The Best One Yet - Glossier’s growth hack, DocuSign jumps 22% on its gateway drug, and Beyond Meat falls 4% on fresh competition

Episode Date: September 9, 2019

Glossier just snagged a new COO from Amazon, highlighting the company’s growth hacking success. DocuSign surged 22% as the e-signature pioneer’s anti-friction strategy pays off. And Beyond Meat drops as plant-based protein competition kicks up four notches.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 is Monday, September 9th. Welcome back to Snack Daily. Welcome back to NFL season. Is this the best snack day than we've ever done? This is the best one yet. Way better than what we put out Friday. Snackers. Markets have risen two weeks in a row. Very big. Basically, there was no terrible updates about the trade war and that was enough. We were doing nothing over the end of the summer. Markets were doing their thing. What have we got to Day Jack? Remember when we mentioned all those meatless meat companies last week? That dropped beyond meat stock by 5% on Friday. Being first isn't a garrar. If you ain't first, you might be beyond me. Second story, what do we got? DocuSign is the e-signature powerhouse, whose stock jumped 22% Friday because it's mastered one art. Oh, the art of reducing the friction.

What does WD-40 and DocuSign have in common? Jack, what is our third story we got here? The unicorn of the day is Glossier, the makeup startup that just snagged a new C-O from Amazon. That got us curious. It got us curious about Glossier. And what got it to this point? The answer? Growth hacks.

Snackers, have you noticed there's a hundred. 100 calories missing from like your daily diet? Apparently, the problem might be a lack of white claw. Apparently, the United States is literally running out of the alcoholic selter. We've talked about this spike seltzer. It is pioneering hashtag hot girl summer. It is revolutionizing beach drinking. But there's a problem because that revolution apparently didn't hit its supply chain fast.

Now, the company says we are working hard around the clock to increase supply given the rapid growth in customer demand. Jack was doing his white claw voice there. Technically, that was the actual press release. Can we talk about the sales number? Yeah, last July versus this July, 283% growth in sales. That is almost quadrupling from those of you who don't understand percent. We like to do the math for you.

Now, we found out about this because of the fizz fiasco discovered by Kath. Yes, Kath created a Twitter account just to send us a snack fact and to ask for some T-Boy merch. Kath, we love that you just got right to the core. Why bother with your own regular Twitter account? Start a new one just for snack facts. Now, we don't give out T-Boy merch to just everyone yet. It doesn't happen enough.

DM us your size and we'll see what we can do. You're tuned in to 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 robberhood 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. Robahood Financial, LLC. Member Fenra. S-I-P-C For our first story,

Docu-Signed stock just jumped 22% because it's mastering the art of killing friction. But first, can we talk about signature hell? I hate talking about that's a train. When you have to sign an apartment place, it is a huge pain. We're talking, you get there, you gotta do two months deposit.

You gotta give two personal references. You gotta, like, name your firstborn after the broker. You might give up your dog, but then signing the thing is a big pain. That's when you get to the signing. Yeah. You got those little plastic strips with the arrows. I remember when we signed our first lease on East 14th Street,

you know, between 2nd and 3rd Avenue. 2.31. Beauty Bar? Incredible spot. All four of us had to go in there and physically sign it. We were physically, that's what you used to have to do when you'd like end a war with a treaty in Poland. Treaty of Versailles.

DocuSign has fixed this. Completely. Their pitch jack can you like sum it up for us? It's kind of complicated. Yeah. It helps organizations connect and automate how they prepare, sign, act on, and manage agreements. That's great if you want to bore me. Can you give me the real person?

pitch in what they actually do. E signatures for contracts. Basically, it's E signatures. And we know, by the way, you can customize these e-signatures. Yeah, you get to write it out. They'll actually propose like, you know, Nick Martel. This is what we think. In superscript.

