__Flashback to Uber's IPO in May...__ Deep in its filing paperwork (aka "S-1"), Uber listed a nightmare policy scenario under the "risks" section: 

*“Our business would be adversely affected if Drivers were classified as employees instead of independent contractors.”*

__That. Just. Happened...__ California's AB5 law (brutal name) [passed](https://qz.com/1706754/california-senate-passes-ab5-to-turn-independent-contractors-into-employees/) late Tuesday to go into effect Jan. 1, pending the governor's signature (he said he'll sign). It requires __[Uber](https://robinhood.com/stocks/UBER)__, __[Lyft](https://robinhood.com/stocks/LYFT)__, and other gig icons to grant full employee benefits, pay, and anniversary balloons to their drivers — that's instead of the 1099 form drivers currently get as independent contractors.

__Uber's response = [*Not doing it*](https://www.theverge.com/2019/9/11/20861362/uber-ab5-tony-west-drivers-core-ride-share-business-california)...__ This seems destined for a legal battle. Here's how this law would be good and bad for the world:

- __The Good:__ Uber drivers would receive reliable (and probably higher) pay, benefits, and the opportunity to unionize. 
- __The Bad:__ Uber claims it would need to schedule driver shifts, stealing their "drive when you want" freedom. The higher overall driver pay would also probably translate to higher prices for you and us riders. 

Legislate

__Don't forget Uber & Lyft's dirty little secret...__ To transition from hugely unprofitable to actually make money, they've got 3 options:

1. Pay drivers less (not happening with this new law)
2. Increase prices for Uber rides
3. Replace drivers with self-driving car technology

#2 could happen because of this new law. The pressure to get to #3 will be even greater.

California disrupts the disrupters, classifying Uber/Lyft drivers as "employees"

__Testing. Testing. Testing...__ After 300 test restaurants enjoyed solid results, __[Wendy's](https://robinhood.com/stocks/WEN)__ is  [adding](https://www.irwendys.com/news/news-details/2019/Wendys-Announces-Plans-to-Launch-Breakfast-Across-the-US-System-in-2020/default.aspx) the 3rd meal to 5K burger joints this year. Investors weren't feeling the most important meal of the day, dropping the stock 12%. Here's the 1st problem: *History*. Wendy's tried adding breakfast 3 times before ('85, '06, '10). It [failed](https://www.cnbc.com/2019/09/10/analysts-are-skeptical-about-wendys-nationwide-breakfast-stock-sinks-10percent.html) all 3 times. 

__Breakfast isn't a no-brainer...__ despite what Mom said. You'd expect that adding a meal would grow profits. Not necessarily. Wendy's downgraded its profit expectations for 2019 because breakfast is hard to make — and it hasn't even unveiled the menu yet (square-shaped waffles TBD).

- __It's expensive.__ Wendy's is dropping a cool $20M across the stores before the first egg is cracked.
- __You need more people.__ Wendy's currently opens at 10am. Early bird gets the 5am morning shift, and Wendy's is hiring 20K new workers for it.
- __Franchise owners don't love this.__ 95% of Wendy's are owned by other people (not [Dave's Legacy](https://www.wendys.com/daves-legacy)). You see Baconator hashbrowns, they see new training, updated fridges, and re-organized pantries that this announcement requires. 

Nourish

__But breakfast is where the habits are...__ Those daily meat/egg/cheese + coffee pit stops are *consistent habits* that [grow](https://www.npd.com/wps/portal/npd/us/blog/2019/why-the-breakfast-daypart-is-sunny-side-up/) revenues for fast food. That's why everyone at the restaurant convention is talking about new plans for on-the-go breakfast options - not boring boxed lunch. Wendy's will need to break morning diners from their faithful __[Dunkin](https://robinhood.com/stocks/DNKN)__, __[McD's](https://robinhood.com/stocks/MCD)__, __[Starbucks](https://robinhood.com/stocks/SBUX)__, and even __[Taco Bell](https://robinhood.com/stocks/YUM)__ rituals.

Wendy's adds breakfast to the menu — and investors really aren't into it

Dow Jones

S&P 500

Nasdaq

Bitcoin

10-Yr US Treasury

_Just another Uber driver taking his paid rest break_

Lyft/Uber's nightmare scenario (now reality)

__The Touch screen. The no-headphone-jack. Siri...__ __[Apple](https://robinhood.com/stocks/AAPL)__ has evolved over the course of its annual new iPhone product unveils. The stage and dark lighting haven't. Here's what we get with the new iPhone 11:

- __Size and colors:__ [Pastels](https://www.apple.com/iphone/) for days with the new lavender, soft green, and honey yellow. Both the regular and Max versions are slightly bigger than the previous ones.
- __A "Pro":__ $999+ gets you three cameras (the starter, a backup, and 3rd-string, just in case), which create quite a [bulge](https://twitter.com/kifleswing/status/1171497608272941056). Your move, Pixel 4. 
- __The "Slofie":__ Sloooow-mooootion videoooo getssss addedddd to the front-facing camera, [too](https://www.cnn.com/2019/09/10/tech/apple-event-memes/index.html).

__Forget iPhone — Apple TV+ is the star...__ and it arrives Nov. 1 at a ridiculously low-priced $4.99/month. __[Netflix](https://robinhood.com/stocks/NFLX)__ ($12.99), __[HBO](https://robinhood.com/stocks/T)__ __Now__ ($14.99), and even __[Disney+](https://robinhood.com/stocks/DIS)__ ($6.99 starting in November) aren't happy about this price war aggression. Tim Cook also showed off original Apple TV+ shows (there aren't many of 'em, but they [star](https://www.theverge.com/2019/9/10/20850996/apple-tv-plus-launch-lineup-shows-originals-see-morning-show-for-all-mankind-oprah-dickinson) Steve Carell and Reese Witherspoon) and a $4.99/month video game "Arcade" pass.

