The Best One Yet - 📼 “The Boomer Tech Founder” — Netflix’s CEO exit. Canned Tuna’s turnaround. Morgan Stanley vs Goldman.

Episode Date: January 20, 2023

This week’s TBOY Quiz: https://go.tboypod.comNetflix’s co-founder is unlike every other tech founder — and yesterday the self-disrupting legend of a CEO stepped down. Millennials killed canned tuna fish, but now canned tuna startups are thriving. And we just saw the biggest flip in finance in years: Morgan Stanley is gold, Goldman Sachs is silver. $NFLX $MS $GSFollow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypodListen to us on Spotify: https://open.spotify.com/show/5RllMBgvDnTau8nnsCUdse?si=7189762d4a9f4a7f&nd=1Or listen on Apple: https://podcasts.apple.com/podcast/id1386234384?ign-itscg=30200&ign-itsct=lt_pWant a Shoutout on the pod? Fill out this form: https://forms.gle/tywqQ9CpMmFDAPXz5Got the Best Fact Yet? We got a form for that too: https://forms.gle/N2Unhwm9DbDw4P8R7Learn 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. It's Friday, the real Friday, January 20th. And today's pod, out of all the pods we've ever done, it's the best one yet. It's a T-Boy. But the real Friday means it's Quiz Friday. Oh, it's Quiz Friday. Our weekly T-Boy quiz, our one-minute weekly pop-biz pop quiz.

Who wants to be a millionaire? Minus the million dollars. We're talking quiz number three to test out how well you know the stories from this week's podcast. Check out our weekly quiz. at go.tieboypodpod.com. Yaddies, while you're checking out that quiz, Jack, what's the first story? One random startup industry is shockingly thriving right now. Yeah.

Canned tuna fish. Millennials, we killed canned tuna. But then we saved canned tuna. For our second story, we just saw the biggest shift in finance in years. Yeah, Morgan Stanley is the new Goldman Sachs. And our third and final story, we were about to write a story about Netflix password sharing. True story. Then the founder, CEO of Netflix stepped down.

So Jack and I threw out that story. So what's our new story, Jack? The former Netflix CEO, Reid Hastings, pioneered constructive self-destruction. That's our new Netflix story. But Yeties, before we hit that fantastic mix. A wonderful mix before a weekend. I love this mix, man. The Wall Street Journal just announced it.

So it's true. Yes, the most vital clothing item of the moment is the... A tuxedo. Comfort wear is out. Formal, formal, wear is in. Tuxedo sales, the bow ties, they are back, baby. Perfect timing because Nick, can we talk about your birthday party plans

for this weekend? Are you talking about the reverse surprise party? Yeties, Nick is pioneering a brand new, never done before party concepts. This is a new thing. We're testing out a new celebration business model. It's been unprecedented. It's called

the reverse surprise party. The reverse surprise party. Yetis, here's how this thing goes down. First, I sent out an invite to my birthday party. I got the invite. Thank you, Nick. And it said the date on that birthday party invite. The date is tonight, by the way.

I got that too. It also said the attire on that invite to my birthday party. Black tie. Good thing I have a tuxedo. But there is one catch to the invite. It doesn't say the location. All it says is I have to show up outside a Nick's apartment. The destination is a...

a mystery. So like, you know what to wear to my party, but you don't know where the party is. So instead of surprising the birthday boy, Nick gets to surprise us, the guests. It's incredible. It's the first ever reverse surprise party. It's unprecedented, baby. Yes, it is. Jack, this could be a dinner at a three-star restaurant or it could be at a chick-fil-a. I hope it's the three-star restaurant. Jack, this could be a celebration at Cirque de Soleil or it could be a backyard barbecue. Can it be both? I hope it's both. It could be neither, could be all the above. Yeties, all you got to do is wear black tie and show up at our apartment.

The rest of the party is a surprise. It's the first ever reverse surprise party. Let's hit our three stories. In reverse. In reverse. Did we do it? Fifteen years before this song, two boys from the northeast met in the dorm. They had an idea to cause a cultural storm.

