accountability we're getting tons of
9:12stock options all the way down to the
9:14rank and file management and boards made
9:17these decisions employees were along for
9:19the ride yeah and they also had no
9:22discipline in hiring people they just
9:23said well let's just you know if it's
9:25gonna if we have to raise every salary
9:2620 we got to do this to be competitive
9:28with each other they created an
9:30unsustainable bid for High-Tech
9:33employees I mean the opening salaries in
9:35some companies 250k 150k like for
9:39positions that if we were talking about
9:40it five or ten years ago it would have
9:42been much lower yeah so when all that
9:43discipline went out and we saw a big
9:45salary we're like pretty standard
9:47million dollar packages
9:50you know out of control
9:52out of control and now um what people
9:54are realizing is
9:56now that the top Line's not going up
9:57then the uh hedge funds or you know the
10:01the
10:02retirement funds people who mutual funds
10:04who want to own stocks that grow are
10:06saying you know what these stocks are
10:07not going to grow they don't have
10:08discipline they're not throwing off
10:10dividends they're not throwing off
10:11profits they're not buying back the
10:12shares there are other options for us so
10:16we went from the number one option the
10:18safe option by Tech Two yeah that's a
10:20safe option I'm gonna buy some energy
10:21I'm going to buy some dividend stocks
10:22I'm gonna buy you know whatever it is
10:25and so now the tech industry is going to
10:27have to prove it to Wall Street
10:30that their stocks are worth buying
10:34if you're a startup you need to sign up
10:36for notion notion is my favorite product
10:38of the last year why do I love notion
10:40well I had to make a new system to track
10:42all the companies we meet with here at
10:44launch launches my Investment Company we
10:46meet 60 to 70 new companies per week we
10:49put them into a database I looked at all
10:51the SAS software out there there were
10:53people who wanted to charge me I kid you
10:55not 50 100 250 000 a year so I said you
10:59know what I'll just make my own software
11:00a hire a developer okay what's the
11:02number 150 250 a year even if I went
11:05outsourced and I used another country
11:07and it would take me a year to make the
11:08product that I won but we were using
11:10notion and notion has databases and they
11:12have these beautiful documents and they
11:14have tables and all the things I needed
11:15so we made the database of all the
11:18companies we meet with and what we found
11:20was we could with a no code solution
11:22like notion and using some other
11:24software that connects it by API to the
11:26other programs we use we could make
11:28chef's kiss the perfect customized
11:31system for ourselves and we did it
11:33within six weeks I had the system up
11:34running and in the six weeks after that
11:35we perfected it I think this product's
11:38taking over the world they'll be totally
11:39honest and I I'm like reading an ad for
11:41it right now but consider this a
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11:48company's information's other well maybe
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11:56stop having 50 tabs open in your browser
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12:01at notion.com to have the.com and so
12:04when I saw this happen Molly I said to
12:06myself I we had a car you and I on this
12:09podcast had a conversation I don't know
12:11if you remember this one but I said
12:13would not the logical thing for meta to
12:15do in a situation where nobody believes
12:17you cut some staff buy back your stock
12:19cut the r d spending a bit and then
12:22watch the stock go back up because
12:24you're buying it on the cheap and I had
12:26owned
12:27Facebook shares from I was an LP and a
12:29fund that had one of their companies get
12:30acquired by Facebook I sat on a nice
12:32chunk of that Facebook shares I wrote it
12:34from 70 60 or 70 bucks when I got the
12:36distribution from this Venture fund all
12:37the way to 115 and I sold it reason I
12:40sold at Molly was because I just didn't
12:41like Zach and his impact
12:44then I became a j Trader and I said I
12:46want to learn about public Equity
12:48investing you came on that Journey with
12:49me and watched me lose 15 of my money in
12:52three months
12:55I tried to return you about Stitch fix
12:57like other than that I was on board I I
13:00am trying to it's Biggest Loser in the
13:01portfolio thank you yeah go to
13:03jaytrading.com to see just the bloodbath
13:06which is
13:07actually where my friends were before
13:10you make your daydream
13:12anyway anyway
13:13what I've learned is that making trades
13:17with your heart as a public market
13:19investor is a bad idea gotta be a little
13:21bit ruthless
13:23so I was out on the weekend Oh God and I
13:26see this news break in our group chat
13:28right next time hey look
13:30I immediately open up Robin Hood
13:33and I put in a trade Jay
13:38and I bought meta I cannot believe this
13:47position to super villain just basically
13:50oh my God
13:52500 shares wow this is my standard slug
13:56I'm buying 50k slugs typically because
13:58I'm trying to build like a million two
14:00million dollar portfolio of active
14:01trading over the next 10 years with the
14:03stated goal of you know just beating
14:05Venture Capital returns I just want to
14:07see if my VC returns from this period
14:09versus my I'm taking like a 10-year
14:12challenged myself can my public market
14:15buys either match or compete with my
14:19Venture buys now Venture funds I've been
14:21involved in are currently marked at
14:23whatever four five six x uh you know
14:26depending on where you trust the marks
14:29um and so I've been Elite in that regard
14:31I'm not counting Scouts where I did
14:32phenomenal and it was off the charts but
14:35just looking at this I'm saying this
14:37founder is going to take the medicine I
14:40believe zoc has so much pride and wants
14:42to win so badly that this this moment in
14:44time going from 360 a share to 90 a
14:47share looking like a fool having
14:48everybody in the world criticize you
14:50everybody in the world give up on you I
14:51think that is going to make suck not
14:53break suck and I think the first piece
14:56of medicine is doing what he's never had
14:58to do
14:59which is to say I was wrong
15:02I was wrong you know who said I was
15:03wrong Jack said he was wrong for hiring
15:06so many people at Twitter this weekend I
15:07don't know if you saw that tweet storm
15:08yeah uh he said it's my fault I doubled
15:11the number of employees whatever I I
15:13shouldn't have done that Brian chesky
15:16made that huge riff now he's throwing a
15:18free cash flow
15:19uh Dara at Uber made that giant one so
15:23at some point mature leaders say I was
15:25wrong and they make the cuts
15:27and you know you look at Lyft
15:29stripe Open Door these cuts are
15:32happening I think this is like is this
15:33lift's third riff I think that's our
15:36second it's definitely their second but
15:37I think it might be their third I do I
15:39want to go back for a second and say
15:40okay stop on your Robin Hood screenshot
15:42of the thing where you just joined the
15:43evil empire and bought a bunch of
15:45Facebook it said time in force good for
15:48day you're on the right side of the
15:49force for one day
15:51he starts doing these riffs I'm kind of
15:55going Ashoka I'm gonna go over this is a
15:57D-Day this is a deep Poll for Star Wars
15:59fans but I'm going to shoka now I'm not
16:01part of the Jedi I'm not part of the
16:03dark side I'm like a ronin my like
16:06perhaps my favorite character in Star
16:07Wars right now sure that's an excellent
16:09that is an excellent
16:10um pull for sure I will believe
16:13everything you have said as soon as I
16:15hear Zach say as soon as one I hear
16:17where these riffs are because I
16:19guarantee because if they are not
16:20accompanied with a reduction in
16:21metaverse spending there's no Universe
16:23in which you will convince convince me
16:25that what he's saying here is I was
16:27wrong that's like that so far is the
16:29unproven part of your thesis right so
16:32there's this my thing was a four-part
16:34plan yeah a significant riff which this
16:36one seems to be we'll talk about how
16:37significant and what significant means
16:39here reduce the metaverse event expense
16:41juice the profits which happens from
16:44those first two things and there's other
16:45ways to use profits and then use the
16:47extra money to buy back stock
16:47essentially one and three are done the
16:50significant riff is going to juice
16:52profits now we don't know if two and
16:54four have been done yet but if I can get
16:56two three
16:58uh two or three of these I'm gonna
17:00double my money in the next three years
17:02if I get four of these this is going to
17:05be a 10 bagger
17:06I think he yeah or maybe a five a five
17:08bagger it'll be a five bag if he does
17:10all four I I could see any but he's also
17:12stock comp I should add a fifth one here
17:13is uh reasonable stock comp so keep
17:16stock compensation at one percent
17:17instead of four or whatever they were
17:19burning through
17:20so that right you know should we do the
17:23charts I interrupted you before we got
17:24to no no that's what I found out the
17:26charts that would actually show how
17:30how this can be accomplished right so
17:33set this up for the listeners so uh we
17:35have some charts Nick made some charts
17:37about meta's uh sort of
17:39situation
17:41Uh current events and then what we think
17:43might be future events if all of the
17:46boxes on your checklist they turn green
17:49okay here's meta stock price since its
17:51IPO in May 2012. you can see it hit
17:55almost 400 a share wow
17:58I had forgotten about those times
17:59representing uh one trillion dollar
18:02market cap in just like one year ago
18:05like 2021 and then now it's trading
18:09where you bought it at like 95 95 50.
