The Best One Yet - 🛻 “Stage 5 Clinger” – Rivian’s IPO truck. GE’s dethroning. Paytm’s Venmo vacuum.

Episode Date: November 10, 2021

The 1st ever mass-market electric pickup truck goes public today, but Rivian is a Stage 5 Clinger when it comes to Amazon. Paytm, the Venmo of India, is the biggest IPO in Indian history because it’s filling the Great Vacuum of China. And General Electric was once the world’s most powerful company, but now it’s splitting up the band.$RIVN $GEGot 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 Wednesday, midweek, November 10th, baby. Looking at the scoreboard, Bitcoin is at a record high, $67,000. Jack, looking at the same scoreboard, Ethereum, that's at a record high. Stock markets overall, also record high, S&P 500. Snacks are at a record delicious.

This is my favorite pod we've ever done, Jack. Today's pod is the best one yet. This is a TBOI. First story. What do we got? Rivian made the first mass market electric pickup truck and goes public as a stock today. Pickups and drop-offs. That is what we're.

Rivian does crab cakes in football. For our second story, GE was once the most powerful company on earth, and now GE is splitting up. The American conglomerate is dead. Long live the tech conglomerate. For our third and final story, paytm. Great name for like a digital finance company. It works on multiple levels, and that's clever. Paytm is the biggest IPO in India history.

Snackers, it's like Venmo if the U.S. government said paper money was Italy. But Snackers, it's not just Wednesday. It's National Vanilla Cupcake Day. National Vanilla Cupcake Day, that one time a year when it's socially acceptable to eat four cupcakes at lunch instead of two. Snackers, quick side note here. Nick loves cupcakes. I'm not going to lock.

I've got one on this side. I got one in the back room. You keep one in the freezer. It's a frusy cake. You can have it whenever you want. They never go back. I'm more of an ice cream guy, but Nick likes to indulge in the chocolate. He lavishes in the red velvet and he munches on the mitten chocolate chip.

But every now and then, Jack, I got to say vanilla vanilla, vanilla cupcakes, they get no love. I understand why vanilla doesn't get any of it. Okay. Except for today, because the most successful vanilla cupcake of all time, we've discovered what it is. It's the Twinkie. Yeah, the Twinkie. Technically, the Twinkie is a vanilla cupcake recipe. But here's what happened.

The company behind it hostess, they rolled that recipe and stretched it out into something the size of a small log. Honestly, when was the last time we even had a Twinkie, Jack? Long, long time ago, honestly. I mean, you don't eat the Twinkie. the Twinkie consumes you. Even if my body weren't a temple, I wouldn't let that thing get close to me. Gwok is always extra. Twinkies will never be extra.

That's the reality here. Well, guess what? We connected with a snacker who literally oversees Twinkie production here in the U.S. We're talking about Duncan Marshall, a legendary snacker down in Kansas who works at hostess. Now, no one's debating that Twinkies are an all-time American classic dessert. It's a legend. But Duncan actually debates the statement that a Twinkie can survive the apocalypse. Twinkies a little bit closer to farmers market than you expected.

They've got a 45-day shelf life. Yeah, a family guy episode told us Twinkies can last an apocalypse. Peter Griffin was wrong. Also, Twinkies, it's owned by publicly traded hostess, which means Hostas is a pure play Twinkie stock. Hostas is worth $2.4 billion of Twinkies. Yeah, that's one fifth of a lift. And Twinkies, get this, they were originally banana flame.

But during World War II, we had to ration bananas due to a shortage. So the buddies over at Hostas, they switched it to vanilla flavor. Which brings us back to National Vanilla Cupcake Day. Celebrate responsible. By having four cupcakes. Let's hit our three stars. You're tuned in the snacks daily.

We spoke to the lawyers and we got to get something legal out the way. It's snacks about to hear ain't food. It's air candy. They don't reflect the views of the Robber Hood family. It's all informational just so. 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 Fenra slash SIPC. For our first story, Rivian just IPOed huge day. Put Ford, Tesla, and Amazon in a blender, and you get yourself a nice, tall glass of Rivian. Jack, let's get more specific here. Pickups and drop-offs. Pickups and drop-offs. That is what Rivian does.

