😈 “Gayborhood” — Grindr’s gay super-app. Saks’ hippo bankruptcy. Airbnb for Diggers. +McConnaughey’s trademark

0:28This is Nick. years, Saks Fifth Avenue just filed for bankruptcy. Cause of death? Debt. Reason for death? What Louis Vuitton did. For our second story, Grindr has a secret plan to survive the decline of dating apps. It's the Gaborhood strategy. Grindr is creating a gay eyes super app to sell pills, hair care, and skin cream. And our third and final story, we know what you've been wondering. Is there an Airbnb but for diggers, bulldozers, and cranes? Jack, we've all been wondering it. Well, there is now. It's called Equipment Share, and it's the newest stock to IPO. So we whipped out a jackhammer and jumped in T-Boy style.

1:06But yetis, before we hit that wonderful mix of stories. I mean, my favorite mix we've ever done. Love the mix, Jack. Warning. The next time you quote Matthew McConaughey, you could get sued. Because get this, McConaughey just trademarked himself. Including his favorite catchphrases. All right, all right, all right. That phrase is now legally locked up with a little TM logo, Nick. McConaughey even trademarked images of himself staring, smiling, talking. Anything McConaughey is now legal property of McConaughey. Jack, this is either the most egotistical thing ever. Or the handsomest thing ever. So why is McConaughey legally locking himself down?

1:45Himself? Well, as with everything in business these days, the answer is AI. That's right. McConaughey doesn't want chat GPT stealing his southern drawl. And he doesn't want AI generators knocking off his Texas twang. That's right. His image and likeness are for him and his mirror only. So if you're a rom-com fan or you like doing McConaughey impressions, you better make sure those impressions aren't too good. They could get you sued. Add McConaughey to our list of tricky trademarks and crazy copyrights. All right. All right. Okay. You see what I did there, Jack? You just prevented a lawsuit. Can't get sued.

2:20I just saved us. Jack, let's sit up for this story. 15 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 the norm. Jack Nick, that's it. I don't even think they need to practice. 50%, that's a fat tip. T-Boy City on your at list. If you know, you know, cause we ready to go. We can't wait no more, so just start the show.

2:48Start the show. First, a quick word from our sponsor.

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4:04For our first story, Saks Fifth Avenue just filed for bankruptcy, taking down Neiman Marcus and Bergdorf Goodman with it. Coup de grace for Saks Fifth Ave when Louis Vuitton built their own Fifth Ave. Ah, Jack, if we're going to talk Saks, I mean, great childhood memories here. My mom taking me down to the Saks window in December to sit on Santa's lap. Great times. I'm picturing gimbals from Elf. Is that what you're talking about? But with better windows. Yeti, Saks Fifth Avenue. The department store is so fancy, they wrote it in script and stuck the address in the name. Is Fifth Avenue famous because of Saks Fifth Avenue?

4:38Actually, Jack, Saks did put Fifth Avenue on the map. There's a great book about it. It's called The Women Who Ran Fifth Avenue and Saks made Fifth Avenue Fashion Avenue. Nice. And Andrew Sachs is a German-Jewish immigrant who opened up his first store 159 years ago. Surprisingly, not in New York, but in Washington, D.C. In fact, Yetis, that first Sachs store in 1867 was a retail disruptor of the post-Civil War era. The first store where everything had the same price. And the first major store to offer refunds. Their famous Fifth Avenue location in New York between 49th and 50th streets arrived in 1924.

5:14Perfect timing. Roaring 20s. Ho, ho, ho. Profit puppy. But then eight mergers and acquisitions later, Saks Fifth Avenue peaked in the year 2001. They IPO'd, they had 200 stores, six billion bucks in revenue. The numbers were looking Gucci. It survived urban flight to the suburbs in the 1970s. It survived e-commerce in the 2000s. It even survived TikTok shop today. Well, about that last one. Yeah, Jack said survived, not thrived, because here's the news. Saks missed a$100 million interest payment last month and just filed for Chapter 11 bankruptcy. The company's broke. They owe Louboutin$22 million.

5:52They owe Michael Kors$33 million. And they owe Chanel$136 million for the merchandise in their store that they haven't paid for yet. Oh, and those luxury brands, they want cash, not cashmere. Now the judge is gonna decide which brand gets paid what. And meanwhile, the stores will remain open. But besties, here's what Jack and I find fascinating. What really triggered the ending for this 159-year-old brand? a real estate deal that Sachs couldn't pay the mortgage on. You see, Yetis, back in 2024, Sachs borrowed$2 billion to acquire their rival, Neiman Marcus. Basically, they tried to eat their rival, but Neiman was so big, Sachs choked on it.

