The Best One Yet - “Who’s gonna buy James Bond?” — Casper’s un-unicorning. MGM’s bidders. Bird’s newest acquisition.

Episode Date: January 29, 2020

Scooter pioneer Bird just acquired a German rival, but it’s a sign the future scooter wars are going to look a lot like today’s delivery wars. Casper’s valuation dropped from over $1B to $744M before its IPO as public investors laugh at the VCs that thought it was a tech company. And MGM is looking to sell itself to Apple, Netflix, or the rest of the “Big 6.”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. It is Wednesday, January 29th already. It was a blockbuster day of corporate earnings yesterday. It was insane. By the way, Jack's mic almost just fell off and hit him in the face. Yeah, that clunk.

It was my microphone. We're not going to redo a take on this. We're going forward with the pie. Now, Apple, Alibaba, Microsoft, McDonald, Starbucks, Tesla, and Visa told us how their fourth quarter went yesterday. Now, I've got to get a water break after this. Now, we're in London. So we have some hashtag time zone problems. Right, it's basically like February here right now.

We're going to cover all those stories tomorrow, but today is still the best one yet. No joke, Jack and I found three wonderful stories. The first, Bird is invading Berlin. We're talking about the scooter icon Bird. It just raised money and acquired a Berlin scooter rival. By the way, bird scooters only have a life of 26 days. And then they're dead and they have to be replaced. Which is weird.

That sounds horrible. Someone needs to address this. Second story. Who is going to buy James Bond? Bond. James Bond. James Bond? The MGM Studios is trying to sell itself. Yeah, not Dwayne Bond, by the way, his cousin in Boston. His nerdy cousin. Not Dway. Now, the buyer of James Bond and MGM Studios could be Netflix

or Apple. It could be one of the substantial six. Our third and final story is Casper. Our ex-unicorn of the day. They lost the horn. It whittled away. The direct-to-consumer mattress company's valuation has fallen below $1 billion as it prepares to IPO in the next couple months. Jack and I are whipping out the chalk. We've got a lesson in a union. it economics. But before we hit those stories, we got to talk about these type Thursday clubs that get together and critique fonts that are used online. Everyone likes a good alliteration. The New York Times reported this. Jack and I are still scarred by Times New Roman. One inch margin, double-spaced margins, 12-point size bond. You got to make the period size 30 to hit that six to eight page

max. You got to do what you got to do. No, the six-page minimum. Oh my God, the teachers in high school. Now, fonts are a big deal in the business world because most fonts that wear well, You need to pay the creator of those fonts to use them on your website. So big companies who do a lot of words in their work come up with their own fonts. We jumped in snack style and found a few for it. Google's font is called Google Sans, which means Google without. Now the purpose of their font, they say, and the reason they decided to design it like that was to make it more accessible.

Uber's is called Uber Move, which also has an accessibility theme. They said they made it to evoke safety and accessibility. Yeah, shocker. There's a little bit of group thing going on in Silicon Valley. B's is called cereal. Yeah. Serial like the breakfast, not cereal like the killer.

You can always count an Airbnb to do something that doesn't really make sense, but is charming. And then Netflix also calls Netflix's font, Netflix Sons. And that one we think means Sons like without having to pay any money. But that's why they did this.

Netflix simply wanted to make millions of dollars and not have to deal with paying for money. They wanted to stop paying people for fonts on the website. Meanwhile, the New York City subway is still trying to make Helvetica happen. My favorite font is Andy, which is the one that looks like it's drawn by a six-year-old kid.

And I think it's from Boy story when Andy's, you know, owner wrote Andy on the boot. He was a great guy. I think I grew up up until age 12. I put impact for everything. Everyone was impact. Woody's owner. Birthday party on the booth.

Saturday 15th. Let's hit our three stories. What's your favorite font, by the way, Snacks? 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 hair ain't food. It's air candy. They don't reflect the views of the rob of her family.

It's all informational just so. We're not recommending any security. Nope. It's not a research report or investment advice. Not an offer or sale of a security. Right. Snacks is digestible. Business news for you.

