What’s next for Ancestry.com?


August 7, 2020

Plus: Microsoft wants TikTok’s whole shebang.
August 7, 2020
The Hustle
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The Ridge

As a lifelong Midwesterner, I’m thrilled my colleague Trung is writing about my fair region and its economic excellence. In honor of his write-up below, I’ll share a few other Midwestern treasures:

  • We put ranch dressing on everything.
  • We say “ope” to apologize for anything.
  • We brag about being from the “No Coast.”

Caroline Dohack, staff writer

The Big Idea

Don’t sleep on the Midwest’s business prowess

The Economist is my favorite publication. Its special report on the US Midwest was so good I had to write about it. 

I consider myself well-versed in business chatter, but the facts definitely surprised me. In my defense, I have an excuse: I’m Canadian 😂

It’s overlooked, but it’s huge

As our colleague Zack has noted, as of 2018, the Midwest was responsible for ~20% of America’s GDP, but it received only 5% of venture funding.

With a total population of 68m, the 12-state region’s total GDP (~$4 trillion) is larger than either Germany or the UK. 👀

And it’s home to monster companies

Many rank at the top of their sectors in the US:

  • Caterpillar (market cap = $73B) is one of the 6 largest industrial companies. 
  • General Motors ($38B) and Ford ($27B) are the largest non-Elon Musk owned car makers.
  • Procter & Gamble ($329B) is the 2nd-largest consumer defensive firm (after Walmart).
  • UnitedHealth Group ($298B) is the 2nd-largest healthcare company (after Johnson & Johnson).

It’s got serious brain power, too

We’re talking “16 of the country’s 50 top-ranked medical schools, five of the 25 best computer-science ones, and 17 of 63 leading research universities,” The Economist says. 

Big Ten universities pull in annual research funds of $10.6B (more than the combined haul of the Ivy League and California universities).

A 2019 Brookings Institution report argued that money and resources should be spread to new innovation hubs. Six of the report’s top 15 “potential growth centers” were Midwestern:

  • Madison, Wisconsin
  • Minneapolis-St.Paul-Bloomington, Minnesota
  • Columbus, Ohio
  • The Chicago metro area
  • Akron, Ohio
  • St. Louis, Missouri

To paraphrase 19th-century newspaperman Horace Greeley: “Go Midwest, young man.”

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Snippets

5 stories to catch you up quick

1️⃣ Macy’s is facing a lawsuit for its partnership with facial recognition company Clearview AI. 

2️⃣ Twitter is promising to label — and stop recommending — posts from state-controlled media outlets, and label posts from “key government officials.”

3️⃣ Uber is buying Autocab, its biggest competitor in the UK.

4️⃣ Microsoft isn’t just trying to buy TikTok in North America — according to the Financial Times, it wants to buy the whole global shebang

5️⃣ A 🔥 take on Casper, the struggling mattress brand: “They tried to make it seem like there is a sleep economy and there’s all these adjacent products, but they’re just throwing products against the wall.”

And 5 more to delight you 

1️⃣ Want to save the Postal Service? People are buying USPS-themed crop tops from its online store.  

2️⃣ This weekend, the federal government is hosting a competition to hack a real-life satellite — it’s literally called Hack-A-Sat.

3️⃣ Say cheese: With so many Americans eating breakfast in, Kraft is rebranding its mac & cheese dinner into… *checks notes* mac & cheese breakfast

4️⃣ Here’s how one guy rescued $300k worth of Bitcoin after losing the decryption keys in an old ZIP file.

5️⃣ You know how happy your dog gets when you tell him he’s a Very Good Boy? Turns out his brain processes praise the same way yours does.

Panic! At Amazon

‘Dark patterns’ are how online stores get your extra moolah

Let’s say you’re buying a pack of frozen White Castle sliders online, and a special offer pops up. 

The option to turn it down is a guilt trip: “No thanks,” it might say, “I hate saving money.” 

Sound like something your bratty brother would hiss? That’s the point

These are ‘dark patterns’

They’re designed to get you to load up on more stuff than you might need. A Princeton study found more than 11% of ecommerce sites had at least one of them.

Last year, Congress batted around a bill that would ban some of these strategies, calling them “manipulative.” 

