Feels good to be bad


July 1, 2019

Today, the Lego family gets into magic and, to aluminum canned beverage brands, Pepsi’s move could be tragic, but first…
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What’s your vice? Former Walmart executive creates VC fund for naughty startups

Like many VC firms, Vice Ventures comes to the table with a strategy. 

But the New York-based company’s focus has a touch more of an edge than your traditional investment firm.

The company, co-founded by former Walmart exec Catharine Dockery, just raised $25m for its debut fund, where it will focus its cash cannon on the markets less traveled — areas like cannabis, alcohol, “sex-tech,” gambling, tobacco, psychedelics, and more.

Corporate investors are buttoning down

Vice Ventures’ fund was backed by many big name money throwers, including Marc Andreessen and Bradley Tusk, showing that bigwigs are starting to loosen the tie when it comes to vice markets.

But many old school backers still prefer their ties like they prefer their billion-dollar deals: cinched. And that has long kept people like Andreessen from making these investments through his own firm. 

Blacklist companies finally have a dark knight 

Many VC firms are kept from investing in “bad companies” through prohibitive “vice clauses” that allow backers to choose where their money shouldn’t be invested (When it comes to investments, Andreessen is like a majestic eagle, people. You gotta let him fly!).

But, it’s becoming clear that it’s no longer just heathen millennials lookin’ to toke, vape and pleasure themselves in public (kidding).

Naughty industries have exploded, and Vice Ventures is proving that not even the poorest of the richest prudes are able to abstain from their true weakness: making money. That’s where Vice Ventures comes in.

Providing a platform for ‘dad’ investors to be ‘bad’ investors 

According to VentureBeat, the firm said it plans to invest around $500k in each of its portfolio companies, with a number of investments already made, including in companies like the canned CBD beverage brand, Recess, and Bev, which sells California rosé in a can.

Devil investors unite
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The Danish fun-glomerate behind Lego will take Merlin Entertainments private for $6B

The Danish family behind Lego has partnered with Blackstone to take the owner of Madame Tussauds wax museum (and all of its high-profile candle-made stars) private.

The deal values Merlin Entertainments at $6B. Merlin also owns LegoLand theme parks, as well as other attractions in 25 countries.

‘They’re not my parents, they’re my roommates’

Kirkbi, the investment house of Lego’s founding family, and Blackstone owned Merlin before listing it on the London Stock Exchange in 2013.

But, after the London terror attacks, the UK theme park market slowed way down and shares in Merlin have been short of magic over the last few years.

The theme park even tried to move to the States in a bid to buy the unpopular SeaWorld. Things didn’t work out, and now it’s moving back in with the parents.

Welcome to the real world 

According to Bloomberg, the trend of private equity groups buying back businesses that they raised, after seeing them get beat up and dragged down in the public markets, to help them get back on their feet is often just what some struggling companies need.

Because as we all know, during hard times, there’s no better presence than family. Unless, of course, you consider the wax statues of Michael Jackson and his pet monkey, Bubbles, your family.

» A corporate indie movie
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In a metal move, Pepsi packages Aquafina in aluminum to crush its competitors’ cans

Aquafina, the PepsiCo-owned bottled water biz, will replace its signature plastic bottles with aluminum cans in outlets across the US, according to a recent press release.

For big brands, ‘going green’ has more cultural currency than ever… 

And cans are a very visible way for PepsiCo to “evolve [their] packaging across [their] water portfolio to make a positive impact.”

But, beyond the corporate jargon, PepsiCo’s aluminum cans also aim to put a serious dent in their competitors’ plans for their cans.

Now, Liquid Death could be dead in the water

One of the primary selling points of Liquid Death — the “punk” water brand that recently raised $1.6m — is that its skull-decorated cans are more sustainable than bougie bottles offered by rehydration rivals.

But, now that Big Beverage is cashing in on the canning craze, demand for “alt” water from startups like Liquid Death or Boxed Water (which sells its H2O in boxes that look unsettlingly like milk cartons) could dry up.

» I think I can

Why does ramen rule the prison economy?

In jail, where inmates aren’t allowed to handle cold, hard cash, most people imagine the same stereotypical prison currency: cigarettes.

But, according to Carl Cattermole — the author of Prison: A Survival Guide — tinned fish and ramen are the most common currency in jails.

In prison, 2 soups are worth 1 sweatshirt

A few things make cigarettes, fish, and ramen good currencies: They’re nonperishable, come in standard units, trade easily, and have intrinsic value.

In some prisons, inmates can buy a sweatshirt (worth $10.81 in the prison commissary) for 2 “soups” — or 5 hand-rolled cigarettes for 1 soup.

But why did ramen and tinned fish replace cigarettes at the top?

Cost cuts and smoking bans gave rise to the ramen economy

After US federal jails banned smoking in 2004, cigarettes became a less reliable currency than ramen or tinned fish. But, more importantly, cost cuts have made high-calorie ramen extremely valuable to hungry inmates.

An inmate told the author of a 2016 study, “’You can tell how good a man’s doing [financially] by how many soups he’s got in his locker. ‘Twenty soups? Oh, that guy’s doing good!’”

Soup seems simple… 

But the ramen economy is surprisingly complex: Inmates can rack up debt with people who hold large ramen reserves, earn higher credit limits, and even refinance soup debts with different ramen reserve-holders.

» Not-so-souper
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