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🚴 Peloton’s pivot, explained

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The Hustle

Last week we asked you to rank the best and worst Chex Mix pieces, and thousands of you weighed in. Scroll down to see the results.

In today’s email:

  • Peloton: What’s the plan?
  • Chart: Chex Mix rankings.
  • Digits: Pricy art and missing millions.
  • Around the Web: Online tools, the history of Clippy, a smooth gorilla, and more cool internet finds.

🎧 On the go? Listen to today’s 10-minute podcast to hear Jacob and Rob break down Peloton’s new strategy, $3 movie tickets, a T-Mobile-SpaceX partnership, and more.

The Hustle Daily Show

🎧 On the go? Listen to today’s 10-minute podcast to hear Jacob and Rob break down Peloton’s new strategy, $3 movie tickets, a T-Mobile-SpaceX partnership, and more.

The Big Idea
Peloton

What the heck is Peloton doing?

When Peloton reported earnings last week, it wasn’t exactly pretty.

The connected fitness pioneer reported a loss of $1.2B, a drop in revenue and membership, and higher-than-expected churn.

But CEO Barry McCarthy is optimistic, likening Peloton to a 720-foot cargo ship in the process of making a sharp turn at 27 knots.

So what’s his plan?

Reining in the balance sheet, for starters. Think: layoffs, store closures, and outsourcing manufacturing.

Aside from that, it appears he’s embracing two strategic bets:

  • Increasing accessibility to Peloton by offering a bike rental program for $89/mo., adding new subscription tiers to the Peloton app, and making Peloton content usable with third-party equipment.
  • Cutting costs elsewhere by outsourcing, including a bike with an Ikea-style self-assembly option, and opening up its distribution channels through a partnership with Amazon.

Remember, McCarthy hails from Netflix and Spotify. By sacrificing white glove service and focusing on subscription revenue, he hopes to cut costs and get Peloton’s best asset — its content — in front of more people.

Despite ugly financials…

… there’ve been some bright spots. One Peloton Club, the bike rental program, is on the upswing; subscription revenue actually surpassed hardware revenue; and McCarthy expects to reach break-even cash flow in 2023.

Peloton is also planning to release a rower in time for the holidays. Hopefully, this time, they don’t screw up the marketing campaign.

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SNIPPETS

You can watch NASA’s Artemis I mission here, scheduled for liftoff today at 8:33 am ET. A 322-foot-tall rocket will launch the Orion spacecraft to orbit the moon on a 42-day journey.

The US Open starts today. Tickets cost 60% more than in 2021, and the Open’s official Honey Deuce drink, at $22, costs 10% more.

A mint condition Mickey Mantle baseball card bought for $50k in 1991 sold for $12.6m yesterday, a sports memorabilia record.

Moderna sued Pfizer and BioNTech for patent infringement, alleging the companies copied its mRNA vaccine.

LastPass said no passwords were stolen when hackers broke into the company’s systems and stole source code.

T-Mobile and SpaceX are partnering to offer Starlink satellite connectivity next year. The service will only enable texts at first.

Netflix’s ad-supported tier may cost $7-$9/mo. and roll out to some markets before 2023. The current standard plan is $15.49/mo.

Ulta’s net sales grew 16.8% in Q2, faring better than many retailers. CEO Dave Kimbell attributes the bump to the popularity of self-care and wellness.

A Michigan Chipotle store voted to unionize last week, becoming the first of the chain’s ~3k locations to do so.

On Sept. 3, moviegoers can get $3 tickets in 3k+ US theaters. The National Association of Theater Owners hopes its new National Cinema Day will attract more customers amid a slow season.

Get that bread: So you’ve built a business from the ground up and now you’re ready to cash in. Here are the tips you need to make a successful exit.

Chart
top Chex Mix pieces

Singdhi Sokpo

Our Chex Mix survey results are in…

… and the rye chip was the clear winner. It’s also clear people may never see eye to eye.

Zach from Knoxville, TN, said the “rye chip has no flavor,” while Brandon from Franklin, TN, said it “consistently has the most flavor.”

What did people say?

The pro- and anti-rye chip lobbies made their cases clear:

  • “And on the eighth day, God gave us rye chips.” (Austin from Chicago)
  • “Surface area = flavor. It’s just math.” (Alison from New York City)
  • “I prefer my bark on the trees.” (Blaire from Cincinnati)
  • “It’s like a communion wafer from the days of Jesus.” (Pete from New Orleans)

Other than the rye chip, nothing brought more people together than pretzels — combined, 38% marked the circle and square pretzels as the worst pieces.

  • “We all know what’s going on here,” explained Blake from Venice Beach. “Big Pretzel sticking its beak in my snack business.”

Lastly, apologies to Jane from Sydney, Australia, who’s never had Chex Mix and isn’t even sure “how to pronounce ‘chex’ properly.”

Maybe next time we’ll ask about Vegemite, Jane.

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Free Resource

An intro to crypto and blockchain

Despite the long downturn, the crypto market cap is still over $1T.

And influential institutions from banks to governments can’t stop hopping on the blocktrain/cryptomobile. Which is to say — money is evolving.

If you grasp just the trappings of DeFi, this video deconstructs the hype.

How cryptocurrency actually works:

  • WTF is crypto and blockchain?
  • The most popular coins
  • The evolution of money
  • What is crypto mining?
  • Three trusted crypto wallets
  • Transacting crypto (exchanges vs. P2P)
  • Basic blockchain use cases
  • JPMorgan gets on blockchain

Watch Tory from HubSpot deliver the crypto fast facts.

Also: Stay informed with the emerging tech podcast, newsletter, and blog recs in this e-book.

Crypto clarity →
Numbers
WordPress app

Digits: Pricy paintings, missing millions, and more

1) Over $150B in M&A have been delayed or fizzled out since June, per Bloomberg. Rising interest rates, crypto crashes, and worries over inflation and the economy play a role.

2) A new LendingTree report found that, in the 50 top US metro areas, Black homebuyers face an average mortgage denial rate of 18% compared to 9% overall — and even higher in cities like St. Louis and Boston.

3) The winner of the $1.34B Mega Millions jackpot has yet to claim it. Apparently, this isn’t uncommon, as winners often consult legal and financial professionals first. This winner still has until next July.

4) Researchers found 47.3k+ malicious plugins used across 24.9k WordPress sites, 94% of which are still active. Some people even paid for bad plugins, with $41.5k spent on malware.

5) Christie’s will auction off 150+ paintings from the collection of late Microsoft co-founder Paul Allen. Valued at over $1B, it may be the largest art auction ever — and it’s all going to charity.

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AROUND THE WEB

📀 On this day: In 1997, Netflix was registered as a DVD rental company.

🔧 Useful: A trove of online tools, including calculators, photo editors, and more.

🎧 Podcast: On (un)sexy with Elaine Zelby, Pipedream Labs CEO Garrett McCurrach discusses the company’s plan to create underground delivery tunnels.

📎 That’s interesting: How Clippy, Microsoft Office’s talking paperclip assistant, became a cultural phenomenon.

🦍 Aww: Did someone call for a gorilla?

Meme
Peloton meme

Soaked. (Source: imgflip.com)

How did you like today’s email?
Today’s email was brought to you by Jacob Cohen, Juliet Bennett Rylah, Samir Javer, and Rob Litterst.
Editing by: Jennifer “Rye chips forever” Wang.

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