More China Tariffs, Woodstock 50 Is Dead, and a Glassdoor for Gender Equality

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TRADE

President Trump announced he will impose another $300 billion worth of tariffs on imports from China: “Stocks fell sharply as investors digested the latest tariff salvo, with the Dow Jones industrial average shedding about 300 points within minutes. Stocks had started the day up significantly as Wall Street traders grew optimistic about another rate cut from the Federal Reserve. ‘We love tariffs. Tariffs are a wonderful thing,’ Trump adviser Peter Navarro told Fox Business on Thursday morning.”

THE ECONOMY

The economy added 164,000 jobs in July: “Payroll growth rose in line with expectations in July and the unemployment rate remained at 3.7 percent amid a sharp jump in the size of the labor force to its highest level ever. … In 2018, the economy created 223,000 jobs a month. Wages also continued to increase, with the 3.2 percent year-over-year gain topping expectations by one-tenth of a percentage point.”

Americans trying to stay in the middle class are falling deeper into debt: “Cars, college, houses and medical care have become steadily more costly, but incomes have been largely stagnant for two decades, despite a recent uptick. Filling the gap between earning and spending is an explosion of finance into nearly every corner of the consumer economy. Consumer debt, not counting mortgages, has climbed to $4 trillion—higher than it has ever been even after adjusting for inflation. Mortgage debt slid after the financial crisis a decade ago but is rebounding. Student debt totaled about $1.5 trillion last year, exceeding all other forms of consumer debt except mortgages. But the debt pile is also an accumulated ledger of economic risk.”

Despite lower mortgage rates, the housing market is taking a hit: “[T]he math facing prospective American home buyers is daunting. Since June 2009, when the United States economy started its current expansion, the median price of existing homes has risen nearly 60 percent, far outpacing the 24 percent gain in median weekly earnings. The divergence means the national housing market—while incredibly varied on a local level—has become increasingly unaffordable. And it will take more to trigger a significant wave of home buying than clipping a percentage point off mortgage rates.”

MANAGEMENT 

Why not opening on Sundays is a good business strategy for Chick-fil-A: “John Hamburger, the president of Franchise Times, described Chick-fil-A’s decision to close on Sundays as a counterintuitive sales booster. ‘Being open six days a week provides benefits to both the operators and the customers,’ Hamburger said. ‘The owner-operator gets the time off. ‘Closed on Sunday’ conveys a sense of caring and community to the customers.’ … ‘It provides a sense of urgencyyou better get to that restaurant today, because they’re going to be closed on Sunday,’ said Mark Kalinowski, the founder of Kalinowski Equity Research. ‘I don’t think the company designed it that way at all. But it’s a call to action every single week.’”

MARKETING 

New York City subways have become a crucial advertising venue for startups: “Startups say they jumped on the subway—with its six million weekday riders—because it presented a cheap way to reach a mass audience. It was the poor startup’s answer to a Super Bowl ad. ‘Now that’s changing, as everyone’s crowded in,’ says Leo Wang, founder and CEO of Buffy, a Manhattan-based home goods startup that advertises on the train. Due to rising demand, he says, subway ads are no longer a bargain.’ Alexandra Fine, CEO of Dame Products also points out that ‘It’s not just consumers who take trains, … it’s potential employees, investors and influencers. ‘If you want to be in Vogue or Cosmo, so many of those writers and editors ride the New York City subway,’ she says.”

RETAIL

The Container Store has a new concept store opening in Los Angeles that sells only custom closets: “The opening of its first store dedicated solely to custom closets is part of a shift The Container Store is making to offer more ‘solutions’ rather than just products, CEO Melissa Reiff said on a call with analysts. The company said that in addition to ramping up the custom closets offerings in its Reston, Virginia, store, a second Custom Closets location will open in Dallas by the end of this year. ‘Our number one focus continues to be owning custom closets and capturing greater share of the estimated $6 billion custom closets market,’ Reiff said, adding that the Custom Closets business represents half of the company’s consolidated sales and execs believe it will continue to grow.”

