MEDIA

Spotify’s Podcast Library Just Got 2,500 Hours Longer

In May, Joe Rogan shocked the podcasting world when he agreed to an exclusive $100 million licensing deal with Spotify. Today, his podcast The Joe Rogan Experience debuts on the platform.

There's a lot at stake

Just about two years ago, Spotify shifted its eye of Sauron toward the small but growing podcasting industry. In a blog post from early last year, CEO Daniel Ek said he realized that “audio—not just music—would be the future of Spotify.” 

• Spotify had 185,000 podcasts on its platform in 2018; now it has over 1.5 million. 

Last year, Spotify filled its shopping cart with podcast companies Gimlet Media and Anchor for $340 million before snapping up Bill Simmons’s sports and entertainment media-factory The Ringer for $200 million in February. 

Thus began a podcast talent shopping spree

The company’s highest-profile get has undoubtedly been the hundred million dollar man Joe Rogan and his 190 million monthly downloads. But for listeners who aren't into hunting or three-hour episodes, Spotify also signed megatalent like Michelle Obama and Kim Kardashian West to podcasting deals. 

• All told, Spotify’s known investments in podcasts come to $696 million. 

But as it’s focused on bringing in new talent, Spotify may have overlooked its existing roster. One of the platform’s most popular exclusive podcasters, Joe Budden, ripped Spotify last week for “pillaging” his audience, accusing the company of leveraging his popularity to gain subscribers without properly compensating him. 

Bottom line: Spotify’s interest in podcasts can be boiled down to one inconvenient truth: the music streaming business isn’t very profitable. Spotify loses nearly 75% of its revenue to royalties paid to record labels, music publishers, and other rights holders, writes the WSJ. As Rogan kicks off the new era of exclusive content, Spotify thinks it's got the arsenal to upend Apple's podcasting dominance.

TECH

Reading Zoom’s Earnings Report

Zoom’s revenue grew 355% annually in Q2, because last year you hadn’t heard of the company and now you use it to watch your brother get married.

With its earnings coming in well above analysts’ (already bullish) expectations, Zoom’s stock gained roughly 23% after hours to hit a new record high. Shares had already jumped 369% on the year. 

We all know the story of Zoom: While the pandemic bulldozed some companies, it handed this upstart videoconferencing software company the gift of a lifetime. 

• Zoom made as much money in the last quarter as it did during all of 2019.
• It raised its revenue guidance forecast for the year from around $1.8 billion to around $2.39 billion. 

Now, Zoom is trying to take that gift and turn it into something lasting. It’s spent the last few months investing in R&D centers, hardware offerings, and seasoned execs across its business. 

Consider all that a massive moat-building project—it knows Big Tech is amassing the troops to storm the castle.

HEALTH

It’s Peanut Butter Therapy Time

Nestlé wants to help all those who just opt for Cracker Jacks at the ball game. Yesterday, the Swiss conglomerate agreed to buy biotech Aimmune Therapeutics for $2.6 billion, specifically to get its hands on Aimmune’s peanut allergy treatment. 

• Nestlé made its first investment in Aimmune in 2016, and already owned more than 25% of the company.

Aimmune’s treatment, called Palforzia, doesn’t rid the world of peanut allergies. It does help reduce the frequency and intensity of allergic reactions by exposing patients to small doses of peanut protein to build resistance.  

• Nestlé says that 240 million people globally have food allergies, and peanuts are one of the most common. They affected almost 2.5% of American children, per a 2017 study cited by the WSJ.
• Palforzia is the first and only peanut allergy treatment approved by the FDA.

Zoom out: The acquisition is part of a larger strategy by Nestlé to shift its focus from grab bag consumer goods (like candy and bottled water) to the higher-margin health and wellness biz. 

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ECOMMERCE

Amazon’s Drone Program Gets a Lift

The traffic cops of the skies, the FAA, handed Amazon the all-important “air carrier” certificate it needs to operate a drone delivery network in the U.S. 

• Yesterday's approval allows Amazon’s drones to carry packages beyond the line of sight of the operator. It’s a need-to-have badge in order to start commercial service. 

The backstory: The race for drone delivery is about as sluggish as George R.R. Martin’s writing process. Amazon first announced its drone plans in 2013, but technical challenges and regulatory delays have pushed an actual launch well into the 2020s. 

The nowstory: Amazon is the third drone operator to secure FAA approval, joining UPS and Alphabet’s Wing unit. Regular commercial service isn’t expected for years, though. 

And why does this matter? Amazon believes the future of ecommerce belongs to the company that can deliver packages before the confirmation email arrives in your inbox. Amazon’s new class of electric drones, the MK27, can fly up to 15 miles and deliver a package weighing under 5 lbs. in less than 30 minutes. 

WEALTH

Elon's Rocket Ship Passes the Zuckmobile

Yesterday, Elon Musk passed Mark Zuckerberg to become the third wealthiest person in the world. Propelled by Tesla’s never-ending rally, Musk joined the rarified centibillionare club populated only by Zuckerberg, Bill Gates, Jeff Bezos, and Jeff Bezos.   

About that never-ending rally

Anyone who opened their Robinhood account yesterday morning might have done a double-take after Tesla’s 5-1 stock split took effect (cutting the company's stock price by 1/5). Despite a chorus of reminders that “stock splits don’t make a company more valuable,” Tesla's stock jumped another 12.5% yesterday, because when it comes to Tesla, everything's made up and the points don't matter.

Zoom out: Tesla shares are up more than 70% since announcing its stock split on August 11 and almost 500% on the year. It’s now valued at $464 billion, which means Elon has added $87.8 billion to his net worth since the start of 2020.

WHAT ELSE IS BREWING

• Delta and American are predictably dropping their change fees for most U.S. tickets. United started the domino effect over the weekend.
• Dell Loy Hansen, the owner of the MLS and NWSL soccer teams in Utah, will sell the teams. He recently criticized players for sitting out games to advance racial justice issues.
• Joe Biden said he wouldn't ban fracking in a speech in western PA yesterday.
• JCPenney’s talks with potential buyers hit a stalemate. Now, lenders are putting together a plan to buy the bankrupt retailer before it collapses altogether.
• Utz, the iconic snacks company, started trading publicly yesterday. 

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BREW'S BETS

Starting a business during a recession: It may not be as bad an idea as it sounds. Business Casual host Kinsey Grant argues in her debut column that companies founded during an economic downturn are more resilient in the long-run. See if you agree.  

Tech Tip Tuesday: 13 tips for using Google Docs like a pro and 10 tricks for mastering Google Trends.

Up: The Sequel: Magician David Blaine plans to distract us all from 2020 by tying 52 weather balloons to himself. The prestige? When he floats about 18,000 feet above the Arizona desert. The stunt is streaming live on Blaine’s YouTube channel tomorrow at 6am PT. Get psyched by listening to Joe Rogan’s recent interview of Blaine.

UNCUT GEMS TRIVIA

This is September's birthstone. Do you know what it is?

Public domain

UNCUT GEMS TRIVIA ANSWER

The beautiful sapphire