The Best One Yet - Beyond Meat boots its meat-focused investor, Comcast (shockingly) hits record high, and one startup’s worst 1st week

Episode Date: April 29, 2019

Plant-based meat innovator Beyond Meat had an awkward investor: The world’s 2nd biggest meat producer, Tyson Foods -- So Beyond Meat kicked it out before its upcoming IPO. Old school cable throwback Comcast is winning even though you cut the cord. And Luminary was supposed to be the future of podcasting, but its 1st week went really badly.Learn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. This is Snacks Daily. It is Monday. April 29th. And this is the best one yet. By far the best snacks daily for a very special reason. I am here with my buddy Nick in Miami International Airport. We are literally a gate. What is this? E4. D12. Whatever coming to you live from Miami because we are on the way to my bachelor. That is exactly right. We got off the red eye. Jack's got his sash on. Hold on one sec, Jack. His tiara is a little off center over here. My face is covered in wrinkles because I was leaning against the aisle. We're on the way to Key West, but you know what? We still put together on the flight three fantastic stories. Let me tell you what we're starting with. Beyond Meat. This is a plant-based meat startup. It is about to IPO, but it just ended this really awkward relationship with Tyson food.

Strategic move to go meatless. Beyond Meat. I'm excited to cover that one. Second story is Comcast. This is an old-school cable TV company. It should be suffering in the cord-cutting era, but its stock just has. hit a record half. We just noticed that. We have to break that. We had to jump into this. Finally, Luminary. This is the biggest disruptor to the podcast industry yet. And it debuted last week.

And spoiler alert, it was awful. Meta, we're going podcast on the podcast disruptor. Now, we're recording this pod for you on Friday morning. If anything happens this weekend, we're not going to be covering it. But we'll get back to you on Tuesday. We'll be mid-batchel party, but we will be there for you again Tuesday morning. In the meantime, listen to these keywords and then we'll better stuff. You're tuned in the snacks daily. We spoke to the lawyers and we got to get something legal out the way. The snacks about to hear ain't food. It's air candy. They don't reflect the views of the Robin Hood family. It's all informational just so. You know, we're not recommending any securities. Nope. It's not a research report or investment advice. Not an offer or sale of a security.

Right. Snacks is digestible. Business news for you. Robahood Financial, LLC, member For our first story, the second biggest meat company on earth was an investor in the opposite of themselves, Beyond Meat. This is a complex store because they just got booted from being investors. It was really awkward. It's a corporate drama. But we're talking about plant-based meats. Yeah, full disclosure, I'm all in on the Beyond Meat Broughtworth situation. Breakfast, lunch, dinner.

Never had that, but I have had an impossible burger with you and your dad in Manhattan at Bear Burger. We'll never forget that thing. have much smaller carbon footprints than regular animal-based meat. Because there's no animals involved. They're made out of vegetables, basically. No animals were always. Ever. Now, we already told you about Impossible Foods a couple weeks ago because they partnered

up with Burger King to launch meat-free burgers. It's called the Impossible Whopper. Now, Beyond Meat's kind of like the, like a rival Batman Superman situation we got over here. Beyond Meat's available at Carls Jr. at a bunch of grocery stores. Now, Beyond Meat is getting ready to list its shares publicly on the stock markets. That's going to happen in like two weeks. Very soon.

It's very close to do. But first, some drama. Yeah, we got to talk about this. The strategic investor in Beyond Meat happened to be the world's second biggest producer of chicken, pork, and beef. This is Tyson Foods, formerly known as Tyson Chicken. Not a kosher situation at all for this relationship. It invested $23 million in Beyond Meat. So now Tyson Chicken owned 6.5% of the shares.

Because they really want to get in on some innovation happening here. The plant-based meat industry jumped like 20%. cent last year and it's worth a billion dollars. Tyson clearly sees that as a threat and they want to figure out what's going on. So if you're beyond meat, you know, you take on these investors because you get cash and a bunch of expertise on how to run a big company. You also get what it can be perceived by the employees as dirty money. Exactly. Because Tyson is big, bad corporate in this situation, but you got to do what you got to do. Now, the relationship got awkward in the last week. This got really awkward. Tyson recently announced that it's launching a

