The Best One Yet - 👞👞👞 “You own 3.6 pairs of Birks” — Birkenstock’s IPO day. Roku’s MoneyBall strategy. The most generous billionaire ever.

Episode Date: October 11, 2023

249-year old Birkenstock goes public today with an IPO — And if “The Lindy Effect” applies, Birkenstock will live *another* 249 years.Roku’s new streaming strategy: Buy leftover TV shows — We call it The Moneyball Strategy: find value in things others don’t.And Billionaire Charles Feeney invented the Duty-Free Store — He passed away yesterday, but not before giving away his entire $8B fortune to charity.$BIRK $ROKU $DUFRYSubscribe to our newsletter: tboypod.com/newsletterWant merch, a shoutout, or got TheBestFactYet? Go to: www.tboypod.comFollow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypodAnd now watch us on Youtube Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. It's Wednesday, October 11th. And today's pod, it is the best one yet. It's a T-boy Jack. Nick and I have an announcement to make in the intro. Yes, we do. In the meantime, though, Jack, what's the first story for today's show?

Birkenstock's IPO is today. You can now wear clogs and buy stock in clocks. But Jack, what's the biggest thing that Birkenstock's bankers are bragging about these days? How old Burkenstock is. And Birkenstock is old. For our second story, Roku's smart TV device has a bold new strategy to win in streaming. Jack and I call it the moneyball strategy. And our third and final story, a billionaire who gave away his entire $8 billion fortune just passed away with $0 to his name.

From $8 billion to $0 billion. So Jack and I are looking at the wildlife of Mr. Charles Feeney, possibly the most generous man ever. Yeah, he gave away all of it. But yeties, before we hit that wonderful mix of start, Jack, a wonderful mix of stories, and I love being on the pot with you today. A personal note from Nick and me. The latest updates on the Israel and Hamas war are pretty sickening. Yetis, as Israel's regaining control of the territory Hamas has taken,

they're finding evidence of a massacre of more than a thousand defenseless Israelis. Hamas gunmen have also kidnapped about 150 more who are still in grave danger. It's a horrific act of terrorism against Israel with video evidence that is just brutal to watch. It looks like Israel's Pearl Harbor moment. And as someone who's half Jewish, the idea that people would want to get rid of you because of who you are or where you're from is just, it's a horrible feeling. And if you're zero percent Jewish or 100 percent Jewish, that is a horrible feeling to think about. Yeties, Nick and I have spoken the past couple days about this news from an analytical and business

lens. But sometimes you just have to speak from the heart. Jack and I said it on Monday and we're going to say it again today. To our Israeli listeners, we're thinking about you today. And to those Palestinian listeners who didn't want Hamas' war and didn't ask for this Hamas attack. And who might be fearful for retaliation right now. But Yetis, that's not the only thing Jack and I want to share with you. Jack and I also want to apologize to you.

For the last couple days, we've covered news about the war in Israel and the Gaza Strip, specifically. And as usual, we did our best to present to you objectively what was happening and why it was happening. But some of you reached out to us regarding our coverage. And we just want to say, we truly appreciate. the feedback you provided. We appreciated the feedback so much. We actually did something we haven't done before. We went back into the show and redid and updated that story. Frankly, Nick and I are humbled by the missed context that we needed to be included in the Gaza Strip story from yesterday. So, Bessie's, if you want, you can actually go back and listen to the new upload from yesterday

to hear the improved story. The biggest issue, the biggest error, was conflating Hamas with Palestine. Hamas and Palestine are not the same thing. We're sorry for the damage that that issue caused. And again, we are humbled and we pledge to do better in the future. Now, we're not going to avoid tough news stories because we think we owe it to you to keep you informed. We love doing tough news stories. It's something Jack and I take pride in. We love doing the research and we love making a T-boy style for you.

Crucially, though, when it is a tough story, we'll do our very best to strike the appropriate tone. Jack and I take a lot of focus to make sure we nail the tone, we narrow the world choice, and we narrow the fact-checking. Sometimes a tone of sensitivity, seriousness, and sometimes even sadness is appropriate. So thank you, Yetis. To all the listeners out there, you're on a journey with us,

we're on a journey with you, and we love doing this with you. We wanted to own up to this mistake in the intro of today's pod and tell you what we're feeling from the heart. And Jack, I love doing this with you. You're the only person I'd be doing this with. Now, let's in our three stories.

15 years before this song, two boys from the Northeast met in the dorm. They had an idea to cough. a cultural storm. It's the best one yet, but the best is a norm. That's it. I don't even think they need to practice. 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. Start the show. For our first story, Birkenstock is going public today after 249 years of putting sandals on souls. And Birkenstock is the perfect case study of a fascinating phenomenon called the Lindy effect.

