Audio By Carbonatix
The Water Coolest is a free daily business news and professional advice email newsletter created for weekday warriors that is delivered fresh daily at 7 AM EST. You can subscribe at thewatercoolest.com.
THE HEADLINES
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SPARE SOME CHANGE?
Who says Elon Musk has lost his innovative edge? Leaked memos indicate that Tesla is asking its suppliers for refunds … dating back two years. Tesla is citing its own profitability for the urgent request. Now that’s innovation.
This appears to be another chink in Elon’s armor. Tesla is starting to sound like a deadbeat roommate (“a little tight on cash this month”). It has already laid off 9% of its workforce while it looks to ramp up Model 3 production. Did we mention Elon and Tesla are staring down two massive convertible note obligations over the next year?
According to experts, it isn’t uncommon for automakers to pressure the likes of Callahan Auto Parts (read: parts manufacturers) to renegotiate deals, but requesting a retroactive refund is unprecedented.
Water Cooler Talking Point: “It’s hard to feel bad for Elon Musk here. And it’s even harder to feel for the 450k pretentious upper-middle-class people who are on the waiting list for a Model 3. Go buy a Prius.”
LEVEL-ISH PLAYING FIELD
Nike is overhauling its comp structure and adjusting pay for more than 7k of its 74k employees. No word on if this extends to the children in their factories overseas.
The decision to “Just Do It” is being undertaken to address pay equity issues and reshape the company’s culture. The swoosh hopes the move can combat the “old boys club” mentality and eradicate inappropriate workplace behavior. Eleven executives have been canned as part of a house cleaning effort.
After the changes, the annual bonuses will mostly be tied to company-wide performance. While employees will still have individual bonus targets, the amount paid will be uniform.
Water Cooler Talking Point: “They do realize there’s a good chance they piss off about 6,999 people who never knew that they were being severely underpaid … right? Ignorance is bliss.”
PUT A PIN IN IT
Pinterest is closing in on $1B in ad revenue and has announced that they’re aiming to go public in 2019 … one DIY-chic wedding board at a time.
Pinterest is already on track to double its $500M in revenue last year. The app is a fairly easy sell for advertisers as a pin is a more direct, measurable endorsement of a specific product than something like Facebook like or retweet. So long as the advertisers aren’t middle-aged men.
With 200M monthly active users, Pinterest has become a go-to for advertisers and influencers in the beauty and fashion space. In the private market, the company is valued at anywhere from $12 to $15B, up from a $12.3B at the time of its last financing round in 2017.
Water Cooler Talking Point: “I still don’t quite understand how Pinterest works. I do know that if Pinterest can continue marketing to girlfriends with hidden wedding planning boards, they will be rolling in ad sales for years to come.”
IN OTHER NEWS
- The New York Daily News, the Big Apple’s fourth favorite newspaper that starts with the words “New York” will lay off 50% of its editorial staff. NYC Mayor Bill de Blasio condemned the move.
- What $5B EU fine?! Google’s parent, Alphabet, reported better than expected earnings yesterday, buoyed by its advertising business. Duh. Shares were up as much as 6% after-hours.
- Chick-fil-A will begin testing its answer to Blue Apron (not that it needed an answer to Blue Apron) at 150 Atlanta-area locations. Meet Mealtime Kits, a meal-kit service play, the first of its kind in the fast-food space. Sorry, the Hello Fresh knockoffs won’t be available on Sundays.