18:12when's the last time it looks like it
18:14was at 95. if you go backwards I mean
18:16maybe 2016. yeah okay so we're and
18:20that's about the time that they were on
18:22an incline but also getting hammered by
18:24Congress remember yeah because that was
18:25election interference stuff there was a
18:27lot of testifying there was like oh
18:29what's gonna happen and it shot straight
18:31up and it just pretty much shot straight
18:33up so no one cares there's nothing you
18:35can swing an election with Facebook bye
18:37bye bye I mean no one cares nothing
18:41matters yay now let's layer full-time
18:43employees over time on top and we have
18:46this red line and you can see that that
18:49number is only ever grown there's not
18:52even been like a dip it is now at 87 000
18:56employees up 28 year-over-year in 2021
19:00it like doubled in three years that's
19:04amazing yeah Staffing Staffing Staffing
19:07that's a real telling chart I mean it
19:08literally and this is what boards and
19:11management did they said the stock price
19:13is going up let's just keep hiring
19:16because Talent makes product product
19:18delights customers delighted customers
19:20equal Revenue
19:22Revenue equal stock price goes up stock
19:25price goes up and just you get into this
19:27flywheel of you correlate the employee
19:30account with the stock price and you
19:32keep it out you keep employees out of
19:34your competitor's hands like we
19:36shouldn't forget this sort of catch and
19:37kill aspect of this did you bring this
19:40up on the show that like sometimes it's
19:42a blocking strategy those blocking
19:44strategy exactly and they'll hire
19:46employees and just sit them there with
19:48an insane salary package correct just to
19:51keep them from the other guy so that was
19:53happening probably too okay now we're
19:56gonna add meta's quarterly net kit and
19:58net income over time represented by a
20:00green line you see that Peak at over 10
20:03billion dollars per quarter in 2021 oh
20:06my God
20:07yeah look at that per quarter before
20:09what this is look at that limiting just
20:12to show people we have now this is
20:14beautiful total employee account in red
20:16the net income in green and the stock
20:19price is the black line we've now
20:21layered three charts amazing yep and the
20:24net income is almost in lockstep with
20:27the share price
20:28of course you know
20:30massive drop right as profits go down
20:33shareholders sell pretty straightforward
20:35but the only line that hasn't gone down
20:37is employee hiring correct at all like
20:41hasn't even hasn't even started to
20:42flatten they are not even flattening
20:44that curve that is just a rocket ship
20:46straight to space okay and then finally
20:49we have a blue line added to our chart
20:52and that represents meta's average
20:55diluted shares outstanding which sit at
20:582.7 billion shares roughly as of last
21:00quarter
21:01and they've been giving tons of share
21:04with what's very confusing about this
21:06blue number and we'll do another episode
21:07or segment on this we have to break it
21:09down uh it'll be another double click
21:11but the amount of shares being given to
21:13employees during this period was
21:16extraordinary I believe you know like I
21:18think the average as I said is like you
21:20know three or four percent so they're
21:22giving money they're giving shares to
21:24employees Molly and that includes the
21:26board uh in all likelihood although I'm
21:28not sure about their board because their
21:29board is all rich people I'm not sure
21:30how much comp they got but all the
21:33management team are getting massive comp
21:34in the form of stock options the
21:36developers you referenced before this
21:38million dollar package they're buying
21:40off employees and Talent with massive
21:42amounts of stock the shareholders are
21:46being diluted every year by those stock
21:49grants right that stock is not free that
21:52comes at the expense of the people who
21:54bought their shares in the company that
21:56didn't have them gifted as employees but
21:57who bought it in other words your
21:59retirement uh you know or your endowment
22:03or some mutual fund
22:04at the same time you're diluting those
22:07folks you're buying back shares so
22:10Facebook did buy back shares and I don't
22:12have the BuyBacks here but if we could
22:14put the diluted shares outstanding with
22:17the a line with how many shares they
22:19gave away
22:20and how many they bought back I've ever
22:23heard people say that this feels like a
22:27scam you're giving massive amounts of
22:30shares to employees
22:31and management
22:34buying back the shares which inflates
22:36the price those employees are selling
22:39into that right
22:41okay so you can Goose your share price
22:43by buying back shares but you're also at
22:45the same time just throwing shares out
22:47of a cannon like at the Warriors game
22:49where they do the t-shirts like a money
22:52yeah now is that fraud or is it sketchy
22:57is it unethical well if the price of the
23:00shares are going up nobody cares right
23:02but when you see a plummet like this now
23:04everybody's gonna start questioning that
23:06so they did these shares backs remember
23:08they announced them in 2016 they did in
23:102017. and I don't know how many how much
23:12they spend on it but it was a lot it was
23:15a lot yeah I mean they started in the
23:17single digit billions with these buyback
23:21programs and by 2021 had announced
23:25had increased the buyback program by 50
23:27billion dollars
23:29so massive numbers of shares being
23:31bought side by the way side note I also
23:34eventually want to see this when we talk
23:36more in depth about BuyBacks I want to
23:38see this chart for Apple because same
23:39same
23:40massive buyback program massive now if
23:45management is keeping you know the net
23:49income the profits of the business
23:50growing
23:53well then maybe you'd look at stock
23:55Buybacks in a different way and you know
23:58the relationship between stock BuyBacks
24:00and employee management grants Molly
24:03because you'd be looking at it saying
24:04okay the employees are getting something
24:07but they're making good decisions in
24:08management to keep those employees and
24:10to keep our profits high right and we're
24:13benefiting from it as external
24:14shareholders who are buying a vote in
24:16this management
24:18so I trust Apple I trust Tim Cook I
24:20trust the board over there they're going
24:22to give some shares to employees to
24:23motivate them they're going to buy back
24:25some shares which is good for all
24:26shareholders but we're not the bag
24:28holders as the public buyers right what
24:31feels like is happening at Facebook
24:33because the price is going down is Zuck
24:35is choosing to burn all the money have
24:37no profits or run the profits down I
24:39should say this so some profits
24:41obviously and the person who is really
24:43punished here is the people who bought
24:44those shares at 300 which is why Jim
24:46Cramer was like I don't know if you saw
24:48that Viral clip of him
24:50he was crying it wasn't crying he was
24:52just feeling really frustrated yeah
24:55we'll play a clip of it right now yeah
24:58okay I just saw the clip
25:00yeah I mean
25:02but it's interesting to
25:05hear anybody talk that sort of fervently
25:07about this idea of like I believed them
25:10I had this trust but it's true that it
25:13is very unusual it's very unusual to
25:16look at the kind of chart we're looking
25:17at and realize that these precipitous
25:20drops right this absolute tanking of net
25:22income and share price came not as a
25:24result of externalities such as covid
