Modern MBA

Self-service storage is an American phenomenon. While self-storage facilities exist in Europe and Asia, the business overseas does not come close to the scale and demand in the United States over the past decade. Self-storage is a direct monetization of American overconsumption so any bet on the industry is a bet that Americans will keep buying so much stuff that they’ll always need to rent extra space to store it. In a time where the economy is contracting, institutional and retail investors are looking for defensive businesses that deal in essentials. Self storage companies have become attractive as stable, recession-proof, operationally lean lean real estate businesses where cash flows in every month, overhead is minimal, and the customers literally do all the heavy lifting themselves. In this episode, we’ll cover the business of self storage, how the industry’s success rides on the death of the American Dream, how it all relates to skyrocketing home prices, wages stagnatio

Airbnb disrupts hotels because it doesn’t own real estate. DoorDash disrupts food delivery because it doesn’t own restaurants or drivers. Uber disrupts transportation because it doesn’t own any cars. As a ride-hailing service, Uber is divisive - to riders, the cheap fares, upfront pricing, cashless payment, and on-demand pickups are upgrades over taxis. To others, Uber is a public nuisance that causes greater traffic congestion and pollution. For some drivers, Uber is a useful gig where they can work flexible hours. For others, Uber is an exploitative middleman who has lowered payouts and provides inadequate benefits to drivers as independent contractors. The purpose of this episode is not to rehash Uber’s checkered past but instead to assess Uber’s profitability. As the most prominent, well-funded company in the past decade, Uber is the largest living embodiment of Silicon Valley. Uber is the only tech startup in history to raise over $25 billion and still not turn a profit a

As restaurants go, there’s Italian, Mexican, Chinese, American, Japanese and so on. But there is only one type of restaurant that is considered to be the most lucrative and makes up over half of the Top 100 highest grossing restaurants in the United States every year. That is the steakhouse. In America, the steakhouse is as much a cultural rite of passage as it is a fine dining establishment. When people go to a steakhouse, it’s for the experience as much as the food - they dress up, they expect quality service, and the meal serves as a platform for business or celebration. All steakhouses offer standard fare like New York Strip, Porterhouse, Filet Mignon alongside mashed potatoes, brussels sprouts, Caesar salad, and chocolate cake. While most restaurants aim to specialize in certain foods or offer unique items for differentiation, steakhouses thrive in conformity. Their goal is to serve tried-and-true classics with good ingredients, good execution, good service, and good ambi

“Net Return" refers to the annualized internal rate of return net of all fees and costs, calculated from the offering closing date to the date the sale is consummated. IRR may not be indicative of Masterworks paintings not yet sold and past performance is not indicative of future results. See important Reg A disclosures: Masterworks.com/cd When it comes to fast food, McDonald’s is unrivaled in scale and success. McDonald’s has held onto its crown, selling more fries, burgers, nuggets, and apple pies every year than any other fast food chain. There is no challenger to the Golden Arches whether that’s overseas or on home field. In the world of burgers, the fight for the top spot is futile. While the fight for first place is non-existent, the battle for second place in the burger wars is vicious. For decades, Burger King held second place with its signature flame-grilled Whopper, onion rings, and French Toast sticks. Burger King and a little red-haired girl by the name of Wendy’s

From the 80’s to 2000’s, Abercrombie was the prom king of American fashion - the cool and preppy brand of choice for teens and young adults. You couldn’t miss when someone was wearing Abercrombie. While wearing Abercrombie was a statement, going into Abercrombie was an adventure. To impressionable adolescents, Abercrombie stores were uniquely alluring with dim lighting, musky cologne, blaring music, and floor-to-ceiling wallpapers of sculpted men. Yet as the shopping mall died, e-commerce grew, social media helped widen perspective and styles, competition intensified with fast fashion like Uniqlo, ZARA, H&M, Forever 21 and athleisure like Lululemon, Athleta, Nike entering the scene. Controversial statements from the CEO only reinforced the perception of Abercrombie as an outdated, exclusionary, over-sexualized brand built on teenage-angst. In less than a decade, Abercrombie went out-of-style. The PR crisis, widespread disapproval, and declining consumer popularity had many pre

In America, burglaries and home invasions are highly publicized crimes that surface regularly in fiction and media. Turn on the news, and it seems like just about every week, someone nearby is getting robbed - whether it’s shoplifters at retail stores, burglars who steal valuables, or viral footage of opportunistic creeps caught on a Ring doorbell camera. Many companies have popped up over the decades with a variety of solutions to help people better protect their homes - private patrols, panic rooms, burglar alarms, and DIY wireless cameras. In the world of home security, there is no company more famous than ADT. ADT and its iconic blue signs are plastered over many lawns and commercial buildings. ADT was the first to turn home security into service - a company that would come to your house, install a custom security system, setup burglar alarms, and then “watch” your home 24/7 365 for a monthly subscription. Through the high-crime and low-tech era of the 80s and 90s, ADT wa

