The Best One Yet - Google co-founders retire — Zume robot pizza aims for $4B valuation — Roku’s ratings drama

Episode Date: December 4, 2019

Google’s legendary co-founders are stepping down effective immediately, but it’s probably because Google’s had its most controversial year in ever. Our “Unicorn of the Day” is Zume whose robot pizza is already worth $2B, and it sells the most intense food trucks you’ve ever experienced. And Roku stock plummeted and then surged after two analysts gave opposite interpretations of its streaming potential.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 Jen. This is snacks. Daily, it is Wednesday, December 4th. Rough day for the markets yesterday. Not the best one for the markets. President Trump was chatting with Emmanuel Macron from France. Sometimes get a chat.

And he randomly said that the trade deal with China probably won't make any progress until next year. Investors were like, wait a second. We thought this was happening in like two weeks. But this is still the best one yet. Here's why. Snackers, we got three wonderful stories. Jackie. Hate us one number one.

Google's co-founders just stepped down from the company Alphabet. If you don't believe us, Google this thing. It caps off the most controversial year for Alphabet ever. 2019, not fun for Googlers. They still got free lunches, though, a lot of free lunch. Second story, Roku's stock dropped by 15% on Monday. And then jump 6% yesterday. What's going on here?

Wall Street is debating about the worth of this company. We're looking at the nuance of analyst ratings. By the way, nuance, great word to say. Third and final story. The unicorn of the day is Zoom, a robot pizza company that actually, actually has a master plan about food trucks. It claims it wants to be the Amazon of food. And Snackers, Jack and I actually ordered a pie.

It's coming mid-Py. Any second. So we're going to eat the pizza, robot pizza mid-pott. Also, bold claim, the Amazon of food? Yeah, the Amazon of podcast right now. All right. Before we get into that, we have to talk about chewing gum. Sales.

When was the last time you blew a bubble with chewing gum? It's obnoxious. Yeah, your mouth's like... Chewing gum is begging for you to chew with your mouth open. It's like saying squirrels do. Now, it turns out. In America, chewing gum sales are down 22% since 2010. And let's say you want to chew gum outside of America, let's say in Singapore, good luck.

You're going to jail. In Singapore, there was this trend a couple decades ago where kids, pranksters, would chew gum and then put the gum between the subway doors as they were closing. It's kind of clever. And then when it opens up to the next station, it's like a cobweb disaster. Right in your face. So they're banned in Singapore. Meanwhile, Americans not chewing gum anymore. Instead, we're spending our time nervously with like those fidget spinners and with our phones.

Well, the Wall Street Journal highlighted in the article that we're taking this information from that, that chewing gum was a thing for burning nervous energy, but we're not doing that energy. No, in fact, chewing gum has realized it's got to adapt to survive. It's kind of socially unacceptable that chewing with their mouth open situation. Yeah, so they've got new brands of chewing gun coming out that are like chewing gum 2.0. These things kick it up and on. All right. You got CBD infused chewing gum so you can get your CBD while you chew.

You got gum that helps you fall asleep on an airplane because it goes like right. Right into your blood system was you chew. Isn't that what melatonin is for? You've got vitamin-packed chewing gum because you're too lazy to just eat good food. Or you could just chew gum to get a workout for your jaw and burn calories. You've got immunity enhancing chewing gum these days because everyone's asking you, did you get your flu shot? Did you get your flu shot?

Snackers. When was the last time you chewed gum? I haven't in a while. But this is a trend where okay that millennials are killed. You're tuned in the snacks daily. We spoke to the lawyers and we got to get something illegal out the way. The snacks are about to hear rain food. said 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. 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. Robberhood Financial,

LLC, member FINRA SIPC. For our first story, it is the end of an era. Google's co-founders are both leaving the company. By the way, you need to clarify here. Google's parent company is called Alphabet. Very true. This is like when your buddy Jimmy, who you've been calling Jimmy for 25 years, says, I go by James now. We're like Jimmy.