25:27but as a result of internalities such as
25:31pivoting the whole company to a totally
25:33unproven virtual reality strategy and
25:35spending 15 billion dollars on it
25:37and so you could see where if you're Jim
25:40Cramer you end up going well okay the
25:43BuyBacks were one part of this scheme
25:45that maybe didn't feel great and then
25:46we're the bag holders but were the bag
25:47holders because
25:49like so far Tim Cook has not lit any
25:52money on fire at Apple no like he's
25:54doing the same thing but with
25:56shareholder price
25:58firmly in mind like in no Universe do we
26:00are do we expect to see Tim Cook be like
26:02you know what I'm sacrificing all the
26:04iPhone margins on something completely
26:06brand new and unproven
26:08it's not happening there is an
26:10underlying thing here uh that we should
26:12talk about as well the headwinds of
26:14Apple making their changes to tracking
26:17uh mobile phones and the headwind of
26:19tick tock becoming an advertising
26:21Juggernaut true also there were
26:23externalities and internalities that's
26:25true I think I made that way
26:27it gives you even less fit but the
26:30majority one you nailed it's the the
26:31spending but it just shows you like
26:34management is internally screwing up and
26:37externally screwing up for getting their
26:39ass handed to them so you're getting
26:40your ass handed to them and then you
26:42make bad decisions yep and they're not
26:43right that's a really bad situation it's
26:46a bad situation so it's a good thing you
26:47drop 50 Grand on their stock I'm just
26:49saying well here well here's my thinking
26:52all right okay on our next chart
26:55wow
26:57yeah this is the one that's going to be
26:58painful and I I do want to put a
27:00disclaimer here because we do we are
27:01talking about humans and you brought
27:03that up early uh thank you your empathy
27:05is always high and sometimes I'm
27:07thinking with my brain not my heart love
27:08Mom
27:10well no I'm trying to think I'm trying
27:11to also Channel my heart uh you know uh
27:15Namaste as well as my logical thinking
27:17here these are people you know in these
27:19layoffs we look at them we talk about
27:21them in the abstract here on the program
27:22you know these are people who you know
27:24uh sometimes have given years of their
27:26life to a company they have their
27:28friends there they love the company and
27:31then the manager has to lay people off
27:32or the CEO told everybody like believe
27:35in me believe in the mission and then
27:37they have to say like we're saying
27:38goodbye to 20 of you 50 of you 15 of you
27:4115 of you three times this is so hard
27:45and painful for individuals
27:48on one hand
27:50and then you must also counterbalance
27:52this so that's that's this breaks my
27:54heart I mean I I have done these kind of
27:56layoffs Molly I had people cry and like
27:58to this day I I feel tortured by it
28:00because when I talk to the two or three
28:02people who are crying when I had to lay
28:03it like a lot of people off at Mahalo
28:05back in the day
28:06because the search engine algorithm just
28:07took away 90 of our Revenue overnight
28:10I said you know it's gonna be okay
28:11you're so smart I'm gonna help you get
28:13another job you're gonna get a job
28:14instantly you know and they said no it's
28:16nothing to do with money the job I just
28:17love working here so much
28:19yeah you know and you just you feel that
28:21dagger in your heart sorry to say that
28:24for uh to my producers you have to take
28:25it I don't know man it is hard it is
28:28really hard to say goodbye to friends
28:29and say goodbye to the mission now going
28:33back to my head from my heart on a logic
28:36basis these are Tech workers they are so
28:39desirable on a global basis I would just
28:42be yes 98 out of 100 because
28:45some of them are sales some of them are
28:48brand you know like okay the assumption
28:50that somehow they're all super skilled
28:52high-tech workers because we know that
28:54the people who get laid off first are
28:56the ones in Customer Support it's often
28:58sales it's often marketing those are
29:00crowded Fields like I just want to
29:02caution I just want to be mom again
29:04caution against the idea that this is
29:06100 they're all just gonna get
29:08immediately snapped up by some tech
29:09company because they all know how to
29:10code that's not true yes so there is a
29:13100 percent correct if you're an
29:15engineer and you get laid off you have
29:16four offers tomorrow if you're a sales
29:18executive you get laid off or a
29:20marketing executive get laid off it
29:21could be quite different it could be
29:23well they kept some of the marketing and
29:25sales people and they didn't keep you
29:26therefore you're the bottom half you're
29:28the bottom third you were the easy cut
29:30and then you have the Scarlet Letter
29:32situation if I'm using that term
29:34correctly you know you're you've been
29:36pinned as maybe the weakest of the herd
29:38it's completely unfair because it's
29:39probably not true who knows how the
29:41decisions are made sometimes it's the
29:42first people in sometimes it's the most
29:44tenured people because they're the most
29:45expensive and you say oh these young
29:47people who are coming in in year two of
29:48their careers are doing I could have two
29:50or three of them do the job for this you
29:52know overpriced person what the
29:54management thinks is overpriced so you
29:55do have a lot of that variability you're
29:57100 correct it's a very nuanced issue
29:58moment it's a very good point of yours
30:00it's just that thing it's just hard it's
30:02hard it's however exactly when you're
30:05looking at charts yeah
30:07it
30:09does require a pause here because we're
30:12going to be on people on CNBC people in
30:14the news New York Times us here we're
30:16going to talk about these things in
30:18relation to oh making the stock price go
30:19up and you know making the cut turning
30:21these companies around making them
30:22sustainable there's pain and suffering
30:24however that pain and suffering is not
30:27comparable to the the true pain and
30:29suffering in the world of people living
30:30in authoritarian regimes people who are
30:32living in dictatorships people who are
30:34oppressed so you have to be able to
30:36maintain many thoughts in your head at
30:38the same time to contextualize this and
30:40so anyway I think it's going to be
30:41pleasant just unpack that yeah so here
30:43we go okay before we go to the people
30:45chart if they execute my strategy here's
30:48what I believe will happen now this
30:49chart you can watch all these
30:50youtube.com this weekend or if you watch
30:52us on Spotify or listen on Spotify you
30:54can press a button or you turn your
30:55phone sideways or something and it shows
30:57the video but these charts are great
30:58we'll do a series of these charts uh in
31:00a tweetstorm on twitter.com Twi startups
31:04Blackline stock price it's going to go
31:06up and to the right Green Line net
31:08income it's going to go up and to the
31:10right those two things are correlated if
31:11the market sees income profits go up
31:13they're going to make the stock price go
31:15up how is that going to happen the total
31:17number of employees the red line is
31:19going to have to go down I believe to
31:212019 or 2020 levels that will be what's
31:25taken seriously now that's going to be
31:26super painful we'll get to that in a
31:27moment Molly and then the diluted shares
31:30that are outstanding perhaps those could
31:32go down a little bit with a buyback so
31:34two things are going up two things are
