The Best One Yet - 🍍 “I only date mangoes" — Bumble’s fruit deal. Chanel’s YOLO Economy. Spirit’s $6.6B air-cquisition.

Episode Date: February 8, 2022

Bumble’s 1st acquisition ever is a dating app focused on cherry, peach, and watermelon emoji. Chanel just jacked up the price of its legendary purse by $3K because we’ve entered the YOLO Economy. And Frontier is acquiring Spirit Airlines for $6.6B in the most expensive thing either cheap airline has ever done.$BMBL $SAVE $ULCCGot a SnackFact? Tweet it @RobinhoodSnacks @JackKramer @NickOfNewYorkWant a shoutout on the pod? Fill out this form:https://forms.gle/KhUAo31xmkSdeynD9Got a SnackFact for the pod? We got a form for that too:https://docs.google.com/forms/d/e/1FAIpQLSe64VKtvMNDPGSncHDRF07W34cPMDO3N8Y4DpmNP_kweC58tw/viewformLearn 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 Tuesday, T-Boy Tuesday, February 8th. This pod Snackers, it's the best one yet. It's a T-B-O-I. Best Pod we've ever done. Jack, what's our first story?

Dating app, Bumble, just made their first acquisition. It's another dating app they bought. If you had to describe your dating intentions as a fruit, would you be a cherry, a watermelon, a grape, or a peach? For our second story, Chanel, didn't experiment in 2021. Wild. What happens if we raise the price of our purse by $3,000? Spoiler, people keep buying.

Welcome to the luxury yolo account. And for our third story, Frontier Airlines is acquiring Spirit Airlines for $6.6 billion. It doesn't include the checked bag of water or the air fees. You got to pay the air fees. And the deal might get stock blocked. Well, it could be a stock blocking. But a wonderful mix of stories today, Jack.

Before we hit those stories, Nick, what is the biggest startup question every startup faces? This has got to be, what are you going to name yourself? Got to be the name. The company name. It's crucial. It's often the first impression. It's a big question. You got to figure that out like ASAP yesterday. So CrunchBase looked at 4,000 startups that raised money last year.

Yeah, they did. And they tried to figure out patterns with startup names. And Jack and I jumped in snack style. First of all, there were a lot of mini trends when it comes to new startup names. Oh, yeah. There's a lot of startups named after animals. Yeah, we got ox, we got caribou, we got hedgehog. I'm looking for Liger. Then there's a lot of startups named for food. Yeah, we got mustard, wasabi, marmalade. And this is our favorite. Of course, we've all seen the startup that just adds the letters L.Y to a noun.

You got officely, queenly, humanly. Is someone going to do adverbally? But the number one trend in startup names right now is misspelled startup names. You just take a word and creatively screw up the spelling. I'd like to not buy a vowel. I'd like to replace my vowel with the number that looks like the letter. Jack, I think it goes I after E, except in my company's name. Oh, Miriam Webster.

go ahead sue us i dare yeah for example you got startups like butler noe of course and you got atlas with a why and you got cooked also with noe oh uh a key reason for all these new spellings it's because some website troll already snagged the domain of the correctly spelled english word lagger dot com that's not going to work you can do sevener though like replace the l of the seven let's just roll with it or maybe someone already got the insta handle for that name that you really wanted that's why your companies called The Real Lager. So Snackers for Teaboy Tuesday, here's what Jack and I are wondering. What is the worst

startup misspelling that you've ever seen? Tweet it at us. What company's name is so poorly misspelled it's actually spelled correctly? Tweet us at Robin Hood Snacks, at Jack Kramer, at Nick of New York. We want to see it. Let's hit our three stories on the game. 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 the here ain't food. It's air candy. They don't reflect the views of the rob of her family. 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.

Robberhood Financial, LLC, member FINRA slash SIPC. For our first story, dating app Bumble just made its first acquisition ever. As millennials settled down, Bumble must find Gen Z's love. Okay, first of all, Jack, big anniversary coming. up. What are you doing? What are you thinking? It's been just about a year since Bumble's IPO. Which means it's also been about a year since you got hitched to the stock. It is. It's been a rocky relationship with the stock. Like most stocks that listed last year, Bumble stock is down big. Yeah, it's trying to work things out. Like there's a lot of tension over the sock drawer.

Who gets which drawer. It's like a lot of things. They're trying to work it up. In the meantime, though, Bumble, they made some big news. They were acquiring in their first acquisition a French dating app called fruits. It's misspelled. It's with a Z. It's with a Z. It's delightfully misspelled. It is so perfectly outpropode at this moment. Now, 6 million users compared to Bumble's 40 million users. That's what Fruits has got. So Fruits is small relative to Bumble, but Europe loves fruits.