Robberhood Financial, LLC, member Fenra slash SIPC. For our first story, Bird just acquired a scooter startup rival over in Europe. We think there's going to be more and more scoots merging with scooters. So many scooters. Everyone's on the scooters these days. Everyone's vertical. I tried it once. I got completely scared.

It was a very close, dangerous thing. I tried it once. I wasn't scared. I did recognize it was dangerous. Everyone's scared. Everyone is scared on a scooter. No one admits it. Bird is one of the e-scooter pioneers that has little scooters with two wheels that are electric that are in 120 cities. Cirque is a Berlin-based startup that was just acquired by By Bird. It does the same thing as Bird, but I'm guessing Cirque is in far fewer cities. Also, when you go to Cirque's website, you get to see their mission, which is bold. Well, their mission has two parts.

The first part is descriptive of what they actually do. Right. Responsible rides. The second part is descriptive of how they want to be like remembered PR-wise. Responsible rides to enhance our cities and build a cleaner, safer, more connected world. It's like they're trying to win a Jesus award. It's like they think they've changed the world. You go from A to Z on a CERC.

That's about it. That's the quick value proposition. Give from A to B quick with just a few bucks on a screen. Now, 2018 was the summer of the scoot. I remember it well. It's the summer that we launched our podcast. Every scooter company was raising money, hitting a billion dollar valuation, unleashing scooters across the world, littering the streets like discarded Big Mac containers. There were scooters. If you had two wheels, a pulse, and a PDF, you could raise millions of dollars from any venture capitalist anywhere. Snackers, in just three years,

Byrd went from nothing to a $3 billion company. That is really fast. Now, here's why Jack and I were fascinated in Byrd right now. It is at a critical inflection point as it takes on lime, spin, jump, skip, tier, yellow, and dot. That's not a boy band. That is all of these scooter rivals in the scooter space right now. I would pay money to see a boy band scooting on scoots. In the future, the only boy bands will be the ones on scooters. Now, Byrd also announced, not just the acquisition of Cirque, the Berlin company, but also a fundraise of $75 million so they can buy more scooters to replace the old ones and to expand to new cities. Now, the company hasn't proven it's profitable yet, but they claim they're now pivoting to a path to profitability because they like

a lot of peas. We're skeptical because there are reports that the average scooter, literally the hardware that people ride on, lasts only 23 days before it's broken. Snackers. You know, like a Toyota lasts 200,000 miles, a Ford lasts 100,000 miles. These thing lasts 23 days. Now, that's according to oversharing, which is a newsletter about the sharing economy. Now, but Snackers, you have to sit down, take off your helmet, and let that sink in. It is the key metric that is hindering the profitability of Byrd. Bird claims it has a solution, which is a new scooter that is more durable and will last longer, but we'll see.

Until then, its scooters don't last as long as like, I don't know, the milk in your fridge. So, Jack, what's the takeaway for our buddies over at Byrd? To see where the scooter wars are going, look at today's food delivery war. Food delivery and scooters have the same underlying elements. First, they're both commoditized experience. You download as many apps as you can. You can find the best deal because they're the same thing. The falafel is going to come to you one way.

Now you're going to scoot down Third Avenue in otherwise. Second, they're both highly regional businesses with local players that dominate. You got scoot in NSF, you got Bird in L.A. You got Postmates in L.A. You got Grubhub in New York. You have studied your notes now. This is good. I haven't just been proud.

And both have no loyalty with their customers. As we mentioned, they're commoditized, and people just, do what's fastest and cheapest. Fastest, cheapest, fastest cheapest. Finally, there are too many competitors in both industries, and we expect consolidation. Right. We're already seeing it in food delivery. We could see more of it in scooting.

By the way, fun fact, the founder of Cirque, who I suppose is German, also founded delivery hero, a food delivery startup, further proving our theory that they're the same business. It all comes full circ. For our second story, MGM, the movie studio behind the Roaring Lion. You know what we're talking about. You've seen the movie with the lion roars at you before? They, like, updated. I think he's a little younger now.

Yeah, it's like Simba in his teenage years. But to get to the key point here, MGM is looking to get bought. They're trying to sell themselves. It looks like we have another big media merger. Can we list out all the media mergers? It's like when you turn 28 and, like, all these wedding invitations start coming in.