31:36going down that equals the stock going
31:385X
31:39you know going to three or four hundred
31:41dollars a share again it could do that
31:43right now it's trading I think seven
31:45eight nine X price to earnings ratio
31:47it's it's been clobbered and people are
31:50bad people were betting last week this
31:52wouldn't happen but this is the plan I
31:53think it's the plan
31:56hey Tom eschbacher is here with us again
31:58he's a senior sales manager at LinkedIn
32:00marketing Solutions and we're talking
32:02about their amazing report today in
32:03startup marketing as well as how to use
32:05LinkedIn to grow your startup what are
32:07some tactical things not big picture
32:09strategy I'm talking tactics that
32:11Founders can do today to figure out
32:14product marketing one of the big tactics
32:16we see here is amplifying organic
32:18posting with paid advertising you
32:20consider a startup that raises a seed
32:22round they post the news on their
32:24LinkedIn page and see a bunch of likes
32:27clicks and follows come in they follow
32:29that then with some updates about
32:31product and they see continued traction
32:33with for instance HR benefit managers at
32:36tech companies that have fewer than 500
32:38employees that's a signal and it becomes
32:41important to the get a larger sample and
32:43to increase confidence we've made it
32:45super easy to identify which audiences
32:48are engaging with your organic content
32:49your LinkedIn company page your website
32:52and then extend reach into those
32:54segments with our Best in Class B to be
32:57ad targeting so for early stage startups
32:59you amplify organic with paid we see a
33:0213x lift in unique reach those are
33:05meaningful insights to help inform
33:06product and go to market strategies such
33:08a great strategy head to linkedin.com
33:10this week in startups and get the report
33:12now so you have an edge on your
33:14competitors and as a little pot
33:16sweetener 100 off your first marketing
33:18campaign thanks to com and the team at
33:20LinkedIn go get that report and get the
33:21hundy there was an interesting
33:23Counterpoint from my favorite Twitter
33:25account which is a parody account
33:27Capital our favorite Capital look he's
33:30got parody
33:32lest anybody think that Artie Buco is
33:36alive and tweeting no obviously he's
33:38alive
33:39he didn't die in The Sopranos if anybody
33:42thinks Artie Buco got whacked he's alive
33:45and well he does not participate in
33:47social media
33:48for obvious reasons he's basically
33:50cooking if you're on the line you make
33:52him man of God you're making the
33:54vongolae you can't be tweeting come on
33:56this is like my favorite account and I
33:58will rain hell if it is
34:01I would start a hedge fund it's amazing
34:05tweeted a bit of a Counterpoint to this
34:07not a complete Counterpoint but just an
34:09interesting like if you're a Facebook
34:11employee I think that the the first
34:13point in this tweet was the one that I
34:16think is interesting because it's it's
34:17like you see Facebook meta trying to
34:20execute this big turnaround
34:23and
34:24if you are an employee at Facebook right
34:28the blue the original product and you're
34:30frustrated with all the metaverse stuff
34:31this is probably not going to help
34:33there's going to be a real morale issue
34:36and then he also makes the point in his
34:38third bullet point that it's going to be
34:40rough out there once big Tech normalizes
34:42big layoffs which is kind of going on
34:43and on and on it is a great time to be
34:45hiring so to all of our Founders out
34:47there if you are trying to hire benefit
34:49yeah you're going to benefit but he also
34:51makes the point that tech companies are
34:52getting their finances buttoned up for
34:5323 guidance and
34:55that actually to what we just talked
34:57about there have been people sort of
34:59celebrating
35:01layoffs as though you know and I think
35:03it's really good that we're getting that
35:04out of the way that that that although
35:07companies gave them entitlements that
35:08doesn't mean they were entitled they're
35:10still people
35:11losing jobs and that even though like
35:14I
35:17have been known to out and out cheer for
35:19Zach to fail
35:21I don't want that to come at the expense
35:23of the people who work there because
35:24they don't deserve that yeah and it's on
35:27the uh yeah great tweet a shout out
35:30Artie Buco apparently my heart already
35:32Buco I have such a crush on that parody
35:34account pretty good I can't wait to find
35:36out who it is totally an Insider it's
35:39good he understands the uh he
35:41understands the industry pretty well
35:43on the morale issue if you make one ref
35:45and you're you know it it tends to go
35:49well after about two weeks in my
35:51experience because I've been involved in
35:52this so many times with my own companies
35:54and companies I've invested in because
35:56what happens is people see their friends
35:58get jobs and become happy and that
36:01that's a two three four week process
36:03they also see them go on vacation for
36:04three to six months if I'm being candid
36:06in the tech industry
36:07people tend to get you know whatever two
36:09three four five six months which is
36:11nowhere near what a bus driver or a chef
36:14or whatever gets like you you get a kick
36:16in the pants and you get like a week
36:18salary two weeks salary if you're lucky
36:20so we have this incredible
36:22um you know graceful Landings for very
36:25highly paid people and they tend to take
36:27a nice you know respite and then they
36:29when they land on their feet that's what
36:31I've seen traditionally and now maybe
36:32this recession will be different but I
36:34don't I suspect everybody starts landing
36:36on their feet and maybe their comp isn't
36:38as good as their Peak comp but it's
36:39going to be within 80 or something and
36:41they survive then what happens is the
36:43company they're at everybody goes wait a
36:45second things are going well and that's
36:47what the Airbnb employees are Airbnb
36:50morale has never been higher they are
36:53throwing off massive cash flow right we
36:54talked about this last week in the
36:55earnings just if you're an employee at
36:58Airbnb right now
36:59what is it four or five thousand
37:01employees and not the two or three
37:03thousand that got laid off remember that
37:04super riff actually you remember
37:05perfectly well because I didn't pack
37:07that yeah the people who stayed are
37:10stoked their stock price is surged and
37:13the people who left
37:14I'm gonna guess older pretty well yeah
37:16you know if you want to hire an employee
37:17and Airbnb employees pretty coveted in
37:18this town absolutely I mean there's no
37:21it's an A-list thing to have on your
37:23resume and so it It ultimately works out
37:26and even for the people who left who
37:28were vested their stock price went up so
37:31yes I mean I think being part of this
37:33industry and leaving having this happen
37:36like you know it just like you said
37:38there are a lot of things happening at
37:39the same time a lot of truths happening
37:41simultaneously it is tough to lose your
37:43job abruptly
37:44in most of these cases these people are
37:47going to be fine but the short-term pain
37:49is real I mean if you look at this chart
37:51is this the people one
37:52yeah and I hate to be a downer here oh
37:55wow yeah but if we were just to go back
37:57three years to the number of employees
37:58met ahead right and then we drew some
38:00black lines here on the alphabet and
38:03meta just to give you an idea in 2019
38:05you know they had uh probably 40 000 or
38:08so employees there and they're now at
38:0987.