Change the signature in your email. You're Jimmy. Alphabet is the parent company of Google. And Alphabet's co-founders just stepped down. Always at Jimmy. Google was founded in 1988 on a mission to organize the world's information, noble mission, right? And the founders, Sergei Bryn and Larry Page, are the poster boys of tech do-gooderism. Now, whenever we say, Sergey, Jack, has one vision that comes to mind. He loves telling you this. Sergei Bryn sounds like an early 90s, Detroit Red Wings hockey player. And he probably could have been. Now, yesterday, the president and CEO of Alphabet, that was them. That was them. And today, they are retired, effective immediately. We were just

telling you about how Jack Dorsey wants to go to Africa for six months. Sergey and Larry, they're basically going to Florida. Yeah, this was totally unexpected, kind of a shocker. And typically they'll say like, you know, we're stepping down effective January 28th. Four months from now. But effective right now. Google stock actually edged up. So Wall Street seems to be okay with the new blood replacing them. Speaking of new blood, we should give you like the LinkedIn situation going on with Sundar Pachai, who is the CEO taking over.

Yeah, he's taking over as CEO and president of Alphabet. But don't call him new. Don't be like, hey, well, let's tell you where the bathroom is, Sundar. Let me introduce it to the snack room. He's been a Googler for 15 years and is responsible for two of its most valuable assets. Back up. Grew up in India, went to a tech university, got his MBA from Word, and ends up at Google making some serious moves.

So he was leading the acquisition of Android, which is Google's mobile phone operating system that powers like 80% of the world's phones. You're probably working on like an iPhone right now. Everyone else in the world is not using that idea. Exactly. And he's also behind Chrome, which is the web browser. So Chrome and Android are two of the big reasons that Google is still the dominant player in search today, and Sundar Pachai is a big reason why. So Snackers, let's talk about Google for a minute, because Jack and I got together, got a whiteboard up, and went through the rap sheet of this company that was supposed to not do any evil.

Well, remember, that was its official, unofficial, actually? Unificial. If there are any Googlers out there, was this written anywhere? Was this like on a board somewhere? I think the definition of a motto is that it's unofficial. You begin every all hands. You're like, remember, we're not doing evil today. Don't do evil, is Google's motto.

And here are some evil-ish things it's done. It gave military drones artificial intelligence to shoot people with missiles. They had four employees who were trying to unionize. Those employees were fired by Google. Thousands of Googlers have protested outside of Google HQ for a culture that condones sexual harassment as long as that person is a top performer. Google has considered offering a version in China, Of itself, that would be censored despite its mission of being for open information.

Don't do evil except those five very big kind of evilish things. So, Jack, what's the takeaway for our buddies over at Google? Alphabet's current chaos requires one decision maker, preferably a new leader, a new decision. Snackers, in the past, Google was all about collaboration, teamwork, they did these trustfalls. That's what built Google into the world-changing company it is today. And that's why it was led by Sundar, Larry, and Sergey, all at the same. same time. But today, it's all about picket line this, strike that, controversy, this, scandal. And because that Alphabet and Google, they don't need like two CEOs and a president, like covering all these

things, mixed messages this, mixed message is that. Alphabet needs one leader, and that leader is Sundar Pichai. For our second story, Jack, don't interrupt me. I'm trying to watch the ground over here. Roku is the most polarizing stock on Wall Street. Roku is either the most overpriced stock ever, or it's going to be the next YouTube. Snackers. There is a battle going on in your living room right now. First, it was radio with those fireside chats from FDR. They owned the living room.

It was more of your grandparents. I think books owned the living room, too. It was books. I think it was like wall hand painting in caves, like a few thousand years ago. Yeah, there it got to books. Now, more recently, cable TV owned America's living rooms for like 50, 60 or even 70 years. But the era of their ownership of your living room is over almost because of cord cutting. Cord cutting companies are taking over the living room.

We're talking about Roku, Amazon Firestick, Apple TV, even Comcast, which gives every internet customer an infinity like Roku type streaming devices. These are hardware tech media companies that are giving you the ability to cut the cable cord so you can stream entertainment way more seamlessly just via the internet. From the internet. Now Roku is the number one streaming stick provider. But the stock fell 15% on Monday because of a damning report from Morgan Stanley. An analyst in Morgan Stanley said, and this is just a wild term. In fact, this could be a Halloween costume. He claims that there is overall exuberance over all things streaming.

