The Best One Yet - 📹 “The Next TikTok” — Whatnot’s $5B shop app. Nvidia’s uranium problem. Sonos’ CEO oopsie.

Starting point is 00:00:00 This is Nick. This is Jack. It's Tuesday, T-Boy, Tuesday, January 14th. The today's pod is the best one yet this is a T-boy. The top three pop business news stories you need to know today. Stocks are up, Bitcoin's down, and Jack's trying to pull off some kind of flannel situation over there. I do look like Bob Vila over here. I like what you're working with. You're going to build us a home, build us a podcast studio? What's working with it? I like it. Measure twice, cut once.

Starting point is 00:00:28 Honestly, I think it looks fantastic. But Yetis, we've got three fantastic stories for today's show, Jack, what's on today's T-boy? For our first story, barring a Supreme Court intervention, TikTok will be banned in five days. Five days? But there's already a new replacement called What Not. What Not. Yeti's What Not is the new app you gotta know. It's Instagram meets eBay, meets MTV.

Starting point is 00:00:49 For our second story, Invidio Stock fell after a new role from the White House about what countries can buy its chips. Because AI chips are the new uranium. And our third and final story is Sonos. Sonos is known for the fancy sound system at your parent's second house. But the CEO of Sonos was just fired for making one huge mistake. But Yeties, before we hit that wonderful mix of stories. I mean, that was a cliffhanger, but three fantastic stories, Jack. Love the mix today.

Starting point is 00:01:18 Yesterday we asked you our weekly trivia question. And here's what it was. What famous candy was invented by a frog salesman? Well, the answer to that question happens to be the most popular candy in America. What is it, Jack? The Reese's Peanut Butter Cup. No, the Reese's Peanut Butter Cup. It is the number one most demanded candy at every Halloween.

Starting point is 00:01:41 And it's also the top-selling candy outside of Halloween. The Reese's Peanut Butter Cup, it is Hershey's best-selling candy, better known as the best-selling flavor combination in history. But did you know that there's a psychological reason why people like the peanut butter and chocolate combo? And did you know that the peanut butter cup was actually invented by mistake? And did you know, it all began a hundred years ago with a down on his luck frog salesman. This guy, he had 14 mouths to feed back at home, so he made one giant chocolate covered bet. H.B. Reese is the most stubborn, hardworking entrepreneur Nick and I have ever read about it.

Starting point is 00:02:17 He totally is, Jack. And Milton Hershey was his guardian angel. Yet he's the untold origin story of America's favorite candy involves a real-life Willie Wonka. And that origin story is the latest episode of our weekly show, The Best Idea Yet. The Untold Origin Stories of the products you're obsessed with. So Besties later today, after this T-Boy, check out our weekly Deep Dive Show, The Best Idea Yet. Because you're obsessed with Reese's Peanut Butter Cups. Oh, oh, you are. Even if you call them Reese's Pieces. Fine, I had four of them. New episodes of our new show drop every Tuesday. So tap the link in this episode description, because the Reese's Peanut Butter Cup is simply the best idea yet.

Starting point is 00:02:54 But let's hit our three stories because they're the best ones yet. Jack, let's hit the nation. 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 a norm. Jack Nick, that's it. I don't even think they need to practice. 50% that's a fat tip.

Starting point is 00:03:14 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. Start the show. First, a quick word from our sponsor. Our first story. There is one app hoping to fill the post-Tick-Tock void, and that app that you got to know is What Not.

Starting point is 00:03:45 Real-time Live Shopping. Live shopping will be the next trend in America, thanks to Psychonomics. So we got to tell you about What-Nod. Now, yeties, Jack and I last year, probably our best-performing, most viral video that we put on TikTok, got like 2 million views, right, man? calculated how many men in finance there were with math. But that doesn't matter in five days. Because unless the Supreme Court intervenes, TikTok will be banned starting Sunday.

