The business of pleasure is booming

August 21, 2020

Plus: Uber and Lyft get a last-minute reprieve.
August 21, 2020
The Hustle

We got the keys to GPT-3 and we’re takin’ it for a test drive. Tweet your best questions for the AI text engine @TheHustle. We’ll share the machine’s answers — the cringe-worthy, the mind-blowing, and the hilarious.

The Big Idea

Sex toy sales have skyrocketed, so why are startups screwed?

If anything good came out of the past couple months, it’s that we’re having a lot more sex. Plenty of pleasure-focused enterprises are raking in huge revenue. 

But for many sex tech startups, stigma is still a barrier to entry.

It was already a hot market 

Sexual health revenues neared $30B globally in 2018, as we reported in Trends last year. And experts say sex tech could emerge from the pandemic in an even better position.

Big brands have been bangin’ since the lockdown era:

  • Wow Tech Group, which owns toy companies Womanizer and We-Vibe, reported a 200%+ increase in revenue in April.
  • The boink behemoth Adam and Eve saw a 30% increase in online sales in March and April.

But startups still struggle to seal the deal

Some VC funds have morality clauses that block ‘em from investing in “vices,” Pando reports. 

Even crowdfunding is hard. Platforms with big audiences, like Instagram and Facebook, crack down on anything remotely suggestive. 

And entrepreneurs often face speed bumps:

  • When sexual communication app LoveSync went on “Shark Tank,” the show’s lawyers insisted on scouring the founders’ pitch beforehand. 
  • The wellness platform Unbound’s founder had trouble opening a bank account and renting an office.

There’s more than one way to shake the sheets

As one investor told Forbes, appeals to health and relationships can sway reluctant backers.

And a few newer funds focus specifically on sexuality:

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  • An appeals court gave Uber and Lyft a last-minute reprieve in the fight over how they classify drivers in California. They won’t be shutting down in the state just yet.
  • Speaking of Uber: A former security official was charged with trying to conceal a 2016 hack that exposed millions of users’ data.
  • Intrigue at Palantir: The company is moving its HQ from Silicon Valley to Denver.
  • Airbnb is banning all parties, everywhere, and threatening to sue violators.
  • Are you a nervous flyer? Maybe skip Xwing’s new unmanned aircrafts

Tesla’s mind-blowing stock rally, explained

Tesla’s stock (current price: ~$2k) looks unstoppable. 

Elon Musk’s electric vehicle maker (and infinite source of memes) gained ~40% over the past 10 days, and it’s up ~9x over the past year.

Three things are driving the rally:

Tesla’s now worth ~$373B (AKA 2x Toyota or 11x Chipotle)

Johan Moreno — who hosts the Inside Transportation podcast with investor Jason Calacanis — tells us that Tesla’s position is “realistic, because they are being judged on a different standard” than other automakers.

Translation: Tesla’s more than just a car company.

It gets credit for its software, batteries, and solar energy tech. Moreno says the solar biz will be “huge” based on the storage of Tesla’s million mile battery.

Also huge: Tesla’s head start 

With China and the EU enforcing electric vehicle mandates in the decades to come, we’ll live in an electrified future. 

Moreno said Tesla is “at least 10 years” ahead of everyone else on production, sales, and automated driving tech.

You hear that sound? That’s our collective regret at not owning any Tesla stock.

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We’ve got 2 tickets to (marketing) paradise

Actually, we lied — We don’t have 2 tickets to HubSpot’s INBOUND 2020. 

We have unlimited. 

And you can get yours right here.

That free ticket scores you access to this immersive two-day bootcamp, full of content like:

Pick the brains of leaders like Bob Iger (CEO of Disney), Alicia Garza (Principal at Black Futures Lab), Sandy Carter (VP of Amazon Web Services, and Sasan Goodarzi (CEO of Intuit) and finally develop all those skills you said you’d learn these past few months — ya know, before we all gave up and watched compilations of pandas falling out of trees while eating bamboo on YouTube instead): 

Save your spot here before INBOUND 2020 goes down in September: 

Save my spot →
A Blue Sky Idea

Are private airports ready for liftoff?

Cities are struggling to pay their workers and ditching growth plans. The Atlantic has a fix: Turn airports private

One dealmaker estimated that investors would pay 17x an airport’s annual cash flow for one. 

It may be a billion-dollar payday that cities could put toward more pressing issues. 

So what does ‘privatize’ actually mean?

Airports are insanely complicated, but here are some quick facts: 

  • Every commercial airport in the US gets federal money, except for Branson Airport in Missouri. That means the government runs them. 
  • In 2018, Congress cleared any airport in the US to go fully private.
  • Privatizing doesn’t mean handing over the keys to an investor — cities would only lease the space.

Privatized airports tend to bring 2 things

More people and more stores. Companies want to make extra money, which means swanky new shops packing the terminal. 

In 2013, a holding company took over Puerto Rico’s Luis Muñoz Marín International Airport. 

It opened 2 terminals and added 118k feet of retail space. A year later, ridership was up by 3.5m people.

But usually, someone gets cold feet

St. Louis, Chicago, and Denver have all tried to turn their airports private. They’ve never stuck the landing. 

A British transit company bought New York’s Stewart Airport in 2000 — but it backed out 7 years later because it couldn’t turn a profit. 

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The Hustle Says

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Lots of recruiters tell us they wanna hire Hustle readers. We’re highlighting cool opportunities to help you find your next gig.

Head of B2B Lifecycle Marketing at Yelp: Lead the team responsible for marketing emails, push notifications, and in-app messaging. 

Senior Product Manager, Consumer Privacy at Twitter: Develop Twitter’s privacy tech. 

English Curriculum Content Writer at Duolingo: Fluent in English and Mandarin? This one’s for you.

Associate, Audience and Growth at Axios: Manage multiple accounts with sharp, eye-catching copy. 

Community Marketer at Podia: For those of you who spend a lot of time on Twitter and Reddit.

See more →
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Shower Thoughts

Occasionally we encounter a Shower Thought *outside* the shower. But what do you call those? “Regular Ol’ Thoughts”? Just doesn’t have the same ring to it. 

So, we stuff them deep down in the dirtiest crevices of our body (you know, like behind our ears) and wait until the loofah comes out to revisit them. It’s tough, but someone has to do it. 

  1. Superman’s most unappreciated power is his extraordinary fine motor skill. He has almost unlimited strength and can literally move mountains, yet is also able to shake someone’s hand without inadvertently ripping off their arm.
  2. The bigger the boat, the less likely the owner is the captain.
  3. Humans are afraid of being bitten by spiders even though they have more teeth. Spiders are afraid of being stepped on by humans even though they have more legs.
  4. Having a stupid person join your side in an argument is worse than a smart person joining the other.
  5. There’s a good chance that your calculator history is more embarrassing than your browser history.
via Reddit
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Editing by: Nick “Crash Test Dummy” DeSantis, Don Kashane (VP of Gratitude).

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