plant-based meat alternative. So basically, it's launching a Beyond Meat competitor. So Beyond Meets looking at the situation, they're like, hey, we're really close in all this stuff you invested in us, and you're now trying to mess with us? Beyond Meat has its quarterly, you know, board meeting, and Tyson Chicken, its rival is right there. They literally said, we don't want you here. Tyson turns around and says, we're contractually obligated to be here. We don't know how this ended, but like, thank goodness it ended, it ended, because that was too awkward to continue. What ended up happening was Tyson sold the shares back. It's just not even clear to whom. Now, Tyson is, off the company. So Jack, what's the takeaway for our buddies beyond me? This wasn't how this was supposed to

end. No, this was supposed to be so much prettier. Strategic investments are unique. Corporations have these venture capital arms and they're investing in startups all the time. It's a pretty cool relationship. The startup offers the big corporate a bunch of innovation and how to thrive in the market. And the corporation offers distribution deals experience because it's been there before. It's a very kumbaya kind of circle of life. There's a lot of well-known corporations that have venture capital arms. Time Warner, Time Warner's got one, Google's got one, Budweiser, Kellogg, Shabony. Budweiser was investing in Aprol Spritz this past summer, I remember. Now, Altria is a cigarette company.

They invested in e-cigarette company Jewell. Yeah, and that's ending much better than this deal. Also, Ford Motor Company invested in an electric pickup truck startup just last week. So the theme here is these investments, they built some really nice relationships, and the result should be a big partnership or an acquisition and a lot of champagne. This deal did not end happily ever after. No. For our second story, Comcast is like the old school cable company that you hate to call

anytime, but you always have to call them. And we just noticed that stock hit a record high. Yeah, I can't stand Comcast because of Xfinity, which is just the worst. I'm still on hold, actually. It's the worst situation. What we do love is where it's based, the city of Philadelphia, which is one of the most glorious places, Paris at the East Coast. My favorite part of Philadelphia, it has built a statue that the city loves based on a fictional

character. If you can't have fun at the Liberty Bell, then I don't know how you can make your own fun. Rocky Bell Bow. Now, revenue for Comcastro is 18% last quarter. Right. And that's partly because it acquired a big European cable company called Sky TV. It always helps your financials when you just bring more companies into yourself. But the first thing we noticed is it lost 121,000 cable TV subscribers. Cord cutting is crushing them. But wait, Jack, there's more. Wow. Wow. They also added 375,000 internet accounts. And they added 170,000 wireless phone plans. So they're actually like adding more people in an era when they should be losing more people. In the cord-cutting era, Comcast stock just hit a record high on Thursday. And we're like still on hold with these guys. I cannot

believe this. Now, cord-cutting, here's our bold claim, was a net positive for Comcast. Most cable companies are also internet companies. Now here's the key thing here, which you're probably familiar with slash doing right now, cord cutting equals binging. Binging on shows requires internet bandwidth, and the broadest bandwidth happens to be maybe with Comcast. So now Comcast has a bunch of obsessed Netflix and HBO Go users that are just eaten up internet all the time. So it's gained more internet biz, even though it's lost cable biz. Comcast has a lot going on. It also owns 30% of Hulu, which is awkward because Disney owns the other 70% and owns NBC channels. So Jack, what's the takeaway for our buddies over at Comcast. Comcast is a lesson. You can't paint all companies with the same

brush. Trends can like make or break a company. You got to squeeze and sift out that company and focus on what's going on with that company within the trend. Cord cutting. Talk to me. You thought it would destroy a cable TV company's life. Comcast thought cord cutting would destroy Comcast. But really, we saw that the real losers of cord cutting, it was actually the channels, the TV channels that were benefiting from all these bundles. So ESPN, for example, it's one of the creatives out there. Everybody was paying for ESPN, even if you didn't want it. Not everyone was watching it. Because it was in the bundle.

So they got a win out of that. Cord cutting. It hurt cable channels, but didn't necessarily hurt cable companies. Our third and final story is a wild one. The startup luminary just launched to change podcasting forever, and week number one was pretty much kind of a failure. Everybody, you're going to have to trust us on this, but this was supposed to be a pretty big deal in the podcasting world. Like really big. Like something everyone was talking about, but never really big.

ended up happening. Kind of like an Apple car situation. Like, when is the Apple car coming? It was like Bradley Cooper was supposed to get together with Lady Gaga. We're waiting. We're waiting. Didn't happen. It was supposed to happen. We can all see it's supposed to happen. Luminary was a podcast platform that was supposed to be the future.

