Shein registers for US IPO, Trump SPAC insider trading & more | E1771

0:00And last week, Sheen flew some TikTok influencers that are Americans. to to I wish you didn't last there. The way you queued it up and it's like how do we solve this problem? It's like you know instead of paying people $16 and making people work 16 hours a day like maybe cap it at 12. Yeah. Nope. It's like no. Better solution. Yeah we'll get private jets first class fly us and TikTok influencers and solve the problem in two days. They'll solve the problem. Right. They'll solve it for us. Right. UGC ladies and gentlemen UGC. Of course. That's what those workers need. Those workers need to be in a TikTok video doing a TikTok dance.

0:36Yeah. This Week in Startups is brought to you by Squarespace. Turn your idea into a new website. Go to squarespace.com slash twist for a free trial. When you're ready to launch, use offer code twist to save 10 % off your first purchase of a website or domain. LinkedIn Marketing. To redeem a free$100 LinkedIn ad credit and launch your first campaign, go to linkedin.com slash this week in startups. And Finn can't burn its mouth on hot pizza or wave at someone who wasn't waving at them. Finn can resolve half of your customer support tickets instantly before they reach your team. Meet Finn, a breakthrough AI bot by Intercom.

1:18Ready to join your support team today. Visit intercom.com slash Finn. all right everybody welcome to the show you know we've been doing all of these great interviews you know we used to do five days of news when molly was here it was amazing but it was maybe too much news and you guys said what happened to the interviews then we started doing these interviews and i got addicted to all these ai uh founders and how great this is going and then our own portfolio companies and i forgot to do news shows so we're going to try to find some balance uh today rachel braun was back to do the news for me but but her internet connection went out it happens, folks.

1:53And so I called an audible. I said, Hey, producer Nick, you haven't slept in 24 hours. You've been doing the all in editing. Can you jump on the call? And you don't put your camera on. But pretend you're a newsreader. And let's do the news together. So special treat for you. Everybody loves producer Nick. Producer Nick, are you there? I am. We got the C team going today. That's how you know it's summertime, July 4th weekend. I just I called you up from the G League. The replacement squad. You got a two way contract for 10 days. And let's see what you do. maybe you'll be like I apologize to everybody in advance maybe you pull a Gary Payton too I mean didn't Gary Payton the second isn't that what he had like my G League contract and all of a sudden he crushed it you could be like who's our who's our new guy on the Knicks Jericho Sims you can come in Jericho Sims style hey Nick I saw this story about Sheen S-H-E-I-N I know about this app or something people buy clothes on it but they filed for an IPO or something let's go over this story because it's really interesting and it touches on some of the human rights stuff that we've been talking about on the program for the years.

2:53Yeah, a little human rights on a Friday for everybody. Yeah, human rights on a Friday coming up. So yeah, they didn't file for it. They registered for a US IPO yesterday, according to Reuters, but we should note up top that Sheen officially denied this. So they could just be posturing or whatever, but they denied Reuters report. Just a quick explainer on Sheen. It's a fast fashion retailer. It's valued at$66 billion. And just so everybody knows, fast fashion, basically, it's a pretty new business model in the retail world it's where retailers create let's call them affordable replicas you could say knockoffs inspired by recent high-end fashion trends so if you see something you know on stage at milan or paris fashion week or whatever a couple days later you'll see it uh for sale for like six bucks um the problem is they mass produce these at a really really low cost uh it's bad for the environment um and then they bring them to stores really quickly while demand is super high so the value prop just so i'm clear is you're some young person you're you're going to coachella you want to look great and hey here's the hack this these clothes were you know at men's fashion week which i think was last week in paris and now we got them on sheen and you can buy them for 10 bucks but my understanding is you put it in the wash and you're done it's like literally you throw it away so it's great for a young person who wants to look good but it's terrible for the environment exactly and it's unfair to the brands that came up with these great dope designs that is true you're not allowed to trademark a recipe so if you make the cronut you can trademark the name the croissant donut if you make a great outfit you could uh trademark the branding of the outfit but you can't actually the style or a recipe these things are not trademarkable yeah and there's kind of like a couple of reasons for the the waist right it's one of it is you know the materials aren't great obviously that's how that's how they're so cheap and then also the short-term nature of trendy styles right that's kind of the thing with fashion is they go into style they go out of style it's not like blue jeans or something that's like good forever something in streetwear that's popular in january is going to be you know cringe in october and also because the manufacturing gets ramped up so quickly it's sort of an it's kind of exploitative or can be exploitative on labor because you have to really get everybody you know rallying the troops getting things out the door quickly so um you want to get on to the news what actually happened yeah let's keep going here so and just in terms of the ipo that's kind of an interesting little rub in and of itself because i thought china was taking the position the ccp xi jinping saying we're not doing u.s ipos anymore we want them to occur on the Hong Kong exchanges or domestically.

5:37That is true. And if you remember the last big Chinese company to go public, which I'm sure you're obviously very familiar with, Didi, the ride sharing app, that didn't end very well. So what happened was Didi went public in June of 2021 at a$68 billion valuation, ironically kind of close to Sheen's current valuation, which is 66. And they did this against warnings from CCP regulators. So basically, the CCP told them, do not go public, do not do this. And Didi's CEO was like, yeah, whatever, I don't care. I'm going to do it anyway. Had that work out for them. Very bad. And if anybody is a fanatic listener to this week in startups, we covered this a bunch of times back in 2021 as it was happening.