It's the best one yet, but the best is an arm. Jack, Nick Tis. 50% that's a fat tip. Tea boy city on your at list. If you know, you know because we're ready to go. We can't wait no more, so just start the show. For our first story, the fastest growing of startups right now isn't in the tech industry. It's canned tuna.

Canned tuna fish literally shows how the greatest product innovation isn't the product. It's the packaging. Jack, can we whip out the whiteboard? Let's pull out that list of things. Millennials killed. What have we killed lately, man? Beer, golf. Yeah. Half and half. Classic. Dairy. Gluten. Buzzcuts. Bangs. Bings. We put those in. Throw it all in there. I got nothing if you had that list. You ready?

Toss in canned tuna fish. It's a polarizing food. Five years ago, the Wall Street Journal reported that canned tuna fish sales had fallen by half. And of course, they blamed millennials. They blamed millennials. Throw us on in there, too. And Jack, what was that incredible quote from that canned tuna CEO that was like mildly offensive to you and me? They accused millennials of being lazy. Yes, they did. They said that most millennials don't even

own a can opener and if they did wouldn't know how to use it. Hey Alexa, can you open my canned tuna? But last year, there was a sudden sea change in the industry of canned tuna. I like what you did there because U.S. sales of canned tuna fish jumped by

10% last year. Justice for the chicken of the sea. And Scout is a canning startup with canned fish and they were crushing it last year. Yeah, they were. What were their numbers, Jack? How were they doing last year? Scouts revenues doubled and it was driven by their gorgeous Instagram posts. Can tuna has started swimming upstream. Yet he's Jack and I were fascinated about this story because we noticed it picks up on a theme. Nostalgia never dies. If something was popular once, it will be popular again. Yeah, it will be. That's the beautiful thing about a nostalgia project.

It's just a question of when. It's just the timing. Just look at TikTok right now. The hashtag tin tuna has been viewed 25 million times for pictures of tuna in a can. And you know who's driving those posts? Scouts Influencer Marketing Program. It turns out scouts can tuna influencers are driving 500 customers a month to scout tuna. Each influencer is getting 500 new customers of their canned tuna fish. All right, yeties. Let's sprinkle on some context here. For years, can tuna was deviant. defined by cheapness. Can tuna was the non-perishable pantry staple of the silent generation and of my father, Big Ten. But in just the last year, it has been revived as an affordable splurge. Can tuna has become the caviar alternative for the millennial class. Can tuna, you see it on TikTok. It's become the star of the charcutory board this year. Jack, can I interest you in the Montchago, the dried figs, or the can of tuna? Can I get a smear a tuna fish on that cracker next? Is this Jack save tuna? This can tuna has become the Bella Hadid of the Charkooty Board.

Now, Tuna Fish is back, but it's also changed because five years ago, 80% of the canned tuna market in America was dominated by three big tuna companies. And Jack, what were those three tuna companies? Because I know you know them off the top of your head as a landlock guy. They're Big Ted's favorites, Star Kist, Bumblebee tuna, and Chicken of the Sea. In the meantime, in just the last couple of years, cute canned tuna startups are eating up market share. So, Jack, can you pop open the takeaways for our buddies over in the canned? tuna industry. Sometimes the greatest product innovation isn't the product. It's the package. Yeti's some of the greatest value creation that Jack and I have seen. It comes from just repackaging a

commodity. Tuna fish is a commodity. It's an undifferentiated product. There's no difference between one tuna from one company and another tuna from that company. Only the container is the difference. And that branding on that container, that's what creates the value. Look at Casper mattress. They transformed the mattress industry by just putting a standard mattress in a box. Jack, look at White Girl Rose. They became the most valuable Rose A brand because of the label and because of the name. Can tuna was dead five years ago, but now it's thriving because startups have updated the can and the packaging for the Instagram age. It's literally not about tuna. It's about the vehicle for distribution, the can. In fact, canned tuna may be the perfect case study for this takeaway

because the package is in the name of the product. It's literally called canned tuna. More than half of the name is the product package. By letter and probably by weight. Because sometimes the greatest product innovation is the product's package. For our second story, we just saw the biggest flip in the finance industry in years. Morgan Stanley just replaced Goldman Sachs as the ruler of Wall Street. Morgan Stanley is the new Goldman Sachs.