It was going to be subscription-based. Now, it was so thought to be the future that they raised a cool $100 million dollars like pre-launch. It was mythical status. They rate $100 million before even having a product. They had no track record. They just had an idea and they got venture capitalists to give them a hundred million dollars yeah this is both

concerning and inspiration now the HBO for podcast model was what they were going for they stood in front of all these corporate vCs and they said hey podcast monetizing listen up broken advertisements stink everybody's listen to ads they don't care about so they came out with this idea of you know we'll just apply a freemium model to here's the options break it down luminary can come for free and it's basically the same as your Apple podcast. You get all the shows you've already known. Right. So like the New York Times, The Daily, for example.

But then there's a paid version for $7.99 a month. That's a premium plan. You get access to 40 Luminary, original, exclusive podcasts. Sounds fancy. If you're wondering what those are, go to the website because it says, they're coming. You've got to be patient. Trevor Noah allegedly was one of those exclusive podcasts that was going to happen. All right, so let's talk about the last week because it was a little bit awkward.

It was really bad. I wouldn't say it was fire festival bad. No, it wasn't fire. It was like a, on a fire festival, it was zero to ten scale. It was like a seven. Day one was like Tuesday or Monday of last week. The New York Times Daily. Barstool Sports is podcast.

The Joe Rogan experience. These are some of the top podcasts. They were supposed to be on Luminaries platform. They all pulled out last second. Suddenly. And their frustration was that Luminary seems to be routing their content through its own server. This is super technical, everybody. So we're not going to get technical.

Basically, Luminary made everyone who was listening listen on like an incognito browser effectively so that the podcast producers didn't know how many people were listening. That was the key frustration. If you're a podcast producer, you need to know how many people are listening to your show and they had no idea.

This is a labor of love. We are being stared at by people in the Miami airport right now. We assume our mom is listening. We want to know that people are listening more than just our moms. Thank you, Mom, for listening. So, Jack, what's the thing? the takeaway for our buddies over at Luminary.

Luminary is trying to get people to pay for something that's always been free. That's the real challenge here. It's a behavioral one. A third of Americans listen to podcasts right now. But in the 15-year history of podcasts, they've almost all been free. The listening apps, they're all free. So for Luminary to get people to pay $8 a month, it needed the best podcast there were. It needed cooperation and buy-in from podcast producers.

Now, the problem was it lost out on a key part of its platform. talent. It didn't connect with them. It fell through. What they did looked kind of inauthentic and sketchy and there's a lock of trust. And if they can't deliver the content, then they can't get the customers. Jack, can you whip up the takeaways for us? Comcast is shockingly winning, despite the cord-cutting era and don't paint all companies with the same brush. Philadelphia, toughest city in the United States, toughest people. I love it. Beyond Meets just had a messy breakup with Tyson Foods just before the idea. This is like, Jack, this wasn't supposed to happen this way. Neither was Luminary, but let's get to that now. Luminary needs people to pay for what they've always gotten for free.

You can't mess with podcast creators. We feel that. Do not mess with podcast creators. So, Jack, snack back to the day in honor of the weekend's festivities. You ready for this? Yeah. I know one thing about Key West. It's called the Concre Republic. Because it technically seceded from the United States a mere like 37 years ago. I need more. Let me talk to you about this. So, 1982, I'll set the scene. U.S. Border Control, sets up a stop right outside of Key West to look for people with drugs. That's not cool. Key West doesn't like it. The mayor comes out, raises a conquer public flag, declares war in the United States,

secedes from the Union, hits a guy dressed up as a Navy officer on the head with like a piece of bread. And then? And then they decided a minute later to like come back to the United States and the whole thing. The shortest rebellion in American history. It lasted for one day and it was in 1982 in Key West Blount. It's a charming thing. All right. Snackers, we got to hit the beach. We're going to this bachelor party now. Thank you for listening to the pod. We'll be back with you Tuesday. Can't wait. The Robin Hood Snacks podcast you just heard reflects the opinions of only the hosts who are associated persons of Robin Hood Financial LLC and does not reflect the views of Robin Hood Markets, or any of its subsidiaries or affiliates.

The podcast is for informational purposes only and is not intended to serve as a recommendation to buy or sell any security and is not an offer or sale of a security. The podcast is also not a research report and is not intended to serve as the basis of any investment decision. Robin Hood Financial LLC, member FINRA, SIPC.