Jag, let's go regal on this thing. Bergenstock's the king of the clog, the queen of comfort man. Or the Kaiser of the Cork footbed. I mean, would you say the fanny pack for your feet? Does that kind of work too? The cradle for your... We're pushing the limits, man. We're pushing the limits.

Yeties, let's go back to 1774. Birkenstock is invented by Johann von Wolfhausen, Berkenstock. It was worn by German cobbler's back then, and it's worn by Justin Bieber's today. Cinderella story, they've gone from frumpy to fashion. And today they're IPOing. The ticker symbol is BIRK, Burke. You can now earn royalties off of Birkenstock's relaxed fit shoe. And Wall Street priced the stock at a $10 billion valuation.

That's the headline number here, $10 billion. Jack, can we slip into a little context for that, please? The perfect company to compare Birkenstocks to is the other comfort shoe. crox. Here's what Jack and I found fascinating yetties. Bergenstock is twice as valuable as Crocs. $10 billion versus $5 billion. Even though Birkenstocks has one third the revenues of Crocs. We repeat, Birkenstock is twice as valuable as Crocs, even though it sells a third as many shoes as Crocs. Bergenstock's bankers must think that Birkenstock has higher growth potential than Crox does. And today, when the stock begins trading, we're going to see if investors agree.

But Yeties, you know, Nick and I love jumping into a company's IPO paperwork. I mean, Sunday afternoon, I'm calling Jack. He's calling me, honey, we're going into the IPO paperwork. But this was the first time we strapped on leather sandals to get in the zone. Yeties, Jack and I are going to whip up the most interesting numbers that we discovered in that 100 plus pages of Birkenstock IPO paperwork. Birkenstocks is everywhere, from Steve Jobs' old shoes to Barbie shoes today. But get this, Birkenstock basically does zero marketing.

They spend less than 10% of their sales on marketing, promotions, and advertisements. And why is that exactly, Jack? Because 90% of sales, according to Birkenstock, are thanks to word of mouth marketing. 90% of us bought those Birkenstocks because we saw our buddy Timmy strutting around in Furkenstocks over the weekend. And you thought to yourself, my feet deserved that kind of fancy treatment too. Okay, well, then here's the funny thing. When you do buy that pair of Birkenstocks, you end up buying another pair and buying another pair. and buying another pair.

Get this, Yeties. The average Birkenstock customer owns 3.6 pairs. I'm sorry, Jack, we're going to have to pause the pot here. Do you want to whip up a full disclosure for us over there? Yeah, I own three pairs. My wife owns four pairs. So as a household, we are spot on with this 3.6 average. I'm checking the Birkenstock IPO paperwork to see heavy-hitting customers right now, Jack.

You're like a third of their sales. And odds are, if you do own a pair, it's the Arizona model. Exactly. The classic Birkenstock open-toe clog. And why is that, Jack? Because one third of Birkenstock sales come from the Jesus Sandel. Are we going to have to do another disclosure here, man? Yeah, I own two pairs of the Jesus Sandals. Sit down, stand up and how big is your closet? Add it all up yet is walking closet. No big deal. Annual sales from Birkenstock are up from 250 million 10 years ago to $1.3 billion of sales today. I mean, of course it's a walking closet. You're putting on the shoes and just walking around.

around in there apparently the whole time. This is Jack. I'm wearing them right now. Yeties, that is 5x growth for Birkenstock in the past 10 years, thanks to its brand. But Jack and I do have to point out this one major risk. Their number one risk. Birkenstock self-proclaimed that the biggest risk to the company is if the brand loses its cool factor.

And that's when we discovered this exciting and comfy takeaway. So, Jack, what's the takeaway for our buddies over at Birkenstock? Birkenstock is the perfect example of the Lindy effect. The Lindy effect, Yeties, that is a mathematical concept that the longer something has been around, the longer it will last. We read about this in Trung Fans newsletter. It's the idea that the passage of time is a filter for quality. It's anti-aging. When people get older, we're getting close to our expiration date.

But when products get older, they just could keep living even longer than they did before. For example, if a book has been highly read and highly purchased for 40 years, that means it's going to be relevant for 40 more years. Well, here's how that relates to Birkenstock. It looks like they're positioning themselves as the Lindy brand of the stock market. In their IPO paperwork, they didn't highlight their freshness, their newness, or their innovation. They highlighted how old they are. Yeah, Birkenstock. They referenced the word heritage 19 times. Century, 21 times. They wrote the word tradition 41 times.