AT&T acquired Time Warner. Disney acquired Fox. Viacom is merging with CBS. Comcast acquired British Com. company. Scott. It's like NBA super teams. Now we have the big six of media. After all those mergers, the companies that are making our movies and our TV shows are pretty much Apple, Amazon, AT&T, Comcast, Disney, and Netflix. That is the big six. Now, Snackers, there also happen to be the small several in addition to the big six who are just kind of sitting on the bench. They're talented,

but they're not getting a lot of playing time. Right. MGM is one of those for sure. And they need a merger to compete in these streaming walls. Yeah, MGM's not whipping up its own streaming like dongle situation. So MGM is a smaller movie studio with private equity owners who really want their payday right. Yeah, a private equity firm basically raised money, bought MGM in 2010, and they did it for like hardly any money. The company was literally in bankruptcy. Yeah, MGM was.

And now CNBC is reporting that MGM wants to sell for $7 billion. Really nice payday for its own. So the big question is, let's say you're in the market, you're going to spend a little cash, you want to buy yourself a little MGM, what are you getting when you treat yourself? It's not like cameras or actors. No, you're not getting that. It's actually characters and the rights to movies and shows that have already been made. Right, you're getting the handsmaids tale, which is like three seasons on Hulu, really good show. You're getting Rocky, which is we've lost track. There were five original movies, I think, and then six, seven, eight, and ten. I can fight. Put me back in.

I can still fight. How you doing? But the big showstopper thing you get with MGM is, James Bond. And by James Bond, we mean contracts that say you own Ian Fleming's spy character, you own Moneypenny, you own Q, you own R, you own M, every letter in the alphabet. What else you got? And you get the ballpoint pen. Yes. That doubles as a flame. Thank you, Jack. So what's the takeaway for our buddies over at MGM? This is our bold take. James Bond is completely under-monetized, especially when you compare it to DC, Marvel, and Star Wars. And that's why MGM is such an interesting acquisition target. Look at the DC universe. They have a movie every year. Batman, Joker, Catwoman, Batman again. Star Wars is giving streaming shows to unborn fake characters.

Baby Yoda, the Skywalker's niece. Marvel is trying to make enough movies so that you can watch every Marvel movie on every flight for the rest of your life. Snackers, Jack and I always talk about this when we're on a flight. Look around like every person on the left side of the plane is watching a Marvel movie. But then you look at James Bond. Snackers, Google James Bond. Bond movies. You'll see a Wikipedia page. Yeah. You can see that there have only been six James Bond movies in the last 20 years. Do the math on that.

It means you're getting one Bond movie for every three and a half years. Why don't they ask Daniel Craig to make like more movies? They're like, Daniel, you're ready for the next one? They're like, I just did that fight scene. They're like, Daniel, that was in 2012. It was a long fight scene. It was a very long fight scene. Now, if Netflix acquires MGM,

it could create a whole TV series about Jaws, that crazy Bond villain with the metal team. Or Apple TV Plus could do a whole origin movie series with just M. M. Played by the famous Judy Densh. Dame Judy Densh. Who is a big time snacker. Just want to point that out. Whoever buys MGM should make more Bond movies. And hire a younger James Bond. For our third and final story, Casper is somewhat shockingly still planning to get out of bed in IPO. Full disclosure, Nick and I both sleep on Casper mattresses. Full disclosure, we kind of like it. But Casper's IPO is going to be for a much lower price and a lower valuation than Casper was hoping for. Now, Snackers, that's because venture capitalists

had valued Casper at $1.1 billion way back in March 2019. We celebrated it on this podcast. It became a unicorn. We called it a brandicorn because it's not just a tech company. It's really a brand focus brand, brand, brand company. Right. Back then, Venture capitalist bought shares of Casper, even though it was a private company, VCs can buy shares. Yeah, it's a great thing. For $26. And if you multiply $26 per share to the number of shares, it was worth $1.1 billion back in March.