38:11like almost 60 Riff to get to where they
38:14were in 2019 to get to where they were
38:17in 2020 it'd be similar like a 50 riff
38:22then to get to where they were but in
38:242021 you know you're talking about
38:27letting go of 27 000 people a third of
38:30your staff that's insane
38:32I I'm gonna put that riff at 10 where
38:35did all this hiring go
38:37I mean so 10 and 10 is still 8 700-ish
38:40employees I mean if they let go of 87
38:44significant 100 employees yeah let it
38:47sink in how many people that is now in
38:49terms of the overall economy not a lot
38:51in terms of in terms of the number of
38:54humans yeah just to process that many
38:57people being laid off is going to take
38:58months I mean holy cow so what I I think
39:02maybe this might be a significant number
39:04but a smaller percentage yeah maybe
39:06between I don't think I don't think he's
39:08going to do 10 I think he's gonna do
39:09five
39:10to suggest
39:12I mean we yeah we have no idea to be
39:14clear the Wall Street Journal didn't
39:15give a number it did say that they
39:17thought it would be many thousands of
39:19people
39:20but that could be five percent I mean I
39:22think it's 4 000 people which would be
39:23five percent I'm gonna put it at five
39:25percent so it will feel like a large
39:27number of people and it is it would be
39:28more people than all the companies
39:30combined last week that you know the
39:32open door Twitter all that combined will
39:33be less
39:34than the matter riff this week well not
39:36at four thousand but yeah well or close
39:38right so if it's 5 000 would be the same
39:40right like alone could do roughly the
39:42same or similar as every other company
39:44maybe 5 000 people would be the same
39:46yeah so I think there were five thousand
39:47people laid off at those five companies
39:48last week to Open Door Lyft Twitter Etc
39:51so anyway uh for this to have an impact
39:54it's got to be five percent and for it
39:57to have a dramatic impact would be 10.
39:59so somewhere between five and ten
40:00percent would be
40:02it's in some way hit the bottom line
40:04which is I think what his goal is if
40:06it's less than five percent if it's less
40:07than five thousand employees this is a
40:10token and I made a bad J trade
40:12to be a complete free market monster
40:15yeah if it's over 5 000 people I made a
40:18killer J trade because he's taking
40:20expense seriously yeah and this is where
40:23I have a really hard time with public
40:25market investing because I'm literally
40:26betting the more people he cuts the
40:28better it will be for my J trade because
40:30I know twenty thousand people what is so
40:32terrible about public market investing
40:34right is that good news is always bad
40:35news or bad news is always good news and
40:37it's just like I know totally yeah well
40:39I'm excited about my three-month CDs at
40:42four and a half years Ryan chesky is
40:44shaping up to being one of the great
40:46CEOs of our time I believe he's paying
40:49attention he's listening to our I think
40:50he's listening to our show I think he
40:52might be listening to me specifically he
40:53even said he he even talks about
40:55stripping the beds in one of his tweets
40:57I was like oh my God that's me that's
40:58you all right go let's break it down
41:00let's break it down All the Right Moves
41:03exactly All the Right Moves chesky like
41:06he really is honestly exactly what we
41:09talked about on Friday so as a follow-up
41:11to earnings uh cheske revealed that
41:13Airbnb was working on the the
41:16transparency around pricing to roll all
41:19of the fees in too and to be fair he had
41:21already tweeted that they were working
41:22on this but he has now rolled it out now
41:25when you search on Airbnb we were
41:26talking uh last week about these hidden
41:28fees that people are annoyed about and
41:31here's a video that chesky tweeted early
41:34on Monday morning today as we're taping
41:36he said basically what you're seeing
41:39here is that cleaning fees will become
41:40more apparent earlier on so when you're
41:43searching for accommodations right now
41:45you only see nightly rates and no other
41:48fees and that those fees could be
41:49cleaning it could be tax it's whatever
41:50it is now uh you will have to hit a
41:53toggle switch to see the breakdown the
41:57total costs with nightly rates and fees
41:59so that you can more accurately search
42:00for locations in your price ranges you
42:03basically won't get this price surprise
42:04where you look at something and it's you
42:05know 300 bucks a night you think and
42:08then once all the fees are in you know
42:10and you can see that there might be
42:12taxes there might be cleaning
42:14yes you'll just see the total price
42:16breakdown
42:18which is great
42:20of this story is fees is just concisely
42:26uh being transparent about the fees
42:28brilliant and he did it exactly how we
42:30were talking about just a toggle switch
42:32and what's the default yeah and I'm
42:34assuming the default is to not have it
42:36turned on and then you turn it on but
42:38it's so prominently displayed for people
42:39not watching it literally has a toggle
42:42switch at the top as if your settings
42:43were open it's literally at the top and
42:45it says display total price bulletproof
42:49it doesn't matter if it's defaulted on
42:50or off in my mind since it's so
42:52prominent yeah totally the what you
42:54would look at and this is why you listen
42:55to this week in startup smiling is the
42:58detail here is what is the default in
43:00other words what does it start as on or
43:02off that tells you a lot is it defaulted
43:05on or off it looks like it's defaulted
43:06off and then you have to turn it on okay
43:08five fair enough that that's a product
43:10decision yeah now here's like an even
43:12more subtle one when you turn it on does
43:15it stay on for your next search or not
43:17these are nuanced product discussions
43:20that really impact revenue and consumer
43:23Behavior
43:24is the default on or is the default off
43:26and does it remember your setting from
43:29the last usage so just keep that in mind
43:31when you're designing a product
43:33and think about how careful Airbnb and
43:37chess you know and everybody has always
43:39said about Brian cheskin Airbnb that
43:42fundamentally that although it was a
43:43real innovation in terms of business
43:45model that it was does it much like uber
43:47design first and so that the reason you
43:51know that that Airbnb has talked about
43:53as far back as May of 2021 Airbnb has
43:56talked about addressing the concern
43:58about the fees and said we're going to
44:01work on it according to the Wall Street
44:02Journal the reason it took so long was
44:04because they wanted to design it
44:06perfectly they wanted to make it as
44:08seamless and appealing and useful as
44:11possible without creating more
44:12off-putting
44:14kind of different Distortion friction
44:17thank you
44:19yes uh so
44:21you know this is I mean it's interesting
44:23right like going from being a journalist
44:24to being inside the industry like all of
44:27a sudden you it's like the Matrix like
44:28when I was a journalist I like had this
44:30amount of like knowledge of what's going
44:32on and then you're behind the scenes and
44:33you start having the real discussions
44:35okay what is the default setting okay
44:37does it remember your default setting
44:39okay what's the friction here why are we
44:41doing it and in product design what you
44:43see is you know a product like uber this
44:46exact same thing happened with tipping
44:48and I had very passionate discussions
44:51with Travis about this back in the day
44:52I'm not speaking out of school we both
44:54have talked about it publicly during
44:55interviews we've done
44:57I'm from Brooklyn I tip everybody I tip
45:01people who don't expect a tip
45:03remember I told you the story of the
45:04time I tried to tip a flight attendant
45:06yep back in the 80s we called them
45:07stewardesses
45:09so back in like 84 like you don't have
45:11to go back but yeah I was like a 15 year
45:13old I thought I was in Goodfellas and I
45:16was like hey sweetie this is for you all
