The Best One Yet - Waymo’s robotaxis hit the app store — Otis Elevator spinoff — HipCamp could be Airbnb’s next acquisition

Episode Date: December 9, 2019

Alphabet’s self-driving car company, Waymo, just took a big step towards real robotaxis — an app for the general public. Otis Elevators made skyscrapers possible, and now it’s getting spun-off into its own company. And a fresh profile on HipCamp (the Airbnb for camp sites) has us wondering if it’s simply an Airbnb acquisition target.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 Jack. And this is Snacks Daily. Welcome back. It is Monday, December 9th all right. Snackers, Nick and I are exhausted from moving this weekend. I moved a Christmas tree and Nick moved everything he owns. Jack, you got a lift with your legs, not your back.

And that's why this is the best snacks daily we've ever done. Nick moved across the street, by the way. The shortest move in the history of the world. Yeah, my back actually does hurt. We got three great stories today. The first one is Otis Elevator. It's getting spun off into its own publicly traded company. This is the 166-year-old company that made skyscrapers possible.

Second story, Waymo, which is Alphabet self-driving car company, it just put the Waymo app on the Apple App Store. Snackers, Robotaxis have been all talk. This is their first big, real step. We're proud of them. Third and final story is the not quite unicorn of the day. It's called Hip Camp. This is the Airbnb for campsites,

and the New Yorker magazine just did a deep dive, so we're taking a luck. So Jack and I are trying to figure out basically, is Airbnb going to acquire these guys or what? Or maybe they shouldn't. But before we get into those stories, we have a bold claim here. New York is the new Silicon Valley. New York is an aggressively new Silicon Valley.

Just walk down the streets. You're going to notice a lot of office space a change in. We just heard reports on Friday that Facebook is in talks to take out the new future Penn Station situation, which could create 14,000 Facebook jobs. Penn Station situation is exactly the way you should describe that, Jack. That's perfect. And then we heard that Amazon,

is adding 1.5,000 employees to make it a New York City tech hub of like over 8,000 employees. Google, this is a little less fresh, but last year Google announced it's adding 7,000 new jobs. It already has 7,000 jobs. So that's 14,000 Googlers roaming the streets of New York. Yeah, they're doing that in Hudson Square, which is basically just a rebranded version of like the West Village. Now, Snackers, with so many techies in New York City, they're going to have to adapt to this new climate, this new way of life, and this new speed expectation of walking on side. walks, which is really fast. They're going to have to get themselves some snow repellent all bird

shoes over there. All those Patagonia vests, you got to turn those into jackets. It's pretty cold in New York. Yeah, you got to actually buy sleeves for your vests. And then instead of complaining about traffic on the 101 or 280, you're going to start complaining about arbitrary delays on the NQR line because of train traffic ahead of us. Now, Uber and Lyft take the cake on all this. They have 80 to 100,000 workers. I mean independent contractors using the Uber and Lyft app in New York City. Asterisk there. By the way, Amazon, guess you didn't need that whole HQ-2 absurd reality show of a contest you tried putting on the last couple years. Honestly, when you're the most coveted city in the world like New York is, you don't need to beg companies with tax incentives to move it.

They just do it. 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 hearin food. It's air candy. They don't reflect the views of the robberhood family. It's all informational just so. We're not recommending any securities. No. 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, Waymo just got closer to offering Uber rides, but for half the price. And here's the secret. They're cutting out the drivers. We're talking about robot taxis, aka RoboTaxies. And they're brought to by Google's parent company, Alphabet. All right, Snackers, take out your. phone right now, if you happen to have an iPhone, open up the app store. And when you go in there,

search for Waymo, you're going to notice a Waymo app with only, you know, 22 ratings. That app was just launched last week. And Nick, this is a big step forward in the progress towards real self-driving cars. Snackers, Jack and I naturally jumped in snack style, started playing around with it. And you're kind of just stuck on a wait list when you get into this. The first thing that happens when you open the app, it says join waitlist. It's not like a real thing. You're not going to get Robo Taxi Rads right away. We should immediately lower your expectations on this. What you can do, though, is check out.

They've got this cool, like, virtual video where, like, you move your phone, and it feels like you're getting in a robo taxi, which is kind of neat. The Waymo app has already been in Google Play, which is the Android version of the App Store, since April. But this expansion signals a new era. They're moving towards becoming open for business to the public. All right. So here's how these Waymo Robotaxy rides have been working. They're like 1,500 riders, and they've taken about 100,000 rides. But it's only in Phoenix, Arizona, which has a dry heat.