But then they'll let you write your own. Right. But Jack, it gets stressful because then you're like, is that N okay? I'm going to wear or try again. I've got to try the N again. Never get this N. Docu-sign IPOed in May of last year. And their stock surged 22% Friday after a great earnings report.

And it basically had been flat. I had to been doing much before. By way, how big is the company over here? Context. It's worth $10 billion based on their market cap. And that's about two-thirds of a lift. Now, e-signatures for DocuSign are like a gateway drug. So true. DocuSign's greatest challenge is actually its greatest benefit. You only use DocuSign when you need to get something signed. But when you need to get something signed, you end up using its e-signature feature, and then you're kind of a little hooked. It's got a whole bunch of other drugs besides e-signature.

Right, because not just e-signatures, it's helping manage documents, help. Store things, prepare, edit, enterprise software thing. So we're going to talk about two quick, quick, quick case studies. Yes. T-Mobile is a big DocuSign customer. Right, because you get there, you're going to get the phone. You're in the store. You're switching from Verizon to T-Mobile, and you start to sign the process.

And then they're like, Mr. Kramer, can you please initial here? Can you please initial here? Wait, what's that $300 thing there? Just keep going. 400 more signatures and we're 100% correct on this thing. So, DocuSign makes T-Mobile's, like, onboarding process a little smoother. Right. But then you got Comcast, which is doing this.

same thing. They've started using DocuSign, not just for e-signatures, but for the whole onboarding process. Right. When they send, like, a repairman to come to your place to install it. He used to go with like a six-volume set of paperwork to your own. Now he's got an iPad managing the whole customer onboarding process, the payment set up, everything. So, now that customers have started using these signatures and then doing more, the number of subscriptions is surging for DocuSign. Up 41% last quarter. And now DocuSign has 537,000 paying customers worldwide. And it added 29,000 last chord. So, Jack, what's the takeaway for our buddies over at DocuSign? He dot their eyes. DocuSign's frictionless free trial is the key to its success. Here is the interesting comparison.

Adobe does the same exact thing. It's got an email e-signature services. But DocuSign is the one we're talking about on this pod and it's the one that has hundreds of millions of users. Now, Adobe tries to do a free trial, but they like load this thing up with pain. It's a huge pain. Just like signing a contract is a huge pain. You have to give your credit card. Brutal. And they're like, don't worry. We won't charge you until your free trial's up. It's I still don't want to give my credit card now. They're like that character in Lord of the Rings who's like, You shall not pass.

Just trying to use the free product. That friction makes you not want to do the free trial. Meanwhile, DocuSign, they barely even ask for your email address and then you're free trial. The result is that DocuSign gets access to hundreds of millions of people who have tried the DocuSign product. And once you try it and have a good experience, you're more likely to become a paying customer.

And that's because e-signatures are their gateway drug. For our second story, Beyond Meat Stock has dropped in the last few months, That's basically because ridiculous competition. Beyond meat, the insane stock sensation of 2019 actually has had a bad chapter this summer. And things got worse on Friday. It dropped like 4% for a few reasons. Yeah. Key one here?

Well, one analyst came out and strongly said, this market for alternative meat, it's not as big as people think. He thinks it actually could be smaller than plant-based milks. Yes. We're talking like almond. Oat. Cashew. No one does Brazil nut milk, but it could be an unlocked market. One entrepreneur just got an idea.

In Brazil. Jack, the other issue here is that the biggest issue here is competition. Exactly. And things got coming from everywhere. Things got kicked up like four notches specifically last week. Big food came to play last week in plant-based meats. We got Kellogg, Hormel, Kroger, Tyson. We're talking about companies that make like cereal cornflakes and spam. And now they're coming out with plant-based meats and they came up with some hilarious names. We were blown away by this.

Incognito. Tiny little plants. Simple truth. Raised and rooted, which is our least favorite of the first. We actually asked Snackers last week to come out and tell us their best names for the next plant-based meat. These were fantastic. Navine, we love this one. Neat, which is like, not meat, but neat. Neat. All one word.