Pick-up trucks, package drop-offs. Rivian, they're awkwardly named. R1T truck is the first ever electric pickup truck to hit the mass market. This thing has happened. Now, Ford is a big investor in Rivian. Ford is basically the sensei to Rivian's karate kid when it comes to pickup trucks. And that is the pickup part of Rivian's business. Or as Ricky Bobby would say, you don't drive with your eyes. You drive with your heart. Now, this is an awkward relationship because Ford owns part of Rivian. But Rivian beat Ford's F-150 Lightning to the electric pickup truck race. But this Rivian electric IPO deal is huge because the U.S. car industry, it's really a truck industry when you look at it.

Yeah. The top three bestselling cars in America are pickup trucks year after year after decade after decade after decade. And if you're not first, you're last. Rivian just IPOed yesterday. The stock starts trading today and the company is worth $70 billion. Translation Jack, how many lifts we're talking over there? Five lifts. But Snackers, here is the funny thing, Jack and I noticed about Rivian. Rivian, it's a stage five clinger. There's one company Rivian cannot stop telling you about.

And that. Yeah, Marsha, Marsha. Marsha. Amazon. They were mentioned 81 times, 81 times in Rivian's IPO S1 paperwork. Rivian calls Amazon their flagship customer of their commercial business line. Yeah. Now, Rivian is making trucks for you and me.

But they're also pumping out vans for their special friend and special client, Amazon. Amazon is customer number one. They have already ordered 100,000 electric delivery vans to help Amazon achieve carbon neutral business. So, Jack, basically your next prime pantry delivery could show up in an electric, smooth riding Rivian van. And this isn't just a customer truckmaker relationship.

It's a special relationship. Amazon has invested $1.5 billion over the years and now owns 20% of Rivian. Okay. And based on the price that Rivian, I have, IPO debt and the $70 billion IPO valuation. Carry the one out of the nine. Amazon's $1.5 billion is now worth $14 billion. So it looks like Amazon could make more profit on this Rivian investment than in its e-commerce

business. It's core e-commerce business. Yeah, stick to the pre-IPO investing, it looks like. So, Jack, what's the takeaway for our buddies over at Rivian? Legacies live forever, but legacy costs can kill you. Yeah, Snackers. Some investors, they think Ford and General Motors head start is actually a liability, not a benefit. And that's because of legacy costs, not something you brag about legacy costs.

We're talking like those huge fixed costs from the past that just kind of stick with a company over time. For the Detroit car industry, labor agreements with powerful labor unions, that is one big legacy cost. Oh, yeah, Jack, another legacy cost for Detroit is car dealerships. Foreign GM, they depend on car dealerships, but you and I, other customers really don't like car dealerships. No. Rivian, on the other hand, has no labor unions, and they sell direct to consumers. so that customers don't have to awkwardly haggle price with a car sales. You're ordering your Rivian truck like a Casper mattress, mattress, mattress. That could be why Rivian is valued at $70 billion, almost as much as Ford and G.

Investors think Detroit's 100-year legacy is a liability, not an advantage. For our second story, the American conglomerate is now extinct. Once the biggest company in the world, General Electric is splitting up into three tinier companies. Okay, Snackers, here's the deal with General Electric. General Electric isn't a company. General Electric is a history book. Nick's grandfather, Augustus A. Martello. Andrew Nichol is Martello, but we can roll with whatever you're thinking of it.

He built turbines for General Electric up in Schenectady, New York. With each one of his hands for like decades. He didn't stop. He didn't use a hammer. He used his fists. And he did that for General Electric, a company founded by Thomas Edison. Yeah, that Thomas Edison. The light bulb guy.

Thomas Edison. The man who gave us light. We're talking the man god. G.E's former headquarters in Schenectady, New York has the coveted zip code of 1, 2, 3,000, 4, 5. Which is a verified snack fact. We have verified it. G.E.'s former headquarters in Schenectady, New York, was number three on Germany's bombing list of American sites way back in WW2. That is an unverified snack fact, although my dad tells Jacking me all the time, we have never been able to verify. It was Washington, D.C., New York City, and the G. E factories in Schenectady. Well, Snackers, in the mid-2000s, General Electric was the most valuable company in the world

by market cap. 20 years later, though, GE is a fraction of that. Today, it's worth less than Target, CVS, Starbucks, and hundreds of other companies. So Jack and I jumped in snack style, and here's what we wanted to know. Why did GE plummet for so long so badly? You've heard the expression too big to fail. Well, GE was too big to manage. Because General Electric, they used to make light bulbs and micro-werefs and nuclear reactors and wind turbines and finance, oh, and financial institutions. They did all that.