6:12So shortly after Didi's IPO, the CCP cracked down. They banned new downloads of the app on the app store and they raided Didi's offices and sent them under some crazy security review. Didi's stock crashed and eventually it wound up delisting from the US market in spring 2022. So yes, these Chinese IPOs are, let's call them risky for retail investors. challenging yeah you got to be careful and you know the thing for me was um uber i believe owned around 10 of it so this was six billion dollars i think uber started selling their shares in it and just cashed in their chips this is why i said on cnbc i don't know maybe seven eight years ago i would never buy any of these stocks and this is when alibaba was surging and people were like you're an idiot and i'm like well how do you know any of the accounting is correct how do you know what you own you don't uh and then the rules can change so this is like playing in a casino and they're like yeah you know a flush beats a straight and they're like well i have a straight this time and so now straights beat flushes and you're like wait that's not how the game works and like yeah we changed the game okay fine so sheen might be we could read into this challenging the authorities uh which is insane uh or maybe they filed and then the government told them no bueno you can't file and they rescinded it and now they're saying they never did yeah so Just a little background on Sheen or Shine.

7:32Sheen. Sheen. It's very interesting. Their name is spelled S-H-E-I-N. And so it's Sheen, not Shine, but it is easy to mix up. Sheen like Charlie. Yes, exactly. Tiger Blood. Yeah. Sheen has raised three and a half billion to date. All these stats according to PitchBook. Shout out PitchBook. We love you guys. Major backers. From what I found, the two biggest investors seem to be Hong Shan, which obviously formerly known as sequoia china they just changed brands two weeks ago and tiger global uh it was most recently valued at 66 billion dollars back in may uh two months last month i guess uh which is down 34 from a peak valuation of 100 billion which they secured last year in october 2022 i have a theory that i want to run by you why uh sheen is uh all of a sudden kind of pushing for this us ipo tiger global is super cash crunched they've been not able to raise the funding they want to raise they need a win they need liquidity um hong shan obviously changing over from sequoia china i'm not sure how the distributions work with the uslps or who like the existing all the existing funds would be um and this is why it's kind of easy for a venture fund to break up like this or for them to end or change their names because each fund is a partnership so if you're on you know sequoia china seven what you do is everybody's just still an LP or a partner in that the economics are all codified in legal documents and then when you go to the next fund and it's sequoia china eight you can just change the name of it and change the dynamics of it so you know i think hong shen and tiger want to win i think they need a little bit i think that's a great yeah i mean they want to win and uh yeah if you think about where you would get the greatest return it would be where the greatest number of investors are not a limited pool of investors so this is where this um insane situation with taiwan is so important for the united states to get right and also more important that china get this right the more i think about it the more i realize china will lose more by invading taiwan than the u.s will by losing china or access to invest in china i think there's a greater loss on the Chinese side because their economy is sputtering right now.

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11:31Yeah. But again, remember - Oh, right, because it's low margin. It's low margin, right. So this is not Slack 30 billion, right? No, this is not Google ad revenue. This is direct to consumer. So what is their cost on that? Their gross margins have to be really challenged. Yeah, and maybe they're a little bit higher because they make everything for so cheap and they might use forced labor. Yeah, but they got to ship it and then they have returns. Right. So this is why this business is like really low margin. So$30 billion in revenue, which was double 2021's revenue, which is pretty crazy. A website called Business of Apps has compiled reports.

12:05Again, none of this is confirmed, but it's just reports of their revenue over time. And you could see on the chart that Brian just showed from 2016 to 2022, there's been like an insane scale up in revenue. But so, you know, for the business, obviously everything is looking good. But here is the big kicker. 24 U.S. representatives from both parties opposed the IPO back in May when rumors were first reported. And they asked the SEC to verify that Sheen has ethical labor practices. and they wanted to mandate that sheen undergo an independent audit to verify that the company does not use uyghur forced labor now this is because sheen allegedly violated the uyghur forced labor prevention act which is a u.s act that prohibits the import of goods into the u.s that were manufactured whole or in part so it could just be one piece of fabric right with forced labor in china last november bloomberg reported that tests on sheen fabric on two separate occasions came back positive for cotton produced in china's xinjiang province where a majority of the uger forced labor allegedly or confirmed occurs um and a spokesperson from sheen denied these allegations stating that the company has a zero tolerance policy towards forced labor so i guess i'll just let you lay out for that yeah this is a very complicated issue i think we should bring in president jason calicanis to comment on cue the music everybody as your president it's important that we are considered when we think about our relationship with China and human rights on a global scale.

13:37While we want to have a vibrant trade practice with all countries in the world, we must also address the suffering and human rights that are occurring around the world. And sometimes here in America, we don't get everything right, but we try and we have good conversations about that. And there is a conversation to be had about the situation with the Uyghurs and Fast Fashion and companies like Sheen going public. You don't want to stick it to one specific company, but when we are in deep relationships and we are going to have a company like Sheen leverage the full economic value of the U.S. markets, we do need to think about their responsibilities to their own people.