Unveil

__Apple's thinking about the whole customer...__ New colors, a 3rd camera, and the A13 chip aren't forming fanboy lines outside glass-plated Apple Stores anymore. So it's focusing on prices: Lower some prices, offer some freebies, and hope to make $$$ on sales every few years (with monthly service subscriptions in between):

- __iPhone 11__ starts at $699 and the Pro version at $999 (iPhone X started at $999 when it debuted in '17). 
- __Apple Watch 5__ is the same price as the previous ones and its Watch 3 is a Fitbit-ish $199.
- __Apple TV+__ costs a Venti Latte per month at $4.99, or free for a year when you buy a Mac, iPhone, or iPad.


Apple reveals iPhone 11 — then ends its always-raising-prices streak

__An $11B makeover...__ __[Ford](https://robinhood.com/stocks/f)__ wants one. It's all part of the car company's aggressive turnaround plan to become more sexy, electric, and self-driving.  So to pay for the new look, Ford issues billions in IOUs ([bonds](https://learn.robinhood.com/articles/6D8ArYVa2bpoTYhdgxxYKh/what-is-a-bond/?utm_source=snacks&utm_campaign=email_Daily&utm_content=Bonds&utm_term=What%20is%20a%20Bond)). Before you invest in bonds, a credit ratings agency jumps in:

- Ratings agencies __evaluate the likelihood__ a bond-issuer (like Ford) __will pay you back__.
- Based on the company's financial health, the ratings agency __sticks a rating on it__.
- __AAA, AA, A, BBB__ — Anything BB or lower is considered "__junk__." Ford just got [downgraded](https://www.cnn.com/2019/09/10/business/ford-downgrade-junk/index.html) to that.

__Ford was created in 1903...__ But this situation goes back to 2009. The Big 3 Detroit car companies needed a bailout — *except Ford.* It even gave its blue oval logo as collateral for a loan to stay bailout-free. Since surviving the car-pocalypse, Ford's bonds have been rated "investment grade." Then it fell behind rival __[GM's](https://robinhood.com/stocks/GM)__ innovation and Ford is now worth less than __[Tesla](https://robinhood.com/stocks/TSLA)__. Junk happens.

__"Junk" makes almost everything Ford does more expensive...__ Even though Ford's enjoying huge profits ($22B over the past four years), the credit ratings agencies are worried about where Ford will be 10 years from now. Because of this downgrade, investors will demand a higher interest rate from Ford because its debt is considered riskier. 

Ford's bonds reach a low blow: Junk status

__Her majesty, queen of internet...__ Venture capital icon Mary Meeker just [handed](https://techcrunch.com/2019/09/10/nextdoor-adds-new-funding-from-mary-meekers-bond-closes-growth-round-at-170m/) an internet company a $170M check. *Must be nice*, __Nextdoor__. The SF-based app is now worth $2.1B  as it scales across ~~continents~~ neighborhoods. By connecting you with humans who live nearby, it introduces people online who might meet up offline.

- __The business model:__ Get people to join the localized social network, then stick ads into the feed (sounds like Facebook). 
- __The verification:__ To join one of Nextdoor's 247K neighborhoods, you have to prove you are who you are and you live where you live (the opposite of Facebook) — they call you when you download the app to confirm.
- __The connections:__ Hyper-local. *Does anyone have a ladder I can borrow? Anybody want lasagna (don't want to throw it away)? Who's down for a game of Madden 2018? Alert - burglar spotted on Gough Street -- lock your doors.*

Appreciate

__Who might acquire Nextdoor?...__ It's selling shares at a healthy unicorn valuation and could IPO someday, like its roll-ish model Facebook did. __Or__ business could turn south and it could fail. __Or__... it could get acquired. Here's how Nextdoor could have strategic value to a bigger buyer.

- __Google:__ You open Maps like 3 times a day. Adding juicy neighborhood details could boost engagement
- __IAC:__ The internet startup collector owns Handy, and could partner the handyman gig platform with Nextdoor.
- __Yelp:__ Local reviews should include references for that nice guy who mows lawns.

Tweet us who you think could acquire Nextdoor __[@RobinhoodSnacks](https://twitter.com/robinhoodsnacks?lang=en)__

Nextdoor hits $2.1B valuation as the anti-Facebook social network

_I got free Apple TV+ when my mom got an iPhone upgrade_

AppleTV+, the free perk for iPhone buyers

__No talky until coffee...__ __[Starbucks](https://robinhood.com/stocks/sbux)__ is making it possible — CEO Kevin Johnson sat down with *[Bloomberg](https://www.bloomberg.com/news/articles/2019-09-05/starbucks-ceo-s-new-ideas-start-with-a-pick-up-only-store-in-nyc)* to reveal a pick-up only store is in the works for NYC this fall. Picture NASCAR pit stop meets barista nightmare — Starbucks is targeting "people on the go" (aka all humans in Manhattan) because even pre-orders face lines lately. Other key deets:

- __The where:__ If NYC goes well, Starbucks [will export](https://www.fastcompany.com/90400118/starbucks-is-opening-a-pick-up-only-store-to-make-psl-season-a-breeze) the concept to LA, BOS, CHI, SEA, and SF.
- __The what:__ PSL, coconut milk lattes, frapp-a-anything — you name it, pickup-only Starbucks serves it.
- __The $$$:__ Pickup-only could become Starbucks' #ProfitPuppy — Coffee sales will bring in the same revenues, but at lower costs (less real estate & employees).


__If the Starbucks mobile app had feelings...__ this would be its dream. The pick-up concept blends deliciously with the Starbucks app's growth — usage has surged to hit 2 shocking numbers:

- __17.2M__ = that's how many Americans use the app
- __40%__ = that's how much of Starbucks' sales came from app orders (QR-code for the win)

__American companies are now inspired by Chinese ones...__ This wouldn't be Starbucks' 1st pickup location — it launched the same concept in China last summer as "Starbucks Now." It made that move because local Chinese rival __[Luckin Coffee](https://robinhood.com/stocks/LK)__ pioneered the concept across the Great Wall, jumping to 3K locations in under 2 years (Starbucks is barely higher at 4K China stores). It's an early example of American retail copying Chinese competition.

