Friday Oct.16, 2020

🚗 Nio's EV battery subscription

_When your Sleep Number Score is worse than your ACT score_
_When your Sleep Number Score is worse than your ACT score_

Hey Snackers,

He's baaaaack: an unidentified man was spotted flying in a jetpack 6,000 feet over the Los Angeles airport... again. Elon?

Stocks fell yesterday as new COVID-19 cases hit records in Europe. Paris triggered nightly curfews, and London banned mixing with other households indoors.

Swap

Nio stock has surged, but we’re more interested in its battery subscription

Red pill or blue pill, Nio?... This six-year-old luxury EV maker is on both. Nio, sometimes called "the Tesla of China," has been on a wild ride this year. Kicking off 2020, Nio had a bad rap as a cash-bleeder:

  • Red pill: In December 2019, Nio stock had plunged more than 70% since going public in 2018. The company had lost $6B since its launch and was almost out of cash. Now...
  • Blue pill: Nio stock has soared ~700% since April 29, when it got a $1B cash injection from Chinese government-backed investors.
  • New pill: The stock is up 30% this week thanks to analyst upgrades on "strong order backlogs" and growth momentum.

Not quite Musky... Unlike Tesla, which recently reported four-straight profitable quarters, Nio has never notched a profit. In 2019, it delivered just ~20K cars compared to Tesla's ~367K. But Nio has a cool differentiator:

  • Battery Swapping: Nio's Battery-as-a-Service lets you swap your EV battery for a freshly charged one at one of its 130+ stations (instead of waiting for it to juice up).
  • The subscription costs ~$145/month, but you get $10K off the price of the actual car (since the battery is the most expensive part).

The lifestyle brand factor is a huge part of it... Like Tesla, Nio has built a cult following. Before it ever sold a car, it spent millions on cranking out Nio hats and merch. It also created "Nio Houses," sleek showroom-clubhouses for Nio owners to chill in. Nio and Tesla have both grown by fueling deep brand love.

Snooze

The power of the pivot: Sleep Number thrives on techy WiFi Smart Beds

Eat, sleep number, repeat... OG mattress company Sleep Number just woke from a deep slumber. Sleep's quarterly profit nearly doubled from last year, and sales popped 12% as we all worked from bed. The stock soared yesterday on the news. But this is really a Health & Wellness story...

  • If you can track it, you can techify it. Sleep Number shifted to selling only snooze-tracking Smart Beds in 2018 and has been making a wellness play since.
  • Sounds familiar. D2C mattress company Casper called sleep the “3rd pillar of wellness” after nutrition and fitness.
  • The OG is beating the newbie. Sleep Number is way ahead of millennial-friendly Casper on snooze-tech, and its stock is beating Casper's this year, too.

"Life-changing"... How Sleep's CEO describes the 360 Smart Beds. She says they've "improved nearly 13 million lives and counting" (that's deep). These beds make sure your Zzzs get on the WiFi:

  • Tracking: The bed tracks your heart rate, breathing, and sleep/wake cycles, stalking your every movement.
  • Temperature control: The bed creates your "personal microclimate," balancing surface temp while warming your feet.
  • SleepIQ Score: You get a SleepIQ score along with a monthly in-app wellness report (70 to 100 = siesta master).

Sleep Number embodies the Power of the Pivot... After going full-smart-bed in 2018, Sleep Number completed its transformation from declining old mattress company to techy growing "wellness" company. That's helped it notch double-digit demand growth for the past three years.

What else we’re Snackin’

  • K-popped: Shares of Big Hit, the management group behind boy band phenom BTS, popped on their first day of trading in South Korea.
  • Invested: Goldman Sachs' profit nearly doubled from last year thanks to strong bond-trading results.
  • Snaptok: Snapchat releases a TikTok-rivaling feature called “Sounds on Snapchat” (great name) that lets you add millions of songs to videos.
  • Fam: Tesla says it will begin production of its 7-seater Model Y in November, with deliveries set for December.
  • Swiped: Payment processor Stripe drops over $200M on Nigerian startup Paystack to expand its biz to the high-growth African market.
  • Cruise: GM's autonomous driving unit Cruise plans to test unmanned self-driving cars this year in SF.

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Friday

Disclosure: Authors of this Snacks own shares of Snap and Tesla

ID: 1371064

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