14:22therefore we would like to humbly ask Sheen to create a labor best practice where they source their materials from and how their employees are treated and have that reach some basic tenets in terms of the number of hours worked per week the compensation and safety and if those things are achieved and we can have a positive dialogue with that we will absolutely embrace them going public here and increasing our relationship if they can't achieve those or they feel it's not our place well then we can't support them going public here in america just like perhaps they wouldn't support our companies coming to china google twitter not allowed in china because we don't hit the notes that they want in terms of uh information flowing the way it does so uh in this case it's the balls in sheen's court and we encourage them to do the best they can for their workers it doesn't have to be exactly what we do in here in america but there is a baseline that we'd like to see them hit and we ask that with humility and in the spirit of collaboration uh to the great people of china and the amazing companies they've built so let's work together to have everybody benefit economically even the people who are on the bottom uh of the economic ladder and i'll see you all at the state of the union thank you very much i won't be taking questions camera flashes all that kind of stuff i mean i'm starting to sound more presidential yeah it sounds like you're posturing for um what was connor roy going for like uh or something i just want to hey listen if i could get somewhere between connor roy and ross perot when i run and let's be honest the other three besties on uh all in cannot run for president oh yeah so i'm the all-in candidate by default so it's clear somebody on all in is going to make it to the White House.

16:13I think Sachs gets their first as Secretary of State. But I'm the only one who's got a shot at being president. So we might as well get my presidential takes from President Jason. Let's get back to the doc. So assuming that Sheen is telling the truth and that there is no Uyghur forced labor, right? There is still an issue with other labor problems going on at the company. So in an investigative documentary by the UK's Channel 4 called Untold Inside the machine machine they reported that workers at the company were subject to 16 hour long days only got one day off a month and earned wages of around 4 000 uh yuan or 572 dollars that's actually okay six seven thousand dollars a year in china goes a long way that's good context yeah the pay is not the problem here the days off is the problem and the 16 hour long days and do they get compensated for overtime and i think this is where americans have to take some ownership if you want a 15 dollar outfit for coachella these virtue signaling woke young people they need to understand that this is the how you achieve that is people getting one day off a month so for these young people who want fast fashion or anybody could be an older person who's using these i don't think it's limited to young people although that's probably the bulk of the users we need to figure out a way to communicate to young people when you open the sheen app that means somebody your age around the world your contemporary works 29 out of 30 days and you're working 16 out of 30 days and you're getting free lattes and massages and you're protesting going to the office this shows you the disparity right uh and i think this is where young people need to look in the mirror and say if i want to be woke if i want to you know support all these social media causes well you also have to vote with your dollar and know where these clothes are coming from and all of these crazy woke influencers and social media people uh who you know can't wait to lecture people about whatever the cause of the month is here's your cause let's see you go to work for the labor conditions of the people who work at sheen this is abhorrent if they're getting one day off a month we all know that's important if you work six days a week and you work 60 hours a week i work that um that's okay but one day off a month and 16 hour long days when you're a factory worker it's a that's a bit over the top i could see a 10 hour shift people work a 12 hour shift as a dishwasher i did and a waiter so you know 8 to 12 hours is is a is not a crazy shift but the one day off and 16 hour a day is crazy i have to tell myself here a little bit because i read one day off a month as like a pto day in addition to weekends and my brain went no no no that's 12 PTO days a year.

18:59That's not like that bad. And then later I was like, oh, they mean like one day not working. Nick, the standard hours in China is 996. We've talked about this on the program. 9 a.m. to 9 p.m., six days a week. If you work at an internet company, imagine I put that out as an edict at launch and I said, we're working 996. Oh, wait, that's what we do anyway. Yeah, I was going to say. I'm not too far off. No, that's pretty far off. 12 hours, six days a week is 72 hours a week that's when you start pushing i would if somebody in our company was working 72 hours a week i would actually tell them pump the brakes and if there are people who are working 72 hours a week i'm telling you right now pump the brakes that's a lot i mean i would say that most people here are doing uh 50 60 i i know the statistics because i have the statistics from i looked at the statistics recently from slack and notion i can tell you people who work 50 hours a week on average yeah i know how many hours people work because if you're working here, you're using Slack and you're using Notion by default.

