The Best One Yet - Facebook’s “GlobalCoin” launching 2020, Kontoor is the new jeans IPO, and SpaceX’s 60-satellite week

Episode Date: May 28, 2019

Zuck’s launching a Bitcoin-ish cryptocurrency called GlobalCoin in 2020 so that paying for anything is as easy as messaging. Kontoor is the newly IPO’d company created after Vans-owner VF Brands spun-off its denim icons Wrangler and Lee’s — And it fell on Day #1 of trading. And Snackers asked us to cover Elon Musk’s SpaceX’s big week, so we did. And we loved it.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. And this is snacks daily. It's Tuesday, May 28th. Welcome back from the three-day weekend because this is the best snacks daily we've ever whipped up after a three-day weekend. Post-memorial day weekend, I blew out a flip-flop, summer starting, good things. Kind of tan, kind of bearded. It's like a weird combination we got going on. Let's break down the three stories we got for you. First, global coin is coming in 2020. It's like Bitcoin, but it's brought to you by Facebook. We're going to call it Zuck coin. just see if that takes off. I hope that catches on. Second story is also strangely named. Contor. Or is it Cantor? I don't know. That's the denim company that just IPOed, and it's really Lee and Wrangler jeans. Into one unpronounceable, terribly spelled name, they've been combined. We'll cover their IPO. Our third story is brought to you by Robin Hood Snacks Democracy. We weren't sure

which private company to cover on today's pod. So we put it out there on Twitter, and you decided SpaceX. This is Elon Musk's other baby. It just launched 60 satellites into space, and it's trying to make Wi-Fi as reliable as, I don't know, like the sun. Except the clouds won't interrupt this Wi-Fi. Cloud's always the X-Factor. Now, before we jump to all three of those, huge, huge congratulations going out here. Yeah, a little bit of a humble brag by our friends at Cruise Automation, which is General Motors' self-driving car company. I think the key number here is 1400, Jack? It announced this weekend that in a 24-hour span, it made 1400 successful, unprotected left-hand turns driving in self-driving mode. Take the Kleenex away. You're going to want

to get emotional about this thing. Left-hand turns are a big deal for a growing car company. Left-hand turns are tough because, you know, cars are coming in one direction. They're not yielding for you. I usually just stop the car. I don't even, I just get out of the car. You got the cars backed up behind you that are just trying to get by. They're honking. They're trying to get around you. It's hard for humans. It's hard for robots. I learned how to drive in New York City. I didn't make my first left-hand turn until three years after having a license. I wonder if they did the Rhode Island slide, though, which anyone from, you know, the Ocean State knows, you just start turning it, and people will stop for you. It's so, so true. Now, this reminds us, actually, Jack,

there are a couple other kind of surprising finesse things in life, wouldn't you say? Yeah, takes a lot of skill to be able to push a suitcase down the aisle in an airplane without banging people's knees. No, it's an elbow killer. And then cleaning a yoga mat requires more finesse than doing the actual warrior three. You need more flexibility to clean the mat than to use the mat. Congratulations, friends at cruise automation. Let's see if self-driving cars come soon. Here's to the next 1400. In the meantime, listen to these keywords. You're tuned in the snacks daily. We spoke to the lawyers and we got to get some legal out the way. The snacks are about to hear rain 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. It's not a research report or investment advice. Not an offer or sale of a security. Snacks is digestible. Business news for you. Robohood Financial, LLC, member Fenra slash SIPC. For our first story, contour, cantor, cantor?

Let's go contour. Contour. Like curves on a body. Very appropriate. The genes come. company just went public basically because its parents didn't like it. It's a crazy time for denim and jeans in general. You got Levi's, which just IPOed after 20 years of being a private company. You got Gap, which wants to spin off old Navy. Jay Crewe, which is like kind of struggling,

made well, doing really well, it's going to get spun off by Jay Crewe. And then diesel went bankrupt like a month ago, diesel, like diesel. Yeah, German word Italian company. But Dezo. Let's talk about VF brands, which is the company that this story's focused on. Now, let's take a step back on VF brands, because if you're wearing something right now, like clothes, it's possible VF owns it. They own the North Face. They own Timberlands. They own vans. They've got like the whole wardrobe situation right now. If you're wearing skater shoes, but you're not actually a skater, it's probably VF brands that's equipping you. You got to project a cooler image than what you actually.