Starbucks is whipping up its 1st pickup-only store — that's a big deal

__Freight just brought sexy back...__ __[Uber](https://robinhood.com/stocks/UBER)__ wants to make trucking its next profit puppy. Just like ride-hailing, Uber Freight connects drivers (of 18-wheelers) with riders (Budweiser's beer kegs or Land O'Lakes' stacks of butter). Uber just [announced](https://techcrunch.com/2019/09/09/uber-commits-200-million-to-uber-freight-expansion-in-bet-on-trucking/) that Freight is its fastest-growing business line, so it's investing more in a big way:

- __Cash:__ Uber's Freight line will get a $200M investment each year.
- __Personnel:__ Uber's hiring 2K people at its future 2nd-biggest location (and the only other one besides SF that gets engineers) — Chicago = Freight HQ.
- __Perks:__ To sign up new truck drivers to the gig-for-cargo platform, it's offering discounts on gas, free tires (but seriously — tractor-trailers need 18 of 'em), and cash bonuses. 

__Uber's spending money to stop losing money...__ It lost a gargantuan $5B last quarter (*the last 3 months*), and loses [$3.36](https://qz.com/1693843/uber-eats-will-lose-money-until-at-least-2024-say-cowen-analysts/) each time someone delivers an Uber Eats meal. It's funneling money away from marketing (it laid off 400 this summer in that dep't) and toward this growing bet.

_"What do I have to do to get you in this Uber Freight?"_

Ship

__Freight has to be different than the rest of Uber...__ Uber's 3 non-Freight divisions — rides, bikes/scooters, and Eats — all face copycat competition. Without barriers to entry to creating an app platform, __[Lyft](https://robinhood.com/stocks/LYFT)__, __DoorDash__, and others keep prices low and competition fierce. Uber must find a way to prevent an Amazon Freight or Lyft Trailer from becoming a thing.

Uber invests big in "Freight" — the Uber for pallets of stuff in tractor-trailers

__Haters gonna hate...__ Only some release a 23-page [open letter](https://activatingatt.com/wp-content/uploads/2019/09/Elliotts-Letter-to-ATT_09092019.pdf) about it. Hedge fund Elliott Management just sent one to __[AT&T](https://robinhood.com/stocks/t)__ after splurging $3.2B for a 1.2% stake in the telecom giant. The letter's core theme: Change (almost) everything. Here's how to interpret the *Real Housewives*-style takedown:

- __It's not personal, AT&T:__ Elliott has "tremendous respect for the Company’s legacy."
- __But there's a problem:__ Over the last 10 years, the broader market (the S&P 500) has risen 193% — but AT&T only rose 42%.
- __So it's time for a makeover:__ Specifically, cut the CEO and the board – Elliot thinks that “this is the moment to determine the right team for the next decade.”
- __Take the free advice and everyone wins:__ The fund thinks its proposals could push up AT&T stock by 65% in 2 years. 
- *FYI, the fund doesn't own enough stock to force AT&T management to listen — but shares jumped __because investors hope it does__.*

__Here's the problem...__ There are a lot of problems facing AT&T. The hedge fund spent pages 2-23 covering them.

- __The botched iPhone:__ AT&T enjoyed exclusive rights to sell iPhones when they launched — but its poor service quality ended that.
- __The identity crisis:__ __[Verizon](https://robinhood.com/stocks/VZ)__ snagged the high-end wireless market while __[T-Mobile](https://robinhood.com/stocks/TMUS)__/__[Sprint](https://robinhood.com/stocks/S)__ grabbed the low-end — AT&T was awkwardly left in the middle.
- __The brutal acquisitions:__ AT&T has dropped a hefty $200B on them the last few years — it bought DirecTV at its peak, and satellite TV has only lost subscribers since.


Haters

__AT&T is a tech company led by landline guys...__ That's the biggest issue. The current CEO has run things for 12 years, and the newly-promoted COO's telecom roots go back to 1998. But now AT&T is a tech media company that owns streaming tech and HBO — that means it competes directly with __[Netflix](https://robinhood.com/stocks/NFLX)__. Elliott wants leadership to be more iPhone, less landline.

AT&T gets an "open letter" from a hedge fund to basically change everything

Uber Freight's $200M, 2K-person, Chicago surprise

__Vinyasa flows are for the boys...__ __[Lululemon](https://robinhood.com/stocks/lulu)__ already recognized that it needs to get its pants on the other half of the population, so earlier this year it made a bold goal: Double its men's line over the next 5 years. Investors rewarded the athleisure pioneer as its quarterly sales of guys clothes [surged](https://markets.businessinsider.com/news/stocks/lululemon-2q-earnings-stock-price-rises-earnings-beat-mens-sales-2019-9-1028505331) 35%, popping shares up 8% last week.

__Game of Deal Thrones...__ and __[JPMorgan's](https://robinhood.com/stocks/jpm)__ got a dragonglass sword. Over the weekend we learned that America's largest financial firm is [close](https://www.reuters.com/article/us-saudi-aramco-ipo-jp-morgan/jpmorgan-close-to-winning-lead-advisory-role-for-saudi-aramco-ipo-cnbc-idUSKCN1VT0NT) to winning the biggest IPO in history: Saudi Arabian oil giant __Saudi Aramco__ (that's Earth's most profitable company). Advising the deal as the lead investment bank is a lucrative bragging rights victory.

High

Who's up...

__Jealous...__ Tinder-owner __[Match](https://robinhood.com/stocks/mtch)__  crumbled 5% as soon as __[Facebook](https://robinhood.com/stocks/fb)__ unveiled its new look: *Facebook Dating* just hit the US (it's exactly what it sounds like). Match shareholders have known for months Zuck was getting into the swipe-game with a feature to connect singles based on interests. But [the surprise](https://newsroom.fb.com/news/2019/09/facebook-dating/) was how much Facebook integrated Instagram into playing matchmaker — that cuts straight through Tinder's soul.