19:56If I correlate those two things, people are putting 50 hours a week here. Yeah. I would say long hours during the week and then some cleanup work on the weekends mostly. Yeah, which is reasonable. If you want to be successful in your career, that's a reasonable 50. I tell people who work for us, fixed 50, solid 60. Fixed 50 means if you're doing less than 50 hours a week, you're not going to be advancing in your career. And a 60 is like really solid. Like I really appreciate that. I don't think you should do more than that honestly i think you get negative returns you're gonna make mistakes and uh what's the point i could always hire another person you know like i don't need you to work 70 hours a week now there might be a conference we're doing all in summit or angel summit yeah you might do 80 hours the week before but i take i gave people like a day or two off like the day after the the thing um and you know whatever so this documentary also claimed that sheen's uh was sometimes withholding first first month wages for workers which i've never heard this is that no yep that is something that happened in america um and this was something that caused major um issues in china before when they've had protests where people um were getting paid like net 30 imagine you're getting this raw deal you got to work 16 hours a day one day off a month and they pay you net 30 that's crazy and then sometimes the factories would shut down and not pay their workers and this is the fear of workers so this would be another thing like do they have guaranteed pay on what cadence do they get paid these are just standards that emerging markets so there's frontier markets and emerging markets and then there's the developed world right it used to call it third world but the the more elegant phrasing today more work phrasing is frontier emerging and so uh frontier market might be like vietnam uh or somebody where it's like you know uh really raw you know like cuba or north korea right it's real frontier markets and vietnam would be included in that places where you don't have rule of law and etc property rights etc or any employer rights they have emerging markets china's now an emerging market it's not considered a first world because it's not a democracy um and so that's what's happening here they just don't have basic law and rights yeah and then the final claim from the documentary was that mistakes made and production processes were deducted from worker wages this was america this was america 200 years ago or even 150 years ago when people worked in factories they used to be given work to take home and they would get paid per piece and if they made a mistake it came out of their bill so imagine you worked here and you lost an episode you know like you the file got corrupted or something and i said okay yeah that that was like a thousand dollars of work i'm taking that out of your pay i'm docking your pay and then people realize like mistakes happen you really can't have your employees do that you have you could fire an employee if they make too many mistakes but you can't retroactively be like you you dropped a steak at a restaurant you owe me the 25 bucks for the steak that's just insane and it's probably true and that's how it worked in america 150 years ago and that's really what we're looking at nick is and this is why there's tension china saying hey we're an emerging market we admit we're an emerging market give us time to hit these standards we're vietnam we're an emerging market we'll hit these standards in our time we don't need to be on the u.s timetable uh and i think that's what we're seeing here so i don't doubt that that's what happened and sheen responded to the controversies by pledging to spend 15 million dollars over the next three to four years to enhance factories and provide better training for workers okay so just so we're clear they did 30 billion in revenue uh 300 million would be one percent 30 million would be 10 basis points 15 million would be uh 50 basis points so yeah i think they need to maybe instead of putting pledging 15 million i think they need to just say 12 hour days are the max any hours after that you get double time you get you know it's a six day work week and wages are at a minimum of this amount and they go up five percent per year okay that's what i would negotiate if i was like um you know the the public markets here and then if the people who want to underwrite this also inherit this so this is an important this is my hot take on all of this nick is you inherit i'll go on my little rant here um you know i won't do this as president jason i'll do this as jason the fund manager because i am faced with this right now uh raising launch fund four you can read the deal memo at launch.co slash memo you inherit the worst behaviors of your partners and that's a two-way street right um so we we've seen this with the nba with china and hong kong right daryl mori just giving modest support for the uyghurs and uh or for the people of hong kong rather another uh situation and um we're seeing it now very acutely with saudi uh and the kingdom kingdom is uh doing what they're doing in golf with live golf we're seeing it with vc funds the saudi investment corporation and other folks are listing their vc funds so now if they list like they listed david sacks craft there uh and other folks um now every time david talks about international relations somebody can bring up well you have saudi money so if another khashoggi god forbid happens then everybody who's taken money from the saudi government has to answer for the saudi government's worst moment just like americans when we have something happen uh like let's say george floyd uh when i travel internationally people will bring up george floyd they'll bring up the blm riots they'll bring up january 6th and does that mean you shouldn't do business should people not do business with our fund launch as an investment fund because of what happened on january 6th well i'm not the government but i am you know operating here in the united states um but if you took money from the u.s government yeah you might have to address that situation so the easiest thing to do nick is just not take the money right then you can just have the high ground i don't need to take the money so i didn't take money from china i didn't take money from the saudi government and uh you know end of story as many vc firms by the way do and now are marketing i saw some uh firms on twitter i don't know if i should name them but saying sure hey go name them if they if they're on twitter they're doing it obviously for that reason i don't want it was one of two firms that have very similar names i'm not sure which one is off the top of my head it was either but we could take that out bloot that out right yeah but they basically were saying hey we'll never take money from a country authoritarian authoritarian yeah basically and that's their choice right because again you inherit whatever the worst moment those countries have and in the case of russia invading another country you saw mcdonald's starbucks a bunch of people had to pull out basically right and just say hey apple we're done we're done here we can't be doing business in a country that's invading another free country sorry um you know we'd love to be engaged um but here's the thing if we look at the debate we had on all in about the uyghurs that was the second most that was the second biggest spike or tied for for first and second of the term uyghurs on google trends i looked at it the other time was when they had taken a famous video drone video of a bunch of uyghurs with their head shaved and uh in handcuffs basically on trains being sent to labor camps uh that was published i think by the guardian and so when we have these tough conversations it brings it sheds a light on these things right and sunlight is the best disinfectant if we talk about what's happening with the uyghurs over and over again well the conditions for the uyghurs might get better and when i worked at amnesty international they knew this so they did letter writing campaigns so these relationships like the one between the pga and live have highlighted what happened to jamal khashoggi and it will highlight what happened to the blogger rafi who is being caned for saying things that the government didn't agree with and then that brings up the discussion oh my god caning exists well we have the death penalty here caning is not as bad as the death penalty death penalty is final caning and torture is abhorrent we also have a torture device here in the united states that is arguably as bad as canning as hard as that is say it's called solitary confinement um and it makes a person literally go mad to be alone for years and those people do go mad um so all of this uh engagement in some ways even though you could be woke and or you could take the high ground like whichever firm you were referencing before uh said hey we'll never take this money great you have the high ground but for the firms that do take the money well now they have to have that conversation just like pga does there's been more discussion about human rights because of the pga because of sheen because of the all in podcasts and the comments uh you know chamath made about hey listen i'm concerned about domestic human rights more than human rights in other countries which is a reasonable thing to say i mean yeah his comments completely got misconstrued by the way of course yes i mean they clipped it and edited when he says it's below my line he's saying my focus is on my kids getting pulled over by a police officer because they're brown skin yeah and i think actually what he even went further and he said like i consider caring as putting money behind it so when i say nobody cares about the uyghurs what i'm saying is nobody's putting money and it's just something that comes up in the news cycle and then goes away and then guess what happened it came up in the news cycle and then it went away he was right what he said was true yeah absolutely so um i've decided so i'll make this personal here um i've had a lot of people reach out to me for i don't say from where but from places that are in the process of going from emerging markets frontier markets and you know wanting to engage with the west and i've had to have a really deep thoughtful uh discussion with myself do i want to engage or do i want to take the high ground i i'm rich already i don't need to have any more money i'll be totally honest I'm not chasing the third comma, not interesting to me.