So what happened last week is that VF brands has these great brands that Nick just described. but it also has Wrangler, Lees, and Rock Republic. And those brands are not growing like the others. So the company separated them into their own, like, thing and spun them off as a publicly traded separate company. Completely. This is a situation. This is like VF Brands as the parent.

They have some kids who are doing well in school. They're younger kids like aren't. So they just like sent them away. Sent them off to born and school. Go away. The family doesn't want them if they're not performing. It's actually kind of brutal. So the rationale from VF was a little bit insulting to Rangler.

Yeah, this is a direct quote. They said, we need to protect and enable the explosive growth at Vans and shepherd the positive momentum happening at North Face by getting rid of these other companies. Like, we're going to bring little Johnny to soccer practice. Susie, you can stay at home and please don't talk to anyone. So Rangler sales only inched up by 1% last year. Lee's jeans sales actually fell 5% last year. Meanwhile, vans, oh my God, their favorite brand. Vans' sales searched like 26%.

So, Lee's and Rangler, we're going to blame their suffering to the American athleisure trend, which is basically my fault. This is all my fault. Completely. I mean, I don't wear jeans because they give me the chills and I find them extremely uncomfortable to look at. Jack, meanwhile, wears sweat-wicking anything like 26 hours out of the day. I do. And the data supports that trend. Elastic knit pant imports, which is another word for stretchy pants. The imports of those things passed denim in 2017 for the first time ever. You got analysts basically saying, Athleisure is causing more problems for genes than at any point in their history.

Now, we've covered on this podcast before the kind of casual it down of dress codes in corporate America. Like Goldman Sachs doesn't even require ties anymore. So you think that this could be good for genes, but for some reason, genes are still taboo in like corporate America. Right. Open up your word bro. You got a section for jeans. I don't.

if you do have a section for jeans, it's like a paradox section. Yeah, it is. I mean, country clubs ban jeans, yacht clubs, ban jeans. The stock exchange. I won't let anyone in there. Bands jeans. Like, it's got this weird taboo. Life's getting more casual, but gene sales have fallen five out of the last six years. So, Jack, what's the takeaway for our buddies in denim over at Contour, spelled with a K and two-Os? We got some advice. Follow the leader, and the leader is Levi's. Perfect timing here because Levi's IPOed earlier this spring and its first earnings report since then, sales rose 7% from last year. Levi's's's playbook is fascinating. The brand's been around for like 150 years. So keep the brand, but adapt to modern stretchy pants styles. That's exactly what

Wrangler and Lees can be doing as part of contour. Lean into the emotional connection people have with these legacy brands that are like older than the Republic of France. Let's talk about that emotional connection. I was at Bottle Rock Music Festival this weekend. Mumford and Sons, amazing live performance. Those are British rock stars who are rocking Levi's jeans on stage all. I heard that they actually stitched Levi's into items that weren't even Levi's made because they were so into the thing. And what's the second key to the Levi's playbook, Jack? Adapting to the style. So that means don't have those stiff, rugged, Rangler-Lee style jeans. Make them a little more comfortable. A little bit stretchy. Those elastic waste man's go a long way. I may even be down for trying a pair. It's working for Levi's. It could work for

contour. For our second story, Facebook is launching a cryptocurrency in 2020, and they're calling it global coin. Yeah. This is a cryptocurrency story, but it's not about Bitcoin. No, it's not. But I talk about one Bitcoin. Sure. I own one Bitcoin. A single coin. And I've been watching it. The price of Bitcoin has rose 10%, 23%, 14%, and 10% in the last four weeks. And we have no idea why. In fact, we've been recording this podcast for like 15 minutes, and the price of Bitcoin has dropped $400, and Jack, do we know why? Nobody knows why. Nobody knows why.