Phoenix, Arizona is the Area 51 for testing out new tech. Yeah, if you're from Phoenix, are you like a Phoenician, a Fenexite? We're going to have to have the Snackers and let us know. I have no idea. Waymo does all its driving in a Chrysler Pacifica, which is a classic old-school minivan, but only early adopters who apply and then sign their life away with like an NDA are able to actually get the rides right now. This was the minivan for moms who wanted something like a little bit sleek or a little bit more aerodynamic

when they were doing pickup. It has radar, lidar, cameras, sensors. These minivans are like the same value as the International Space Station. Now, here's what's happening now. The general public in Phoenix, not just like an elite group of trial people, they can be on the wait list. It's expanded to all Phoenix people. They're still going to have to sign an NDA, though.

But here's a really exciting step. Google is offering drives without a human being, not even a safety driver behind the wheel. But the funny thing, Nick, if you get a ride from a Waymo car that doesn't have a safety driver, and you're like waiting for it to pick you up and you can't find it, you can't call the driver and be like, I'm standing right in front of the restaurant, where are you? This is Nick. Are you in the black Prius or the gray Prius? No, you can't do that. But what you can do is you can click a button on the Waymo app that will get the vehicle to start honking so that you'll be able to actually track it down.

Brilliant move. So Jack, what's the takeaway for our buddies over at Waymo? Whoever offers Robotaxies first will become the new monopoly. in rides. All right, snackers, bring out, like, get a whiteboard out, maybe a pencil, whatever material you've got on you right now. Here's how this breaks down. The human driver is about 50% of the cost of your typical Uber ride. These are our estimates, full disclosure, but let's say you take a $10 Uber ride today. We're going to break down where that $10 goes and how that $10 could be different if you take a Waymo self-driving Robotaxie. All right, so let's say you're Julie, the Uber driver, Julie is going to get $7 of that $10 Uber ride and $3 goes to Uber.

Now, of that $7, Julie got, $2 of it, let's say, is going to go to gas and maintenance of the car and like your lease payments because you need to have a car to drive an Uber. So the human driver ends up with $5. But here's the deal with Waymo. Waymo won't have a human driver to worry about, so they will have $5 that doesn't go to a human driver. Instead, they could drop the price of that ride from $10 to $5. and make just as much money as Uber did.

So a Robotaxy, by cutting out the human, can cut the price of a typical ride right now by like half. And whoever offers that is obviously going to become the market leader in Ridehales. Right now we've got like Lyft, Uber, Tesla, probably GM, they're all talking Robotax. It looks like Waymo is ahead of the pack and most likely to get there first, but we do expect all of those competitors to like knock out Waymo's monopoly, which it'll probably only have for a little while.

In the meantime, this is a big step for Robotaxies. This is Jack. Nick and I both own stock of Tesla. Also, check out our Snacks Daily newsletter because we talk about how this moonshot, Waymo, could be the last moonshot after Alphabet's Structure Reorg. Last of the moonshats. You can find that at Snacks.robinhood.com to subscribe. For our second story, Jack, what floor? Seven, please.

You give me seven. I think it's seven. We'll work with seven. We'll work with seven. Otis Elevator is getting spun off into its very own publicly traded company coming in April. Otis is 166 years old, but it's currently part of United Technologies, which is a publicly traded stock. Now, Snackers, we've got the Eiffel Tower, we've got the Empire State Building, we've got the Burj Khalifa in Dubai because of Otis.

We're going back to 1913. That is when the Woolworth Building became the first skyscraper in the world in New York. city. Stunning work of art. It's like got a got a gothic structure going on. I could stare at this thing all day. It's on the corner of Broadway and something in downtown Manhattan. It's a great corner.

It's just really far away from everything. Guess what made the Warworth Building possible? Otis. Otis. Without elevators, you don't really get skyscrapers. No, you're not going up to that business meeting at the Woolworth Building on the 27th floor without an elevator because you don't want to lose a lung climbing up those 27 flights. You got to hire a Sherpa otherwise to make sure.

on time to this thing. So elevators made skyscrapers possible and Otis started in 1853 in I think Yonkers, New York before moving to Connecticut. Now they have an elevator test tower right now in Bristol, Connecticut where they're based, which is like 400 feet tall and literally a skinny shaft

just to handle elevators. You can't get off at any floors on that elevator. It's just up and down. Now, key invention here that changed the history of elevators and it came from Otis. The failsafe. Basically the mechanism that catches the elevator in case the ropes break, so that you don't get that horrible scene from every Indiana Jones movie.