Starting point is 00:04:15 That's right, besties. Unless China sells TikTok by this coming Sunday, TikTok will be banned. Oh, by the way, Lemon 8, another bite dance-owned company, that's probably going to be banned, too, according to the law. In fact, one random TikTok alternative called Red Note just hit number one in the app store on Monday because everyone just assumes TikTok is going away. But another potential beneficiary of a TikTok ban is a new app called What Not. What Not, a real-time live shopping app that happens to be the wildest shopping experience you have ever seen. Because this app is Instagram meets eBay

Starting point is 00:04:54 meets reality TV. All in one. And last week, Yetis, What Not raised $265 million and hit a $5 billion valuation, because TikTok's in its final days. Now, Jack, you and I should pause the pod for a second. We should sprinkle on more context because this is a new frontier, these live shopping apps. Live stream shopping is already huge in China. China has 80% of the live stream shopping market. Live shopping is also big on TikTok right now.

Starting point is 00:05:21 You can whip out your TikTok and do a little live shop shop. Now, to understand live stream shopping, think about this. TikTok democratized the ability to post things online. Well, whatnot democratized QVC. I like what you did there, Jack, because Yetis, collectors will set up accounts on whatnot, turn on their cameras, have production studios like in their basements that are actually pretty nice, and then sell anything to users of the WhatNot app. And if you're a user of the What Not app, you're swiping through videos like you used to swipe

Starting point is 00:05:53 through TikTok. You are. But each video is a person selling some random, interesting collectible. It could be like Disney merch, it could be crystals. Like, Jack, it kind of feels like you're walking through a night market in Bangkok. You get that vibe, man? Yeah. But there's some credibility here because Whatnot, the app, vets each seller. And if that seller doesn't send you the thing you pushed buy on, whatnot will reimburse you.

Starting point is 00:06:16 In fact, Jack and I jumped in T-boy style to the numbers, and we calculated something wild about Whatnot size. There's so many sellers selling random stuff on Whatnot that they have three times as much video content as all of cable television. And there's like wild examples out there. Like we found a great example in San Francisco. This old San Francisco collectible coin store went on whatnot just to sell their collection of 19th century currency. And how did this small random coin shop in the middle of the city do, Jack? They're selling way more on whatnot than they ever sold in their physical store.

Starting point is 00:06:50 Four million dollars worth of coins sold on whatnot. There's another dude who's selling European men's wallets. This guy's dressed like Vanna White. He's selling for six hours a day and it's only European wallets. You see, this is shopping, but it's also entertainment. Exactly. You can watch videos for hours, not buy anything, but still leave the app feeling satisfied. Like that guy you found selling, what was it, Jack?

Starting point is 00:07:16 It was flags. Vintage American flag. So he had this 48-star American flag behind us. And to get me to buy the flag, he explained, you know, Hawaii and Alaska statehood and where the country was when, you know, Congress approved them as being the 49th and 50th states. It feels like you're watching pawn stars on the history channel, but Chum Lee is selling the stuff directly to your wallet. What I'm saying is unlike TikTok, this is a productive waste of time. Yet is What Not's innovation.

Starting point is 00:07:44 The way we see it was turning e-commerce into reality TV and then putting it on your phone. It sounds pretty cool. It's Survivor meets Amazon. It's Etsy meets Squid Games. So Jack, what's the takeaway for our buddies over at Whatnot? We have to talk about psychonomics. Psychonomics. Yeties, that is our term for when companies use psychology to boost their economics. And that's exactly what whatnot's doing. They are a master of psychonomics.

Starting point is 00:08:12 For example, every whatnot video includes live comments so fans can encourage you to buy. So as a user, you're feeling peer pressure. Oh, and also there's a countdown clock that keeps the seller on their toes and creates a sense of urgency for the buyer. They also have this thing called Sudden Death Auctions. Right. Which is when next bid wins. Yeah, it's crazy. So you see a sudden death logo come up on the screen. You grab your phone to type in $50 as quickly as you can.

Starting point is 00:08:35 Could you imagine if Billy Mays was doing this for six hours a day? And then you had, oh, Billy Mays here, two seconds to get 50 bucks off oxy clean. Add those tactics up. And that's why whatnot users can spend hours scrolling through live shopping videos. So besties, Jack and I think live shopping habits will be China's next big export to the United States with or without TikTok. Because $5 billion whatnot shows how psychonomics can power live stream shopping. For our second story, NVIDIA just issued the most angry, upset, bitter, aggressive press release we have ever seen. Because NVIDIA's chips are being treated by the White House like they were nuclear weapons. Less than a week left.