45:19in one place I came to flight attended
45:21three dollars for a Coca-Cola and she
45:23literally took it and dropped it in my
45:25lap and said we we don't get we don't
45:28take tips you're like oh and I was like
45:30oh what do you mean you don't take a tip
45:33I keep the hurts guy Artie Buco already
45:37Buca high temp the hurts guy who brought
45:39my car around he was like why are you
45:41tipping me
45:43oh my Lord I mean I tipped the security
45:46guard when I you know
45:48I do remember that actually with uh with
45:52Uber and trying to figure out how to
45:54integrate tipping in a way that wouldn't
45:55feel invasive like it wouldn't stress
45:58you out but it would let you make it
45:59easier and then the drivers you'd know
46:01where it was going like all of this is
46:03all of these are fundamentally designed
46:04questions so then the other thing other
46:06changes so there's this big design
46:08change to make the fees more obvious
46:10slash invisible the default is off I'm
46:13reading here about invisible in the
46:14right way though I think it's
46:15interesting that the default is off but
46:16I guess maybe it's like then you can
46:18really
46:19see the breakdown a little bit better I
46:21don't know sounds to me like a
46:23discussion that occurred
46:25and there was a little bit of a split
46:27discussion internally I would love to
46:28know and they said let's start by
46:31exposing it and let people turn it on
46:33yeah so this feels to be like a bunch of
46:35respected people had a difference of
46:36opinion and they said let's start with
46:38the test with it off and see how many
46:41people turn it on so we get data which
46:44is not a bad decision by the way it's a
46:46considered decision let's turn it off
46:47and let's see if people turn it on
46:50yeah it's interesting like yeah
46:53it's sort of a jobsian question right
46:57like do you are you the kind of company
46:59who collects the data and does a little
47:00bit of a real-time a B test and takes
47:02the Flack or do you just say this is
47:04what you want as a customer I'm gonna
47:06give I'm just gonna make that call and
47:07they could have gone either way and I
47:08don't hate it yeah it's another that's
47:10another perennial that's why you listen
47:12to swinging startup from the inside I
47:13can tell you that's another perennial
47:15management decision right do great
47:16products get made by God kings and
47:18queens who give the edict okay we're
47:21having a difference of opinion here
47:22congratulations everybody on the debate
47:25this was a vibrant debate as the uh CEO
47:28I'm going with default off where I'm
47:31going with default on and that's where
47:33we're going I appreciate the dissenters
47:35uh the dissenting opinion but I'm just
47:37going to pick this one and if I'm wrong
47:38I will own it right
47:40so if I'm taking out the headphone jack
47:44and our cells plummet
47:46or I don't want buttons all over this I
47:48don't want to remember the Blackberry
47:49had tons of buttons remember like the
47:50smartphones had 18 buttons he's like
47:52let's have one button at the bottom
47:53Steve Jobs and they're like are you
47:55crazy and he's like well the buttons
47:57could be on the screen
47:58with the right decision I mean does
48:00anybody want an iPhone with four buttons
48:01on the bottom no it's great you want
48:03Dynamic buttons you don't have to
48:05remember what the little circle Arrow
48:06back button means like come on have you
48:08ever been to that Fifth Avenue store in
48:10New York where there are no buttons in
48:11the elevator
48:17you're going to and
48:19yeah I do not like that anyway
48:21okay and yeah and so in addition to this
48:27choice so the toggles off by default
48:29fine
48:30but chesky also announced that they'll
48:32be prioritizing searches
48:34by total price hmm so that your cert the
48:38highest quality homes with the best
48:40total prices whether you have that
48:42toggle offer on
48:44exactly we'll rank higher in search
48:46results so they're prioritizing value
48:49and then regardless and I think this is
48:51such a clever mix and match so you have
48:53the toggle off by default
48:55but the algorithm is going to prioritize
48:57the best total price which I think is
48:59genius and he's saying you know we
49:00started as an affordable alternative to
49:02hotels that's totally true and
49:04affordability is especially important
49:05today
49:06wants to help hosts who offer the best
49:08so in a way and I don't he's not trying
49:11to out the hosts here but it's an
49:13incentive the fact that the fee
49:15structure is very very obvious because I
49:17think the hosts get to decide the
49:18cleaning fee yep they do is a very
49:21clever threading of the pressure needle
49:24here he just took the buttons out Molly
49:25he took the buttons out he did it he
49:28pulled the jobs
49:30Brian All the Right Moves chesky that's
49:33his new nickname when you see him if
49:35there's Airbnb employees listening I
49:37want you to come up to him just give him
49:39a little pound on the chest he can like
49:41you know
49:42fist bump and I just want you to call
49:44him All the Right Moves he's doing All
49:46the Right Moves yes he understands his
49:48customers
49:49uh he understands his shareholders he
49:51understands his team
49:53and I was going to ask this question is
49:55Airbnb about value or experience
49:59and what Brian is saying people come to
50:02us for Value we know that we're not
50:05pretending we're the Amman hotel we know
50:07you want to save a little bit of money
50:08we know that matters to you that's part
50:09of your decision-making process you want
50:11bang for your buck right and that's what
50:13I think of when I when I rent an Airbnb
50:16I think okay I'm going here and I would
50:19have to buy four hotel rooms when I
50:21travel it's four hotel rooms
50:23the parents
50:25the kids
50:26probably two rooms now with three kids
50:28and the nannies if I'm with a nanny or
50:30if I'm bringing my parents or whatever
50:32it's typically three four rooms right
50:33and I'm like okay three or four rooms
50:36four or five hundred bucks a night I'm
50:37in for two three grand a night with
50:39because there's so much taxes in hotels
50:41oh
50:42and then I think Airbnb it's typically
50:44150 a night or a thousand I get five or
50:46six bedrooms I can I can invite an extra
50:48person and they have a game room for the
50:49kids and they got
50:50a kitchen sack and now I can cook food
50:52which we like so much better when you
50:54have a family you don't have to have a
50:55kid in a hotel room alone like you don't
50:57have to be freaked out about all of that
50:58adjoining it's nonsense so it is it's a
51:01better value for families and it's just
51:03it's good but what I really like about
51:05this
51:06the more I think about the toggle being
51:08off comparing with the search results
51:11prioritizing total price
51:13he's preventing the pharmacy benefit
51:16manager problem
51:18the middleman that sits in the middle of
51:20drug pricing so like if
51:23they had just turned this toggle on by
51:26default and all you ever saw was the
51:27total price you wouldn't know the
51:28difference between the hosts who are
51:30charging an absorbitant cleaning fee and
51:32the ones who aren't
51:34that's the game that's the game is to
51:36say you customer get to see this and you
51:38don't get to be shocked by the fee but
51:40you host you don't get to just charge a
51:42bunch and hide it
51:47they play games with the fee too from
51:49what I understand I'm not like I use
51:51Airbnb like maybe twice once or twice a
51:53year
51:54and I think a lot of those hosts play
51:57games with that fee they're like oh if
51:59you do all these things on the list
52:01which is super annoying like I I didn't
52:03come here to clean your house came here
52:06to have a vacation
52:07you ever have this experience the last
52:09day of your Airbnb and you're like oh
52:11you know the last time I vacation when
52:12I'm exhausted and I gotta go home and
52:14face reality I got to spend two hours
52:16making sure like the sheets are off the
52:18bed totally I got at the garage door has
52:21to be locked with the code and I'm just