It's the new wooler of Wall Street. Yet he's Morgan Stanley and Goldman Sachs. It is a timeless rivalry for Wall Street's craft. Now, those two banks are not the biggest investment banks in the country? True, good point, Jack. That would be J.P. Morgan Chase. Jamie has got the biggest bank in America. But Morgan Stanley and Goldman Sachs are the top pure investment banks in the country.

Right, because I like JP Morgan Bank for America's Citibank, Wells Fargo, There are no bank tellers at Goldman Sachs or Morgan Stanley. No, there's no retail bank. There's only suits, sweet green salads, and spreadsheet crunch. Yeah, Morgan Stanley and Goldman Sachs analysts, they're not clocking out at 5 p.m. They're sending that TPS report to the VP in South Hampton at 2 a.m. on a Saturday evening. They're expensing their door dash, and they're taking Uber black back to their penthouse. Throw in some fries.

Well, last week, both of these New York City-based investment banks announced earnings and what did we notice, Jack? Well, first, we have to go back to two years ago. Good point, good point. Good point. In 2021, investment bankers were overworked, prepping IPOs for record numbers of companies that were listing on the stock market. But one year ago, there was the opposite situation. There was nothing to do. There was like a bad stack market, which cut the number of IPOs by 61%. So in the fourth quarter of 2022, Goldman's profits fell by 66%. Really disappointing investors. And yet, Morgan's, Stanley's profits only fell by 40%.

Really impressing investors. So how did the stocks react this week on the news? Well, Jack, Goldman's stock fell by 5%. And Morgan Stanley's stock jumped by 5%. You know what that sounds like? Talk to me, Jack. Morgan Stanley just cemented its status as number one to Goldman's number two. Jack, you know what that sounds like?

Morgan Stanley is the new Goldman Sachs. Indeed. I like the business card. That's Egg White Shell. Paul Allen, nice to meet you. So, Jack, what's the takeaway for our buddies over in the banking industry? Morgan Stanley picked the better profit puppy. Yeties, for 10 years, from 2007 to 2017, Goldman was the gold standard.

It looked down on Morgan Stanley. Morgan Stanley was the younger brother in this situation because Goldman's valuation, its market cap, was consistently larger than Morgan Stanley. But then Morgan Stanley. Stanley CEO James Gorman made a strategy decision. He chose a new profit puppy. He chose the less sexy, more boring, more stable wealth management business. The more stable wealth management business. Morgan Stanley's profit puppy today is to tell super wealthy people how to manage their money and then take a 1% fee on their net worth. Yeah. So in down years, like last year, Goldman didn't

have any fun startup IPOs to make money off of it. But in, down years like last year, Morgan Stanley was still making a 1% commission on millionaire Madeline's estate. And that is why for five straight years, Morgan Stanley has been more valuable than Goldman's sex. Because Morgan Stanley picked the less sexy, but more loyal profit puppy. The more stable one. Now a word about our sponsor, Robin Hood. A lot of Yetis don't realize how much prep work goes into this pot. We spend hours every morning jumping in T-boy style to earnings reports. CEO tweets, breaking news, heaven. Yeah, Jack and I are toggling tabs like you toggled IM Convo's in 2004.

Having eight tabs open can be stressful. You don't need that, especially when invest. Robin Hood offers it all in one app. Whether you want to trade options, ETFs, or stocks through Robin Hood Financial, or you want to buy some Bitcoin on Robin Hood Crypto. You can do it all on the Robin Hood app. If you're not investing in Robin Hood yet, to get started, go to robin hood.com slash T-boy and choose your free stock.