He sounds like a grouchy old man. He's like, these damn corn cutters with their exuberance. Okay, so the stock fell because of that just overall panning of the industry that Roku works. So Jack and I saw this. We noticed this on Monday. We were like, you know, we're going to watch this develop. what happens. Well, guess what happened on Tuesday? The stock had a comeback. The stock rose by 6% on another investment bank's report, which was like the opposite of Morgan Stanley.

They're like exuberance. Yeah. So this investment bank is called Needham, based in New York City. It says cord cutting is the new normal and claimed that Roku is the next YouTube. YouTube is the default for user-made videos. Basically, where did you watch that funny cat video? YouTube. You watch it on YouTube. You watch it on YouTube. This report claims that Roku will become the platform for streaming, just like YouTube is your default platform for homemade videos. So, where did you catch that chef's table episode? Caught it on Roku. Okay. So YouTube is worth $160 billion. That's the estimate. Which, by the way, Snackers, let that sink in. That's like 10 lifts. It's a lot. YouTube is worth 10

And YouTube's owned by Google. And this investment bank thinks that Roku is the future YouTube, and yet it's only worth one-tenth of YouTube. They're like, we just explained to you what a big opportunity Roku has. How come it's not worth more? And that's why Nidum gave a buy recommendation to Roku. So Jack, what's the takeaway for our buddies over Roku? Wall Street is basically arguing between great and absolutely incredible. Here's the thing about Roku. It also has 32 million active accounts, it controls the TV set for 32 million households. The average American watches four hours of TV per day, and Roku can sell a ton of ads if people keep cutting the cord, and Roku takes that.

So just based on what we just shared with you, it's pretty clear that Roku is a valuable entity. An incredible valuable company. This is a nuanced debate about just how valuable it is. Right. Morgan Stanley thinks Roku stock should be worth $110. And Nidam thinks the stock should be worth $2.10. $100.

But this is like when you go out and you see some fancy watch out there, you're like, oh, this one's $1,000, that one's $1,200. They're both awesome watches. They're incredibly expensive. You're not getting this for yourself. Roku stock is one of the best stocks of 2019. It has more than quadrupled this year. For our third and final story, don't pat the grease off this thing like some third year grader. That's embarrassing.

It's the worst. We're talking about the unicorn of the day. A robot pizza company. It's called Zoom. It's really a robot kitchen company. Now, we know what you're wondering. Jack and I are wondering the same thing. Why is it called Zoom?

We literally called them up and asked them this question. Zoom. Z-U-M-E. Zah for you and me. That's like a mind-blown noise right there. I was impressed. We sat down, we got back up, we had to sit down again. This is a four-year-old robot pizza company based in Silicon Valley.

It's worth $2 billion. We know what you're thinking. How many hundreds of million is worth? Oh, no, it's billions. Rico just reported. that Zoom is in talks with investors to hit a $4 billion valuation within new fundraise. That's one third of a Lyft. A robot pizza company.

By the way, their biggest investor, SoftBank, the company that invested in bailed out, we were. All right. Let's talk about how Robo Pizza works. Okay. So Jack and I jumped into this literally snack style to the point where we're eating the pizza right now. I have a full slice in my belly. Listen. Nick had a full bite. Listen.

What are we listening for? That's the cheese. That's the cheese. Now, how do you make a robot pizza? That was our question. So we dug into this a little bit deeper. Now, first we went to the website, which is zoompisa.com. You immediately see a bunch of human faces.

It's very ironic. They're trying to overcompose. No mention of the R word. No, there's no. Do a control F robot? It doesn't show up. Nope. Then you put in your address.

Now, here's the funny thing. We thought, you know, robots are making the pizza. They don't really need a work-life balance so we can get the pizza anytime. It turns out they open at 4 o'clock. Prior to that, the robots are sleeping. So we kind of had to wait on this one until we got our pizza. Then they have pizzas ranging from like $10 to $18. We went with the Sergeant Peppers, which, great name, had peppers on it.