__Bralettes > Pushups...__ 2 numbers explain it all: __[American Eagle's](https://robinhood.com/stocks/aeo)__ sales fell 1% — but sales for its lingerie brand Aerie surged 16%. The Millennial-toned bralette legend is [snagging](https://www.cnbc.com/2019/09/04/american-eagle-stock-falls-as-delayed-back-to-school-season-hurts-sales-growth.html) market share from Victoria's Secret. So while American Eagle stock dropped on overall weakness, it's rewarding Aerie with 40 more of its own stores.

__That whole [destroy email](https://www.nytimes.com/2019/06/19/style/slack-replace-email-ipo-listing.html) thing?...__ That'll cost more than expected. __[Slack](https://robinhood.com/stocks/WORK)__ unveiled its 1st earnings report since going public — and shares fell 14% after it only added 5K new clients. Looks like the office instant-messager's 1st 10M clients (startups, scaleups, VCs) were a lot easier than its next 10M (law firms, financial institutions, corporate America) will be.

Lows

...and who's down

__The cavalry has arrived on stalks of celery...__ We unofficially hit peak __plant-based meat__ last week as established food icons jumped on the bandwagon (don't worry — it's a Prius). You can decide whether the market — *looks/tastes/bleeds like animal meat, but smaller environmental impact* — is [bigger or smaller](https://www.cnbc.com/2019/09/06/analyst-slaps-sell-rating-on-beyond-meat-says-plant-based-meat-market-not-as-big-as-people-think.html) than its cousin industry, __plant-based milk__. 

__The iMEATation game...__ Here are major new brands/partnership announced just this month. The primary theme is aggressive creativity around the names:

1. __[Kellogg's](https://robinhood.com/stocks/K)__ plant-based burger: "[Incogmeato](https://www.cnbc.com/2019/09/04/kellogg-to-produce-its-own-plant-based-burger-and-imitation-chicken.html)"
2. __[Hormel's](https://robinhood.com/stocks/HRL)__ plant-based beef: "[Happy Little Plants](http://www.startribune.com/hormel-unwraps-plant-based-protein-line-called-happy-little-plants/559404552/)"
3. __[Kroger's](https://robinhood.com/stocks/KR)__ plant-based deli meats: "[Simple Truth](https://www.cnbc.com/2019/09/05/kroger-unveils-plans-for-a-line-of-plant-based-products-including-sausage-and-deli-slices.html)"
4. __[Tyson's](https://robinhood.com/stocks/TSN)__ plant-based shrimp: "[New Wave](https://www.fastcompany.com/90399811/plant-based-shrimp-is-a-thing-and-tyson-foods-wants-a-taste)" (it invested in the company). It also unveiled its own plant-based option "[Raised & Rooted](https://www.tysonfoods.com/news/news-releases/2019/6/tyson-foods-unveils-alternative-protein-products-and-new-raised-rootedr)" in August.
5. __[Nestle's](https://robinhood.com/stocks/NSRGY)__ plant-based "[Awesome Burger](https://finance.yahoo.com/news/no-meat-please-nestle-may-120100981.html)" is already testing with McDonald's in Germany.

Protein

__One of [Beyond Meat's](https://robinhood.com/stocks/BYND) advantages is gone...__ The only publicly traded company that's 100% plant-based meat had a tailgate-worthy IPO (rival __Impossible Foods__ is big, but private). Beyond's stock though has fallen 35% since July, and a hefty portion of that is from increased competition. Here's how its 2 divisions are doing:

- __Grocery Stores = 50% of sales: *Weak first-mover advantage* 🌾.__ Beyond's brand is better known than the rest, but it could become a price war in the confusing aisle getting packed with more *not-called-veggie* veggie burgers, 
- __Fast Food Partnerships = 50% of sales: *Strong first-mover advantage* 💪.__ Beyond has partnered with __Dunkin__, __KFC__, __Subway__, and more. Those chains aren't likely to switch just because there's competition. And as __McDonald's__ looks for a plant-based partner, it'll probably want one with a vegan track record. 

The competition has arrived: Beyond Meat drops as Big Food goes plant-based

_When you can't come up with another name for plant-based anything_

IncogMEATo vs. Beyond Meat

__Whip out the pint of gelato and romcom marathon...__ Tinder-owner __[Match](https://robinhood.com/stocks/mtch)__ is feeling the pain as __[Facebook's](https://robinhood.com/stocks/fb)__ dating feature [goes live](https://newsroom.fb.com/news/2019/09/facebook-dating/) in the US (just update your app and opt-in if you're looking to mingle). Technically, Facebook told us last year that this was coming, but here's the love story timeline.

- __1st date (fall 2018):__ Colombia. The magic begins when Facebook started testing in the land of Arepas.
- __1st trip (winter 2019)__ Latin America. Facebook expands the tests regionally to Mexico and Argentina.
- __1st fight (spring 2019)__ Feedback. Listening to early users, Facebook updates the feature to make it easier to set up a profile (and creepily proposes a pic for you).
- __Facebook makes it Facebook official (*today*):__ Another [19](https://twitter.com/mattnavarra/status/1169611360881324033) countries enjoy access, including the US (Europe waits 'till 2020).

__"If you're a bird, [I'm a bird](https://www.youtube.com/watch?v=EdwkSYsUvBs)"...__ The Facebook dating concept is that simple. Since Facebook knows what you like/click/join/share, Zuck thinks he can play match-maker better than Tinder. But the most unique feature we could find in our Snacks research is "Secret Crush":

- Facebook Dating defaults to __not matching you with friends,__ but there are 9 exceptions.
- If your sophomore Geography class partner is the one that got away, you can "Secret Crush" tag them.
- If they unknowingly reciprocate, Facebook makes the connection (warning: You get 9 "Secret Crushes" max).