So now Casper still wants to IPO, but it's basically downgraded those ambitions, according to these docs that it's filed with regulators. It issued a document yesterday. It said, we know we sold those shares for $26. It was kind of a joke. We were kind of kidding around that. We are aiming to IPO at a share price of $17 to $19, which means it's worth $7444 total. Right.

You multiply the new share price by the same number of shares. $744 million down from $1.1 billion. This company has been de-unicorned. It's now a horse. It's basically a pony. It's been de-horned. Now, Snaggers, Jack and I got to talk through the entire S-1, the IPO filing doc, about Casper, just a couple weeks ago with you when they released it.

But this time, we won't. want to talk about Casper's unprofitability by looking at one individual mattress. We're going from entire Casper company to one thing you sleep on. Now, Casper lost $92 million last year, even though it had revenues of $358 million. Now, we know you're wondering, what does that mean for me? Why does this single unit of measurement of one mattress matter? Let me tell you, the average mattress at Casper cost $1,362. dollars. Yeah. For each of those mattresses sold, Casper lost $294. Now let's compare that to another

single unit like the iPhone from Apple. The iPhone goes for about a thousand bucks these days, and Apple makes $200 a profit on each iPhone sale. Which means Casper is a lot more like Uber. Let's look at a single Uber ride. Let's say an Uber ride costs $15 bucks. Uber loses $5 of profits. It's losses of money on each $15. Those unit economics matter because a single product can tell the entire company's story. Apple makes money with the sale of each iPhone. Casper and Uber lose money with the sale of each mattress and ride. So Jack, what's the takeaway for our buddies over at Casper, who kind of sound a lot like a

takeaway we had yesterday about WeWork? Casper somehow convinced venture capitalist that it was a tech company, and that boosted its valuation by 50%. Here's the funny thing about Casper, and we can say this having slept on it every night for a long time. It's definitely not a tech company. It is not a tech company. I tried sticking my iPhone in there, didn't work. I tried downloading the new Casper also didn't work. Casper could make a few cents of profit on each dollar of sales, but not the 20 to 40 cents of profit on each buck like a tech company can. Now, life is all about timing. And maybe if Casper had IPOed before the whole WeWork

debacle last fall, it could have gotten away with a tech stock price. But in this post-WeWork IPO debacle world that we live in. It's a crazy world. It's going to have a mattress company stock price, not a tech company stock price. Jack, can you whip up the takeaways for us over there? Bird, the e-scooter startup, acquired a European competitor and raised some money. The scooter industry faces the same challenges at the food delivery apps. MGM Studios has reportedly put itself up for sale. And the buyer is probably going to make like a bunch of James Bond spin-offs and then spin-offs of his friends. Casper is still planning to issue stock on the New York Stocker Exchange. but at a much lower price.

No joke, they mentioned the word technology 88 times in their IPO filing paperwork. But they're not a tech company. They could have done 87 fewer. They just said, we're not a tech company. Yeah, one line that just says, we're not a tech company. Now, time for our snack fact of the day. This one sent in by Hoda Mare in San Francisco, California. Mera is in the German word for more.

Now, the big question Hoda asked was if we've hit peak subscriptionation. And remember, subscription is, we got all these subscriptions. Yeah. Are we saturated? Have we hit subscription? Because we can't take another password. Subscription saturation. Hoda points to data that shows app subscriptions rose by 21% from 2018 to 2018.

So it's plenty of subscriptions out there. Yeah, we're not at subscription. So growing subscriptions getting handed out like 20. However, we looked into the numbers. And although 21% growth looks like we haven't hit subscription, 21% is way slower than the growth we had the year before, which was 63%. From 2017 to 2018, subscriptions grew 63%. It's a sign that we're closing in on that point where maybe you have a little bit too many subscriptions.

We're not at subscription yet, but we're getting closer. Snackers, love being with you today. Can someone please explain to us what the serif means in San Serif? Please, I would love that. We have no idea. And Times New Roman versus Times Roman. We'll see you tomorrow, Snackers. This is Jack. I own stock of Amazon and Nick and I both own stock of Tesla.

The Robin Hood Snacks podcast you just heard reflects the opinions of only the hosts who are associated persons of Robin Hood Financial LLC and does not reflect the views of Robin Hood Markets, 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.