29:57I just like to do what I do every day. If I do you think I would spend six, you know, days podcasting if I was trying to optimize for cash? No, I wouldn't. I just enjoy it. So I'm optimizing for my own enjoyment. I would. And so I've given a lot of thought when I went to the UAE with Brad Gerstner and I met everybody. I wanted to go because I wanted to see, you know, how much further along UAE was than other regions. It turns out it's far along. And then you look at Kuwait, you look at Qatar. They're also making great progress. and saudi wants to make great progress and that's why they're doing a lot of this stuff so uh engagement i think is the right model i think everybody has to make a personal decision and then if i take money from one of these places uh and someday you see me doing and you say oh my god you're a hypocrite now i'm not saying i'm doing it but i am deeply considering it um you will have the ability for me to say i am taking this token amount of money for my fund one percent of my fund whatever five percent of my fund i know that this is a risky bet for my reputation but i'm doing it because i want to have the ability to say you know what i've decided to stop taking money from this region because of this this happened in other words what starbucks did in pulling out of russia uh and i think more engagement between countries that disagree and more discussion between people who disagree is better and i'm in a position where i don't need to do it but i might do it and i'm you might see me give a keynote just like you saw me go to uae uh which is not a democracy but is also incredibly western and is an incredibly safe place to be and you know uh has a lot of freedoms uh that are it's kind of like being in the u in the united states honestly i think the freedoms in the uae and the culture feels kind of like the culture where i grew up in the 70s and 80s it's not as woke as it is today but it's it's not the 50s or 40s.

31:43It's kind of like they're in the 70s, 80s, 90s. Maybe 80s, 90s would be most accurate. So anyway, I just want to put that out there on the table because it's an important discussion that we've been having. And I think this moment, what's happening with Sheen is absolutely fantastic. Ah, when you're looking for those B2B buyers, how do you find them, huh? They're so hard to find, The decision makers, senior VPs, executive VPs, CFO, COO, CEO, hard to reach them unless you use LinkedIn marketing. If you use LinkedIn marketing, you're going to have direct access to 180 million senior level executives.

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33:24And the LinkedIn marketing team, you're crushing it. Really great job. so why don't we get back to sheen real quick because there's another angle to the story so you see this thing has a lot of angles yeah so let's like level set real quick right sheen registers for us ipo reportedly they denied it yep they're valued at around 66 billion dollars they have a couple of major shareholders who want slash need a big win okay um and there is and very bad press in the united states even going as far as regulators saying hey we need to review this company got it so earlier this week and last week sheen flew some tiktok influencers that are americans to it but to i wish you didn't last it up and it's like how do we solve this problem it's like yeah you know instead of paying people 16 and making people work 16 hours a day like maybe cap it at 12 yeah nope it's like no better solution yeah we'll get private jets first class fly us and tiktok influencers and solve the problem they'll solve the problem right they'll solve it for us right ugc ladies and gentlemen ugc of course that's what those workers need those workers need to be in a tiktok video doing a tiktok dance yeah um okay shane flew tiktok influencers to a couple of its factories in china to try and help boost its image and then a insane backlash ensued so and flew this group of influencers out to tour factories in guangzhou um they toured the influencers visited four factories while sheen reportedly is you know has thousands of factories working in china according to time magazine it's around 6 000 factories producing clothes for sheen they do not own their supply chain so they're sort they're um like third-party factories i guess yep um they manage these factories using internal software this is an aside but i think it's pretty interesting they use internal software that collects data and shows what items are trending almost like an algorithm and it boosts the most popular items on their website to the top neat kind of like how tiktok works kind of interesting yeah um so one influencer named danny uh carbonari uh had recently had had a really controversial tiktok that went viral where she basically did like a tour of the factory said how amazing it was how it was clean it was all automated so uh we have a 63 second tiktok that she made that we're going to show which by the way was deleted because there was such a strong backlash against it okay i want to see this china trip has been one of the most life-changing trips of my life getting to see the whole process of she and clothing from beginning to end with my own two eyes was so important for me taking off the trip by heading to the factory of the leading manufacturer for she and was the perfect way to start i was really excited and impressed to see the working conditions the next day we headed to the sheen innovation center this facility blew my mind it's over 600 000 square feet there's so much technology and she is just such a developed and complex company and it was so beautiful to see firsthand i was able to interview a woman that worked in the fabric cutting department and you guys know me she's an investigative journalist so i asked her all of our questions and she answered them honestly and authentically she was very surprised at all the rumors that had been spread in the u.s she told me about her family her lifestyle her commute her hours our last stop was to the sheehan warehouse this place was massive it's about 84 acres and almost fully run by technology and automation i was really impressed by the extensive checklist that each item had to go through or it shipped off i think my biggest takeaway from this trip is to be an independent thinker get the facts and see it with your own two eyes there's a narrative fed to us in the u.s and i'm one that always likes to be open-minded and seek the truth so i'm grateful for that about myself and i hope the same for you guys oh my god that is the worst thing i've ever seen did they put a gun to her head or just give her a bag of diamonds to say that the ccp wrote that script basically um did you know what she said about the woman who worked in the fabric cutting department who was an investigative journalist i I was like, what?