But let's talk about GlobalCain here, because Global Coin is Facebook's new cryptocurrency. According to the BBC this weekend, 12 countries will have access to Facebook's payment option called GlobalCoin by March of 2020. And this is what's important. It's what Global Coin does not have. It does not have a bank account. It does not include fees. And it does not include nobody.

It's for everybody. Everybody will be able to pay everybody for free without needing a bank account. We're going to call Global Coins Zuck Coin just because it's a little bit easier and sounds a little bit more specific. Now, you need to know about the plumbing of online payments. We're talking about the digital pipes that money flows through. And what's wrong with these digital pipes is that there are fees just leaking out everywhere. They're grabbing fees all over the place.

Everyone is pulling them out of thin air. There's a fee over there, Jack. Can you go get that fee for us? Let's start with the most unknown hidden fee ever, credit card fees. Customers like you and me, we don't pay them, but businesses, they pay something like 25 cents plus 2% for every payment that happens. There's like some bips involved and basis points here. It gets totally confusing. If you want to send money abroad, good luck. There's an international wire fee of like $25, typically. And if they learn it's a birthday present you're hiring money for, it's like an extra $50.

Oh, they're going to always throw that kind of thing on. Now Zuckcoin, would be free. It would probably be linked to U.S. dollars and other currencies so you could then turn it into your local currency, but it would be free. Right. So say Amy posts pictures of her birthday party at Tortilla Flats in West Village of New York. Rest in peace. It's going out of business. Love that spot. She posts the picture of it on Facebook. You can pay her back for your portion of the meal, like through Facebook Messenger with GlobalCoin. Now, if you're Tortilla Flats, you'd probably be saying, you know what, maybe just pay me directly in Zuck coin because there are no fees involved. Yeah, Amy and her like 13 buddies at the table can just whip out their phone and pay Tortilla

Flats or any merchant through Global Coin on their Facebook app. Amy, we had a great time of your birthday and we don't want to be screwed over with Feast. Now, Zuck has made it very clear where he stands on this. He says it should be as easy to send money to someone as it is to send a photo to someone. Jack, that leads perfectly into our takeaway. What is the takeaway for our buddies, on Zuckcoin. Facebook has network effects. Exactly. Network effects are when a product is better because it has a bigger network of users who are actually using it. And 2.4 billion people use Facebook currently. So if you could create a free fee-less payment system and 2.4 people already have it downloaded, that is a valuable, valuable thing. Exactly. Because if only one person has Zuckcoin,

it needs a second person to be able to transact with. Otherwise, it has no value. So the more people, the way better the actual product is. Look at Venmo and the Cash app, which is owned by Square. They're trying to make payments easier too, but they only are as good as how many people have downloaded their apps. So they have to focus on you downloading the Venmo or Cash app, and then they have to focus on getting you to use it. Facebook's just got one focus.

Hugely ambitious global coin coming by 2020. For our third and final story, this one was like by popular demand. SpaceX wants to become the world, wireless internet provider. And it just made that happen almost. We love listening to Snackers, and you told us you wanted to hear this story. Shockingly, we've never covered SpaceX on this pod. I like what we did with, though. We spent a lot of time this weekend on it, basically all of Memorial Day. Now, can we talk about the company, Jack?

SpaceX. It's actually in a brief. It means space exploration. And it's based in Los Angeles, founded by Elon Musk, and it's got 7,000 like NASA dropouts or NASA former. NASA. Listen, ex-Nassens. X-Nassens. I feel like NASA folk aren't the type to put it on on LinkedIn. It's like you're at NASA, you just do that. This company in a nutshell is a shipping company, okay?

Just like two-day free overnight shipping, except this is like same-day, extremely expensive intergalactic shipping. Exactly. The cargo includes humans, satellites, and cargo to send up to the International Space Station. Now, that's its main goal, what the company SpaceX is doing right now. It's future goals a lot more bold. It's to colonize Mars. Literally.