6:30And remember, in 2024, interest rates were high. Interest alone on that loan cost$400 million. And then 2025 was a tough year for Sachs, so they ran out of money. The way Jack and I see the situation, it's kind of like Sachs was stuck in one of those safari situations you see on National Geographic, right, Jack? Look at that alligator. He's trying to eat that hippopotamus. I think it's too big for him. Oh my goodness, he's going for it anyway. Exactly, like the gator of Sachs tried to eat the hippo of Neiman in one bite and basically got crushed. And why try to swallow a company so big? Well, this story reveals Sachs Fifth Avenue's real business model these days.

7:06That's right. Sachs is actually a real estate firm that happens to sell dresses. Saks' most valuable asset was the building on 5th Avenue and 50th Street, which is worth an estimated$4 billion. But Saks really wanted that Bergdorf store on 57th and 5th Avenue owned by Neiman, basically the golden corner, incredibly valuable. So that 10 % mortgage that Saks took on to acquire that Bergdorf store was kind of a Hail Mary desperation play for a department store that was past its peak. Saks, a real estate firm dressed in a tuxedo. So Jack, what's the takeaway for our buddies over at Saks Fifth Avenue?

7:41Louis Vuitton went around Saks' back. Went around their back or stabbed them in the back, Jack? I think they went around the back. Okay, they went around the back. Yetis, the number one reason why department stores existed? Curation. That's the value prop. All the brands you could want, all in one place. It was convenience for the shopper and it helped them discover new brands too. But over time, luxury brands realized it's way more profitable to just go direct to consumer. In fact, 95 % of Prada, Gucci, and Louis Vuitton sales these days are direct, bypassing the department store middleman. I mean, Jack, why go to Saks on 5th when you can go to the Louis Vuitton Tower, also right down the street on 5th Avenue?

8:19Nowadays, you get your content, your information, and your handbags direct. And that was the latest blow for Saks. Louis Vuitton went around its back. For our second story, with Tinder and Bumble stocks both down 80%, Grinder is still growing. Because unlike other dating apps, Grinder is selling to you even after you stopped swiping. Yetis, you know how you know Grindr is a millennial tech company? How do you know it, Jack? They dropped the vowel. Yeah, G-R-I-N-D-R. Yeah, they dropped the E there. Got rid of the E. Classic giveaway. It's got 15 million users, though, who spend 67 minutes a day on average, on swipe.

8:57Oh, but those users, they are active, man. They sent 130 billion chats on Grindr in 2024. And their next leg of growth is Grindr AI, or as they call it, gay-eye. But Grindr is the only dating app right now whose numbers are going up and to the right. Revenues and profits hit an all-time high for Grindr last quarter. Over at Match, revenue shrank three of the last four quarters. Bumble, their revenue's fallen five straight quarters. It's a classic case of Tinder fatigue. Gen Z is simply done having pictures of their face swiped left or right on somebody's phone. It's a little different though for the gay community which needs a safe space and Grindr, they provided that for nearly two decades now.

9:38But Grindr is preparing for a post-dating app world. They're doing it by building an entire gay super app. Or Jack, a super gay app, if you will. You know, not just for dating, but for selling. Selling things like hair products. This is all based on internal documentation from Grindr that leaked to Business Insider. It's called the Gaborhood strategy. Again, Gaborhood, their term. Grindr has 15 million people who open the app every month, but also tens of hundreds of millions more who use the app in the past and it's probably still downloaded on their phone. It's a digital Gaborhood that the community loves and appreciates.

10:14You found your guy on the Grindr app. So now Grindr wants to capitalize on that love from the gay community with stores to sell you stuff. Basically, turn that digital gayborhood into a real functioning style neighborhood. Or a marketplace. For example, they launched an erectile dysfunction pill just last year called, wait for it, Woodwork. They also want to sell you hair care, skin care, meds, and merch in the future. Also likely with some very punny names. The product roadmap that leaked shows four successful direct-to-consumer businesses by 2028, all outside of the core dating app business.

10:49Add it all up and Grindr calls it a gay eye super app. A gay eye super app. So Jack, what's the takeaway for our buddies over at Grindr? If you're going to expand the gayborhood, make sure it's with repeat rabbits. Yeti's Grindr knows that its customer base will eventually stop using the core product, right Jack? So now they're leveraging their real asset, their brand, to sell those customers physical things too. Okay, but pause the pod. The one thing Jack and I noticed, these direct-to-consumer businesses Grindr is entering are recurring businesses. recurring as in not one-off sales. For example, if you buy Grindr skin cream someday, you're going to buy them every few months as you run out.