That's from Neveen Rawat. And then Ahmed Hasuna just came out with one that just, I want to put this on a t-shirt. We ain't beefing. We ain't beefing. It's simple. Now, Beyond Me has two main sales channels. Restaurants and grocery stores. It's about 50-50 sales.

It's interesting. Now, the new brands, the ones we just mentioned, they're focused on crowding one specific sales point. The grocery store. Exactly. It's like Beyond Meat and Impossible Foods, both discovered one empty gate to get into the stadium. Exactly. They rush there. Now everyone's like, oh my God, there's an empty gate.

Suddenly, security's there. The crowd is rushing into that gate. They're making you take your shoes off now. So now what you have is a grocery store aisle is going to have a bunch of different plant-based meat options, and it might just become a price war. The lowest cost will win. So, Jack, what's the takeaway for our buddies over at Beyond Meat? First mover advantage, like Beyond Meat has.

It only works in certain scenarios. Okay, so in the grocery aisle, Beyond's first mover advantage, it's not really helping here. Yeah, there's going to be a battle for shelf space now, and Kellogg and Kroger, they have long-lasting relationships with grocery stores. They're not just going to give up this fresh shelf space they have to another Beyond Meat. But in restaurants, the first-mover advantage Beyond Meat has, that may hold. And they've got great relationships already. Beyond Meat's partnered with KFC, Subway, Duncan, Blue Apron, Tim Hordens.

Those partnerships, like KFC isn't just going to drop Beyond Me and go with someone else. In fact, for Dunkin' Donuts, they literally called the sandwich, like the Beyond Breakfast Sandwich. And because those restaurants with relationships, the first mover advantage is key. That means the next one, McDonald's, is going to be critical. McDonald's hasn't picked a provider of plant-based meat yet for its inevitable plant-based Big Mac. But when it does, it's going to want to choose an option that is established new and has a supply chain that can handle the scale. Not necessarily these big companies that are just dabbling and checking it out and have shown up late to the game.

By the way, this is Nick and both Jack and I own shares of Beyond Meat. For our third and final story, we got to talk about our unicorn of the day here. Glossier, they just made a strategic hire. Let's give some cosmetic context here. Are you got your SPF on, by the way? Yes, I do. We do. Both of us.

35. Last week, we talked about Alta, which is a thousand physical stores. Another cosmetic queen. Sephora, 2,500 stores. Glossier has five. And yet, it's worth $1.2 billion because it is a direct-to-consumer. online beauty company crushing online skin care. And here's what they just did. The HR team over there was able to snag a 19-year Amazonian to become the chief operating officer. Now, when you hire a 19-year

Amazonian, it means no more Mr. Nice Glossier. We should clarify this. This is someone who worked at Amazon for 19 years. Yes. Now, Glossie is big with middle and high school girls, especially people in their 20s, a big portion of our snacks listenership. And it has a hundred million in annual revenue. One million customers have used Glossier. And for the record, it's a private company has an IPO yet. But the reason this has really been driven by growth is what the CEO and founder, the gloss boss, Emily Weiss has done. She built the company to look great on Instagram, and that strategy is paying off. It's its core value. The company now has 2.3 million followers. That is more than double the number of customers it has, but that many are following

on Instagram. Now, if your focus is on looking good at Instagram because you want to sell the Instagram, that means packaging becomes as important as the product. The outside of a Glossier product, is as important as the inside that you put on your face. And this thing is gorgeous. You kind of don't want to put it on your face. You probably want to eat that lip on. The packaging is wonderful. It's pink.

It's clean. It's simple but stylish. They've got like that bubble wrap option there with the like zipper. It comes right down. It comes in this pink bubble wrap neck. And I'm telling you it should be your toiletry bag. It's beautiful. Twilts you try.