Human cities on Mars. Which I'm, like, Jack and I were talking about this. We're not that psyched about that. We're pretty comfortable with everything on Earth. Like, we're very exploratory, but I don't know. The poison gases and stuff, they're not as appealing. Lower gravity, I would be able to dunk on Mars, but that's about. True.

We did a positives, negatives plus minus analysis, and that was a positive. Now, like the second slide deck of SpaceX is the business differentiator. And unlike NASA, which sends a rocket up to space, and then the rocket like, you know, burns up in the atmosphere like an Apollo 13. SpaceX's rockets, they actually come back down and they land really gracefully on like a launch pad so they get to reuse the launchers and save a ton of money. This is actually a beautiful thing to watch. But what happened last week was key because it's codenamed Project Starlink and it's strategically

critical to the whole future of this company, SpaceX. All right. Let me bring you to Cape Canaveral, Florida, okay? Please. Elon Musk and SpaceX sent a Falcon 9 rocket. This was its third voyage. It's been to space three times now and come back and landed safely. 30,000 pounds of cargo, and it was 60 satellites they spent into space.

Now, that all sounds very technical. It's because what it really is is an expensive Wi-Fi router that's going to be orbiting all of Earth like a constellation. 60 of them. 60 expensive Wi-Fi routers. They're packed with it. like solar panels so that they can like keep doing their thing. And they're sending internet signal down 270 miles to the surface of the earth. And they're basically trying to outsource cell towers so that everyone gets internet from space. So this is like phase one of Project Starlink. The whole goal is to

get 12,000 satellites spinning like electrons around all of us on Earth. Like electrons. That is the first chemistry reference on this pod, but it's so accurate. I like the visual there, Jack. Now, this is part of the long-term goal. In order to colonize Mars, the company needs a moneymaker right now. And that's going to be this crazy outer space powered internet company. So when you hear about Starlink, who's actually scared of SparLink? It is the team over at Verizon. Yeah. Imagine the Verizon team's nightmare. Elon Musk is trying to take our business from space with satellites. So Jack, what's the takeaway for our buddies over at SpaceX? The other innovation here is SpaceX's unique stock structure. Exactly. This isn't a typical private company where like investors invest early and then

are stuck to be investors until the company IPOs and then they can sell their shares. Right. Full clarification. You cannot buy SpaceX stock on the stock exchange because it is private. But every six months, the company hosts like an opportunity for shareholders to buy and sell, kind of similar to a stock market. Sounds very fun. Now, it gets the benefits of a public company if you're an investor in SpaceX. But it also means if you're a SpaceX, you don't have to IPO. Yeah, and you don't have to deal with every quarter talking to stock markets and, like, having the haters out there be like, why haven't you colonized Mars yet?

And you're like, I'm trying to launch the next orbital system of satellites to give everyone in the world Wi-Fi. And they're like, why? Jack, can you whip up the takeaways for us over there? VF Corp told its weakest links goodbye, and now Wrangler and Lee are Contor Brands. All they have to do is follow the Levi's Playbook. easiest look in the game. Facebook wants your payments love so it's launching its own cryptocurrency out 2020. And it's all about the network effects. Just throw that term around a bunch.

And SpaceX is currently a shipping company, future a sci-fi Mars company. We just want to know when during the day Elon Musk, CEO of Tesla also fits this into everything. And boring company and Twitter extraordinaire. So time for a snack fact of the day. And we got to say this one isn't Typical because we are doing a second shout out to someone within the month, and it's because this is just so timely since we just covered Disney. Everything's bigger in Dallas, Texas, including snack facts of the day. Haley, thank you for the second one. So, you ready for this next? Please hit me.

It's explosive. Outside of the U.S. Department of Defense, Walt Disney World is the largest purchaser of explosives in the United States. We're talking nightly fireworks and other, like, pyrotechnic stuff that, like, scares little children but entertains family. Not cannonballs. We're talking fireworks. We love that one, Haley. Feel free to send in a third one to get for the hat trick. Everyone else, we loved having you on the pod with us today. Everyone, you look great after the weekend. And we are back with you tomorrow for more summer pods all summer. 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.