That's robinood.com slash TBOY. Limitations apply. LLC, member SIPC, all investments involved with us. By the way, this podcast is not owned or part of Robin Hood. We are not employees of Robin Hood. For our third and final story, are you curious where the reverse surprise party surprise is going to be, by the way? Are you curious?

Well, you do love barbecue. It's kind of your birthday tradition. Unless I'm throwing you off the scent. Yeties for our third story, Netflix just announced earnings. But the highlight was the shocker that their founder is stepping down. Reed Hastings is leaving Netflix, so we're looking at his greatest lesson, self-disruption. Yeties, Jack and I have been saying, 2022, it's the year Netflix stopped being Netflix. Netflix launched its top movie in theaters last year.

Netflix launched a subscription tier with ads last year. Netflix lost subscribers for the first time last year. Netflix's stock fell for the first time last year. Netflix, are you okay? Netflix, it's us. We can talk. What's going on? look like yourself. Well, we just got the final earnings for 2022 yesterday. And Jack,

what were the numbers? I don't know. All I noticed was that the co-founder and co-CEO, Reid Hastings, stepped down as legendary CEO. Ipso facto yetis, it is now 100% positively confirmed. 2022 really was the year Netflix stopped being Netflix. It really was. Now, full disclosure here, Besties, Jack and I prepared a story. on the Netflix earnings, but then we kind of just threw out that story. We had a different idea. What did we decide to do? Because Reed Hastings is a completely unique big tech founder.

Okay, the CEO and founder of Netflix, Reed Hastings, stepping down, we have to honor this moment. Reed Hastings is 62 years old. He's one of the only tech founder CEOs who has gray hair. This guy can grow a mustache. You can't say that about most of Silicon Valley. Go tea, actually. And this man wasn't a college dropout like so many tech CEOs.

Uh-uh, no, he was. Wasn't, Jack, where did this man go to school? Bowden? A Neskack school? Way up in the Northeast. Fighting polar bears. He's one of them. He's from Maine.

Reed Hastings and Netflix isn't a suck and isn't even an Evan Spiegel. No, this isn't some hydrofoiling plant-based mocktail millennium. No, Reed Hastings is a baby boomer who sold vacuums door to door before he attended college for a whole year. But then everything changed because in 1997, he paid $40 to his local movie rental for late fees for Apollo 13 VHS.

We're talking Apollo 13 VHS. He sat down, stood up and sit back down on his couch again. The best way to start a company like Netflix is in anger. The best entrepreneurs are motivated by spite. But Reid moved on from the spite to become a master of management and an innovator of entrepreneurship. And Jack and I have taken a lot of lessons from Reed Hastings, which is why, Jack, what's the takeaway for our buddies over at Netflix. Reed Hastings is the master of constructive self-destruction. Yeties, our greatest lesson from Reed Hastings of Netflix, it's the innovator's dilemma. The innovator's

dilemma. It's that to stay competitive. You may have to disrupt your own profitable business or someone else will. Jack and I prefer to call it constructive self-destruction or self-disruption, if you will. And Reed is a master of that because Netflix started as a company that mailed you at a DVD every week. But here's the key. Reed knew that the internet would kill that business, so he built a streaming division to destroy his very own profitable DVD business. He disrupted his own DVD by mail business before someone else. But then that's not all. In 2012, while at the top of his game, he disrupted himself again by launching original content. With House of Cards and Orange is the New Black. He disrupted his third party neutral streamer business

before someone else could. Add all that up, and Reed Hastings twice disrupted his very own business when it was at its most successful. And it's resulted in something more successful than anyone could have imagined. Because Reed Hastings is the master of constructive self-destruction.

Jack, can you smear up the takeaways for us over there? canned tuna is enjoying a renaissance thanks to the new package. Sometimes the greatest product innovation isn't the product, it's the package. Or our second story, Morgan Stanley just cemented its status as number one on Wall Street to Goldman's number two. Morgan's the new Goldman.