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STARTUPS

A startup launches in-depth guides to starting up: “Founders need to get smart quickly about the many nuanced aspects of building a company, from understanding weird language in a big term sheet to hiring a key software developer. But the best practical advice is scattered across blog posts, podcasts and books, and it gets outdated quickly as industry norms evolve. Even experienced founders spend a lot of time searching and still end up with the wrong information. Holloway has an ambitious solution: Today, it’s launching a library of book-length online guides about work, written and regularly updated by teams of industry experts. The flagship title is called Raising Venture Capital, which features 340 thoughtfully organized pages in 15 sections and three appendices on all aspects of the funding process. Designed for easy reading and easy searching in spite of the information density and length (it has a 14-hour total read-time), the guide could become a go-to resource for the startup world.”

Online catering-marketplace EzCater is a unicorn that started with a long-held truism in the pharmaceutical industry—the best way to get face time with doctors is to bring food: “‘Doctors are extremely busy. But what we found was they are also a little too polite to grab the food and run, so they will stand there while you give their pitch,’ [CEO Stefania] Mallett says. [Mallett and her co-founder wondered] if a catering platform, one that would help sales reps across industries make delicious meals appear at their would-be clients’ offices, could scale. … [They] also envisioned a platform that connected local restaurants to offer large, shared trays of food—rather than, say, individually packaged sandwiches—would have applications beyond just sales calls. ‘Turns out, the formula also works for feeding hungry Millennials at tech companies,’ Mallett says.”

Oslo-based Equality Check wants to be Glassdoor for gender equality: “To that end, it has developed a digital platform that allows employees to write reviews of their places of work. … ‘[We] are looking at how equal a company’s policies are, what is the experience in terms of work-life balance and whether there has been any experience of sexual harassment within the workplace,’ says [co-founder Marie] Sunde. On a commercial level, Equality Check is a B2B play. It provides companies with a means to assess their own progress in terms of promoting and maintaining progressive gender equality policies, with data from employees informing the analysis.”

M&A

FTC investigators are examining whether Facebook purchased technology startups to block competition: “The tech giant has acquired about 90 companies over roughly the last 15 years, according to data compiled by S&P Global. Among those companies are the photo-sharing app Instagram and the messaging service WhatsApp, which bolstered Facebook as a dominant force in social media and messaging. …

“One acquisition that could come under scrutiny was the 2013 takeover of Onavo Mobile Ltd. Facebook used Onavo’s behavior-tracking technology to identify and target fast-growing companies as potential purchases or to scope out new product categories, The Wall Street Journal reported in 2017. Facebook used data from Onavo in deciding to buy WhatsApp. Documents UK lawmakers released late last year confirmed Onavo’s importance to Facebook’s strategy. Facebook eventually shut down the controversial app.”

OXFORD STRATEGIC ADVISORY DEALS OF THE DAY  

DoorDash has acquired Caviar, a menu and delivery service for restaurants. The company was acquired for $410 million.

Southeast Computer Solutions, a provider of consulting services supporting small and mid-market companies with ERP solutions, was acquired by Net@Work, a provider of information technology and business consultancy services.

VENTURE CAPITAL

Armory, a developer of a software delivery platform designed to deploy cloud applications, raised $28 million in a Series B Round.

Holloway, a developer of an online publishing platform intended for navigating the challenges of modern work, raised $4.6 million in a Seed Round.

Fuel50, a developer of a cloud-based talent experience platform intended to directly impact the career development processes, raised $14 million in a Series B Round.

ENTERTAINMENT

Woodstock 50 is dead: After months of uncertainty, which saw organizers battling a former investor in court, losing two potential venues in upstate New York, and attempting a last-ditch move to an amphitheater in Maryland, the planned 50th anniversary concert was finally called off on Wednesday. ‘We just ran out of time,’ Michael Lang, one of the partners behind Woodstock 50, as well as the promoter of the original festival in 1969, said in an interview. The event was to have been held Aug. 16-18, almost exactly 50 years after the original. Once planned as a world-class outdoor concert for up to 150,000 people, featuring Jay-Z, Miley Cyrus, the Killers, Dead and Company, Santana, John Fogerty and dozens of others, the festival met an ignominious end after the majority of its artists abandoned the event once Lang and his partners tried in recent days to move it to Merriweather Post Pavilion in Columbia, Md.”

And that’s what’s ahead.

Please send comments and suggestions to mattg@oxfordcenter.com and lfeldman@oxfordcenter.com

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