The Best One Yet - 🏖️ “24/7/365 Spritz” – Aperol’s seasonal challenge. Spirit Airlines’ bankruptcy warning. 9-1-1’s emergency call startup.

Episode Date: October 7, 2024

Aperol sales surge in the summer, but drop in winter… now Aperol’s trying to solve “Seasonality.”Spirit Airlines stock plummeted after reports it’s considering bankruptcy… and we’re glad that’s happening (we’ll explain why).The 9-1-1 emergency call hasn’t changed in 50 years… so the startup Prepared is disrupting it.Plus, we’re about to launch our biggest new thing in years…$SAVE $JBLU $DVCMY—-----------------------------------------------------GET ON THE POD: Submit a shoutout or fact: https://tboypod.com/shoutouts FOR MORE NICK & JACK: Newsletter: https://tboypod.com/newsletter Connect with Nick: https://www.linkedin.com/in/nicolas-martell/ Connect with Jack: https://www.linkedin.com/in/jack-crivici-kramer/ SOCIALS:Instagram: https://www.instagram.com/tboypod TikTok: https://www.tiktok.com/@tboypodYouTube: https://www.youtube.com/@tboypod Anything else: https://tboypod.com/  Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. Welcome back. It is Monday, October 7th. And today's pod is the best one yet. This is a T-boy. The top three pop business news stories you need to know today. Yetis, that day today, it is the one-year anniversary of Hamas's horrible terror attack on Israel. We have no words to describe the horror that happened that day. Or for the year of war since that's happened in Gaza. So as Jack and I were talking about it, we just need to start today's show with heavy hearts for all Israelis and the people. Hallistinians affected by all of this. Yes, we do. But besties, as always, Jack and I prepared our best show yet for you. So Jack, what are the three stories for today's T-Boy? For our first story, Spirit Airline stock just plummeted after a report that they're close to bankruptcy. Everyone's afraid of bankruptcy, but we're glad it's bankruptcy. And we'll tell you why. For our second story, it's Aparall Spritz. Sales surge in the summer, but they plummet in the winter. It's called seasonality, but Aparol thinks they have a seasonal solution. And our third and final story is the 911 emergency call. It hasn't changed in 50 years, but one startup

wants to change that. Prepared is the first startup to disrupt 911. But Yetis, before we hit that wonderful mix of stories. What a fantastic mix of stories to kick off the week. Love the mix, Jack. Yeties, for the last year, Nick and I have been working on something in secret. Actually, Jack, we've kind of been working on this for like two, maybe even three years. Like, we've been working on this for a while, actually. It's finally coming to fruition because A-B-L-E. A-B-L-E always be launching everything. Now, the best way for us to tell you what our new thing is, is to play a game.

We're going to play a little game, Jack. Let's kick it off. What do Vietnam, Guatemala, and Pennsylvania have in common? What do Michael Jordan, Marilyn Monroe, and the hamburger have in common? What does World War II, Woodstock, and Y2K have in common? What do Barbie, Space Jam, and Hot Tub Time Machine have in common? Nick, you know what? This is an audio show. Yeah. What does have in common?

Well, we'll pause the pod. We'll give you a sec to guess. We'll let you guess. Take your time. Take a time. Because they do have one thing in common. And that thing is our next big thing. And we'll announce it tomorrow. Guess is welcome. Drop a thought in the comments. And Jack, let's see my... 15 years before this song, two boys from the Northeast met in the dawn. They had an idea to cause a cultural storm. It's the best one yet, but the best is a norm. I don't even think they need to practice.

50% that's a fat tip. Tea Boy City on your at list. If you know, you know, because we're ready to go. We can't wait no more, so just start the show. Start the show. First, a quick word from our sponsor. Our first story. Aparol, the iconically orange summer drink is trying to

one of the biggest challenges in business, seasonality. How can Apparel still sell to you in the winter? The answer is in your coffee mug. Jack, let's set the scene here for a second. It is cider season. It's IPA season. And it is pumpkin spires everything everywhere on anything season. I just had a half dozen apple cider donuts and listened to all the fall things.