52:23like I feel like I'm launching a rocket
52:24with the list of things I've got to do I
52:26just gave you money so I don't have to
52:27do these things that's what I said last
52:29week because I was like I stated this
52:30Airbnb and I had to strip the bed and we
52:32had to take the trash out to the outside
52:34trash can do all of this cleaning and I
52:37was like okay come on I just want to be
52:38in a hotel and then I saw this tweet
52:40from Brian chesky that was like you
52:41shouldn't have to do unreasonable
52:42checkout tasks such as stripping the
52:44beds doing the lot and I was like he's
52:47listening to the Pod hey Brian what's up
52:49what's up brother hold around moves All
52:52the Right Moves all right come on the
52:55show no idea he's gonna come on I just
52:57talked to him
52:59what
53:00do the laundry and the vacuuming
53:02apparently that's Bonkers okay you put
53:06the sheets in the washer for me I've
53:07stayed in places where they asked you to
53:09put the sheets in the washer oh so they
53:11come in and just after the dryer I
53:12understand I understand the goal of the
53:14host in doing that stuff it's just not
53:16cool
53:17and then they charge you an extra like
53:18100 200 bucks if you don't do it right
53:20that's the that's the the threat I guess
53:23nobody wants this nonsense just making
53:26it or they leave you a bad review or
53:27whatever right it's just like no it's
53:29too much oh yeah right there review you
53:30too I love the idea that they sell it by
53:33value I love that sort by value so if
53:36you want to play games you want to you
53:38want F around and then you find out you
53:40want to F around with your cleaning Bill
53:42uh your cleaning face then you find out
53:44your search results
53:47yeah if I do an Airbnb I'm gonna have a
53:49new thing no cleaning fee no cleaning
53:51fee unless you stay in something or
53:52whatever but just well I was gonna say
53:53like if you want to be if you want to be
53:55a host too if you know this up front and
53:57again this is just all about
53:58transparency and design and not letting
54:00hosts hide stuff and not letting you
54:03know guests take advantage so you could
54:05be the kind of Airbnb that says hey
54:06there will be no cleaning fee whatsoever
54:09if you strip the beds and you put the
54:13the wash in the washer
54:15cool some people might be willing to do
54:18that they just might you know like I get
54:19a little bit of my grandma Vibe and I
54:21want to clean up a place like
54:23if that's what you're into and as a
54:25result you have no extra fee that it
54:28then all of a sudden you have some
54:29pricing control as a host you have a
54:30differentiation opportunity you know I
54:33do that too when I leave a hotel room
54:35I tidy up I totally do and I leave a tip
54:38and I leave a huge tip and I still clean
54:41up and use it but I still clean up a
54:43little bit because I don't wanna
54:44be it's more like my own personal pride
54:47of not being a slob exactly maybe it's
54:49my Irish upbringing but like I'm like oh
54:51my God I left like if I leave the coffee
54:53set up a mess I'm like oh no I literally
54:56if it's like stand I go get a towel I
54:58moist it and I just wipe the thing down
54:59because I don't want any coffee stain
55:01and be an animal so even though I
55:02complained about stripping stripping the
55:04beds was for some reason that was a
55:05bridge too far for me that really
55:06irritated me I was just like that is not
55:08because it's just like it was combined
55:09with 50 million other rules and whatever
55:11but the truth is I would nine times out
55:14of ten book an Airbnb that didn't charge
55:16me a cleaning fee if I agreed to do that
55:18because then it would be a trade and I'd
55:19be like yeah fine cool I saved some
55:21money
55:23but considering that I paid a cleaning
55:24fee and was asked to strip the beds I
55:26lost my mind
55:28full Karen I
55:30asked on the Twitter yeah what's the
55:33best rug now why did I ask this question
55:34I don't want to get to my personal life
55:36here but
55:38uh my spouse who you know is delightful
55:42beautiful stunning has incredible sense
55:45of design Charming Charming all the
55:47things I'm not uh that's why the
55:48marriage works foreign
55:52you know like that couple where they
55:54invite the couple and they're like she's
55:56so great I guess the price we pay is
55:59that guy oh come on but we'll still
56:01invite him
56:03but I've already heard I started getting
56:05the second invites uh to dinner parties
56:08before that I was one and done like wait
56:09a minute it's like wait a second huh she
56:13takes the edge off but anyway uh par
56:15part of the problem is uh you know we
56:17have the two dogs three children and
56:20um
56:21the rugs get destroyed this makes me go
56:24Manic and I did a tweet one of The
56:26Producers could go find it by doing an
56:29advanced search on the Twitter where I
56:30was talking about this and I oh my God
56:32look at myself like come on look at my
56:34producers so probably like they didn't
56:36already have that ready so I said this
56:38anyone have a lead this by the way this
56:39is dated September 16th I just got a
56:41light and a quote I'm getting a quote
56:42Retreat LOL
56:45first for the show
56:48did we get any Adderall prescriptions
56:51from our producers they're on tonight
56:52wow strong Monday so put this out there
56:54because I'm losing my mind I grew up
56:56poor we didn't we had like one rug and
56:59like we didn't get rugs because these
57:01things get destroyed and it will make
57:03you as a cheap person like I am who has
57:05cheap DNA lose your mind
57:07like I love my kids I love my dogs
57:11but when they stain the rugs and I have
57:14to go into dad mode and I'm like bad
57:17dogs or like daughters I told you no ice
57:19cream while we're watching superhero
57:21movies
57:22like watching superhero movies with you
57:24why can't we have both things and I'm
57:26like I find out both things but they're
57:27doing these goddamn rugs Molly me and
57:29everybody on Twitter was like
57:31esalerugs.com the end there's only one
57:33scroll down everybody said to me oh
57:37that's right ruggable ruggable everybody
57:39said ruggable and so what I did too
57:41actually but now I'm all about e-sale
57:43but anyway ruggable anyway ruggable went
57:45crazy now here's the thing
57:46ruggable you have one
57:49yeah
57:50okay it comes with a little like base
57:52level mat and you velcro it onto this
57:54mat and the reason that that's important
57:56is because you can unvelcro it and you
57:58can put that sucker in the washing
57:59machine
58:01washing machine I pay five six hundred
58:04bucks for I got a big house I got five
58:07or six of these rugs five rugs
58:10these guys come they lift all the
58:11furniture they take the rugs we do this
58:13every year
58:14um
58:15that's five or six hundred bucks per run
58:18per rug yeah because
58:20they come back perfect God love them
58:22they do a great job it's three grand
58:24every time I do this
58:26and I just watched three thousand
58:28dollars in my mind on fire Sorry God
58:31damn it on fire
58:33and I kid you not like this is my the
58:35level of privilege I'm living under now
58:38these things get stained two weeks later
58:39the dog takes a leak
58:41a dog pukes on it a kid drops an ice
58:44cream and now I'm back in OCD land
58:48I just paid three grand and I told my
58:50wife let's do this she's like I don't
58:51like those rugs
58:53why don't you guys just buy a Bissell
58:54I'm no I have now you you try to trigger
58:58me this is my trouble you can rent a
59:00Bissell at the grocery store I have a
59:01Bissell it doesn't work oh it none of it
59:05works they that whatever they do on the
59:07commercial with the Bissell what are
59:08they it doesn't work or maybe I got the
59:10wrong Bissell
59:11crystal.com twist get 20 off your next
59:14missile if the Bissell work
59:16Ed for it but it's not
59:19it's like freaking parents up in here
59:20right now like I'm literally turning
59:22into my phone and then my rag does this
59:23and then I need a Bissell you're just
59:25gonna be so passionate about rugs in the
59:27Montclair okay okay so now let's explain