Because Morgan Stanley picked the better profit. And our third story, Jack, what's the takeaway? Netflix's co-founder Reed Hastings is stepping down as CEO. Reed Hastings, the master of constructive self-destruction. Now, time for the best fact yet. And this one is set in by me because it's my birthday this weekend. So, Jack, we'll whip up a little surprise one for you over there. You ready?

I'm ready, man. I'm ready. It's all surprises for me. Send that bouquet of balloons anytime. I'm just waiting. No problem. All right, here we go. Here we go. Here we go. Jack. Here we go. Here we go. There are over 100,000 pizzerias in the United States. Do you know what portion of them are in New York? Wow. That's a great question.

2%. One out of seven pizzerias in the United States is in the state of New York. You're joking me. I'm not kidding you. And that's not per a slice. We're talking per pie per pizzeria, man. 15% of all. All pizzerias in the United States are in the state of New York? I don't have our whiteboard right now in the exact number, but it is one out of seven pizzerias is in New York.

Original raise or classic race? Famous raise or legendary raise? Oh my God. By the way, your go-to? I was thinking, I love Joe's on the West Village, although I miss Patsies on the Upper West Side. That was a classic. I know you've got some favorites. We've been going to Artichoke on 10th Avenue.

That was great. We went on that last trip to New York. That was really good. They go by the slice. They go by the pie. The artichoke pizza. Yes, Jack. That's a thick one. That's a pizza that eats you.

Yetis, you looked fantastic all week. And whether you are hosting a reverse surprise party or just a regular surprise party, remember to celebrate the wins. Now, Yetis and besties, please join me in the singing of happy birthday to you to Nick. Happy birthday. And before we do that, we're just going to end the pod. Jack and I, we'll see you Monday. And before we go, happy birthday to Yeti Yenny Wang in San Francisco.

And happy birthday. to Chris Chalani in New York City. And a happy birthday to Aaliyah celebrating with the Middle Eastern Feast down in Washington, D.C. Happy 25th birthday to Patrick Sandoval Sanchez in Houston, Texas. And Sam Lusberg, happy birthday over in Dallas. An happy half birthday to Amanda Pell in Trent, New Jersey. And Andrew the Bambino Bester, happy 11th birthday in Harrison, New York. Alex Chaucer is celebrating big time, big style, in Saratoga Springs, New York.

And Tiffany Garrison is turning 20. down in Nashville with a future in-and-out burger. Congratulations to Bryant and Maddie, who are getting hitched down in Jamaica. And Fragrance and Telly are celebrating their anniversary 6,000 miles apart between Nigeria and Canada. And to anyone else, including Nick, who's celebrating something this weekend,

making a tea boy. Jack, thank you for always helping me celebrate the wins together. This is Jack. I own stock of Netflix, and Nick and I both own stock of Robin Hood. Now, a word about our sponsor Robin Hood. A lot of you listen to our show while you're driving. Two hands on the wheel. Keep it 10 and 2. You might be cruising Chris. No rush. Stay in the right lane. Or you might be doll line from Duncan, dotting from lane to lane. And there are different drivers on the road.

They're different investors too. Maybe you're cruising down the long-term lane with stock investing or maybe you're a more advanced full speed trader. Well, the Robin Hood app helps put you in the driver seat wherever you're at in your investing journey. If you're not investing on Robin Hood yet, to get started, go to robinood.com slash t-boy and choose. your free stock. That's Robinhood.com slash T-B-O-Y. Limitations apply. Robin to Financial LLC, member SIPC, all investments involve risk. By the way, this podcast is not owned by or part of Robin Hood, and we are not employees of Robin Hood. I used to love when the nurse would check us for lice in elementary school.

It was a great. It was a massage. It was a head massage. It was a head massage. She used to like just poke her out of the tooth. Dude, I would fall asleep. I'm asleep mid-lice exam. Like, Mrs. Kramer, we have an issue with your son in the lice detection. Oh, he is lice?

No, but he keeps coming back and requesting a checkup. And we can't get him to leave. He's trying to tip the lice checking people.