Right. The Economist magazine put this perfectly by saying, basically Otis created the self-driving elevator. Exactly. So Otis didn't just go vertical. They expanded to horizontal and diagonal. It's pretty much an MC Escher situation at Otis. All right, moving sidewalks when you're like at the airport and like, you know, you should rush,

but you're like, do I really have to sprint for this thing? That's thanks to Otis. Escalators, also thanks to Otis. In fact, there have been a whole bunch of unburned calories from climbing steps and walking sidewalks thanks to Otis. Michelle Obama is not a huge fan of Otis. Actually, we don't know that, but still, it's a lot of calories. So for the last 40 years, Otis has been a subsidiary of United Technologies, which is a conglomerate

based in Connecticut. But Snackers, it's not going to get to 41, and here's why. United Technologies is splitting up into three separate companies to unlock value for shareholders. One of them is going to be like an air conditioner company. one of them is going to be like a defense aerospace company and the other one is our buddy otis otis is a substantial company on its own it has 13 billion in revenues 69000 employees let that sink in two million elevators on earth that gets service like once a year so that you look at that little sign up at the elevator and you're like oh it's been checked within the last year jack and i

heard these numbers we had to sit down this is a future fortune 500 company and it's like embedded and nestled within another company right now. And I'll tell you, it's a Fortune 500 company that makes pretty good profits because there aren't many competitors in the elevator business, so they can charge a pretty high price. You don't get like startups in the elevator business. There's no Warby Parker for elevator. No, that would take like 20 years to launch the Warby Parker of Elevator. A lot of VC money.

So Jack, what's the takeaway for our buddies over at Otis? Otis is one of the biggest American profitors from China's economic rise. Snackers. has grown four and a half times bigger since 2006, or in trillions, $2.7 trillion to now $12.2 trillion. Those gigantic numbers of dollars, Nick just described, those are the GDPs of China. Over that same period, the U.S. economy grew just 40%. So you got 40% growth for the U.S. first 350% growth for China. Interesting thing, Jack and I noticed about Otis, though.

Their revenues from China have searched 20% a year over that same period of time. This is a true shocker. That's because about 70% of the elevators getting built in China as it has new cities springing up from Shanghai to King High, they're being built by Otis. And 15 million Chinese are urbanizing every year. Otis loves it. China has been an incredible market for Otis. And it hopes that continues. For our third and final story, Hip Camp is the Airbnb for the outdoors. So we should probably talk about acquisition targets right now. Hip camp is not a unicorn yet. It's only valued at $127 million. Which means it's about, give or take, one, one hundredth of a lift. It's one percent of a lift.

It's still pretty tiny, but the New Yorker magazine just did a deep, deep, deep dive on this company. This is the most information Jack and I have been able to get on it, so we were curious. We jumped in snack style, and there's some interesting investors. We learned that Jay-Z, Will Smith, the former CEO of Twitter, and legendary venture capital firm, Andresen Horowitz have all invested in Hip Camp. So here's the thing about Hip Camp Snaggers. It's basically just land sharing with like 300,000 backyards that someone's going to let you camp on, party on, sleep on, and basically be close to the soil.

Right. It's a lot like Airbnb, but instead of getting a home, you're getting just a piece of land to pitch a tent and sleep under the stars. This is actually frequently summer to Airbnb. It actually looks like Airbnb wandered into the woods for seven years and came back out with like a little less sharp website. Yeah. The website is a little more rough, but the business model in the booking process, it's all the same.

You pay $100. Hip camp keeps like 10%, and the rest goes to the landowner. So, Staggers, here's how it goes down. Let's say you want to stay at Yosemite. You've heard great things. It's the same image that's on your Mac book right now, so you're like, I got to see this thing live. You just watch Free Solo, and you're like, I got to wake up next to the Donwall. So you go camping in Yosemite.