But let's talk Apparel, the bright orange apparitivo. Jack, you want to pour on a little more. context, please. It's the Italian beverage that you want to have an affair with. I was going to say, your love language is apparel spritz, isn't it, Jack? Why do I drink it from three straws? Why not? Yeti's true story, Jack, it's all up in an apparel spritz. I was with him and his wife once, and she was

like, Jack, why do you have three straws? He was like, leave me alone. It made everyone at the table uncomfortable. It was a little too close for comfort licking that thing. It was sipping in apparel struts and there's licking it, Jack. Yet he's aporal. It was founded 106 years ago in northern Italy. It's got a secret recipe of a dozen different botanicals.

Growth surged in the 1950s when they combined apparel with Prosecco, add a little bit of soda and called it a spritz. Yeah, it was a Reese's moment. Sales took off. And this company, Apparel, was acquired in 2003 for $150 million by Kampari, the famous liquor brand in your Nogroni. Most people call it an apparel spritz. Pro move called a spritzen. I think I just made everyone uncomfortable again. No, we're just happy you found Love Jack. In the meantime, Apparall sales have been out of this world. Jack, the numbers, please. Sales have climbed every single

year since Kampari acquired it in 2003, including a shocking 23% sales growth last year. They're almost at a billion dollars in annual sales. Get this. Apparal now has doubled the sales of Kampari, which means the child is beating the parent. And the student is out drinking the master. But yet, there is one problem with Apparal sales surge that we should talk about. If you're not sunning, you're not spritzing. Because apparel's revenue growth actually fell by half last quarter. And why is that check? Unusually bad weather across all of Europe where people wanted to be outside sipping an apparel spritz. Even worse, to quote our buddy John Snow, a winter is coming. So sales of apparel are going to slow even more over the next two quarters. Because apparel is just like

sunblock with ridiculously high SPF. It requires hot, sunny weather in order to sell. Now, yet as we studied this concept in business school with the term seasonality. When sales are affected by the change of seasons. Apparol's brand, it screams summer, right? Jack, you feel it. You look at it. I mean, look at the liquid. It's so orange. They have orange branded umbrellas, orange towels that are Apparel branded. They even sell Apparel swim trunks. Now, you guys have gotten really close. But in the meantime, Apparal sales have maxed out at summer vacation spots, so Apparal is trying to break the seasonal ceiling. So they just revealed to the Wall Street Journal their plans for desseasonizing their sales. The desseasonization strategy. And what is in this? Approl, what's going on? What are we going to do?

They plan to bring Approl to ski resorts and market the hell out of Approl at the Apra ski bar. Appre Ski Apprae Ski Apparel. Appre with Apparol by the fire. In the lodge, you're Schretsen with all that, you know, parka on. You might as well be Spritzen too. Jack, here's the big question. Would you try? A hot chocolate on a cold slope for an ice spritz. I'm still not buying it. Really, Jack? No, not really.

I'm buying it for sure. Those things are so refreshing. So Jack, what's the takeaway for our buddies over at Apparal? If seasonality is beatable, you must evolve the product. Now, you should point out some products will always be seasonal. You're not selling mittens in the summertime, and you're not selling tankinis in the wintertime. But in the food and beverage industry, it is different. Some have found a solution to seasonality, and the perfect example is Starbucks. Starbucks, they sell hot coffee. Not that popular on a hot summer day. But then Starbucks launched the Frappuccino, which is actually a great story for another pod. And today, iced beverages make up more than half of Starbucks's annual sales. Our point is that beating seasonality is more likely to succeed with a product change than just a marketing change. So Aprol Spritz in the ski lodge, maybe that'll work.

but more likely to work is a hot apparel toddy, or maybe an apparel latte, or an apparel and whiskey. Either way, if seasonality is solvable, the problem isn't just a marketing fix, it's a product fix. Yeah, I'm definitely buying it. I'm a slave to apparel. For our second story, JetBlue stock soared on Friday because Spirit stock plummeted on Friday. Spirit Airlines is reportedly going bankrupt, and we're actually glad about it. we'll explain why. Yetis, this is your captain, this is your captain speaking. JetBlue is done serving hot meals.

