Hey Snackers,
Warning: That new Netflix price hike hits in 1 month.
Markets dipped Tuesday heading into a fresh round of US/China trade talks on DC soil.
Blue Apron surges 15% after C-suite switcheroo
This is awkward... Blue Apron announced its CEO and its Chief Technology Officer (who is also the last co-founder still there) are "pursuing new opportunities." Linda Kozlowski (Etsy's former COO) is now top chef. Investors were so into the change that they bought up shares 15% in after-hours trading.
Chefs in the kitchen... So many. Aggressive jumps into the meal kit market from big fish (Amazon, Walmart, Kroger) and little ones (Plated, HelloFresh, Sun Basket) hit Blue Apron hard — Shares have fallen 90% since its 2017 IPO. And the number of customers has fallen, too:
- December 31, 2016: 1,000,000+ customers
- December 31, 2017: 746,000
- December 31, 2018: 557,000
Food tribes are the future... Gluten-full? Keto-ish? There's probably a meal kit for you. To stand out, Blue Apron's partnering with beloved brands to reach as many food-focused segments as possible. The stock popped in December after it partnered up with Weight Watchers. Here are the others:
Walgreens falls 13% to become the Dow's worst of 2019 so far
We appreciate the candor... First, Walgreens became the worst-performing stock among the 30-company Dow Jones index. Then, its CEO called last quarter the "most difficult we have seen" as profits fell 14%. He even downgraded expectations for the full year — he expects zero profit growth now.
The CEO said, "no excuses"... But there were reasons. And he was happy to blame them for Walgreens' struggles.
- "A weak cough, cold and flu season": Lack of fevers was good for society, but bad for sales of medicine, tissues, and bed-side ice cream.
- "Continued de-emphasis of select products such as tobacco": Under pressure to follow CVS's leadership (the rival quit tobacco in all its stores), Walgreens tested out tobacco-less stores. Turns out it hurt sales, so Walgreens won't expand the pilot.
- FYI: It hopes that adding CBD products to 1,500 locations can help ease some of that pain.
Insurance companies. They can be bullies... When Walgreens sells prescription anything, it's paid by customers (a small co-pay) and insurance (the rest). And insurance companies keep growing through mergers. Now they're flexing their pricing power by paying Walgreens less for drugs you buy.
- Customers of monopolies suffer.
- And the health insurance market keeps getting more monopoly-ish.
Andreessen Horowitz transforms venture capital with new $2B fund
15 million shares... That's how much stock venture capital legend Andreessen Horowitz owned in Lyft before the IPO. Now the decade-old VC's raised $2B in cash for a unique fund to find Lyft #2. And #3. And #50. And they like using big terms to do it.
- Their first fund wanted to invest in "megalomaniacal founders".
- Then they created the concept of "software eating the world".
- And the "a16z" nickname is a coding thing — starts with an "a," ends with a "z," and has 16 letters in between (we didn't get it, either).
Cue the makeover montage... Early stage venture investing not enough? Transform into a "Registered Investment Adviser." That's what a16z is doing. RIA life comes with extra regulatory rules — But it gives a16z freedom to drop money into more crypto and regular old public stocks, too. Other VCs will just watch (or follow).
a16z breeds unicorns... Since starting the fund in 2009, it's invested in Instagram, Buzzfeed, Dollar Shave Club, Skype, and Soylent. And in 2019, its shares in Slack, Lyft, Pinterest, and Airbnb will probably (or have already) become publicly traded. This portfolio page is really a humble-brag trophy case.
What else we’re Snackin’
- Un-super: AMC's website crashes as Avengers tickets hit pre-sale
- Crypto: Bitcoin surges (but not on the April Fools' joke buyers thought it jumped on)
- InstaFamous: Facebook pops on word its new Instagram ecommerce feature could add $10B by 2021
- Miles: Delta rises 6% after a 10-year extension to its AmEx credit card contract
- Caught: Wynn Resorts execs may have concealed its founder's #MeToo misconduct
Wednesday
- A judge hears arguments in the SEC's case against Elon Musk's tweeting
- US/China trade talks head to DC