Lovely

__Instagram is Facebook's surprise +1...__ That's what crushed Match. Match investors have known *for months* what Facebook was up to. What they didn't know was how much Facebook's *Insta* would be involved. Turns out Facebook integrates photos from Insta profiles into the dating feature. Since Instagram is where a whole generation's digital-selves obsessively live, FB Dating is now much more of a threat than Match expected.

Match drops 5% as Facebook Dating just happened

__*This isn't how I imagined my dream IPO*...__ According to [WSJ](https://www.wsj.com/articles/wework-parent-weighs-slashing-its-valuation-roughly-in-half-11567689174), __WeWork__ is thinking about dropping its valuation in order to IPO down to $20B-$30B. That's half of where it was. The last time WeWork raised money, its valuation reached $47B. This update is just a few weeks after it officially filed its IPO paperwork (aka "the S-1"). Here's what wounded the coworking unicorn:

- __What WeWork wanted:__ Investors to be sooo excited to own We stock that there would be *overdemand*, requiring an *increase* in the planned offer price.
- __What actually happened:__ The opposite. Powerful investors are telling WeWork the stock is too pricey, and nobody wants to buy at that price when it goes public soon.
- __The reason:__ Lack of transparency. The IPO paperwork WeWork issued last month didn't clarify key details about its (un)profitability. [One investor](https://finance.yahoo.com/news/weworks-ipo-filing-masterpiece-obfuscation-170920303.html) called WeWork's S-1 "a masterpiece of obfuscation."
- __The result:__ WeWork's reportedly dropping the price, basically putting its stock "on sale for 50% off" so investors can get comfortable enough to buy shares at the IPO. None of this is official yet.

Discount

__Tough day for WeWork shareholders (they already exist)...__ Even though WeWork hasn't IPO'd, its employees, early investors, and venture capitalists already own shares (some as compensation for work). Now the stock could be worth 1/2 what We was hoping for. WeWork's valuation got (very) high as a private company, so when shares hit the public market (and anyone can buy them) their price could come down to reality.

WeWork plans to massively devalue itself to save the IPO

_"It's just Instagram. Your Tinder profile will be fine."_

Instagram's 1st date

__The force isn't as strong with this one...__ __[Slack's](https://robinhood.com/stocks/WORK)__ mission to destroy email with zippy messaging had a rough quarter. 100K companies pay Slack to manage non-verbal inter-office messaging and only 5K came on board in the last 3 months. That's [slower growth](https://www.cnbc.com/2019/09/04/slack-work-earnings-q2-2020.html), so shares tanked 14% on its 1st earnings since going public in June.

__It's very much unprofitable...__ but it's profitably dominating your life. The average Slack user is actively slacking [90 minutes per day](https://s23.q4cdn.com/371616720/files/doc_financials/2019/Q2/Updated/Earnings-Graphs-9.04.19_V11.pdf) and has it open for 9 hours of work/life imbalance. Here's why growth lost its mojo: 

- __#spent-less-on-advertising__ — Slack hoped its growth momentum was unstoppable, but it still needs to buy ads.
- __#low-hanging-fruit-is-gone__ — Early adopters have Slacked for years. To get less adventurous white collars, it needs to work harder training users on how to quote (use ~ tildes ~) and start a :thread:.

Debut

__For Slack to win, Microsoft must lose...__ Microsoft is the Tyrian Lannister of software (it thinks and it knows things). It finds ways to survive. It owns office email with Outlook, and is adapting with "Teams," a nimble messaging service that mimics Slack's qualities. Microsoft's Slack competitor is an easier sell to Larry-from-procurement, who's been Microsoft-loyal for decades. Plus, Teams is sneakily bigger: 13M daily users to Slack's 10M.

FYI: [This NYT guide](https://www.nytimes.com/2019/08/28/smarter-living/how-to-stop-slack-from-taking-over-your-life.html?fallback=0&recId=1QP79LRMzCAhEBn9ep0aITZKzDo&locked=0&geoContinent=NA&geoRegion=VA&recAlloc=random&geoCountry=US&blockId=home-living-vi&imp_id=82546538) to stopping Slack from taking over your life.

Slack's quest to kill Outlook email hits a speed bump

__Abercrombie's little cousin...__ __[American Eagle](https://robinhood.com/stocks/aeo)__ doesn't fill its stores with cologne and abs — Instead, the retailer is [adding](https://www.cnbc.com/2019/09/04/american-eagle-to-launch-beauty-business-before-the-holiday-season.html) CBD-infused lotions to its button-downs next month. In the meantime, shares plummeted 12% Wednesday because of the following contradiction in last quarter's performance:

- ⬇️1% = __American Eagle's__ sales fell — blame weak back-to-school sales in July.
- ⬆️16% = __Aerie__ sales surged — American Eagle's lingerie brand saw *its 19th-straight quarter of double-digit growth*. Let that sink in.

__Bralettes experienced "renewed excitement"...__ American Eagle's [words](https://seekingalpha.com/article/4289636-american-eagle-outfitters-inc-aeo-ceo-jay-schottenstein-q2-2019-results-earnings-call?part=single). It's talking about its Aerie brand's signature anti-push-up bra. Aerie's Photoshop-less models are ([actually](https://fashionista.com/2019/09/fashionista-five-jennifer-foyle-profile)) stealing market share from Victoria's Secret's ultra-sexualized ones. Now AE is opening 40 standalone Aerie stores and expanding the brand from underwear to yoga pants.

Worn

__Spinoff brands are the new black...__ While American Eagle's style stays grounded, its Aerie line has taken off. These spinoff brands let the parent brand catch trends, try-on new looks, take risks, and scare corporate. But your Snacks team is noticing key apparel spinoff brands outpacing their parents. Check your closet for examples:

- __Madewell__ has [outperformed](https://www.vox.com/the-goods/2019/4/12/18307911/jcrew-madewell-ipo-brand-spinoff) owner __J. Crew__ for years.
- __Anthropologie__ [out-dresses](https://www.businessinsider.com/urban-outfitters-vs-anthropologie-comparison-which-clothing-store-is-better-2019-6) and out-grows __[Urban Outfitters](https://robinhood.com/stocks/URBN)__.
- __Old Navy__ performed so well that __[Gap](https://robinhood.com/stocks/GPS)__ had to [spin off](https://www.nytimes.com/2019/02/28/business/gap-old-navy-spinoff.html) its spinoff brand into a separate publicly traded company.