That's an actual news headline. They announced last week that cold meals, that's the only thing you're going to get on a transatlantic JetBlue flight. Yeah, JetBlue is replacing chicken with chicken salad on their, like, transatlantic flight. I guess they're saving money with the cold stuff instead of having to heat everything up.

If you want a pasta bowl and Yeezy, you cannot get that on Jeblu. They're putting pros before Coes. But that's not the news that explains JetBlue. stock jumping 14% on Friday. No, it is not because JetBlue stock jumped 14% after Spirit said it may file for bankruptcy. The Wall Street Journal reported Friday that Spirit Airlines, JetBlue's low-cost competitor, is in talks to enter bankruptcy. So Jack and I got curious about this story, and we decided to focus on Spirit because

Spirit stock is almost worthless today. It's down 97% from its highs. Jack, let's jump in T-boy style because Spirit Airways. Airlines's problems, they are a many. The key issue for Spirit Airlines is that the big airlines learned how to act like budget airlines. Really interesting yet, but Spirit undercut Delta, American, and United Airlines by eliminating all their perks a few years ago. I took a Spirit flight in February. They don't even have pockets on the seat in front of you. They have bungee cords. Like, who's strapping their thermos in there with bungee cords? It's a BIO toilet paper situation, Jack.

It's a tough times on the Spirit Airlines. Either way, the no frills offering of Spirit worked. Spirit stock grew by 700% from 2011 to 2015. Spirit even controlled 5% of all American air travel. But then, Delta Airlines launched something called Basic Economy, a brand new, lower tier to purchase a ticket on Delta. And with Basic Economy on Delta, you were in second class, you were a third class citizen. An American and United, they offered something similar to. a new lower class. So Spirit Airlines, they lost their price advantage. And you know what?

Spirit Airlines never recovered after losing it. Revenue has shrank pretty much every year since profits flipped over to losses. Spirit was desperate. So Spirit a couple years ago tried to merge with Jeff Blue, but a court blocked the deal in January saying that this would have hurt customers. So now Spirit is cutting 20% of their flights. They furloughed 186 pilots. And they're definitely not serving ricketone, Bull and Yeezy anytime soon. In fact, Spirit is discussing bankruptcy options, according to the Wall Street Journal. But Jack and I kind of think that's awesome. So Jack, what's the takeaway for our buddies over at Spirit Airlines?

It's time to let the system work. Let Spirit go bankrupt. Yeties, get this. The U.S. government has bailed out airlines in 2001, 2008, and 2020. That is a lot. That is not natural. That is not typical, Jack. We have never seen an American airline go bankrupt.

You and me? No, no, no, we haven't checked. And you know why this is a problem? Because it leads to moral hazard. Moral hazard. Airlines can operate recklessly, knowing daddy will always bail them out. Interesting thing. This airline failure from Spirit is isolated to one airline.

So they're probably not going to get a bailout, which means they'll probably go through bankruptcy, and we are excited to see that work. In the short term, with bankruptcy, shareholders of Spirit will lose all their money. But that's the risks that they took by buying Spirit stock. In a bankruptcy, the bondholders of Spirit, they're going to lose most of their money, too. Again, a risk they took by buying Spirit's bonds.

But you know what else will happen if Spirit does, in fact, declare bankruptcy? What will happen, Jay? They're going to put up all their airplanes for sale. And someone is going to buy Spirit's airplanes and put them back to work. And once they do, then the flight crews and the pilots will get rehired by a new airline, unencumbered by Spirit's debts. Oh, and Spirit's bankruptcy? it'll have an even bigger impact in the long term.