37:08Yeah. The whole thing makes no sense. It is so scripted and so abhorrent. If you wanted to do that, and this is why investigative journalism is really important in society. This is why the Googles of the world should pay a licensing fee, like this whole thing going on in Canada we talked about previously. They really should be trying to send more support and money to investigative journalists, whether it's Reuters or the New York Times, Washington Post, Boston Globe, LA Times. They really should be trying to get some more money to those organizations. and if you should subscribe to them if you can um because this is not investigative journalists this is a pr campaign by an ill-informed easily bought and sold influencer i mean if you're if you're getting your news from an influencer you this is a bought and sold influencer this person didn't mention the working conditions she never used the word uyghurs she never used the word forced labor she never said tianemans square if this person wants to see how free she is and that she is not a shell for the torture of humans or the unfair labor conditions or the sterilization and genocide of an entire race of people she should start her next tiktok video with i looked at the history of the uyghurs here's what i read about the uyghurs then she should do another follow video here is what i've learned about what happened to apple news and the takeover hong kong and these people who owned a bookstore and who were disappeared for two years Here's what I learned about tanks running into Tiananmen Square.

38:35Here's what I learned about the worst labor conditions in China. Go ahead and do those videos and see if they trend on TikTok. That's what she should do. Let me stop you right there. So after she posted this, the comments were basically roasting her all over TikTok and Twitter. Obviously. And how old is this person? Is it 25? I have no idea. She looks like she's in her 20s, I think. Yeah. I mean, what is this person now? I mean, like, I honestly, I almost look at her as like, um, there's a term in, um, I don't, and I don't mean to say this to be cruel. There's a term useful idiot in, uh, international relations and a useful idiot is like somebody who you can just flip really easily for propaganda reasons.

39:14Uh, and so like the KGB, I think came up with the term useful idiot. Like they put people into buckets and like a Trump or somebody like, um, you know, one of Trump's kids would be put into the bucket of useful idiot. Right. You can just easily manipulate them. You can give them a little bit of money. You can give them a little bit of shine. Would you kind of say that was like Tom Wamsgans, what he kind of signed up for to be the guy's useful idiot when he said, I could just take all the pain? Absolutely. Yes. I am willing to sing for my supper. He just says it outright. I'm a pain sponge, I think is what he said.

39:44I'm a pain sponge. He's a pain sponge. And he said, sure, I'll sing for my supper. And the guy says, why should you be CEO? And listen, useful idiot or I'm a, you know, you can have a price and here's the price. and you put me out there, I'll tap dance for you. And so for a young person, this is a hard lesson. I actually feel bad for her because I do think she's kind of like in the useful idiot category. And listen, I'm not saying that to say she's an idiot. I think she needs to understand that she's being manipulated and they gave her a first class ticket, which must be very exciting to go on a trip to China.

40:14And they probably gave her what, 10 grand to do this? 20 grand as an influencer. So if you're watching TikToks and you're getting news from an influencer, understand for 10 or 20K, they will say whatever you want. and brian just added she's 30 years old okay yeah so i mean she's she doesn't have enough experience in the world to know that she's being manipulated or they gave her a great price to be manipulated finn can't spill coffee on a white shirt or wave at someone who wasn't waving at them or burn its mouth on hot pizza but finn can resolve half of your customer support tickets instantly before they reach your team what's finn finn is a breakthrough ai bot from intercom designed for customer support teams and ready to put other chatbots out of work.

40:59It learns your entire knowledge database and has the ability to carry conversations and remember context and nuance while slashing your resolution times and support volume. Meet Finn, a breakthrough AI bot by Intercom, ready to join your support team today. Visit intercom.com slash Finn. so after she eventually deleted this video uh later but before she did she wound up making a first response video where she basically called anyone that took issue with her taking the trip xenophobic and got even harsher responses from that then she deleted both of her videos the original one and the response and then eventually released an apology video oh where she said she cut ties with sheen so brian if you want to cue that one up hey everyone i wanted to come on here and clarify a couple things after yesterday's live.

41:49The first thing I want to make abundantly clear is I have terminated my relationship with Shein upon returning from the trip and I will no longer be aligned with them or work with them in any capacity now or ever in the future. I made a mistake. I made a huge mistake. I always try to lead with me, my younger self, and my community in mind. And I let us down. I did us wrong. I led us to the wrong path. and I'm very aware of that now. I am ready to take accountability and look at myself and look at my role in my industry and I'm going to take a couple weeks off. I'm going to re-evaluate, rebalance and I'm going to come back and I'm going to be better and I'm going to be stronger and I'm going to continue the fight for us in a new way and continue to be an even better pioneer for the plus size community so thank you all right i'll see you then all right so snaps up for that apology well done and i will give her some instructions if she wants it uh well done she takes full ownership of it she was manipulated and she says i'm never going to work with in the future remember i said earlier nick like uh when you make these engagements the danger for the people who are trying to use their money to uh human rights wash or to worker condition factory wash this is factory washing i'll come up with that term if you want a factory wash and your sheen if you do that and you get busted doing it now it makes it even worse oh yeah the cover-up is always worse than the crime and so this is exactly my point about engagement eventually somebody like lebron james who has you know uh really fought for human rights here and black lives matter and all this stuff in the united states is rightfully called out for the human rights conditions and his involvement in china and at some point you know he has to say listen my community is facing these human rights violations here but i'm making this huge pile of cash here i'm not going to take that huge pile of cash unless these things change right And so this is exactly my point.