Aerie's bralettes are saving its parent company: American Eagle

_American Eagle's "aha" moment_

American Eagle is now a bralette company

__#AnxiouslyWaitingForLikes...__ Been there. *You post a pic of you and that friend — or worse — a pic of just you. After 5 minutes you've got 2 likes. After 10, 6. After an hour, 14. DELETE POST.* The like-struggle is real. __[Facebook](https://robinhood.com/stocks/FB)__ is aware and just confirmed its test to remove the number of a post's social media affirmations from public view.

__Side hustle...__ Jane Manchun Wong enjoys one as a "reverse engineer" — while you're reading Snacks, she's mining code, searching for deep-app irregularities. We'll let her describe what happened next in [her own words](https://wongmjane.com/blog/fb-hiding-likes): 

- "*I observed that Facebook has recently begun prototyping this hidden like/reaction count feature in their Android app by reverse-engineering the app and playing with the code underneath.*"

Facebook [confirmed](https://techcrunch.com/2019/09/02/facebook-hidden-likes/) it's testing a way to hide the likes from your followers/friends, *but still showing you*. Letting go 100% is hard.

Testing

__This is a classic cost-benefit analysis...__ It's testing to see how users react first before it makes the thumbs-up invisible. The cons could hit Facebook's bottom line (less user engagement and potentially ad revenue), the pros are mostly for society (less anxiety). But Facebook could win valuable PR points if it makes the right decision — just as it separately faces political tech-lash over its privacy problems and anti-competitive size.

A side-hustler reveals Facebook's test to hide your "likes"

__Toothpaste or teeth-whitening?...__ Both. Last week, __[Walmart](https://robinhood.com/stocks/wmt)__ sneakily [updated](https://www.businessinsider.com/walmart-testing-health-clinic-in-georgia-with-counseling-dentistry-2019-8) its website to reveal it wants to be a doctor when it grows up: Starting September 13th, a Georgia location will add medical services. This week, Earth's biggest retailer is taking a fresh stand: *guns*. Big one. Here's what's in and what's out:

- __Out:__ Walmart will stop selling handgun ammunition nationwide or any handguns in Alaska (the last state where it still does that). And it's politely requesting shoppers not openly-carry guns in its 4,700 stores.
- __In:__ Walmart's still selling deer rifles and shotguns. 

__"The status quo is unacceptable..."__ — Walmart CEO [Doug McMillon](https://corporate.walmart.com/newsroom/2019/09/03/mcmillon-to-associates-our-next-steps-in-response-to-the-tragedies-in-el-paso-and-southaven). Both he and Walmart's founder were avid hunters. Plus, the chain enjoys 20% of all US ammo sales. Now he's expecting these policies to drop that market share to 6%. Two recent shootings within Walmart stores pushed these moves — here's how they fit in:

- __1990s:__ Walmart stops selling handguns south of Alaska.
- __2015:__ Stops selling assault-style rifles.
- __2018:__ Raises minimum gun-buying age to 21.
- __Last month:__ Yanks violent video game displays.

Recalibrate

__Corporate policies > Government policies...__ (lately). Investors have been [rewarding](https://www.fastcompany.com/90388604/politically-active-ceos-and-jobseekers) companies that jump into political issues where consumers crave government action, but aren't getting it. Picture Nike with social issues, Starbucks with employee pay, or private Patagonia on the environment. Walmart saw gun standards as its "[responsibility](https://www.cnn.com/2019/09/03/business/walmart-ends-handgun-ammo-sales/index.html)" — now it's even sending letters to Congress to follow.

Walmart's new arithmetic: add dentists/therapists, subtract guns/ammo

_Waking up in a like-free Instaworld_

Facebook tests the end of the like 👍

__Therapy in aisle 6...__ __[Walmart's](https://robinhood.com/stocks/wmt)__ making it happen. The chain subtly updated its website last week to include hearing, vision, dentistry, and mental health services for $59-$99. The pilot stealthily starts on September 13th at one Georgia location as Walmart [tests](https://www.cnbc.com/2019/08/29/walmart-is-piloting-health-clinic-at-walmart-health-in-georgia.html) the concept. With 140M American visitors every week and 1.5M employees, it could actually democratize doctor access like it did tube socks.

__"Peloton sells happiness."...__ The privately-held workout-tech unicorn [stuck that](https://www.sec.gov/Archives/edgar/data/1639825/000119312519230923/d738839ds1.htm) in its IPO paperwork as it plans to go public. __Peloton__ makes nearly 80% of its money from selling $2K bikes or $4K treadmills — the rest rolls in from $39 monthly video subscriptions to its streaming fitness classes. It lost $196M last year, but we were impressed by the loyalty of the 500K+ Pelotonistas: Only 0.65% of customers end their subscription each month.

Highs

__Spend money to make money...__ __[Citigroup](https://robinhood.com/stocks/C)__ raised its [minimum wage](https://www.cnn.com/2019/08/28/business/citigroup-minimum-wage/index.html#targetText=A%20Citi%20spokesman%20told%20CNN,that%20was%20made%20public%20Tuesday.) in the US to $15/hour. It's not doing it for smiles — with an ultra-competitive market for workers, it's upping paychecks to keep tellers from ditching for __[Bank of America](https://robinhood.com/stocks/BAC)__ (which pays $20/hour). We also learned that __Panera Bread__ has 100% worker [turnover](https://www.cnbc.com/2019/08/29/fast-food-restaurants-in-america-are-losing-100percent-of-workers-every-year.html) — if it hired 100 sandwich-crafters, it'll lose 100 by the end of the year. Promotions cost money. Losing a worker costs more.