Good point, because that bankruptcy would be a lesson to all the other airlines out there, wouldn't it, check? The lesson, if you act recklessly, you're going to go under, and you're not going to get a bailout, and everyone's going to lose their money. And that reduces chances that us taxpayers will have to bail out another airline.

That's why it's time to let the system work. Let Spirit go bankrupt. Let them cook. Now a quick word from our sponsor. For our third and final story, Andresen Horwitz just invested in a startup that is disrupting the 911 phone call. Prepared is reinventing the 911 emergency call because time saved is lives saved. And time is money yet.

Yet is the most famous phone number in the world is not 1-800 cash now and is not 1-800 call ATT. Although it was impressive that call ATT is just dialing down the center. If you know, you know. But it's 9-1-1. because 911 is the phone number we all first learn out of any phone number before you learn your own phone number. The first 911 emergency call was on February 16th, 1968, down in Haleville, Alabama. Someone lost a cat and 911 solved the case. The reason they chose 911 for the universal emergency phone call is that it's fast to dial.

It's easy to remember, and it's hard to dial by accident. It was those three reasons. The nine and the one, they're kind of far apart. It's like, you're not going to like, you're not going to butt dial it. No, no, no, no. But shockingly, it took decades for 911 to expand. The year of our birth, 1988, only half of the American population had access to a 911 offering. I mean, Jack, that's amazing.

When we were born, one out of two Americans could not call 911. One out of two Americans had to turn on their bat signal if there was an emergency. Yet he's 911. It gets one call per American every year. And yet, in the 50 years since it was created, the concept has barely innovated. So Silicon Valley wants to disqual. It's the news. Andreessen Horwitz just led a $27 million

fundraise into a startup called Prepared. Quick side tip. To all the entrepreneurial listeners we have out there. Whip it up. What do we got you on? If you're looking for an opportunity to start a startup, if something hasn't been digitized, digitized it. Oh yeah. Mark Andrewson, he'll write you a nice little fat check. Because despite

a 20-year effort, only half of America's 911 phone calls is internet-based. Half is still telephone landline. So, prepared digitize the emergency call center and is sprinkling on a little artificial intelligence. Now, why not? Now, a human being will still respond to a 911 call that's received by prepared. But thanks to prepared software, that emergency dispatcher will have a lot more information to work off of. Because they're going to get the data on your GPS location, your caller ID, and they can accept text and photo and video messages.

With prepared, that emergency dispatcher can even accept a FaceTime phone call. if you prefer showing that a cat is stuck in the tree instead of having to explain that your kitten is stuck in the tree. He's right there. And all that information helps the dispatcher get you the thing you need faster. But here's the real kicker, and this is the premium side of the product. What if you don't speak English, Jack? If a non-English speaker calls 911 and the emergency dispatcher doesn't speak their language, the AI in this software will translate it in real time.

And then respond in whatever language the caller speaks. So this software is Zoom, iMessage, and Google Translate all-in-one emergency phone call platform. This software is 911 2.0. Simple strategy. Apply iPhone capabilities to the most important phone number in the world. Jack and I jumped in T-boy style. The founders of Prepared actually were a couple of Yale students who dropped out of college to launch this thing. There were Yaleys.

But what's the business opportunity here? It's our takeaway. So Jack, what's the takeaway for our buddy is over at Prepared? Time is money. literally. Now, Yeti's, Prepare's business model is offering the basic service for free, but they charge extra for those AI enhancements. And they think jurisdictions will pay extra for that AI because saving lives is worth spending

for. Get this hero stat. According to the FCC, a one-minute reduction in the average 911 response time would save 3,000 lives a year. That one stat says it all. Oh, it does, totally. Like, every community knows that upgrading to prepared saves time, which saves lots. The return on that investment is really clear.

Oh, totally clear. So you always hear about people saying time is money. But in this case, time is lives for the community. But time is also money for prepared. Jack, could you whip up the takeaways for us to kick off the week? Aparol has conquered beach cabanas. Now they're targeting ski shallas. If seasonality is solvable, it requires a product change, not a marketing change.