Is dark magic at work? Here are some warning signs

  • Peer pressure. 80 people viewing an item? Sometimes, those warnings aren’t based on real data.
  • Scarcity. Nothing gets the credit card out faster than a “Low Stock” label.
  • Double negatives. Does “Uncheck the box if you prefer not to receive email updates” make any sense? 
  • Countdowns. A clock is winding down your special offer. But once it hits zero? A lot of times, the timer just starts up again.
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Kiss noise

Can lipstick and underwear predict economic activity?

Pucker up, babe. 

Armchair economists have long looked to the lipstick index to gauge where the economy’s going.

When money’s too tight for other extravagances, the thinking goes, women buy lipstick to get a luxury fix.

But the premise smudges faster than cheap lip gloss when you look at what’s happening now.

Mask mandates make MAC’s Ruby Woo moot

A report from McKinsey predicted global beauty revenues will dip 20 to 35% this year. Lip color sales are down 15% on Amazon.

In other words: The lipstick index is chapped.

OK, what else is there? 

The hemline index says women’s skirts get shorter in good times and longer in bad. 

But who’s wearing anything besides sweatpants right now?

Then there’s the men’s underwear index. During economic booms, men indulge in new undies, former Fed chair Alan Greenspan once said. In bad times, they’re content with ratty shorts. 

So does the undie theory hold up? 

The jury’s still out.

We used Jungle Scout to check men’s underwear sales on Amazon — they were up as much as 193% within the past 90 days. Hanes’ parent brand, meanwhile, saw “innerwear” sales dip 27% in Q2.

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Insider Takes

A private-equity firm bought Ancestry.com for $4.7B. Here’s what they might do with it.

The Blackstone Group is acquiring a 75% stake in Ancestry.com for $4.7B.

It’s a major move at a tricky moment

Two DNA-testing kingpins, Ancestry and 23andMe, laid off workers this year when consumer demand sagged. They kinda have the D2C mattress problem — a customer might buy one kit, but who needs two?

So we put the puzzle to our Trends community: Why is Blackstone going big on a DNA testing company?

Amanda Black, owner of The Solo Female Traveler Network, was unnerved: Just before hearing the news, she got a kit, used it, and returned it in the mail. “I thought it was weird how many times I was asked if they could keep my info and also told me they were going to be using my results,” she said. “This is interesting and uncomfortable.”

Here’s what others told us

Jon Khaykin from IPOs.fyi says the DNA/health data is a “huge moat” for Ancestry. By licensing it to a biopharma giant, “These companies could use the health information to research diseases as well as find and recruit research subjects.”

Chi Odogwu, co-founder, Odogwu Digital Media, says screening for predisposition to diseases could work like a Minority Report for healthcare. Another opportunity: “Marketing for customized fitness and health plans via subscription newsletters.”

Join the insiders’ conversation on Facebook by subscribing to Trends.

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THE BIG NUMBER

It’s Tom Nook’s world, we’re just living in it.

Nintendo reported an eye-popping 5x jump in quarterly profits yesterday — thanks to the island denizens of Animal Crossing: New Horizons

The hit game sold 10.6m copies during the most recent quarter. It’s sold 22.4m copies since March.

(Source: Reuters)

Sunday Sneak Peek

The 19th-century entrepreneur who pioneered ice cream

We’re living in a golden age of ice cream innovation.

There are currently more than 82k posts of people inhaling liquid nitrogen ice cream on Instagram. Experimental flavors like charcoal and Thai tea are commonplace. And the frozen dessert market — largely driven by ice cream — is on the up and up.

But modern ice cream likely wouldn’t exist without the innovative efforts of one woman more than 100 years ago.

This Sunday, we’ll explore the life of Agnes B. Marshall, a largely forgotten 19th century entrepreneur who democratized a treat typically reserved for the rich — and who, in many ways, pioneered the ice cream we all know and love today.

Watch your inbox for the scoop.

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Shower Thoughts

Alright, folks. Buckle up. We’ve got some weird ones for you today!

1. Indoor plants were normal plants until houses were invented.

2. You can only see a maximum of three sides of a cube at all times.

3. Oceans are the continents of the fish world.

4. A hotdog feeds the hand that bites it.

5. A sleeping bag is also a snake onesie.

via Reddit
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Today’s email was brought to you by Michael Waters, Caroline Dohack, Trung Phan, and Bobby Durben.
Editing by: Nick “Ope” DeSantis, Marianna Trench (Director of Deep Sea Research).

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