__Your new farm-raised almond butter routine...__ is killing your childhood peanut butter go-to. __[Smucker's](https://robinhood.com/stocks/sjm)__ sales dropped 6% as grocery stores are stuck cutting peanut butter prices. The 122-year-old master of jelly, Jif, and UnCrustables (picture a PB&J dumpling) [claims](https://www.wsj.com/articles/smucker-shares-fall-but-consumer-staples-are-poised-to-bounce-11566930349?mod=lead_feature_below_a_pos1) grocers face 2 problems: price pressure from Walmart/Amazon  and taste buds preferring alt-nuts over peanuts.

__2 dollar store companies, 30K American locations...__ Stocks of dollar chains are living their best lives. Dollar General's CEO put it [best](https://www.axios.com/rural-america-dollar-stores-retail-recession-grocery-51054373-38f8-45fd-b088-9ab0dd00aba3.html): "*The economy is continuing to create more of our core customer.* " While rising American inequality's been great for his business, the trade war hasn't. Then last week happened: 

- __[Dollar Tree](https://robinhood.com/stocks/DLTR)__ stock popped 5%.
- __[Dollar General](https://robinhood.com/stocks/DG)__ stock surged 13%.

__Red pill or blue pill?...__ Imports from China made dollar stores possible. But Trump's latest tariffs (a 15% tax on $110B of Chinese goods) just kicked in Sunday. That left dollar store managers with 2 options: raise prices by 15% (make customers pay) or don't raise prices (pay the tariffs themselves). But they twisted into 3 [way more creative](https://www.marketwatch.com/story/dollar-general-pvh-other-retailers-adjust-their-outlooks-to-soften-the-blow-of-tariffs-2019-08-29) options:

1. __Find the same products made in other countries:__ If your Solo cups are made in China, find Solo cups made in Vietnam.
2. __Find just-as-good products (aka "substitutes"):__ Paper cups should do just fine. Source ones crafted in the US instead. 
3. __Make someone else pay them (aka "negotiate"):__ Try to get the Chinese Solo cup company to reduce prices by 15%.

Avoid

__Dollar stores get a "10" for dodge-ability...__ Those 3 tricks above didn't completely offset trade war pain, but Wall Street is pumped that they're adjusting well. Other retailers aren't as nimble. Picture shoe, apparel, and electronics companies — you can't just up and move a Nike, Ralph Lauren, or GoPro factory. And Abercrombie can't start stocking American Eagle henleys to avoid tariffs (the teens will notice). 

How to not pay for tariffs: Dodge 'em (Dollar Stores figured it out)

_To dodge a tariff, channel your inner Neo_

How to avoid tariffs like Keanu

__Now batting, for the New York Yankees...__ Jeff Bezos. In one of the final chapters of the Disney-acquires-Fox saga, __[Disney](https://robinhood.com/stocks/DIS)__ officially [sold](https://www.geekwire.com/2019/amazon-joins-ownership-group-yes-network-tech-giant-moves-sports-media/) the YES Network Thursday to the NY Yankees, Sinclair Broadcast Group, __[Amazon](https://robinhood.com/stocks/AMZN)__, and some other investors. Here's what they're buying:

- YES is __the TV channel__ with rights to broadcast the Yankees, Brooklyn Nets, NY Liberty, and NYC FC teams.
- And __it's worth $3.7B__ because New York sports have global appeal despite local frustration.

__This Disney & Fox deal goes way back to 2017...__ That's when Mickey started a bidding war against Comcast to acquire 21st Century Fox, which included X-Men, Fantastic Four, The Simpsons, Avatar, 22 regional sports networks, and the YES Network. The Justice Department allowed the merger on 1 big condition:

- __The requirement:__ Disney can add all those big names, but only if it [sells](https://www.justice.gov/opa/pr/walt-disney-company-required-divest-twenty-two-regional-sports-networks-order-complete) the sports channels and YES — otherwise it would have too much media power.
- *__Sports translation:__ LeBron and Kobe can be on the same team, but only if they trade away Steph to another one.*

_When Amazon buys a sports channel_

Bundled

__Amazon's now the proud 15% owner of YES Network...__ It hasn't said what it will do with that — But we're all hoping for the Yankees to be a #PrimePerk. Amazon Prime Video has already done deals with the NFL's Thursday Night Football and the Premier League. CEO Bezos won't offer up details yet, but it's already generating HQ2-style speculation.

Disney sells YES Network to the Yankees, Sinclair, and *Amazon*

__Because you need that fall transitional cropped sweater ASAP...__ "fast fashion" became a thing: it's the art of catching new trends and pumping out styles quick with efficient supply chains — and the big 3 have been __H&M__, __Zara__, and __Forever 21__. Now Forever 21 and its satin belted 800 stores are [reportedly](https://www.cnn.com/2019/08/29/business/forever-21-bankruptcy-trnd/index.html) filing for bankruptcy.

__Travel back to 1984...__ Mock turtlenecks were in and a South Korean immigrant couple with $11K founded a store in LA committed to chambray, bomber jackets, and anything that had staying potential (fyi, Forever 21 is still private — you can't buy the stock). That fast fashion trend it rode hit a peak this decade, but now the leaders are feeling pains. Fast.

- __H&M__ lost half its market value in just the last 5 years — and it's stuck with $4.3B in unsold clothes, some of which [it burns](https://www.nytimes.com/2018/03/27/business/hm-clothes-stock-sales.html) to get rid of.
- __Zara__ just [missed](https://fortune.com/2019/08/11/hm-zara-store-closing/) full-year earnings expectations.
- *Fast fashion has now faced the f-word: "Fad" — it's become one.*

Strut

__Fast Fashion's losing to its opposite...__ *sustainable fashion*. Sure, Forever 21 is also dependent on physical stores and malls that are struggling — but overall, the *used* fashion industry is now suddenly expected to [pass](https://www.cnbc.com/2019/03/19/fashion-retailers-under-threat-from-24-billion-second-hand-market.html) the *fast* fashion one within a decade. Here's who's out-dressing fast fashion:

- __Rent the Runway__ literally rents you daily clothes now (not just fancy wedding weekend gowns).
- __[Urban Outfitters](https://robinhood.com/stocks/urbn)__ launched its own rental copycat look.
- __[Stitch Fix](https://robinhood.com/stocks/sfix)__ sends monthly boxes and uses AI to better tell what you'll actually like (and not waste).
- __[TheRealReal](https://robinhood.com/stocks/real)__ IPO'd this year committed to reusing and reselling that authentic Gucci getup so it doesn't end up in a landfill.

