🚪 Founders see themselves out
The RealReal’s founder heads for the exit (Michael Kovac/Getty Images for Vanity Fair)
The RealReal’s founder heads for the exit (Michael Kovac/Getty Images for Vanity Fair)
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Hey Snackers,
“Not trolling. Just helpful.” —Ford CEO Jim Farley explaining an adapter included with the new electric F-150 that lets it charge a stalled Tesla.
Stocks slid as investors await tomorrow’s inflation data for May, which could show evidence that prices have peaked. Meanwhile, the red-hot housing market is clearly cooling: mortgage demand plummeted to a 22-year low last week as rising rates spook would-be buyers.
Things just got really real… Yet another CEO has stepped down to help their company step up: this week Julie Wainwright, founder of luxury resale marketplace The RealReal, unexpectedly resigned. Wainwright said she’s leaving on good terms so that TRR can find its “next generation” of leaders to achieve profitability. Her replacement faces a tough challenge:
- Real struggles: Last quarter TRR reported a bigger loss than during the same period last year. TRR’s stock has also suffered: shares are down about 90% since its 2019 IPO.
Out with the new, in with the seasoned... Fast-growing tech companies, which dominated the stock market for a decade, are now underperforming the overall market by the widest margin since 2000 (aka: the dot-com bubble). With growth stalled at many techies, founders are turning to corporate execs who have experience generating cash flow:
- Freshening up: Makeup and skincare dynamo Glossier recently replaced its founding CEO with a long-time Nike exec. Glossier went through a round of layoffs earlier this year as sales slumped.
- Industry veterans > visionary founders: Profitable startups like supply-chain-software company Flexport are turning to veterans for help. Yesterday, the logistics biz announced plans to replace its founding CEO with a long-time Amazon operations exec.
Growing up can be hard… and sometimes the best thing founders can do for their companies is to fire themselves. CEOs of public firms — and even midsize startups with dreams of an IPO — are responsible for maximizing profits. But the skills required to run a profitable public company aren’t always the same as the skills needed to launch a successful startup.
Savoring the last Buffalo wing... because chicken prices have flown the coop. The latest poultry headline: private-equity firm Atlas is taking over Foster Farms, America's 10th largest chicken producer with $3B in annual sales (you've probably seen its ground meat at grocery stores). Atlas will install the ex-CEO of nugget giant Tyson to lead Foster. The deal comes as US chicken prices have surged, up a #flated 16% in April from a year before.
No one's a winner... with this chicken dinner. Chicken is the world's most popular meat by far, followed by pork and beef. But a series of events have combined to send chicken prices soaring — and worker shortages are just the tip of the iceberg.
- An avian flu has spread through major producing regions, wiping out 38M chickens in the US alone — where the price of boneless skinless breast is up 68% this year.
- A dire drought and Russia's war on Ukraine have strained global grain supplies (think: corn, wheat) and ballooned prices, making it hard to feed and fatten the birds.
- Pork-pocalypse: Price-sensitive consumers might swap chicken for cheaper pork, but now an African swine fever is sweeping through global pig herds.
Some markets are less price sensitive... when it comes to nutritional staples. In the US and other wealthy countries, where food represents ~1/10th of household spending, chicken demand has held steady from consumers and restaurants (think: fried-chicken-sandwich frenzy) — that’s a positive for the poultry industry. But in developing countries, where food typically accounts for a third of budgets, people are starting to have to cut out meat altogether, and some are at risk of undernourishment if they can’t swap for more affordable proteins.
What else we’re Snackin’
- Revamp: The SEC floated an overhaul to how the market handles stock trades from retail investors. Under the proposed changes, brokerages would have to compete in auctions to execute certain stock trades.
- Suitors: Spirit delayed its shareholder meeting to give it more time to consider buyout offers from JetBlue and Frontier. Spirit investors will get to weigh in on the bidding war at the end of the month.
- Slurp: Campbell's Soup posted tasty earnings and an upbeat sales outlook, reporting 7% sales growth last quarter. The 150-year-old company said it’s well positioned for a recession as people eat at home to save $$.
- Ad-vantage: Roku shares jumped 10% on a report that it might be a takeover target for Netflix. Some analysts think Roku could be attractive to the Flix as it preps its own ad-based streaming tier.
- Snap: A mile-high NFL deal: Walmart heir Rob Walton is buying the Denver Broncos for a reported $4.6B — a record for an American sports franchise. The purchase is expected to be approved by the fall.
Snack Fact of the Day
Thursday
- January 6 public hearings begin
- Weekly jobless claims
- Earnings expected from Nio, DocuSign, Vail Resorts, Signet Jewelers, Stitch Fix, and Rent the Runway
Authors of this Snacks own: shares of Netflix, Walmart, Ford, and Amazon
ID: 2237561