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June 26, 2019

Today, Wayfair employees walk out and slum tours build clout, but first…
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At renegade free-market workplaces, the best perks are paying to use your own desk

Employees at Japan’s Disco Corp. think twice before hanging up their umbrellas in the office on a rainy day.

Why? Because they have to pay for it. 

In fact, according to a Bloomberg report, employees at Disco pay for everything from conference-room access (which costs $100/hour) to advice from coworkers (rates vary).

But the bold, bizarre business model works

Since Disco (which makes production equipment for the semiconductor industry) launched its radical management strategy 8 years ago, its stock price has increased 4x and its margins have improved from 16% to 26%.

Each employee at the company operates like an autonomous startup, using an internal currency called “Will” (short for “Personal Will”) to rent desk space, pay colleagues for consultation, or bid on projects.

The system creates an intense free-market atmosphere that eliminates redundant tasks (assignments that don’t get bids often turn out to be unnecessary).

Are anti-perks the new perks?

Disco contrasts starkly with American tech giants like Google, Facebook, and Apple that offer lavish free perks (Zumba classes! Craft beer on tap! Nap pods! All Free!).

But what Disco doesn’t offer in plush perks, it makes up for with plentiful performance bonuses: Disco worker pay is double the national average thanks to never-ending monitoring, and overtime work has dropped 9% thanks to efficiency increases.

Can ‘personal will’ and ‘radical transparency’ go mainstream?

Disco isn’t the only company to radically monitor employee performance.

American billionaire Ray Dalio built the world’s largest hedge fund, Bridgewater Associates, on the concept of “radical transparency,” requiring employees to constantly grade each other’s performance. 

But Disco and Bridgewater both found their systems don’t work for everyone: Many bright engineers allegedly left Disco due to its pressure-cooker culture, and 35% of Bridgewater recruits last less than 18 months in the company’s “cauldron of fear and intimidation.” 

Maybe the answer lies somewhere between Silicon Valley startups’ kombucha taps and Disco’s charge-by-the minute umbrella hangers…

“Will” work for anti-perks
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Slum tours are India’s most popular tourist destinations

Trip Advisor’s Traveler’s Choice Awards recognized the most popular tourist attraction in India for 2019, and it ain’t visiting the Taj Mahal.

Dharavi in Mumbai, one of the largest slums in Asia, was not only recognized as the top experience, it also ranked in the top 10 of “Travelers’ Choice Experiences” in all of Asia.

Why?

“Slum on in”

Slum tours are on the rise around the world, and the influx of visitors — and, more importantly, their cash — has helped prop up industries in the 533-acre shanty-clad craw of Dharavi.  

But, while it may be a tourist destination, it’s also important to remember the city is exactly that — a shanty town, scattered with open sewage piping and lined with dirty huts so warped they could be blown over by the faint breath of an angry pig. 

Thus, the debate continues…

Many support slum-tourism, leaning on the fact that it is good for business while also giving the visitor an authentic perspective of the area.

Of course, it’s understandable why some are uncomfortable with the whole “using poverty to sell a tourist attraction” thing.

According to Trip Savvy, Dharavi tour companies like “Mystical Mumbai” nicely thread the needle without being either depressing or exploitative.

» Slum-dunk

Apple spends a record $23.8B buying back its own shares — and saving cash in the process

Apple spent $23.8B buying back its own shares this past quarter, more than double the next biggest buy-backer in the S&P 500, Oracle (which spent $10B), Axios reports.

Even for Apple — which is responsible for 8 of the 10 largest stock buybacks in business history — this was a new record. 

So, why does Apple want to buy back its stock so badly?

Buybacks are flexible and they reduce tax responsibilities

By buying back stock, Apple reduces the number of shares on the market, increasing the value of its remaining shares.

It’s a cheaper way to pay shareholders than issuing dividends: Unlike regular dividends, Apple issues buybacks whenever it feels like it.

Plus, buybacks enable Apple to get rid of cash it would otherwise pay taxes on, boosting stock prices AND warding off the tax man. 

But buybacks are also controversial

Critics like Bernie Sanders argue that buybacks — which have increased dramatically in recent years and sucked up 54% of total earnings in the S&P 500 between 2003 and 2012 — elevate inequality by concentrating wealth with shareholders. 

Wall Street equity analysts, on the other hand, insist buybacks are just good business.

» Buy buy buyback
my first million

Dust off your headphones — we made a podcast!

You asked (pretty much nonstop), and we listened.

Announcing The Hustle’s first podcast: My First Million hosted by serial entrepreneur and friend of The Hustle, Shaan Puri.

Over the next 8 weeks, we’ll be sharing the entire first season with you. Tune in to hear interviews from today’s most successful founders, business execs, and leaders as they share every tiny detail on what they did to make their first million.

First up, Suli Ali: The founder who went from a $76k salary at Microsoft to selling TinyCo for $100m.

Subscribe below on Apple Podcasts or Spotify.

Wayfair employees protest the company’s furniture sales to border-detention camps

Employees at online furniture marketplace Wayfair plan to walk out in protest today at the company’s Boston headquarters, the Boston Globe reports.

Yesterday, employees announced the walkout to oppose the company’s sale of $200k worth of mattresses to BCFS, a government contractor that manages detention camps for migrant children along the Mexican border.

Wayfair’s stock dipped more than 5% after the announcement.

The speedy version:

Last Wednesday, employees learned that Baptist Children’s Family Services had placed an order of roughly 1.6k mattresses and 100 bunk beds — and that Wayfair planned to fulfill it.

The more than 500 employees at Wayfair signed a letter asking the brass to sever its ties with the nonprofit detention center manager. 

The brass refused, saying it was standard practice to sell to “any customer acting within the laws of [Wayfair’s] operations.” 

So the employees said “nah, we’re out.”

Now what?

Wayfair execs agreed to establish a client code of ethics and donate some of the proceeds to charity.

But organizers want Wayfair to donate the $86k it will make in profit from the sale to the nonprofit organization RAICES (Refugee and Immigrant Center for Education and Legal Services).

But Wayfair’s business operations — which brought in revenue of $6.8B in 2018 — will probably keep going as usual at their daily average of 100k orders per day.

» If I were a betting man
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