44:00Engagement can lead to the disengagement. The disengagement moment puts so much shine on the issues that it's actually good for the people who have those issues and the people who are suffering. So this is absolutely a fantastic outcome. And I would say she has an opportunity to do more here. She should do a series. And this is my best advice for her. What's her name again? Danny Carbonari. okay great i'm gonna we'll post this to my tiktok danny it was very brave of you to do the apology video and to break off all ties with sheen uh congratulations on that as somebody who worked at amnesty international and has been passionate of human rights uh for 30 years um i want to give you a roadmap here i highly recommend you get educated on the workers conditions uh and specifically those of the uyghurs the sterilization the forced sterilization of women in the uyghur renew the torture of uh the uyghurs and uh also get educated on tiananman square the takeover of hong kong uh and um just workers conditions generally and you could become through this turn of events the greatest advocate for factory workers on tiktok and make a series of videos where you either interview and the same way you interviewed that woman who was an investigative journalist and you said hey listen everything looks okay to me and you were in one of 6 000 factories well what about you visiting the worst of those 6 000 or you getting a video and you becoming an investigative journalist and you exposing the suffering of the six worst sheen factories as opposed to getting duped by the number one one which they clearly made beautiful and tried to dupe you and use your reputation to factory wash.

45:53Danny, you could become the number one advocate in the world for these people who are suffering. And not just in China. You could do this for any country where you think factory workers are suffering. And what a great legacy for you. And what a great story. And you could be the hero of this story, Danny. You could be the hero who made a mistake, owned it, but then you could do more. You could actually improve conditions with your voice. So bravo to you. Snap stop. That's it. Good. So are you buying the IPO or no? What's the deal? Oh, yeah. Well, I was looking at the IPO price and no, you know, listen, this is another way you can vote with your dollars.

46:32If you're an influencer, you can have influence. So you should stick it to them. You should stick it to them. They duped you. They made you look stupid. They caused damage to your brand, Danny. Now you should do the same to them. you should stay on sheen until the workers conditions continue you should be absolute beast an animal a wolverine a berserker for human rights and factory conditions and uh yeah no i i think you do have to vote with your dollar uh when you're buying socks and you know i i wouldn't buy tobacco stocks i i'm i you know i am not so cutthroat about winning that i feel i need to take every opportunity i'm not axe from axe capital right like i think those hedge fund guys think a certain way any trade is worth doing and the trade is the trade and i'm just making a trade speaking about voting with your dollar would you like some blue meat oh i got something for you i think is that the opposite of my red media yes it is blue meat okay so we have a little bit of a trump update today but i promise the people that hate politics do not to know this is not about politics i promise it's financial mostly such nasty people at twitter oh your impersonation is lagging you gotta you gotta get yeah okay elon musk great rockets terrible social network okay and zuckerberg asperger's gonna gonna demolish him in the ring i'll be there okay all right what's what's going on with trump okay so a couple of updates one he's considering coming back to twitter of course which has been floated for a while and uh you know is exciting for a lot of people and youtube and facebook right isn't he back on those two did they end his ban no okay i think they ended the facebook ban before the trump the twitter ban and i don't know about youtube but i think all the platforms since it's a presidential leading presidential candidate let him back on okay so axios reported that uh trump is entertaining the idea of getting back on twitter he hasn't posted since his account was deactivated during uh january 6th the riots insurrection whatever you want to call it um so for more than a year he's been posting truths on his truth social app where he's a majority shareholder yep um and let's just there's there's more news about true true social that we need to get into so it's hard to know exactly how many users that truth social has how many active users rather but reports online vary from somewhere between 500k to 2 million which seems like it tracks right that seems like a fair number you think yeah sure i mean it's basically a it's the most mag of people who would download a you know a clunky piece of software to have a more direct relationship and get those faster because anything he says on there is quickly reposted to twitter anyway yeah yeah because didn't he have i think as part of his deal he had to wait six hours between a post on truth and twitter that was i think the term they gave him in order for him to own all that money in tmtg i'm not sure but anyway truth social is owned by trump media and technology group also known as tmtg yeah you might know tmtg because they are the company that agreed to go public via spack by merging with dwac big acronym show today dwac is digital world acquisition corp That's a SPAC.

49:54And that agreement happened back in October of 2021. Right. So that date's important. Since then, and Brian, you could pull up the stock chart. The DWAC stock price has been all over the place. Insane surges. It was obviously$10 a share, like most SPACs start at. Ripped up to 94, went back down to 40, went back up to 97. and it's basically you know i don't want to say vaporware but it's truth social and like trump's future media uh properties whatever those may be right so you're basically just betting on donald trump to create some media properties so the spack is still not closed even though it first agreed to the merger in october 2021 usually you see the d-spack process within six to 12 months it's been a lot longer since that that's wild yeah so recently they extending the they extended the closing deadline to September 2023.