To some, GameStop is a relic of the glory days of gaming before the arrival of the filthy casuals where true gamers would line up passionately at midnight in the cold and rain to get their hands on the next AAA title. To others, GameStop is a painful reminder of deep losses and a timeless example of the institutional market manipulation between hedge funds and stock brokers. And to a faithful few, GameStop is the superstonk and hodling is the best way to fight back against a game rigged against retail investors. But the real question with GameStop that no one has answered is that beyond the headlines, daytrading, and memes - is there an actual business? In this episode, we’ll cover the three eras of GameStop - from its dominant control over gaming in the mid 2000’s into an overextended mess throughout the 2010’s and finally to the present day, where the company is deep in a last-ditch-effort to reinvent itself as a tech startup and restore relevancy: diving headfirst into every t

Starbucks has been a mainstay in business school literature as a role model for innovation, branding, vertical integration, and corporate social responsibility. The impact of Starbucks is well-known - the company repositioned coffee into a mainstream drink that people consume these days for taste and aesthetics as much as function. Thanks to efforts from its CEO, Howard Schultz, Starbucks has carefully crafted a uniquely respected and celebrated image in academia, business, political, and investment circles. Starbucks is not some basic coffee retailer, but instead a forward-thinking, fast-growing, innovative, socially responsible company that always does the right thing for customers, employees, investors, farmers, and environment. This makes it especially ironic that Starbucks, the poster child of corporate social responsibility and model employer, is now waging such a high-profile, visible, ugly war with its baristas across the United States - using every trick in and outside th

In the world of travel, the destination matters far more than the journey. The travel industry has adjusted to this as resorts, tour guides, agencies, hotels, and airlines now compete on how fast they can get you to where you want to go. Yet there remains one business who insists that the journey is just as important as the destination. That is the cruise ship. By the numbers, cruises are very much an American phenomenon. Cruises boast restaurants, bars, bowling alleys, water parks, Broadway musicals, basketball courts, golf, comedy, waterfalls, pools, rock climbing, ice skating, casinos, theaters, go-karts, spas, nightclubs, and arcades. Throw in unlimited alcohol, bottomless French fries, and endless pizza, it makes sense why cruises lean on spectacle and excess for appeal. Industry insiders push every year that cruises are a fast-developing, under-penetrated market with significant growth potential. Cruises are an oligopoly run by three players - Royal Caribbean, Carnival,

In America, the police are a $100B annual business. Modern policing can be seen in the stream of viral police body camera footage that lands the Internet. Look at the top right corner of those videos and 10/10 times it will say Axon, the one company that has made this revolution possible. In business theory, some say that companies are not about flawless execution or perfect prediction. They suggest that the most important ingredient to success is picking the right space. You tread water, develop expertise, and even make mistakes - but once the market moves in your direction, you can snowball that momentum into billions of dollars. In the 2000s, Axon was a struggling startup. Then in the 2010s, tailwinds propelled Axon, who had been building wearable cameras and software, into prosperity. Now in the 2020s, the company is a powerhouse where every single interaction with law enforcement every day is recorded with an Axon body-cam and stored in Axon’s cloud platform. In this

Banks make money by lending out the money that you deposit. The more cash you put in, the better you’re treated - transactions take priority, fees get waived, interest rates are higher, and a personal banker is assigned. On the flip side, the less money in your account, the more fees you pay, and the further back in the line you start from. Banks chase affluent accounts who bring large balances and high cash flow. But it’s not just banks - every business aims for as many high spenders and wealthy as possible. Yet there are 2 companies - Western Union and MoneyGram, that have gone in the opposite direction in providing financial services in peer-to-peer money transfer (international & domestic) to a population that banks deem to be too poor and too low-value. Migrant workers and the poor are left out of the global financial system for similar reasons: they have too little money, their employment is volatile, their earnings are inconsistent, there are significant language and cultu

Fluffy pancakes, sunny-side eggs, crispy bacon, golden hash browns with buttered toast and coffee. For decades, diners have specialized in serving not just the hearty American breakfast but also classics like burgers, waffles, milkshakes, soup, and pie. Due to their sustained popularity and depiction in TV & film through generations, diners have become so ingrained into American culture that they’ve become iconic establishments over the world. While every industry is evolving, diners are the rare example of a business that's been invincible to change. While the restaurant industry has gravitated towards off-premise dining, originality, and automation, diners have remained consistent since the 1940s with huge menus, staying open 24/7 or into the late night, traditional service with pen and paper, simple comfort foods, and an accepting atmosphere. At a diner, there are no reservations, no VIPs, no private areas, no policies, no minimums, and no judgment. In this episode, we’ll cove

In the 2010s, there was one tiny American brand doing what no one else had been able to do for decades in sportswear. It had grown sales in North America at double digits every year for 13 years, taken market share from Nike, and leapfrogged Adidas as the new number #2 athletic brand in the United States. It was an upstart with a passionate fanbase, competed on quality over price, and backed by some of the most celebrated athletes in the world. This was Under Armour. In the eyes of the media and investors, the fast-growing Under Armour was the closest to a Nike slayer that the industry had ever seen - and that enormous potential was quickly priced into the stock. Yet fast forward to the present - just a few years after the hype and my own experiences, Under Armor is a shadow of its former self and is worth only a little more than a penny stock. Declining sales, executive turnover, failed pivots, expensed trips to strip clubs, and federal investigations into dodgy accounting hav