They are so into fruits. Jack and I jumped in Snacks style on this, downloaded the Fruits dating app, began by inputting our phone numbers, inputting our name, and then we had to choose a fruit. This is key. The fruit emoji that you choose as you set up your account, that signals to the rest of the fruits dating verse, what you're looking for in a relationship. It all comes down to your fruit emoji. For example, you're either going to choose a cherry. A cherry means long term. You're looking for the other half. Or you could choose a grape.

A grape signals you want to go on some nice dates. Or to use their words, you want to share a glass of wine and dye. Or Jack, you could have chosen the watermelon. This is fruits with benefits. Or you could choose the peach, which means dancing in the sheets. Again, their words. So Snackas, when you're using fruits, your profile isn't about. like picks of a puppy and like the Hampton sharehouse they were humble bragging about. It's not about casually sliding in there the picture of you and your sports uniform from college. It is just your first name, just your face, and just your fruit emoji. Fruits.

Now, it's a fundamentally, you know, it's just a dating app. Yeah, this core product is a dating app. It does swiping. It does matching. It's got that freemium model so you could like upgrade to new dating features if you want to pay something. But the difference with fruits is also in the demographic. Exactly.

Wild stat from fruits. Their strongest growth is happening with ages 10 to 25. That is not Bumble sweet spot. No. That is a generation younger than Bumble users. Now, the reason that Fruits is able to snag this younger audience is because they've focused on transparency. The fruit that you select is your intention.

You're screaming while you're on the dating app up front. You're basically saying, look, I just want another grape to eat ice cream with on a Saturday night. So with Fruits, there's no more guessing the other person's intentions based on like their cryptic bio or some scintillating eye stare in like picture three. You know, you know. Now, the fruit, it's saying it all. It's honest.

It's not playing games. Everything is boiled down into a single fruit emoji. And that transparency is attracting a different target customer than what Bumble attracts. And not just because fruits is targeting Europeans. So, Jack, what's the takeaway for our buddies over at Bumble? We're starting to see a zolennial divide. Gen Zian millennials, they're distinct. Snackers, funny thing Jack and I noticed when we were researching the story,

turns out Gen Z isn't as swipy as millennials. According to a 2020 survey from the knot, 26% of millennial couples met through dating apps. That's more than one out of four of us. Yeah, Timmy. Our buddy Timmy just got engaged this weekend. Timmy! They met on a dating app.

Oh, did they? I think so. So there's a 25% chance. 26. Well put, but get this, Snackers, only 16% of Gen Zers met on a dating app. The rest of Gen Z is meeting in real life. or like a video game or like

Roblox metaverse, I don't know. So Bumble is already maxing out on the American dating millennial customer and many of those millennials are aging out of dating. Yeah, so Bumble must find new growth and it needs to find it with Gen Z. That means Bumble must adjust to Gen Z's dating styles.

And that means acquiring a fruit forward emoji dating app from France. We misspelled their name. For our second story, Frontier Airlines just announced that it is merging with Spirit Airlines in the most expensive thing they've ever done, a six and a half billion dollar airline deal.

When the going gets tough, the tough get merging. We said it last week, and it perfectly works with this story. It totally works, Jack. But Snackers, both Spirit and Frontier Airlines, they specialize in absolutely no leg room.

Well, yeah, we're boarding in five minutes. Sprint to get here immediately. Please have your boarding passes, your ID, and your tape measure ready. I've done it once, Jack. It's like, it's $40 to check a bag, $50 to carry on a bag, and then like $60 to continue breathing on this thing.

They do let you bring like a purse or a small personal item onto the floor. Yeah, that's true. That's true. But if it's longer than 14 inches, that is not a purse, then it's a suitcase. Oh yeah. $50. Pay up now. Yeah.

A height, length, and width. You have to like have a geometry major with you. Can't exceed 62 inches? If it's longer than 62 inches, your kneecaps will be shattered. Jack, I think they say, please pay for your oxygen mask before helping the people around you. Now, Spirit calls themselves the no frills air. It's not low. They actually refer to themselves as ultra low cost. Jack, did you see what Spirits airline,

their stock ticker symbol is, by the way? I did. Save S-A-V-E. Both Frontier and Spirit. They cut out every perk that traditional airlines offer in order to offer you the lowest cost ticket imaginable. Now, here's how the business model works, Snackers. Yes, they're getting frugal passengers, and that means less revenues, but they are frugal themselves and have 39% lower costs on average than the big four airlines do. Which brings to yesterday's big news, Frontier is offering to buy 51% of Spirit Airlines. The combined airline with Leap Prague JetBlue and Alaska Airlines to become number five pending regulatory approval, of course.