Hidden in that enormous corporate org chart where actually some gigantic liabilities no one paid attention to. For example, General Electric, they actually almost went bankrupt during the financial crisis because of all those things they were doing. Because at some point, this manufacturing company expanded to banking. All of that is kind of messed up, but that's not even the most disturbing thing that happened to General Electric. More recently, Nick and I covered this one on the pod. In 2019, GE accountants found 14.5 billion dollars worth of liabilities related to nursing home bills. Bob, what's this? It looks like about $15 billion worth of stuff we owe.

Here's what happened. GE's insurance arm wrote a bunch of policies guaranteeing long-term care, which meant they signed up to pay for nursing home bills for 300,000 people. as long as they live. And it took them 13 years to notice that they owed almost $15 billion worth of these bills. GE wasn't too big to fail, but it failed because it was too big to manage. Which leads to the news yesterday, General Electric, which is now the shadow already of its former self, is splitting up into three companies.

You're going to have GE, which is just the aviation unit. And they make jet engines. Then you're going to have GE healthcare, which is going to be named something else. Which makes MRI machines. And the energy division will be named something else too. Which makes big wind turbines. All three businesses will be separately, publicly traded companies. And on this news, GE, which is still one thing for now, the stock jumped 5%.

As legendary Andy Marteller would have said, come on, come on. So Jack, what's the takeaway for our buddies over at General Electric? Long live tech conglomerates. Snackers, General Electric, that was the American conglomerate. Tons of different business lines all within one. one company. The advantage of being a conglomerate is you have diversified profits. You can share resources across divisions and you become hugely culturally relevant to that country. More synergies. But now the manufacturing conglomerate is all but extinct with General Electric announcing a

split up. But the conglomerate is not dead because tech conglomerates are actually stronger than they've ever been. Take Microsoft, for example. They're a tech conglomerate. They got business software, consumer gadgets, social media. Amazon is a business. another. E-commerce, cloud computing, movie studios. They have a movie studio. And Apple and Alphabet, their tech conglomerates too. All four of those companies are in or close to the $2 trillion club. The tech conglomerate is even more powerful, more profitable and more valuable than General Electric ever was. For our third and final story, Paytm is about to become the biggest IPO in India's history. And it's all thanks to the great vacuum of China. Okay, first of all,

Jack, have we seen a more straightforward name here? It feels like they get right to the point with PayTN. I thought PayTM had something to do with ATM. You'd think it does, but then they kind of do the double switch. PayTM stands for Pay through Mobile. And they are IPOing at a $20 billion valuation this week. Now, in India, IPOs take three days. So the stock will start trading on Monday. But this is a huge payout for early investors Warren Buffett, Jack Ma, and SoftBank. It is also a classic peer-to-peer company, just like PayPal's Venmo app, but they do things a little differently with QR codes. That's right.

The QR codes of this app are described as ubiquitous for paying things in India. But PayTM is a little different from Venmo when it comes to the numbers. Paytm has 330 million users to Venmo 65. But Paytm is also very similar to Venmo when it comes to the financial numbers. Neither of them are close to profit about. Well, here's what Jack and I. find wild about the peer-to-peer payment space. What's the greatest competition to a peer-to-peer app? Cash. Pocket change. It's pocket change. It's the stuff in your pocket. That's way more

convenient and it's the thing that freaks them out the most. Nothing scares Venmo like the fungibility of a George Washington or A. Blinken. Which is why we noticed a crazy story on how Paytm got to be so big, so fast in India. The government of India banned cash. Literally. Exactly this week, five years ago, something just shocking happened. India's prime minister went on television and announced something nobody expected to the whole country. It was a secret announcement. He'd kept it secret the whole time and he dropped this bomb. In 50 days, there will be no more small change in India. Small change will become illegal. So make sure to convert your cash, paper, and coin money into something digital or else it will lose all its value. So, Jack, this is basically like

if the United States came around and was like, we're going to ban nickel. and dimes this week. Man, they're gone from now on. And dollars and $5 bills too. Yeah. Washington's and Lincoln's, we only want to see anymore. Now, the purpose of this big announcement from the prime minister was to fight money laundering because dirty deals were using coins and dollars. But here's what happened next. Paytm started booming. People started downloading this digital wallet because they needed to turn in their coins and digitize it. That was Paytm's moment. Because the prime minister basically pulled a reverse Regis Philbham and made no one a So Jack, what's the takeaway for our buddies over at Paytm?