And a pronunciation change. It's pronounced spritz. Get a room. For our second story, Spirit Airlines is reportedly investigating options for declaring bankruptcy. No bailout is in the cards. It's time to let the system work. Let Spirit go bankrupt. And our third and final story is prepared.

They're selling software to emergency call centers to modernize and add AI to 911. For communities, time is live saved. For prepared, time is money made. But Yeties, this pod's not over yet. Here's what else you need to know today. First, a couple of big wins for the U.S. economy. First, our economy grew by 254,000 jobs last month. That is way more than economists expected. It's the highest in six months, and our unemployment fell to 4.1%. And then the whole strike with the dock workers, it ended. They got a short-term deal through January.

Which means all of our East Coast and Gulf Mexico ports will remain open. Oh, yes, we have some bananas. Yes, yes, enjoy your banana splits. And second, a remarkable change among Americans. the U.S. obesity trend just shockingly reversed. Weight-loss drugs like OZembeck and Wegeve are making mankind lighter and we have the data to prove it. Get this. Ever since we've been keeping track, the percentage of American Adel to our obese has been rising. But over the last two years, it's fallen from 43% to 40%. Not too shabby.

And finally, Waymo continues its biggest year yet striking a multi-year deal with Hyundai. Waymo, which is Google's Robo Taxi Company, will add Hyundai, IELA. electronic electric vehicles to their fleet. These self-driving taxis will be built in America by Hyundai, and they will join the Waymo Jaguars that roam the streets of San Francisco. And get this, Nick, I bankers estimate that Waymo is worth more than Uber. Oh, wow. Waymo is on its way to becoming a verb.

Now, time for the best fact yet. This one sent in by Savannah Westwood from lovely Orlando, Florida. Orlando has the highest tourist-to-towny ratio we've ever seen. the home of Disney world, attracts over 75 million visitors a year. It's also got Universal Studios, and the population is only 300,000 people. If so facto, Orlando has 250 tourists per year

for every one Orlando citizen. That's got to be the biggest ratio of tourists to locals in the whole world. I mean, who else we got? What else was up there? Oh, the Vatican City. I bet the Vatican pizza. It's like a lot of Americans and Pope.

I've never been yet. True. Yeties, you look fantastic to start the week. Jack, I can't wait to see in L.A. We got a big thing. I know. I'm fine to L.A. to make this announcement tomorrow in person with you. Oh, I can't wait to see him.

What are you going to wear? We got to decide. Pink? I think I'm going to wear a pink. Yeah, that makes sense. I was thinking pink too. Yetties, we can't wait to see you tomorrow. In the meantime, Jack's got to order an apparel spritz.

And we'll catch it on the pot. Do not disturb. Waiter, he needs some alone time. And before we go, a happy. 27th birthday to Jamie Hurley Sanchez in lovely seaside, California. And Samuel Buchanan, it's turning 30 years old in Vermillion, Ohio. Celebrate that win. Your husband, Jared, cannot wait to celebrate after Air Force training.

Celebrating with some chick-fil-a for breakfast? Not too shabby. Happy 44th birthday to Fred Hussein in Dumfries, Virginia. Who's recreating a childhood field trip to the Alamo Jack. That's a great birthday. And happy birthday to Josiah Baker in Cedar Hill, Texas. Happy fifth birthday to Clark Qualls in San Antonio, Texas. And Mike Brand has got a birthday down in Iowa.

And happy birthday to Martin Flesquoise of Eugene Oregon, who has spread the show to so many listeners. And Martin and his wife have moved from New York City to the West Coast. They've been T-boy H-Y-H in all over the place. Thank you so much, Martin. Celebrate the wins this week. And a happy birthday to the bad girl in New York City, if you know, you know. And to anyone else celebrating something today, make it a T-boy.

Celebrate the wins. This is Jack. Nick owned stock of Delta and I own stock of Disney. So the guy with three straws and his apparel spreads. Jack, why are you gargling the ice? Leave me alone!