Starting point is 00:09:23 The Biden administration has less than one week left in the White House, so they have been making moves the last few days, Jack. They've been very active with executive orders, but the latest one that came out Monday morning might be the biggest. If you happen to make, you know, artificial intelligence computer chips, well, you can now only sell them freely to 18 ally countries. That's right. Our top European and Asian allies have the green light.

Starting point is 00:09:48 They can buy as many Nvidia AI chips as they want. It's kind of like mean girls. You can sit with us. You can't. And you can enjoy the AI chips while you're sitting with us. All the bullies in the lunchroom, in Nixon analogy, are China, Iran, Russia, and North Korea. They have been deemed red-light countries by this executive order. They are forbidden from accessing America's top AI technology.

Starting point is 00:10:09 So you got green-light countries who can buy any of our chips. You got red-light countries who can't buy any of our chips. Jack, I got to ask, who are the yellow-light countries? The rest of the world. The 100-plus other countries who can buy Nvidia or other top AI chips, but only in limited quantities and with serious security strings attached. Malaysia, you're cool. You can buy them, but only this many of them. And Nick, those yellow light rules, they're intended to stop China from accessing U.S. chips

Starting point is 00:10:38 through intermediary countries like, I don't know, Saudi Arabia. So besties add it all up and the goal of this red light, green light, yellow light, who can buy our computer chips point is to prevent China and other adversaries from accessing our most powerful chips that can power AI. Now, Yetis, that was the new rule from the president. But, Jack, what was the response from Nvidia, the company that, you know, is famous for making AI computer chips? Envidia was furious.

Starting point is 00:11:08 Furious. We have never seen such an angry and aggressive press release. This is just one quote. But here it is. Rather than mitigate any threat, the new Biden rules would only weaken America's global competitiveness, undermining the innovation that has kept the U.S. ahead. Yes. That is the corporate equivalent of flipping.

Starting point is 00:11:26 a table on a Bravo reality show. Now, the rest of the press release, Nvidia actually praised Trump, name-dropping him twice in the same report. Which is honestly, it's a politically calculated move that we're seeing others do at this moment as well. With Trump coming into office next week, every tech company is keen to flatter him. It just is a lot easier to bash the lame duck outgoing president and compliment the incoming new president. It's political calculus that just about everyone is made. Basically, Nvidia is hoping that Trump will cancel the order once. he's inaugurated. But still, Nvidia stock is down 11% in the past week because of this rule.

Starting point is 00:12:01 Because this one rule could put a big dent in its business. Invidia happens to sell about $17 billion worth of computer chips to China. That's what they did last year. That's 11% of their business. Now, not all those chips are going to be restricted. Only the most cutting-edge AI chips are affected. So, Jack, what's the takeaway for our buddies over at Nvidia? AI chips are officially military arms. They're like digital uranium. Yeti's wild stat we noticed. One expert told the Financial Times that China is only six to 18 months behind the United States in the AI arms race. And honestly, Jack, that sounds like the plot of Oppenheimer, the movie. And that makes sense, because we see AI as being like nuclear

Starting point is 00:12:43 power. Yes, we do. Nuclear can be used for good or can be used for bad. So the Biden administration is trying to keep AI chips away from our adversaries like it's a bomb technology. Vindia's chips, like nuclear power, can be used for peace, say AI chatbots. But on the other hand, invidia's chips can also be used for war to build advanced weapons, surveillance, drones, it's possible. This new chip export restriction was probably Biden's biggest final move as president, and it makes one thing official. AI chips are military arms. They're basically digital uranium. Now a quick word from our sponsor. For our third and final story, Sonos just fired it.

Starting point is 00:13:29 CEO because of a single, simple app update. This is the first time we've ever seen that, but it won't be the last. We'll explain why. Okay, Jack, our favorite hero stat about Sonos, you want to tell it to the Yetis? This is really good. Sonos is the only publicly traded company whose name is a full palindrome. Okay, spell this out yeties. S-O-N-O-S. It's the same left to right, and it's the same up or down. If you flip the name over either dimensions, It still says Sonos. Sonos, it is the Santa Barbara Bay Sound System.