But here's the thing. The National Park Service campsites tend to be packed with people, and you're like sleeping on top of somebody else in their camp. Yeah, you're like, I tried to get away from humans, and now I'm literally on top of one of them right now. So instead, you go over to hip camp where you notice there's a private landowner nearby who's made a lot of money in his or her day,

and they've got 80 acres that they're kind of hip camping out. And they're willing to rent one acre for the whole weekend for like $110 a night, and you're like, that sounds amazing. I get Yosemite without the people. All right, so you're pitching up your tent, you're going there, you're sleeping on the ground. But let's say maybe like, I don't know,

me in this case, you kind of want a warm blanket and you appreciate a roof over your head and not like worms under your body. It's like, uh, my tent doesn't come with an electric down comforter. What's going on? It's B.Y.O. Electric down comforter season? What's going on over here? So hip-cap, you can also find luxury yurts like at some vineyard and totally glamp out for the whole weekend. Right. So you can either do like the luxury treehouse experience or you just get actually just a piece of land that you got to figure out your own life on right now. I've actually been looking to use hip camp for a few months now. Haven't done it yet. But what I've seen is that

pieces of land for camping tend to be like 30 to 60 bucks a night. Yeah, you got to getting touch with your inner Lewis and Clark on this. Now, meanwhile, in this interview with the CEO, she believes that the growth in camping is a combination of two trends. And Jack and I thought this was particularly interesting how the two work together. One is the general movement to cities to find good jobs that we're seeing among millennials. You're working in the city. You're stressed. You're trying to get to work on the subway. It's like a rat race. you realize you might want to get outdoors and experience nature on the weekends. And that's when the second trend comes, which is once you're doing something over the weekend,

like getting outstores because you're like incredibly stressed because the train's been late all week, that's when you start Instagramming it. And that's when more people realize they could be going outdoors too. Now, one problem of these two trends is that campsites like the ones in the National Park System are being overrun by humans. So the solution is Hip Camp. So, Jack, what's the takeaway for our buddies over at Hip Camp? Regulators shouldn't let Airbnb.

acquire HipCamp. Now, Airbnb hasn't offered to acquire HipCamp, but Jack and I think it's very potentially possible, because HipCamp is creeping into Airbnb's business. Airbnb lets you monetize your home by renting out your home or renting a home. HipCamp lets you monetize

land because you're not using it. And the best way Airbnb can neutralize the threat of HipCamp is to acquire. Here's the thing, though, if Airbnb does acquire HipCamp, which Nick and I are speculating on, it would be an Instagram acquired by Facebook all over again. Snackers, today we know that Facebook is a monopoly on social media because it also

owns Instagram. And if Airbnb is allowed to acquire its tiny little competitors before they become big, then Airbnb could become a monopoly as well. And then you're going to be stuck like paying $10 just so you can pee in a river. Yeah, monopolies are bad for you and me. You don't want to pay P-Fees. Jack, can you whip up the takeaways for us to start the week? The Waymo app is now available to all the public iOS, Google Play, and it's one step closer to real-life, Robotaxies. Whoever offers Robotoxys, Taxi's first could offer rides for like half the price. Otis Elevators will become a publicly traded company in April. And they've been breeding vertical profit puffies in China for years now.

Hip Camp is the Airbnb for campsites with over 300,000 potential places to pitch a tent. And from C to shining C, we're hoping Airbnb doesn't acquire this thing. Now, Snackers, time for our snack pack today. This one's sent in by a great longtime snacker from the University of Michigan, Mr. Shraeus. I went to business school with Shreyes. and Shreis noticed on my Twitter account last week. I posted a picture for all the bikers out there telling you what colors to wear to be noticed by cars. I thought green was the number one color that cars would notice.

Turns out your eye is like actually playing favorites on this thing, and the first color that the human eye processes is yellow. A certain shade of mustard to yellow is super noticeable by the human eye in peripheral vision, and that's why every school bus in America is painted this yellow. It's also why every bank robber avoids wearing yellow at all times. They're really more into like blues and gray. Yeah, not a good color if you're robbing a bank. Also, the official color name is school bus yellow.

Yeah, I mean, I don't know if this is an official snack fact, but if you're robbing a bank, go with the earth tones. Snackers love to have me with us to start the week. Jack and I are going to do this tomorrow. Are we wearing the same sweaters? I'd say yes. The Robin Hood Snacks podcast you just heard reflects the opinions of only the 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 and 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.