TikTok’s deal is coming into focus


September 21, 2020

PLUS: How Domino’s Pizza surged during quarantine.
September 21, 2020
The Hustle
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Daniel Wellington

Justice Ruth Bader Ginsburg, who died on Friday at the age of 87, leaves a remarkable legacy of advancing equality under the law. As noted by Chief Justice John Roberts: “Our nation has lost a justice of historic stature.”

The Big Idea

At this point, it would be tech media malpractice to not write about TikTok.

So, here’s the update: On Saturday evening, TikTok tweeted a video of Vanessa Pappas — the firm’s interim head — with the text “#WeAreTikTok and we are here to stay!”

The US government has agreed in principle to a deal

Under the agreement, Oracle and Walmart would take minority stakes of 12.5% and 7.5%, respectively, in TikTok Global (all markets ex-China).

This 20% stake in TikTok would reportedly cost $12B, valuing the video app at $60B — nearly as much as Snap ($35B) and Twitter ($32B) combined. In total, US investors will directly or indirectly own 53% of the firm.

Per Walmart, the deal may also create 25k US jobs and $5B in tax revenue. TikTok Global will be “an independent American company, headquartered in the US,” with 80% of its 5-person board composed of US citizens.

What are Oracle and Walmart actually going to do?

Oracle would be TikTok’s cloud provider (“trusted tech partner”) and be given access to the firm’s source code to ensure US consumer privacy.

There’s been confusion as to what Walmart will actually bring to the table other than “yo, Larry called and said we should totes do this deal.”

The company cites its omnichannel retail chops (including fulfillment and payments), suggesting TikTok Global wants to take its ecommerce ambitions to the next level.

The straw that broke the open internet’s back

China began censoring its internet in 1997. Today, thousands of international domains are blocked from the country’s internet: Google, YouTube, Facebook, Wikipedia, Reddit and Instagram, among others.

As noted by Quartz, the structure of the TikTok deal mirrors similar agreements that foreigners have struck to operate in China. For example, Apple currently stores Chinese user data within China’s borders.

A hawkish US cyber sovereignty position will further erode the notion of an open internet … likely with unforeseen long-term business and geopolitical implications.

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Snippets
  • Chime raised a massive $485m round. Now valued at $14.5B, the neobank is America’s largest fintech startup. 
  • A federal judge halted the US ban on WeChat, which was scheduled to go into effect this week.  
  • A new crop of law-tech startups like Hello Landlord are helping people navigate eviction court.
  • Another thing WFH is taking from us: Fast-food workers say the early-morning coffee rush has shifted to midday. 
  • The newest in luxury fashion: Clothes spun from all those fish skins that would otherwise wind up in the trash.
  • Bonus: Kanye West wants to make a startup incubator for music (AKA YeCombinator). Witty Wealth’s Anuj Abrol brilliantly breaks down what that might look like.
Q&A

‘I would take passion, curiosity, and commitment over experience any day of the week’

Kara Goldin is the founder and CEO of Hint, the leading unsweetened flavored water company (estimated annual revenue = $200m+).

In her new book, Undaunted, Goldin recounts the personal doubts and challenges she overcame to build one of America’s most successful beverage businesses.

We caught up with her last week for a Q&A: 

Who’s the most interesting person you’ve ever met?

(Editor’s note: We received this response prior to the news of Justice Ginsburg’s passing.) 

I would have to say Ruth Bader Ginsburg. When she was a young woman living in a man’s world, she decided to dedicate her life to leveling the playing field and she never stopped pushing. 

She has changed the world we live in, making it a fairer place for girls and women by overturning hundreds of years of discriminatory laws, first as a lawyer and then on the Supreme Court of the United States. 

To have such a big vision about the way things should be and to actually see it through is awe-inspiring. What a badass!

What’s the best piece of advice someone ever gave you?

Early in my career at Time, Inc., I told my boss about a meeting I had just finished. I felt really good about it and told her how nice the people were.

She said, “everybody’s nice” [but I would know] if the meeting was a success based on what they did. She taught me to judge people by their actions, not their words. That’s great advice. 

What’s one mistake you made in your career, and what did you learn from it? 

When I first started Hint, I thought that I needed to find some beverage experts. None of [these experts] knew how to solve the big problems, though, and very few of them were willing to work hard and innovate.

Today, I look for smart people that are curious and have a work ethic. I would take passion, curiosity, and commitment over experience any day of the week.

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SPONSORED

Who needs traditional marketing? Not Daniel Wellington, apparently.

The brand was launched entirely on social media in 2011 — and they’ve sold more than 6 million watches since.

When you boom that big, there’s only one thing left to do: Expand. Daniel Wellington is wading further into jewelry with three new collections

Based off of the success of their original bracelet and ring, Daniel Wellington has now launched 3 distinct collections. 

  • The Elan: A fresh take on their original bracelet and ring, available in stunning Rose Gold or Silver.
  • The Emalie: More accessories designed to match their Classic Satin White Bracelet and Satin White Ring.
  • The Aspiration: A completely new approach that puts a unique ceramic design at the center of all the pieces.