Now, the most roboty thing in the process is the kneading of the dough, the spreading of the flour, the pushing around of the sauce. Apparently, this is too challenging for us, humans. And the sprinkling of the cheese. Literally got like machines doing the pizza. But then the human places the pepperoni because you want it to be evenly distributed. Yeah, you can do that naturally. The kicker for this company is the mobile pizza truck oven things. Right, because forget what you know about food trucks with like the cute tacos they're selling.

No, no, no. Zoom pizza is doing something up three notches. They have pizza trucks and the ovens are in the trucks. They don't have a kitchen based in one place with all the ovens. So like after the robots kneaded the dough and put this pizza together, it then goes in the truck where it cooks as it rolls. And the truck is rolling around cooking pizza delivering simultaneously. By the way, with a human driver. This is not a self-driving pizza robo-track.

Now, by the way, that's what they say, their competitive advantages. Bakes on the way. So they can get it to you quicker and hotter when it arrives. OPS, humans cut the pizza with a pizza wheel. We don't know. What happened? Do we like that? We asked the delivery guy.

We asked that a human did that. It was human work. So, Jack, what's the takeaway for our buddies over at Zoom? Robot pizza was actually just the guinea pig for Zoom. It has a bigger master plan. Because Zoom's not really a robot pizza. a company anymore. It now sells and leases super high tech food

trucks. It's a huge pivot. It's moved from delivering pizza to Nick and Jack. Yeah, just a couple of guys. Robbins snacks. Big guys. We love it. To working directly with businesses and entrepreneurs who want to start a food company. From B to C, business to consumer, to B to B, to B, business. So the offering is flexible. They're going to give

you a food truck with ovens built in so you can save cost, deliver faster, and deliver fresher. And they've got the sustainability angle. They're making compostable pizza boxes for Pizza Hut. They're not selling those directly to you, the pizza eater, they're selling them to Pizza Hut. The boxes are circular. They're actually called pods and they don't waste the cardboard in the corner of the box. And Zoom because, you know, it claims it's a tech company. It's got to do something

tech-ish with the big D word data. It's data powered and it's tracking who's ordering on the apps, tracking the websites, and it's going to give you like a perfect GPS route through town where you can deliver the most pizzas most efficiently. It knows who ordered that Sergeant Pepper's Pie the day of the week, weather at the time, the school calendar so it can optimize for who wants pizza when. We talked about cloud kitchens on this podcast. I remember it finally. These are cloud food trucks and it's Zoom's specialty. Jack, can you whip up the takeaways for us over there?

Google's co-founders, Sergey and Larry, are retiring from Google. And Sundar is taken over at a time of peak Google controversy. Roku has a sell recommendation Monday and then got a buy recommendation Tuesday. Wall Street's basically debating the nuances of how good a company. this company is. It's definitely good. That's what they think. Consensus. Zoom has demonstrated that cloud food trucks can work with Zoom pizza. Now it's selling and leasing out teched out food trucks to restaurants. I want to see them to do the, hit my ride on this thing. That'd be a good episode. Snackers are a snack back to the day. Comes from someone named Chrissy. Born in Orlando, now lives

in Berlin, was enjoying her snacks on air Serbia like many of us probably have. She took off from the Belgrade airport and couldn't help but notice. that was named after Nikola Tesla. Some may call him the father of alternating current, which is different than direct current. He is the reason why Tesla car company is called Tesla. And back in the early 1900s, he was already advocating for sustainable electricity.

Basically, Mr. Tesla worked with Westinghouse to create the Niagara Falls Hydroelectric Project, which was like the first of its kind in the world. Remember, hydroelectricity is when you take the movement of water in rivers, And let it push you. And turn that into electricity. It's the original renewable energy source, and Tesla made it happen at Niagara Falls. Snackers, loved having you with us.

We should definitely do this tomorrow. Let's do it tomorrow. Are you going to wear the same sweater? No. Okay, we'll wear different sweaters. Talk to you that. Can't wait. By the way, Snackers, this is Nick.

Jack and I both own shares of Tesla and Jack own shares of Amazon. 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.