The amusement park, like the shopping mall and movie theater, was once an indispensable establishment for every major metropolitan. Before the Internet, the amusement park thrived as a provider of affordable recreation. Yet fast forward to present day and amusement parks are a dying breed in the modern age. With the emergence of the Disney adult, consumers all around the world have shown a preference for IP-based theme parks like Universal Studios and Disneyland. The themed concessions, branded attractions, exclusive merchandise, and trademark characters of theme parks have elevated customer experiences to the point where amusement parks can no longer compete with generic foods, mascots, and rides. In this day and age, customers have demonstrated through virality, spend, and popularity that they’d rather make a special trip to Disneyland or Universal over the local / regional amusement park. In this episode, we’ll cover the business of roller coasters through the lens of Six Fl

Popeye's chicken sandwich is one of the greatest modern business phenomenons. For years, McDonald’s, Burger King, KFC, and other leading brands have given up on innovation and instead lean on nostalgia to breathe life into stagnant menus and hide one dimensional cost-cutting strategies. These brands have all deprioritized the United States in favor of international markets. Dollar menus have been eliminated, consistency is now as rare as quality, and Americans have gotten used to getting the short end of the stick in fast food. All these factors made the Popeyes chicken sandwich in 2019 a miracle in itself. The sandwich was so unexpectedly exceptional in quality and price that customers waited hours to experience the viral sensation. The sandwich was groundbreaking in demonstrating that even in a market as mature as fast food, businesses ultimately compete on merit and that customers will always reward innovation. As we covered in the Burger King episode and Under Armour episode,

In the 2010s, there was one startup who by the measures of Silicon Valley and Wall Street, seemed destined to be the next big billion-dollar consumer brand. That company was GoPro. GoPro took the world by storm with its game-changing cameras. With radically compact design, tiny form factor, high portability, rugged waterproof exteriors, and reasonable picture quality - GoPro cameras were able to capture never before seen action and perspectives. GoPro was category-leading and category-defining - the company had effectively created and owned an entire category of cameras. It was the pioneer, golden standard, and household name as GoPro was not just the name of the product and company, but also became the unofficial label for any small, portable, action camera on the market. Yet fast forward to present-day in 2023, less than a decade later, and GoPro’s stock has dropped 95%. How could a company who had all the right ingredients from the measures of Silicon Valley and Wall Street

For a business about making and selling pizzas, Papa John's has gone through non-stop drama, infighting, and controversy in recent years. While every company has its problems, Papa John’s takes the cake with the founder trashing his own company in public. But when a founder says a racial remark in a recorded business meeting, it’s an offense so great that no company could sweep under the rug. Companies rarely go to war against their own founders. But the timing, evidence, and volume of media covering John’s misconduct was so sudden, strong, and overwhelming that it was no coincidence. The Board wanted to bury John. It would not be enough to exile the founder and former CEO. John was an evil spirit and what Papa John’s needed as a company was an exorcism. Since his removal in 2018, John has climbed out of the dirt and gone on a high-profile, mud-slinging, counter-offensive rarely seen in usually tight-lipped corporate America. Was John Schnatter actually a good CEO or was h

Temu is everywhere, promising that you can shop like a billionaire buying $10 wireless speakers, $12 sneakers, $20 drones and other cheap gadgets, clothes, backed with the promise of free shipping, 90-day returns, 30-day price adjustments, and deliveries within 2 weeks. But Temu isn’t the first to sell generic, unbranded, mass-produced Chinese products online at radically low prices. Before Temu, there was AliExpress and Wish - who both went to market decades ago with the exact same value prop, unbelievably low prices, and wacky advertising. Wish was the earliest entrant into this space and the SF-based startup was once one of Silicon Valley’s darling unicorns. It all begs the question - how exactly do these companies stay alive selling $5-10 items online? In this episode, we’ll cover the business of selling cheap Chinese-made junk online through the rise and fall of Wish, the persistence of AliExpress, and the sudden emergence of Temu - and how all of this ties back to greed,

Puffer jackets and the broader outerwear market are a competitive billion-dollar market that's been historically dominated by legacy brands like The North Face and Columbia. But in recent years, there has been a strong push towards luxury with the emergence of Canada Goose and Moncler. 10 years ago, spending $100-300 on a winter jacket would have been considered to be a top-of-the-line investment. Nowadays, that price-point sits over $1,000. If you look at famous luxury brands like Hermes, Gucci, Prada, Versace, Rolex, Hugo Boss, or Dior, they all built up their clientele and prestige through many generations. Yet luxury outerwear is remarkably young. Canada Goose and Moncler have been around for decades, but their evolution and success has only been very recent, making them truly modern luxury brands - and not the old money brands of the past. While the rapid rise of Canada Goose and Moncler is well understood, the economics and market dynamics of outerwear have remained une