11:28It's the same with the hair care, the skincare, the pills. They are not one-offs like an Instapot or a board game. And this is the same reason why every celebrity or influencer has their own energy drink now. They're looking for new revenue sources and they want those revenue sources to be recurring. Besties, one-off products can be good for business, but recurring products more reliably drive profits long-term. If you're going to expand your gayborhood, make sure it's with repeat rabbits. Now, a quick word from our sponsor.

12:00For our third and final story, it's Equipment Share. It's not just the Airbnb of excavators. This is much more than that, and it's IPO-ing next week. The business looks incredible, but Jim Cramer would not approve of this stock. We'll explain why. But first, Yetis, a little bit of awkward, constructive feedback for the American construction industry we gotta share. You're not productive enough. And here's the hero stat. Since 1947, productivity in American construction has risen pathetically slowly. Farmers are producing 10 times more crops per person than 1947. Manufacturers are producing 3.5 times more per person.

12:41But construction workers are building just 1.6 times more per person than 78 years ago. An even more ridiculous comparison here? The tech industry, right Jack? I mean, computers are trillions times faster than 1947. But construction is just 1.6 times better despite all the advancements in technology. Not convinced? How about this? Construction productivity is actually down since 1973. each worker appears to be building less. And this just rings true to me. Everything these days takes forever to build and always goes over budget. Okay, Jack, but pause the pod for a sec. Don't blame the construction workers.

13:21You got huge safety precautions and red tape that mean it takes eight months to build a bakery out there. Still, we're talking about an$11 trillion global construction industry. Huge! Construction is 10 % of the world's GDP. And yet, it's been stagnant for decades. That's all according to the S1 IPO paperwork of Equipment Share. That's right, Yetis. Jack and I threw on those green visors, you know, that accountants used to wear back in the day. Oh, no, no, Jack, I was thinking the cargo pants for this one. And Equipment Share is the company that filed to IPO on Tuesday, 10 years after being founded in Missouri as a Y Combinator startup.

14:00You see, Yetis, the way Jack and I see Equipment Share, we thought of it at first like the Airbnb for construction equipment, but they're not just dishing out drills for the day. They're actually renting out entire fleets of construction vehicles to build an entire real estate development. We're talking 373 physical locations with$8 billion worth of vehicles, 325 ,000 things with huge wheels. It's basically a toddler's dream. It is. They got John Deere excavators, Genie lifts, Hitachi bulldozers. Equipment Share, if you're listening right now, if you can invite Jack, me, and our two two-year-old toddler boys to your next earnings report, we would really appreciate that.

14:37So Equipment Share rents these vehicles and sells them outright, but here's the key. All of their construction vehicles are connected to software. That's right. Each vehicle has cameras and sensors to track productivity, basically smart machines. Half of the fleet they rent out and the other half they sell, but all of the vehicles are managed by Equipment Share software. So they're making money three different ways off the customers, and here's the value proposition to the builders. With these smart construction vehicles, your project will run faster, the equipment will last longer, safety will improve, and the cost will come way down.

15:07The result, the average revenue growth over at Equipment Share is 140%. They're doing 4 billion bucks a year in annual revenue, targeting a$6 billion valuation. That is almost one lift. But we can tell you who's not going to buy Equipment Share stock on their IPO day. Yeah, and who is that, Jack? CNBC's Jim Cramer. Exactly. So Jack, what's the takeaway for our digging buddies over at Equipment Share? When it comes to stocks, the word cyclical makes investors sick. Yet he's back in November. Jack and I read Jim Cramer's book on investing. And then we got to interview Jim about that book at the NASDAQ Stock Exchange.

15:42His key insight is that you only want stocks that can grow in any market. Equipment Share, unfortunately, is not one of them. Remember that 140 % growth rate Jack and I just mentioned? Well, that was their average growth rate since they were founded. More recently, it's been much more slow. In fact, their growth rate has shrunk every year since 2022 and is down to just 27 % growth last year. Well, what happened exactly in 2022 that hit their growth, Jack? Inflation and interest rates both spiked. And high interest rates basically kill the construction industry. It's like automotive and airlines.

16:18construction is a cyclical industry. It does well when the economy's doing well, but it shrinks when the economy's not. That's why Equipment Share is on track for their first year of losses since 2019. Look, besties, Equipment Share sounds like a great biz. Again, kind of fun to call it the Airbnb of construction stuff, but they could lag the rest of the stock market long-term because it's cyclical. When it comes to stocks, the word cyclical makes investors sick. Jack, could you whip up the takeaways for us for the new Friday? Saks Fifth Avenue declared bankruptcy because its acquisition of Neiman Marcus was just too big to eat.