50:47And the reason that it's been postponed is because the deal is currently under investigation by both the SEC and FINRA. FINRA, obviously, the Financial Industry Regulatory Authority. And just yesterday, in just incredible news, three men were charged with insider trading for buying DWAC shares before the merger was announced and then selling for a profit. And I want you to strap your seatbelt in. One of the people charged oh no is named bruce garelik garelik bruce garlic something g-a-r-e-l-i-c-k i don't know how to say his name he was a director of the spack you're kidding oh my lord okay so is this is the first question is he the dumbest white collar criminal of all time pretty close yeah i'd have to really think this through uh because whenever any kind of major transaction goes on, people look at who bought the stock right before it.

51:46This is just a standard practice. So before a merger gets announced, Slack's being bought by Salesforce, they would just go back and say, okay, show me the last 60 days. Anything unreasonable occurring here, right? And that's how they catch these folks. They catch them every time they get caught. Martha Stewart, everybody, doesn't matter if you're buying 10 ,000 shares or 10 million. so this thing's gonna get unwound i thought would be my guess can i give a personal anecdote about this sure so i worked on a spack presentation uh about a year ago oh um everything is public now obviously but i remember as part of the i had to sign an nda that basically said and again you did a side job yeah you don't remember this oh i gave the okay for it you did give the okay for it of Of course you did.

52:35You think I'd ever take a side job without the okay? No, of course. I mean, it's how it works in a corporate America. I had to sign an NDA. And basically it was like, and again, this is a editor, right? The lowest person on the totem pole who means nothing to anybody. And it was like, if you buy shares or you tell someone and they buy shares, you will go to jail. It had big red flags everywhere, right? For the lowest person on the totem pole. Yes. This is the director of the SPAC that did this. How did this guy think that he wouldn't get, this is insane. I mean. people commit crazy crimes and uh it's uh it's it's arrogance entitlement and stupidity all wrapped up in a ball like if this was an snl skit they would throw it out because they'd be like no that's stupid that that's like it was a plot point in a movie you'd be like too this is dumb too dumb yeah the person knows the rules uh they sign the documents yeah so i think the more interesting part of this story is i you know i think this will unwind i think trump loses whatever steak he had in this i think it's worthless to just throw it in the garbage um there's no way when you have all of this you know all of all of these alleged crimes going on that you would want to go forward with this because it's going to result in a ton of lawsuits so it's a disaster and uh but the bit more important thing is trump needs twitter trump needs youtube trump needs facebook he's got to get off truth anyway so i think he can easily walk away from this and just say listen uh truth social is great we built a great product but uh you know i need to be on these other platforms where a lot of the voters have asked me to be present you know and i gotta meet the fans where they are i can't just broadcast to two million people even though it's a better product and i created a much better product so he'll figure out a way to blame somebody else for this failure instead of himself even though he's the majority shareholder if you're the majority shareholder he should have got together he said this i'm the majority shareholder you're all fired off the board these are five really highly competent people but highly competent people don't work with trump this is what we've learned and every time highly competent people go try to help trump uh you know who are like well he's our president and this is my hope i tried to give him a chance when he won the presidency i said yeah maybe there'll be like look at all these good people these generals and these like you know lifelong career servants who are trying to help him the mooch be a great president what's that the mooch well not that one but no mooch is i I love the mooch.

54:54What do you mean? I like the mooch. I wasn't thinking of the mooch. I was thinking like even earlier. I got you. I got you. Earlier in his presidency, you know, Chief of Staff. Yeah, Mattis. I get mad dog Mattis. I mean, he had a lot of really great people, or at least people with great reputations. I don't know anything personally, but you just thought they were like, he'll rise to the occasion. Even Pence, right? You know, may disagree with him about abortion and some other things and having lunch with women. You know, I have some differences in opinion with him on the margins. I might agree with him about other things.

55:22but like wouldn't he um wouldn't they be able to help him rise to the to the office right and the truth is um he is um the ultimate iconoclast who listens to nobody including his lawyers or including the smart people brings around him so you can't build a large enterprise without attracting great talent he was unable unable to attract great talent the end he'll be back he's going i mean when he comes back to twitter oh my god that's gonna just i think it'll be like a 10 % boost to engagement on Twitter when he comes back. It's going to be a total free-for-all when Trump comes back to Twitter. I think it'll be like a 10 % boost in engagement on Twitter in terms of users and everybody rushing back to hear what he's going to tweet next.

56:10Twitter is pretty engaging right now because a lot of the voices who were silenced on Twitter are now back. so it'll be a full contact uh even more engaging uh free-for-all what is that free-for-all mode when you play like a game uh you know like a uh first person shooter it'll be like one of those free-for-all modes where like 30 people are battling 30 people at once it's going to be pure chaos you're going to have the left the right moderates everybody is going to be going crazy and the same thing with youtube i mean if he just started doing youtube live streams it would be incredible i would highly encourage him to if i was trump i would take a uh i would do a combination of twitter and youtube lives because youtube lives seem to work pretty well um the live streams it's certainly going to be interesting all right and in the last story for today quick hit the quick hit there you go so over the past year for people that don't know if you don't live in san francisco or one of these areas waymo which is owned by google and cruise have both launched self-driving taxi fleets in limited areas.