Starting point is 00:14:05 Sonos, a billion and a half dollars in revenue, 50% profit margins. Not too shabby, Jack. This is the Mercedes of Speakers. But here's the problem. Sales fell by 16% last quarter. And the stock? While the rest of the stock market grew 25%

Starting point is 00:14:21 last year, Sonos fell by 30%. And then there's the latest news because yesterday, the CEO of Sonos stepped down. The CEO was fired because he botched an app update this past May. Here's the deal. The Sonos app was beloved by Sonos speakers owners. A lot of people love it.

Starting point is 00:14:38 Many used the Sonos app instead of Spotify or Apple Music. It was that good. But last May, Sonos came up with a new app update that was supposed to improve the app experience for everyone. Instead, downloading the app update brought you bugs, lost features, and one huge mess up. Many Sonos users set alarm clocks, and sleep timers so that they wake up to music on their Sonos speakers.

Starting point is 00:15:03 Okay, but this new app had deleted that feature. It no longer existed, no more alarm clock. And Sonos didn't apologize. They didn't explain why that feature was gone, so everyone was just kind of pissed. And remember, people had built speakers that were made by Sonos into their bedroom architecture. They, like, depended on the sound system.

Starting point is 00:15:22 And the new app update was a total pain. Okay. It made all that money they invested in their speakers feel like a waste. Can I read you the latest app update? Here's the latest review about the Sonos app. Here it is, here it is. One star, spectacularly bad from Lowell 62. This person says, Sonos is one of the worst apps I've ever seen or had the displeasure of using.

Starting point is 00:15:45 It is wildly unfortunate and were held hostage in their product. Brutal. They feel like they're held hostage because they spent so much money on those speakers, right? Exactly. Yeah. And Sonos's new Ace headset, the reason they did the app update in the first place, It was totally overshadowed by all the rage about the app update. So the news as of Monday is that the CEO is out.

Starting point is 00:16:05 He said that we let far too many people down. Basically, Sonos has seen more drama than a conscious uncoupling. Like the real housewives of Sonos. For real. So Jack, what's the takeaway for our buddies who we can hear over at Sonos? If you botch the app, you botched the whole product. Yeties today, no matter how physical the product, chances are it is infused with technology.

Starting point is 00:16:30 And we consumers have such high expectations of technology, because of Apple and Google and whatnot, that we get very upset when the app falls short. So consumers are now making product decisions not based on the hardware, but based on the software. For example, cars. Cars were always a hardware product. You like looked under the hood and checked out the engine. But electric cars today, they're more about software than hardware. Great example, Jack, because you and I both own electric vehicles. and we both just re-offed our leases. And we got another Tesla because the software was so good.

Starting point is 00:17:02 But I ditched my Volkswagen because the software was so bad. That is why CEOs are being judged not just by how good the product is, but by how good its accompanying app or software is. The espresso machine might make great lattes, but if the touchscreen is glitchy. You hate that espresso machine. Honey, just toss it out. So today, a product is only as good as the software that runs it. Besties, if you botch the app, you botch the whole darn product. Jack, could you whip up the takeaways for us for T-Boy Tuesday? What Not is rising in the app store as TikTok nears its end in America. What Not's live stream shopping is a mastery of psycho-economics. For our second story, it's Invidia. Their stock fell on news of new export restrictions for their AI chips. AI chips are

Starting point is 00:17:51 officially military arms. AI chips are like digital uranium. And our third, third and final story is Sonos. Their CEO is out. Gone. Because he never recovered from the company's botched app update. Besties, if you botch the app, you botch the whole darn product. But Yeties, this pod's not over yet. Here's what else you need to know today. First, big week in Washington, D.C., Trump's picks for positions like Treasury Secretary get confirmed by the Senate in the next few days. That's right. Trump's cabinet appointees must get 50 votes in the Senate in order to lead our government agencies. And second, if you're interested in betting, listen to this, because pretty soon you can bet in the sky. First of all, Kalshie, one of the online prediction markets, just added Donald Trump