59:29what's happening yes okay the reason
59:31that we're talking for so long is one
59:33it's fun as hell and two the Peloton
59:36co-founder and former CEO John Foley is
59:39back love it with adidasy company love
59:43it because why not and in this case it's
59:45a rug business d2c custom rug retailer
59:48hoping to enter the market quote in
59:50between home decor retailers and
59:52high-end custom rug sellers let's go
59:56ernesta I don't know what she means in
59:57terms of pricing oh eight to forty
59:59dollars per square foot
1:00:03100 100 times eight is eight hundred so
1:00:07for a large rug you've got a large
1:00:09living room or a hundred times forty
1:00:10four thousand
1:00:11oh hell yeah so this is some this is
1:00:14meaty this is mid to high end but
1:00:16there's a custom now hold on a second
1:00:18custom is different they're cutting it
1:00:20to your specs I like this we had a
1:00:22company called Benchmade modern
1:00:24uh that I really believed in a great
1:00:26founder um and they
1:00:28the one I think we got our money back it
1:00:31was like one of these sales where I was
1:00:32like ah I wish I almost wish it was a
1:00:35zero instead of getting my money back I
1:00:36would ever say got me either 100 or
1:00:38whatever but they did couches by the
1:00:40inch
1:00:41you could literally they would send you
1:00:44a draft a piece of paper that you would
1:00:45unroll and you would unfurl it put it on
1:00:47your floor and it would say 48 inches 49
1:00:50inches 50 inches 51 inches you tape it
1:00:52to your floor Molly and then you go sit
1:00:53on the floor in front of your TV and
1:00:54you're like you know what I was gonna
1:00:56buy a 48 inch I could fit a 52 and you
1:00:58put your side tables on the piece of
1:00:59paper next to it bench made Modern you
1:01:02can look at the vid you look them up
1:01:05I think they still exist by the way I
1:01:07just yeah
1:01:08I mean I think it's not unusual I bought
1:01:1050 year old handmade Turkish carpets in
1:01:13Istanbul and I paid you know
1:01:17three thousand I think or something like
1:01:19that how much is like six thousand total
1:01:21yeah I mean huge a good one they're
1:01:24seven by nine they're fifty girl they're
1:01:25handmade Turkish carpets like it's a
1:01:27whole people you will spend money on yes
1:01:30and you'll be able to resell them
1:01:32probably for half of what you bought it
1:01:33for a third of what you bought it for
1:01:34maybe yeah maybe the same depending on
1:01:36what the Market's doing but I will say
1:01:38this is not a ruggable you're this isn't
1:01:40you're not gonna Bissell this you're
1:01:41gonna have to send this out for cleaning
1:01:42however uh it looks like Foley learned
1:01:44his lesson on d2c we should note before
1:01:46we uh have to wrap here he's he was
1:01:49quoted as saying I want to show
1:01:50discipline I want to show profitability
1:01:53oh and I want to have a real focus on
1:01:56unit economics I love it Ernesto this is
1:02:00probably integrate it's supply chain
1:02:02yeah we always say this you want to bet
1:02:04on a Founder after they get their ass
1:02:06kicked I just made that bet on Zuck yeah
1:02:08I I I was about to say I hate stock try
1:02:11I gotta speak for my heart not my mind I
1:02:14wish only the best for Zuck in his
1:02:17evolution
1:02:19my mind not my heart my mind hates what
1:02:22he's done
1:02:23but with my heart I wish Zuck a great
1:02:26evolution
1:02:28and Palmer lucky
1:02:31why did I do that why did I do that
1:02:37every interview they're like what about
1:02:38Jason gallicadas he's like oh
1:02:42it never ends
1:02:44it never ends but anyway I wish him the
1:02:46best I would like him to come on the
1:02:47program I'm a huge fan of Peloton
1:02:51I love it I hope that John Foley This Is
1:02:54My Hope
1:02:55I hope John Foley makes this a freaking
1:02:58huge success
1:02:59and Ben goes to a private Equity Firm
1:03:02and says look I'm selling rugs I'm a rug
1:03:05salesman
1:03:07I'm a rug salesman now I've learned my
1:03:10lesson uh-huh I I'm doing my Penance I'm
1:03:15selling rugs
1:03:16amazing and I have learned
1:03:19like the rug salesman for thousands of
1:03:22years to do this profitably I'm a new
1:03:24man
1:03:26you can trust me now give me four
1:03:29billion dollars and I want to buy the
1:03:30Peloton asset back yes and I want to
1:03:32make
1:03:33my own umbrella company of DDC Brands
1:03:36and I'm gonna buy quip and Casper and a
1:03:38couple of other ones oh let it be
1:03:41I went to Morocco
1:03:43and I worked in the bazaar and I haggled
1:03:46and I focused on Union economics he
1:03:48learned those skills right
1:03:51he's like uh yeah you know like in the
1:03:53bazaar yeah he went to the Mountaintop
1:03:55he that's him he went on his pillows Let
1:03:58It Be I want this to be I wish John
1:04:02Foley an epic return
1:04:04I hope he dunks on all his naysayers and
1:04:08I hope he comes back and buys Peloton oh
1:04:12my God that would be sweet sweet revenge
1:04:13make this thing a money printing machine
1:04:15save up all those profits John and then
1:04:18go by Peloton The Return of the King
1:04:21love it I'm here for it I'm here for it
1:04:23oh it's a Redemption show is what we
1:04:25have on Monday all right everybody thank
1:04:26you so I was just gonna I'm so glad you
1:04:29versus such a great thing I didn't have
1:04:30to I know totally I was like such a
1:04:32great song man when I saw that Bob
1:04:34Marley
1:04:38for me that's it we got a huge week
1:04:40coming up next unicorns is back on
1:04:43Wednesday we have our crypto round table
1:04:45on Thursday we're gonna talk about this
1:04:46whole ftt FTX Alameda research binance
1:04:50selling out of all its coins and who's
1:04:52propping up who and whatnot it's gonna
1:04:53be amazing and we need those two to help
1:04:55us understand it and then of course
1:04:56we'll have more Lon Harris and OK Boomer
1:04:58on Friday Harrison Rachel reporting are
1:05:02just bringing the heat every week really
1:05:03really like great supportive Friday
1:05:05combo too great Supporting Cast here
1:05:07great support cast I wonder if Rachel's
1:05:09going to find an interesting product and
1:05:10break in one day Rachel reporting oh
1:05:12yeah totally you know I'm not this okay
1:05:14Boomer she's locked for Fridays but you
1:05:15know I'm hoping maybe Tuesday Wednesday
1:05:17Thursday she breaks in that's a great
1:05:19interesting product maybe she did the
1:05:21last week she did that cool uh mood
1:05:23boards freaking awesome yeah she's good
1:05:25also if you're not I know I know you got
1:05:27like a side hustle or a side quest the
1:05:30kids call it a side quest I know you're
1:05:31on a side quest but you have to watch
1:05:33the peripheral
1:05:34I watched one
1:05:36and I just watched the last two episodes
1:05:38of Andor
1:05:39without my wife yeah and they were so
1:05:42freaking good that I this is the Slow
1:05:44Burn of all slow Burns there have been
1:05:47no lightsabers or blasters in this and
1:05:49it is the most
1:05:51heightened
1:05:52tense just incredible storytelling in
1:05:56the Star Wars Universe outside of like
1:05:59you know two or three of the best films
1:06:00it is incredible all right Andor is a
1:06:04revelation
1:06:06the money they spent on this the actors
1:06:09in it the guy who played Gollum
1:06:14that guy
1:06:15they pigeonholed Andy
1:06:18circus with Circus Circus
1:06:23this guy Andy Circus
1:06:25deserves an Emmy
1:06:27for this performance oh he is
1:06:31an extraordinary actor and they pigeon
1:06:34told him as like the monster like Gollum
1:06:37like he always plays a CGI character
1:06:39this guy says thespian he can act I want
1:06:42to see him in more films I love him and
1:06:45uh you know he's in uh the Iron Man once
1:06:48he's in the Marvel The Avengers one he's
1:06:51like he's the he's the like kind of
1:06:52South African guy who's like you can't
1:06:54scare me because you're not a cuttlefish
1:06:55oh
1:06:57anyway okay so that's all coming up I
1:07:00will I will get caught up on Andor you
1:07:02should get caught up on the peripheral
1:07:03it's gonna be a great week
1:07:05stick with us see you tomorrow
1:07:07bye bye bye

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