They should be giving this stuff away in order just to make friends if you want to make friends somewhere. Now the boy brow brow is one of their top like eyebrow shaping products. Bomb.com is another one. So do you know what a bomb is? No idea, but I know the name is something I want to share and definitely put on my face. So users of Glossier are posting Glossier products on Instagram. Get this. Nick and I do a little hack research here. Got some numbers here.

Hashtag Glossier. The number of Glossier posts on Instagram is 474,000. That's how many people have posted pictures of Glacier products on Instagram. And when it comes to Kim Kardashian, who is the queen of Instagram, she's been hashtag KKW Beauty 547,000 times. So Glossier and Kim Kardashian are right there neck and neck. in Instagram performance of their products. One is a Kardashian, one is a startup. That is good company to be in.

So, Jack, what is the takeaway for our buddies over at Glacier? Find your growth hack. Now, growing is hard. Marketing focuses on it, and they tend to do TV ads, billboards, free samples, maybe some subway spots. Now, all of those things Nick just mentioned, they're very expensive. But some really creative and successful unicorns,

particularly brandicorns, they managed to find growth hacks. Glossier, its growth hack, was making packaging that is Insta candy and letting your users do your advertising for you on Instagram. Outdoor voices wanted to get you in their athleisure gear, but they also gave you that free tote that pretty much everyone has. I am a walking outdoor voices billboard. When I go to the airport, I always bring that back. Jack and I commute in the bags.

We're that dedicated to them. Casper, you know, the mattress in a box. Yeah, exactly. When you unbox that thing and it expands, I literally posted that video on Instagram. It's like a first man on the moon moment. You want to tell everyone, I remember the first time I saw. saw it and I'll never forget. Now, it's not just these millennial branding companies. If you go way back to Skype, we're talking growth hack history here. The first Skype users, after they made their

first phone call, it would ask, do you want to add your entire inbox to become Skypers? Boom, easy, one click. And then you get like an email going to everybody in your inbox asking to join Skype. Growth hacks should become a business school class. We're calling it now. It's going to. Growth hacks accelerate growth for cheap. You got to be creative. And it's how Glossier became a unicorn. This is Jack. I also own stock in Amazon. Jack, and you'll whip up the take. Way's over there to start the week. Nick DocuSign has made the free trial frictionless. And that's why hundreds of millions have free tried the thing for e-signatures,

the gateway signature. Well said. Second story. Beyond Meat stock is down because of a bunch of new competition that hit last week. Beyond Me can barely breathe in that grocery store aisle, aisle 6 with the parent-based meats. It is so crowded. Third and final? Glossier I just hired an Amazonian to be the chief operating office.

And it's at a new phase, a phase where the growth hacks have paid all. off big. Beautiful packaging. Now time for our snack fact of the day. This one's set in by a one-two combo punch. We got Judith and Jolly. They both live in Washington, D.C. But they want to point out they're not from D.C.

Their hometowns are Grelel, Iowa, and Raleigh, North Carolina. Judy and Jolly. It's like a 70s TV show. It sounds like a 70s show. Judas's man on the wheel driving. Jolla's man in the podcast. Judith and Jolly heard that we were in D.C. last week.

True. But they wanted to point out a common misconception about B.C. Yes, there's a belief that no buildings may be built that are taller than the Washington Monument or taller than the Capitol Bill. That is a myth that has been carried on from generations and generations. That's not true. It's actually just due to this 1910 height of buildings act passed by the D.C. Pretty boring here. 130 feet. That is the width of streets in Washington, D.C. And if you're a new building, you can't build higher than the street is wide.

Yeah. Bring out your calculators. And the result is that Washington Monument and Capitol building are the tallest. Exactly, because one's on the mall. And one's on the mall. Snackers love starting the week with you guys. Have a fantastic one. Should we do this tomorrow? We'll talk to it tomorrow. I'm in.

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, Inc. Or any of its subsidiaries or affiliates. The podcast is for informational purposes only, 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.