So Jack and I jumped in Snacksdale to the deck for this deal. And we notice that the theme of the deal is you should all be grateful that we're going to do this airline merger. The CEOs are both telling us that this is going to be really, really good for everyone. The CEOs are predicting that $1.5 billion of annual savings will result from these two cheap airlines getting together. And the CEOs say that two out of every three of those saved bucks is going to go to you, to me, to us, to the flying consumer public. That is, if Frontier and Spirit get together, or we could call this Frontier at Airlines, they would now be big enough to compete with the Big Four American Airlines. And that's a huge deal because the Big Four airlines, they control so much.

of the U.S. air travel market. Get this, Snackers, Delta, American Airlines, United Southwest, they control a whopping 80% of all the U.S. airspace. And Frontier, the merged airline, they would be big enough to compete with those for and open up new flights to 32 new airports. Yeah, Frontiered Airlines wouldn't be doing that if they couldn't get this merger together.

But if they do get the merger together, they'll offer new flights in those cities where customers will finally have a cheaper alternative to the really high monopoly prices of the big form. Grand Rapids to LaGuardia, here I come, baby. Finally, you get a second option. Finally. I don't have to pay a thousand bucks round truck.

And that is how consumers would save a billion dollars a year because this merger would be a force for lower prices with this new ultra-low-cost airline. That's the story that the CEOs are trying to sell the public and to the regulators who have to approve the deal. Funny thing, Jack. Investors, the market. What does the market think about this deal?

Does the market agree that this is going to be? good for low prices and airfare? The market doesn't agree. It does not agree. No. Snackers, the stocks of the four big airlines that might get disrupted by this merged entity, they all rose on news of the market. Yeah, because Wall Street thinks the big four airlines

are actually going to benefit, not you and us benefit. So, Jack, what's the takeaway for our buddies over at frontier at airlines? Unlike Obama, President Biden might block this stock deal. Yeah, one progressive critique of the Obama administration has been that there was lax antitrust enforcement when it came to deals like this. For airlines, President Obama, he let the Big Five at the time become the Big Four.

Jack, remember U.S. Airlines? And they combined with American Airlines to become American Airlines a couple years ago. A bigger American Airlines. A bigger one. President Obama also let Alaska Airlines by Virgin American Airlines. And studies have shown that those mergers led to less competition in the air and higher prices for flying consumers. And that's the exact logic that has Wall Street excited for all the airlines. lines when it comes to Frontier merging with Spirit.

Airline investors thinks this is going to benefit every airline. Because lower competition is higher prices. So the Biden administration could break from the Obama administration and block this frontier from buying spirit. Because Frontier and Spirit, they say flyers will benefit. Investors think airlines will. For our third and final story, Chanel has jacked up the price of its iconic bag by a whopping $3,000.

Don't blame inflation. No. Blame the yellow economy. Okay, Jack. Just a great history story here, going all the way back to 1909. Great story. French designer Coco Chanel started a fashion company, Chanel, at the age of 26. Unreal.

In 195, Coco Chanel has this idea. Why are women carrying their purses with their two hands? You got two hands. Why are you eliminating 50% of them just for fashion? Free them up with a strap. Boom, Coco Chanel comes out with her now famous Chanel flap bag, which totally changes the fashion game. It wasn't just a strap, okay? This rectangular bag has a turn lock that casually has some gold in there for like no reason.

This thing is quilted and it's got a chain for your shoulder. A gold chain. And that was the key. And you can still buy the same bag today. So, Jack, before the pandemic, let's say, I don't know, fall 2019, how much would one of these Chanel flat bags cost you? A paycheck or two. 5,200 bucks.

Today, Jack, less than three years later, how much would that same Chanel flatbag cost you? It's up $3,000 to $3,000 to $1,000. 8,200 for one handbag with a strap. Yeah, we know what you're thinking, Snackers. What is the core material here? Is it like a unicorn hair? Did they hire Zuz to start hand stitching these things? Here's the surprise. They didn't change anything about the bag. They just changed the price by $3,000. By 60%. Snackers, it turns out when Jack and I jumped in snack style, Chanel is raising prices faster than any luxury brand out there. Last year, they ran an experiment. They increased the price the bag, then they did it again, and then they did it again.

Yeah, and people are still buying. And according to the Wall Street Journal, Hermes, Louis Vuitton, Cartier, all their competitors, they've been raising prices at, you know, a steady 3 to 5% over the last year. Chanel raised the price of this bag, their namesake bag, by 60%. Now, Snackers, this isn't just about inflation. Jack and I are fascinated with the story because it's brand inflation. People are just willing to pay extra for luxury brands right. 60% on a single back. That is a huge price hike. It's not the supply chain. It's not a shortage of

gold. It's not that the silkworms are on strike. No, no, no, it's not. But Michael Coors, a competitor in the luxury industry, they've said that they're raising prices hugely too. And the Michael Core CEO said, why? This is a great quote. They've seen absolutely no consumer resistance to any of their price increases. No resistance to them raising prices. And naturally, he said there's going to be more of them because consumers keep paying. And here's the key Snackers. You don't know what you're truly worth until customers start saying no. Apparently, Chanel and Michael Corr still don't know what they're truly worth because customers are saying yes. Yeah, people are paying for this brand inflation. An extra 3,000 for a leather purse with a little bit of gold in there.