Because if the Lindy concept holds true, that would be good for Birkenstock. It means that Birkenstock's 249 year history means 249 more years of Birkenstock stock. The Lindy effect. How old you are is also how much longer you're going to be around. For our second story, Roku, its stock just jumped because it's got a bold new strategy and how would we describe it, Jack? So when in the streaming wars, Roku, is doing the moneyball strategy. The Oakland Days baseball team moneyball strategy. But yet he's first, we're all familiar. We all kind of love leftovers. Leftover lasagna gets better in three days. But in media,

there's also leftovers. Content leftovers are a thing in the media industry. Jack, care to explain? And Roku, the streaming company, just ate up Disney's leftover content and the stock jumped by 5%. Here's what Roku acquired. Here's what they ate up. They bought the Spider-Wick Chronicles, which Jack, how would you describe the Spider-Wick Chronicles? It's a TV show based on the best-selling children's book. It's about a family that moves from New York to Michigan and discovers an alternate world of magical fairies. Who loves alternate worlds of magical fairies?

Well, Jack, I'm going to head on down to Orlando, Florida. Disney loves alternate worlds and making money off them. Yeah, so two years ago, Disney bought the rights to put the Spider-Wick Magical Chronicles on their streaming platform. They already produced an eight-episode series of Spider-Wick Chronicles to put on Disney Plus, but they just canceled it. Spider-Wick Chronicles is not coming to Disney Plus anymore. Instead, it's coming to Roku. That's right.

Roku users can now watch Spider-Wick Chronicles for free starting in the new year. Now, it's funny, Yeties, this isn't the first time that Roku has bought up a canceled show that some other streamer didn't want. This is not the first time that Roku has opened the fridge and eating another media company's content leftovers. Roku's playbook is finding sleeper shows that other streamers don't want and then buying those shows for cheap. For example, remember when HBO canceled Westworld? Roku bought it and put it on their free-to-watch Roku channel, which is supported by ads. Or remember the failed Quibi app that shut down a couple years ago? Roku bought the entire library of Quibi shows. They live on the Roku channel now.

I mean, Jack, let's whip out the whiteboard. Bachelor in Paradise, Blue Mountain State, Gordon Ramsey's Kitchen Nightmare Season 2. Those are basically C-list shows. They're little known. They're leftover shows. But now they found a new home where they're finding new viewers. My Babysitter's a Vampire with Ethan Morgan. Also now on Roku. What Roku's doing reminds Nick of me of the 2000 Oakland A's baseball team

profiled in the movie and the book, Moneyball. And the reason why is our takeaway. So, Jack, what's the takeaway for our buddies over at Roku? It's the Moneyball strategy. Finding value in things others don't. Now, yetis, here's the context. The Oakland A's baseball team snagged players no other team wanted, but who still had value. And that team won games.

That's exactly what Roku is doing in media. All the streamers these days, they're competing for our attention with splashy, new, fancy exclusive shows. But Roku's taking a different approach. They're buying up old shows that you remember and offering them to you for free. Sleeper shows like Gossip Girl, Save By the Belt, Little House on the Prairie but free. And that strategy is working. The Roku channel has as much viewership hours as Peacock and HBO Max do.

Get this, Roku has two-thirds as much viewership as Disney Plus. Roku just hit 74 million households that are streaming through Roku. And it's all thanks to the Moneyball strategy. Roku is finding value in shows that other streamers didn't. Just like the Oakland A's. Just like Brad Pitt and Jonah Hill. For our third and final story, Charles Feeney. He's the most generous person who you've never heard of.

He was Warren Buffett's hero and Bill Gates' hero and he passed away yesterday. Charles Feeney grew up in the Depression, served in the Air Force during the Korean War. Jack, can you take it from here? On his way back home from war, he said to himself, you know what, I'd love a drink right now. Maybe a Guinness, where can I get this? Actually, I can't. That's how he hatched the idea for one of the most game-changing retail concepts out there. The duty-free airport store.

Nick, do you even know what duty is? No one really knows what duty is, Jack. No, I don't know what duty is. No one knows. All I know is you walk to the store, you walk out with a 12-pound Godiva chocolate bar, and somehow you got sold a 14-pound Johnny Walker whiskey. And you have a big duty-free tote bag that you can walk to Gate 34B with. And you have no idea how much he actually saved on the duty.

Well, Yeties, in the 1950s. that's exactly what Chuck Feeney did. He served cigarettes and alcohol to homeward-bound U.S. servicemen. And that idea scaled. Mr. Feeney built an $8 billion duty-free dynasty, and guess what the best part was? All his income, it was duty-free too. Tax-free. So by age 50, this man was living the billionaire lifestyle. It expanded duty-free shopping to new airports across the world, and the wealth came with him. So he expanded his homes across the world, too. He had a house in New York, one in London, one in Paris, Honolulu, San Francisco, Aspen, the list went on. But that's when Charles Feeney completely changed his life and did something no other billionaire has ever done.