Starting point is 00:18:36 Jr. as a strategic advisor. Meanwhile, Delta Airlines is partnering with draft kings for in-air betting. Betting on airplanes is illegal since the 1960s. But now you can play roulette from your seat back. And finally, Shakeshack is tripling their number of locations. they're going up to 1,500 shacks. Shake Shack has been the top performing burger stock of last year. They've nearly doubled. And yet, Shake Shack is the most expensive fast food burger. What's going on, Jack? It's all about expectations. Totally. Because you compare Shake Shack to a nice restaurant. So compared to a nice restaurant, Shikshack's actually a discount. You don't compare Shakeshack to a fast food burger, in which case it would have felt it expensive. Now, time for the best fact yet. This one, whipped up by Jack, and

Starting point is 00:19:25 eye for the lovely city of Los Angeles. Some of the wildfires in Los Angeles are contained, but others are still raging with more wind coming this week. Okay, right now, this is on pace to already be the costliest fire in American history. We have friends of the pod based in Los Angeles that we've been thinking about for over a week now. A huge portion of our team, the people we work with, our editor of this episode, Trey, he's down in L.A. Our ad sales team at Wondery, they're in L.A. Our talent agents at UTA, Rebecca Orrin, they are in Los Angeles. We've been talking to these people. And personally, we know a couple of people who've lost their entire homes.

Starting point is 00:20:00 It's devastating. We actually know people also who have just had to pack up their cars with a few things, and they're just waiting to evacuate. Which is a traumatic experience in and of itself. So Yetis, if you're in Los Angeles or you know someone in Los Angeles, you can let them know about these businesses that are offering what we think are really good services to help. Airbnb is offering free emergency housing to 25,000 families in L.A. at Airbnb.com. Planet Fitness opened up gym access to anyone so you could shower, use their locker rooms, get cleaned up at any planet fitness.

Starting point is 00:20:31 Instacart is waiving all delivery fees in Los Angeles. And if you know someone with babies, Bobby, the Baby Formula Company, will let you gift baby formula through their website. You can buy formula for people in LA. There's a bunch of other organizations doing amazing things, and there's a lot of ways that we can donate and help. In the meantime, the city of Los Angeles is lovely. We are thinking of all of our Yeties and besties there, and we know you're in. to come out of this. Yeties, you look fantastic for Tea Boy Tuesday, but we don't want to leave you yet. Jack, what's the best place you can go right now? To our episode description, to click the link,

Starting point is 00:21:07 to listen to the best idea yet. We've got a wild story on the true origins of the Reese's peanut butter cup and that crazy frog salesman who made it happen. H.B. Reese was a wild car. Great guy. Milton Hershey was his guardian angel. Even wilder. Jack and I will see you at the best idea. And before we go, a happy birthday to legendary Panther Yeti, Lizzie Horvitz from lovely Cleveland, Ohio. What do they call Cleveland, Jack? Paris on the Lake. Paris on the Lake. An happy birthday to Alejandro in Chicago, who's turning 12 and listening to the show right now with his dad.

Starting point is 00:21:46 We see you, Alejandro, and Maison Zabet is celebrating his 30th birthday in lovely Reidsburg, Wisconsin. Happy birthday to Chris Costell in Brooklyn, New York, who's celebrating, get this, at a Hans Zimmer musical score concert. That's how you do a birthday, Jack. The guys got range. He did the Lion King and he did interstellar. And Chris has taste. And Justin Fetrell got stuck in a window seat with no window. Hate 17th seat.

Starting point is 00:22:11 I know. Trigger warning, Jack. I'm sorry. I know that hits your heart. Seed 17C. Avoid it at all costs. And Amanda Whittam, legendary Yeti got her T-Boy sweatsuit. She felt fantastic.

Starting point is 00:22:23 She's been rolling in it all week. And congratulations to Savannah Westwood. A great Yetty in Orlando, Florida. walked enough dogs to cross the state of Florida three times. And Grant Murchison is a Yeti who found the last Chucky Cheese with an animatronics down in North Carolina. Send us a pick, Grant. Don't send us a pick because that scares us every time. Kind of freaks us out. Those things get freaking. This is Jack. I own stock of Amazon and Instacart. Nick own stock of Shake Shack and Delta. And Nick and I both own stock of Apple and Spotify. And we both own a Bitcoin named Ben.

The Best One Yet - 📹 “The Next TikTok” — Whatnot’s $5B shop app. Nvidia’s uranium problem. Sonos’ CEO oopsie.

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