Forever 21 may declare bankruptcy — and the end of fast fashion

__Free bread's not enough...__ The CFO of __Panera__ told [CNBC](https://www.cnbc.com/2019/08/29/fast-food-restaurants-in-america-are-losing-100percent-of-workers-every-year.html) that he's suffering through 100% employee turnover every year. With [100K](https://www.businessinsider.com/panera-bread-employees-facts-2018-7) employees, this stat means the carbo-loaded chain needs to hire 100K people every year because about 100K quit every year. Let that sink in. And get this:

- The __"turnover rate"__ is even higher in the rest of fast food — up to 150%.
- That means __more than 1 person quits__ from the same position each year, and the company just has to keep on rehiring.

__Different industry, same problem...__ To keep employees from leaving, __[Citigroup](https://robinhood.com/stocks/C)__ just increased its minimum wage to $15/hour, finally catching up with __[Wells Fargo](https://robinhood.com/stocks/WFC)__ ($15/hour), but still trailing __[JP Morgan](https://robinhood.com/stocks/JPM)__ ($15-18) and __[Bank of America](https://robinhood.com/stocks/BAC)__ ($20). 

- High turnover is driven by __our ridiculously low unemployment rate (3.7%)__ that puts workers in high demand, more able to switch jobs and make more money.
- The response is to __do nothing or pay more__ to preempt a cook from bouncing to Chipotle for an extra buck or two an hour.

__Companies can *save* money by paying workers more...__ To replace a Panera employee, it has to hire (+ paperwork/interviews), train (that takes time), and wait until the worker is actually good (many mis-flipped eggs later). Paying more could prevent those costs by keeping workers around. But wages are still [not growing fast](https://www.nytimes.com/2019/05/02/business/economy/wage-growth-economy.html) on average, forcing some states to push minimum wage increases.

Citibank & Panera Bread: 2 stories show minimum wage is having a moment

Amazon snags 15% of the Yankees (network)

__Pranks just got harder...__ Over 400 police departments ([these ones](https://blog.ring.com/2019/08/28/working-together-for-safer-neighborhoods-introducing-the-neighbors-active-law-enforcement-map/)) can now ask __Ring__ security camera owners for help cracking a crime. __[Amazon](https://robinhood.com/stocks/amzn)__ acquired Ring last year for $800M, then connected the doorbell-camera security startup to its own Neighbors app — Now Ring shows you, or the police, who's knocking.

__Don't panic...__ You've got to opt in first. But here's how it goes down. The Neighbors app lets Ring-owners open up the video feed of their front stoop for all to see. Then "neighbors" (as Amazon calls the users) could get this request from local police: "*There was a burglary this morning on 240 Spruce Street — you got video footage?*" Got Ring? You might.

Watch

__Nearly every new tech product has a privacy issue...__ Amazon made phone-connected home security a scalable thing — Ring became a Prime Day [bestseller](https://www.vox.com/recode/2019/7/16/20695008/amazon-ring-prime-day-fear-social-media). Now catching package thieves in the act is the next reality TV hit. But Ring's relentlessly un-blinking 24/7 footage is just another front in the tech privacy battles:

- __The customer benefit:__ Protect your home, your neighborhood, and help the police catch "the [Wet Bandits](https://homealone.fandom.com/wiki/Wet_Bandits)."
- __The social downside:__ Record your unwitting neighbors, potentially start over-reporting unsuspicious activity, and possibly get your feed hacked into. 

Amazon's Ring security cameras team up with 400 police departments

__Manning vs. Brady. Jordan vs. Kobe...__ __[Fitbit](https://robinhood.com/stocks/fit)__ vs. __[Apple](https://robinhood.com/stocks/aapl)__. Fitbit's only product competes with the iPhone maker's 4th most important product (Apple Watch). But the fitness tracker pioneer just [announced](https://www.cnet.com/news/fitbit-has-a-new-versa-2-smartwatch-with-alexa-a-new-premium-health-service/) Fitbit *Premium* — the new subscription concept hopes to more money every month off users who already paid for a Fitbit. It's a trick out of Apple's book.

__Put me in, coach...__ For $10/month, your fitness tracker will crunch some artificial intelligence and tell you what to do — it analyzes your activity, diagnoses your "problems," then guilts you into changing with "solutions." And it's got a menu of 9 health programs to choose from, like "Healthy Habits" or "Get More Zzz's." Think of it like this:

- __Your old Fitbit wearable:__ It just showed that you only did 683 steps today. That's it. It counted.
- __The new Fitbit Premium service:__ Nudges you to go for an 18-minute walk at 2pm since you haven't moved in hours. Then it "encourages" you to join a 30-minute mindfulness course to clear your head before dinner.

Sweat

__Are we at #SubscriptionSaturation?...__ Add "digital AI health assistant" to the list of things you're coughing up $10 monthly for. On top of your Netflix, Spotify, and Blue Apron subscriptions, Fitbit's adding to the subscription-obsessed tech-meets-wellness trend we're seeing elsewhere:

- __Fitness:__ Peloton's about to IPO, charging $39/month just for videos of spin classes. And OG gyms do the same thing (physical gyms matter, too).
- __Wellness:__ Calm and Headspace [charge](https://snacks.robinhood.com/newsletters/I8ABCDal2o99W3TesGSBI/articles/3ziQ103JRMSgNbg05BPe1F/) $60 and $96 per year for meditation audio. Like podcasts, but for your deep brain.