Get this yeties, Charles Feeney committed to giving away all of his fortune, $8 billion before he died. And we're not just talking like moving the money to his foundation. We're talking directly giving away his money to charities. He donated a billion dollars to Haiti earthquake relief. and another billion dollars to Cornell University. He gave to AIDS clinics in South Africa and paid for surgeries for children with cleft pallets. And by 2016, he had succeeded with his goal. He had given away all his money.

$8 billion, two lifts worth of money had been given away over the last part of his life. All he had left was $2 million to live out the rest of his life, however long that was going to last. Now we know what you're thinking yet. He did Charles Feeney have any kids. Yeah, he did. He had five kids. And he left them what he called decent but unextravagant provisions. And after that, he finished out his final years by taking public transportation and living in a modest two-bedroom rental apartment in San Francisco.

And yesterday, he passed away at the age of 92. So, Jack, what's the takeaway for our buddy, Mr. Charles Feeney? Charles's lesson to billionaires actually applies to everyone. Yeties, it's not just about your successes, but what you do with your successes. Warren Buffett said this about Charles Feeney. He said, Feney is my hero. He's Bill Gates' hero. And frankly, he should be everybody's hero.

Let's say you've been successful and you've accumulated some wealth. Congratulations. So many wealthy Americans are obsessed with growing that wealth. But what are you doing with that wealth? That's the important question. Well, Fini spent his first 50 years earning money and his final 40 years giving it away. Because succeeding is just the beginning. What you do with your success is just a good.

as important. Jack, can you whip up the takeaways for us for Cici Wednesday? Birkenstock is now, after 249 years, finally, a publicly traded stock. And if the Lindy effect holds true, it'll be around for another 249 years. For our second story, it's Roku. They're buying up canceled leftover shows for their free ad-supported Roku channel. It's the Moneyball strategy, finding value in shows that other streamers didn't. And our third and final story is Charles Feeney. He invented the duty-free store, and he also invented giving away all of his billions to charity. Feeney, no relation to Boy Meets World, is a role model for everyone, not just billionaires.

But Yeties, this pod's not over yet. Here's what else you need to know today. First, President Biden addressed the nation describing Hamas' actions against Israel as pure, unadulterated evil, calling it terrorism. He vowed unequivocally to stand with Israel as they begin a statement. siege and possible land war in Gaza. And second, hot strike summer continues. Walgreens pharmacists are the latest to walk out on the job.

First, it was UPS, then car and train workers, then writers and actors, then healthcare workers, and now pharmacists. And finally, Skittles is launching the biggest candy innovation in years just before Halloween. And what is it, Jack? They're called Littles. Littles. Skittles, Littles are literally little Skittles. Baby rainbows.

I think Dr. Seuss was responsible for that last sentence. Now, time for today's best fact yet. This one whipped up by Jack and me. We actually don't have a best fact yet for today's pie. No, we don't. We really don't have a fact for you today. Do we, Jack? What do we have?

We were scrambling to update yesterday's story. And just honestly, we don't have one. But we need some more for you. So we'd love your best fact yet. You know how to send us your submissions. Go to our website, tiboypod.com. And honestly, like we said at the beginning of the show, if you ever have feedback for us, if you ever just want to connect with us, if you ever want to share your thoughts on a story, hit us up at T-BoyPod. Jack, you're looking fantastic over there.

Yeties, you look fantastic too. Jack and I, we'll see you tomorrow. Yeah, wait. And before we go, a happy 20th birthday to the Starbucks Pumpkin Spice Latte. Two pumps. Starbucks just turned 20. Condolences to Dahlene. And a happy birthday to Linda Chang, who just got a new job at a new school and is,

celebrating a birthday down in Silver Spring, Maryland. Happy birthday to Linda Mangroce, who's in San Francisco and whose daughter just started daycare. Congratulations. Celebrate midday. And congratulations and happy birthday to Jonathan Ramirez, who's turning 30 with his baby boy Mateo over in Kansas. Happy birthday to Sammy Filco, who's one month into a new job over in Texas. And Felicity Ados is turning two, never missed a pod down in Franklin, Tennessee. And happy birthday to Kaviris.

Ramirez, a legendary Yeti since 2019, about to fly to California, sorry, to the Caribbean, even better, to celebrate his birthday. And Isaac Santana is starting center on the Pop Warner Lawrence Hurricanes football team, and he's celebrating a birthday in Lawrence, Massachusetts. Hut, Hut, on two, ready, break. Just outside boss. And congratulations to Duncan Forbes, celebrating seven years at the same company over in Westchester, just north of the Bronx. And to anyone else celebrating something today. make it a T-boy. Celebrate the wins.

This is Jack. I own stock of Disney, Netflix, and Roku. And my son Wilder owes to talk at Disney too for his 529 college savings account of Crocs, too. Nick, do you even know what duty is? No one really knows what duty is, Jack.