16:53It's death by debt, but Louis Vuitton held the dagger. For our second story, Grindr's business is still all-time highing, but they're expanding to become a gay super app anyway. They're expanding the gayborhood, but they're doing it with repeat rabbit products. And our third and final story is Equipment Share. The stock hits the stock market next week. It's a huge milestone going public with an IPO. It's a great business, but a cyclical business, and that limits its stock's growth. But besties, this pod's not over yet. Here's what else you need to know today. First, Carmen Sandiego style, we got to do a rundown of some geopolitical updates out there.

17:29In Greenland, the Secretary of State Marco Rubio met with Denmark, who insisted that Greenland is not for sale. But the two sides agreed to disagree and continue talking. Over in Iran, the president says that the killing of Iranian protesters has stopped, and he's ruling out military action for now. No major updates right now on the Panama Canal or Venezuela, the two other geopolitical hotspots the president is very interested in. And second, Delta Airlines is apparently becoming a luxury product. Their premium cabin sales have eclipsed their coach cabin sales for the first time ever, even though the premium cabins are just 30 % of the seats.

18:05It's like a 12-tier society up in the sky. God. Delta One, First Class, Premium Select, Delta Comfort Plus, Delta Comfort. They bring in more than half the bacon, even though they're just 30 % of the seats. It's the air travel evidence of the K-shaped economy. Wealthy or eagle to spend more on tickets, but not so wealthy trying to save every buck they count in seats. And finally, Nike's first pickleball deal. Wow. Nike signed Anna Lee Waters to an endorsement deal, and she's a pickleballer. Yeah. This 18-year-old is the LeBron of the kitchen, the number one ranked in singles and doubles and mixed.

18:37In 2023, Nick and I wished that Nike would acquire Major League Pickleball. Just saying. This isn't that. We basically predicted this, Jack. I think we got to give ourselves some credit on this one. This isn't that, but we were directionally correct three years early. Nike, just buy the whole league. Just do it. Now time for the best fact yet. This one sent in by Rob Yosway from lovely Littitts, Pennsylvania. Did you RSVP to my party? You know, did I RSVP to your party? I think I forgot the RSVP into your party, Jack. Well, it's just a segue because the abbreviation RSVP is the star of this fact.

19:07I was going to say, I don't feel like I got an invite to your party, Jack. What does RSVP stand for? Well, it's actually a French phrase. And in French, it stands for répondez s 'il vous plaît, which means respond, please. Or more directly, respond if it pleases you. Speaking of France, White Lotus season four has named their destination. Not possible, Jack. It's a hotel in the south of France I'm pretty sure you've never been to. No spoilers, Jack. No spoilers. Yetis, you look fantastic for the new Friday. And the best thing you can do to grow the show, what is it, Jack? Share this show right now with a friend.

19:46Yeah. By copying a link to the episode, pasting it into your group chat. And McConaughey, we know you're listening. Actually, he's probably looking at himself in the mirror. All right, you can send it to yourself, McConaughey. Send it to yourself. H-Y-H-T-V-O-Y. If you know, you know.

20:04And before we go, a woof woof to Cooper the Husky. Happy gotcha day down in Charlotte, North Carolina. Thanks for listening to this pod every day on your walks. And happy 20th birthday to Pranav Ghadraju in Cary, North Carolina. And Isaac Awusu in Cincinnati, Ohio is turning 36 listening with his fantastic two and four-year-olds. Happy birthday to Terrence Agnew in Jersey City, who's also just become a dad. And Declan Bernards over in Portland, Oregon, celebrating the best birthday yet. Happy birthday to Lindsey Drager in New York City. And a shout out to Pamela Miller, a legendary Yeti who points out it is International Voter Registration Day.

20:40Get yourself signed up. And to anyone else celebrating something today, make it a T-boy. Celebrate the wins. This is Jack. I own stock of Bumble. Nick owns stock of Nike. And we both own stock in Airbnb. There's one place for the newest drops in wellness and performance and the biggest sale of the year. It's the drop by GNC, curating the best of what's new, handpicked by the pros who know what works. And right now, get it all, buy one, get one 50 % off during the semi-annual LiveWell sale. From crushing workouts to leveling up your nutrition and everything in between, get the best deals on the latest innovations.

21:19All the newness is all on sale right now during the LiveWell sale on The Drop by GNC.