India is filling the great vacuum of China. Snackers, in the last year, we've seen China's government punish the most successful tech companies in all of China. They canceled their financials IPO, they scolded video game companies, and they banned crypto mining. And China's aggressive control. That's scared investors out of Chinese stocks and out of Chinese startups. But India is the beneficiary.

Yeah. India is filling the great vacuum of China. India's jumping into that void. Get this. This year, 30 Indian startups hit billion dollar valuations. Jack, how many Chinese startups hit billion dollar valuations? Just 19. Because investors want access to huge emerging markets. And China and India both have one billion person populations and growing middle classes. Chinese companies, though, they face a huge government risk. Indian companies don't. So investor money, it's moved out of China and into India, just like we saw with people. Hey, T.M. Jack, can you whip up the Twinkies for us over there?

Rivian is now a publicly traded company worth $70 billion. Rivian doesn't have a legacy, which means it doesn't have legacy costs. For our second story, GE is splitting up into three little companies. The industrial conglomerate is dead, but long live, the tech conglomerate. Paytm boomed thanks to India's demonetization of coins. And now it's booming thanks to the great vacuum of China. Now, time for our snack. back to the day. This one sent in from the road, I guess, Jack, from Dan and Johanna McIntosh from

lovely Chey Ann Yom. Hey Nick and Jack. The snack fact I have is out of Quincy, Florida. Pat Monroe, banker during the Great Depression, was convincing the value of Coca-Cola and not only bought shares from himself, but encouraged people in Quincy to buy shares as well. Coke was trading at $40 a share, which was a significant amount of money during the Depression. But old Pat was so persuasive that many followed his lead and the town not only got through the Depression, but a At least 67 of his clients went on to become millionaires by holding their shares and reinvesting the dividends. And for a brief period of time, Quincy was the wealthiest city per capita in the U.S. Thanks. Love your show.

Great snack fact. And shout out to Dan and Johanna because they're both bike riding from Florida to California, right? Which is long. We did the math. Sea to shining sea on a bicycle. So here's our advice. It is National Vanilla Cupcake Day. You will need calories.

We suggest you replenish. The rest of you Snackers, Nick and I'll see you tomorrow. Can't wait. And before we go, congrats to Snacker Dr. Darius Carter for defending his dissertation in aerospace engineering over at UVA. Who's? And congratulations to John Killen Jr. By the way, John Kellyn are my first and middle names.

Really similar to your name, Jack, actually. John Killen Jr. beat myocarditis and is back to running in his Auburn. Congrats. And Jack, Samuel Shaw over in Singapore, just made his first stock purchase. Tesla. Congratulations. There we go. And happy belated birthday to Dean Wang in San Francisco, California. Send it some picks of the celebration and happy birthday Toran Chung in Rhododendron, Oregon. And Benjamin Schneider in Seattle. And Tina makes a van in Austin, Texas. And get this, Dorothy Tovar just found out that all her friends are snacking to. That must have been

a great moment. H. Y, HY, HY, Y, Y, Y, Y, SD. And a big thanks to Catherine from Spartanburg, South Carolina who got her entire family snacking. We should get her a T-boy t-shirt in 2022. And to anyone else celebrating something today, make it a T-boy. Celebrate the wins. This is Jack. I own stock of Amazon and I own some Bitcoin. Nick own stock of Apple and we both own Ethereum. 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 Robinhood Markets, Inc. or any of its subsidiaries or affiliates. They are meant for information. 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 on the basis for any investment decision. Any third-party information provided therein does not reflect the views of Robin Hood Markets, Inc, Robin Hood Financial LLC, or any of their subsidiaries or affiliates. All investments involve risk, including loss of principal and past performance, does not guarantee future results. Robin Hood Financial LLC, member FINRA, SIPC. I honestly don't remember. I don't know if I've ever had it. Honestly, I was a birthday party in like fifth grade, I literally think it was a birthday party

in fifth grade. I even remember the girl. It was Sequoia. Sequoia's mom brought in Twinkies. She brought in Twinkies and I had never seen it. You'd hear the class on wrapping it. Here's the thing about the Twinkie check. The birthday candle actually goes very snobes. ugly into the twig.