Yeah. Sure. Let's do it. Now, Chanel is a private company, but publicly traded LVMH, Capri Holdings, and Burberry. They could benefit from the same trend. Chanel's scenes. So speaking of this trend, Jack, what's the takeaway for our buddies over at Chanel? Welcome to the Yolo economy. Snackers, you know who else charges ludicrous prices and is enjoying record sales right now? Rolls-Royce. The CEO of Rolls-Royce, he says it's not just because the wealthy have extra cash from the pandemic. This was interesting. The Rolls-Roy CEO said specifically that consumers are feeling a life can be short mentality right now. Yes, the wealthy are enjoying booming stock markets and booming real estate prices. But like everyone else who's been cooped up

too, maybe they've also seen friends pass away with COVID. They realize you only live once, you may as well buy it even though it's three grand more than last year. So the way we're seeing, the Chanel didn't jack up a handbag price 60% because inflation forced them. They did it because Yolo consumers are letting them do it. Jack, and you'll whip up the takeaways for us for T-Boy Tuesday. Bumble has acquired the French dating app fruits. Yeah, the Zelennial divide, because Gen Z, they date differently than millennials. For our second story, Frontier Airlines is trying to acquire Spirit Airlines in a 51-49 merger. But President Biden could part from Obama and try to block this airline merger.

For our third and final story, Chanel didn't jack up handbag prices by 60% because inflation forced them to. No, they did it because YOLO consumers are letting them do this. Snackers, time though for our snack fact of the day. This one sent in, I think this is her fourth jack from Savannah Westwood. from lovely Orlando, Florida. Happy Black History Month. The first African-American to win an Olympic gold medal is John Baxter Taylor. Yeah, the only black athlete, actually, on his entire track team in Philadelphia.

He was born in Washington, D.C., but ended up at the Wharton School at the University of Pennsylvania to study finance before eventually going to veterinary school. Now, he was running while he was at Warden, and in the 1908 Olympics in London, Taylor helped the U.S. beat Britain for gold in the relay race. He was three out of four. He grabbed the baton from some guy behind him and handed off a little quicker than the guy next to him. Now, sadly, John Baxon and Taylor passed away just five months after the Olympics because of a combination of typhoid pneumonia. At his funeral, his trainer, eulogized Taylor as the nicest man he had ever had to train.

He never gave any bother. He worked hard and was always on time. Savannah, thanks for the snack fact. And snackers, we want yours. There's a link in the episode description to a Google form for you to say. submit your Black History Month snack fact. And Snackers, because it's Tea Boy Tuesday, if you think you know the worst startup misspelling name you've ever seen, we want to hear it.

Tweet us at Robin Hood Snacks, at Jack Kramer, at Nick of New York. We'll see you tomorrow. Cannot wait. And before we go, congrats to our buddy Timmy and Liz, who just got engaged. Our buddy Timmy, congratulations. Liz, he's a keepback. Oh, and Jack, Jarden Roberson and Grace Cook, they're getting eloped. Happy elopement over in the Osema.

Big congratulations to Ryan and Rebecca Cummings out on Long Island. They just had a baby girl named Gale. And Lillian Flinders just had the one-year work anniversary over in Columbus, Ohio. Happy birthday to Avery Bolanos in Austin, Texas. And Tatum Kanova, it's his birthday. And he's listening on the way to school in Livermore, California. Happy 30th to Cassie in Los Angeles. And Chris Boucher over in Hampton, Connecticut.

Jeremy Hock, celebrating the birthday in Cabo? not a bad way to turn another year. And November Ward, happy birthday over at the University of the Arts down in Philadelphia. And to anyone else celebrating something today, make it a T-boy. Celebrate the wins.

This is Jack. I own stock of Bumble. Robin Hood Snacks, newsletters, and podcasts reflect the opinions of only the authors who are associated persons of Robin Hood Financial LLC and do not reflect the views of Robin Hood Markets, or any of its subsidiaries or affiliates. They are meant for informational purposes only

and are not a recommendation to buy or sell any security, cryptocurrency, or investment strategy in any account. This is not an offer or sale of a security, not a research report, and is not intended to serve as the basis for any investment decision. Any third-party information provided therein does not reflect the views of Robinood Markets Inc., Robinto Financial LLC, or any of their subsidiaries or affiliates. All investments involve risk, including loss of principle and past performance, does not guarantee future results. Robin Hood Financial LLC, member FINRA, SIPC.