Each one introduces a new style, material, or design to their existing accessory offerings, so you can now make sure your neck and fingers look just as good as your wrist.

As the wise Tom Haverford always said… “Treat yo’ self.

View the collections →
Delivering the goods

Domino’s has been working on pizza delivery innovation for years. During quarantine, its efforts have paid off.

When we think of companies benefiting from quarantine, Amazon and Zoom probably come to mind.

Whether or not you’re on a paleo diet, you should also throw Domino’s Pizza into this mix.

Case in point: Domino’s sales jumped 16% YoY in Q2 to $920m

That’s during a period when 15k+ sit-in restaurants have closed, according to the Wall Street Journal.

Further, 2 notable pizza competitors — California Pizza Kitchen and the parent company of Pizza Hut (NPC International) — have recently filed for bankruptcy.

The $16B pizza giant has particularly benefited from its focus on digital sales over the years. Per WSJ, a quick-service restaurant typically does 5-10% of sales online; Domino’s was at 65% last year and 75% today.

What’s its secret?

Domino’s made a handful of key moves that prepared it for this moment:

  • It created its own point-of-sale system for all 6k US locations
  • The chain made it possible to order through any channel: desktop, smartphone, Twitter, a Samsung TV, Amazon Echo, Slack, FB Messenger
  • It introduced “zero-click ordering”: open the app and your favorite pizza is ordered within 10 seconds
  • In the works? Autonomous delivery and e-bike delivery

Our favorite innovation: the cardboard pedestal for contactless delivery.

We reached out to Domino’s to see if the genius inventor of this product received a promotion (no response yet).

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Save For Finsta

The boarding-pass hack that hit Australia’s former prime minister

You probably aren’t flying much right now, which might be for the best. All those boarding pass pics you’ve posted to Instagram? Turns out, hackers love them.

Since at least 2015, scammers have seized on boarding pass barcodes that travelers have posted publicly — or tossed in the trash.

And most recently, a new victim really stepped in it: former Australian Prime Minister Tony Abbott.

Vacation pics are perilous

Back in March, when Abbott posted a photo of his boarding pass from the airline Qantas, an Australian blogger named Alex decided to experiment.

When logging in, Qantas only asks for 2 pieces of info from customers: your last name and your booking reference code.

Abbott’s booking code was printed on his boarding pass. When Alex entered the code, plus “Abbott,” he was in.

At first, most of the info seemed a little drab

Alex could see Abbott’s frequent flyer number and his flight times for Qantas.

But when Alex used a Google Chrome feature called “Inspect” to look over the back-end of Qantas, he hit a goldmine.

Two things were buried in the HTML: Abbott’s personal phone number… plus his passport. Yes, the private, government-issued passport number for the former Prime Minister of Australia.

Lesson being: Never post on Instagram.

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TRENDS

What do Drake David Copperfield, and Roger Federer have in common?

Extremely mediocre websites.

Each week in Trends, hundreds of people post their ideas and get feedback. Here’s one from our very own, Steph Smith.

She was surfing the web, enjoying TSwizzle’s newest album, when she realized that despite Taylor’s undeniable success, $300m net worth, and the fact that she is literally giving away money for free… her website left more to be desired.

But that led her down a rabbit hole, exploring the world’s richest and their online homes. Here’s what she found:

  • Roger Federer (est. net worth $450m): Broken CSS, un-readable pages
  • Drake (est. net worth $150m): A simple 1-page site that directs to a broken page. 
  • David Copperfield (est. net worth $875m — can we talk about the fact that he’s the richest of this bunch?!): Doesn’t even have an SSL and looks like it’s from the 90s. 

These are among the celebs that even have a website… celebs like The Rock, Jennifer Garner, Vin Diesel, Ryan Reynolds, Jared Goff, and Ben Affleck to name a few… have left it up to their fans to fill in the gaps.

The opportunity? Create an agency that works directly with celebs and their agents to create world-class websites, that spring them into the 21st century.

If anyone has a direct connection to Federer, Drake, or Mr. David Copperfield, tell them to give us a ring. We’d be happy to sprinkle some CSS magic. In the meantime, you can get access to ideas just like this one everyday in our Trends community.

Get access today for $1 → The Hustle Says

2020’s big three stock picks just dropped. Check ‘em out right here and start potentially cashing in.*

What do IG influencers do with all those free clothes? List them on Series, the fashion-forward flash sale site that gives high quality clothes a second life. Three cheers for being environmentally friendly, y’all. 

Fabric’s 60-second quiz can help you find your family’s financial blind spots. They offer tools such as term life insurance and college savings accounts to help protect your family’s financial future.*

Talking politics without personal bias is tough. That’s why we let Tangle do it for us. Subscribe to this independent, ad-free, nonpartisan politics newsletter right here.

Forget $SPY. If you’re into investing, you’re gonna want to get in on Miso Robotics while there’s still time. They doubled their revenue from 2018 to 2019 by revolutionizing dining through automation, and they’re showing no signs of slowing down.*

*This is a sponsored post.

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