WEBVTT - Bloomberg Businessweek Weekend - December 21st, 2019 0:00:02.520 --> 0:00:06.120 This is Bloomberg Business Week from Bloomberg Radio. Hi, I'm 0:00:06.200 --> 0:00:08.600 Jason Kelly, I'm Carol Masser. Welcome to the weekend edition 0:00:08.640 --> 0:00:10.840 of Bloomberg Business Week. Over the next couple of hours, 0:00:10.840 --> 0:00:12.799 we've got news of the week, insights from the magazine 0:00:12.800 --> 0:00:14.520 and more, and a couple of stories that are going 0:00:14.560 --> 0:00:18.200 to freak you out right and some maybe you'll learn 0:00:18.280 --> 0:00:20.320 something about some brands that you know you won't get 0:00:20.320 --> 0:00:23.800 too freaked out, including how one private equity investor. I'm 0:00:23.880 --> 0:00:26.440 very proud of this story, one big on Lulu Lemon. 0:00:26.480 --> 0:00:29.520 It's not scary. They came back to fix the company. 0:00:29.640 --> 0:00:32.360 There were some moments of doubt though, Yeah, but they 0:00:32.400 --> 0:00:34.040 made a lot of money along the way in terms 0:00:34.080 --> 0:00:37.519 of those private equity investors. So here's the freak quotient 0:00:37.800 --> 0:00:40.680 if I may. And this is a story from Austin Carr. 0:00:40.760 --> 0:00:43.920 It's about Silicon Valley. They're listening in. They are, I mean, 0:00:43.960 --> 0:00:46.920 we all of us. You and I both have these 0:00:46.920 --> 0:00:49.879 devices in our homes. Pretty much everyone we know, I 0:00:49.920 --> 0:00:54.080 feel like, has a Google and Alexa or whatever it 0:00:54.200 --> 0:00:57.280 is that's sitting there on your kitchen counter or whatever. Well, 0:00:57.320 --> 0:01:00.920 apparently that device isn't just listening to you. There are 0:01:01.040 --> 0:01:03.520 humans who are sometimes listening to you as well. This 0:01:03.600 --> 0:01:05.600 is going to freak you out there all listening, You're 0:01:05.600 --> 0:01:08.440 gonna be worried. Plus it's holiday time and we got 0:01:08.440 --> 0:01:11.520 to visit with two rockets. They stopped by the studio 0:01:11.560 --> 0:01:15.199 and it is amazing. They're in all their regalia even 0:01:15.360 --> 0:01:18.280 and if you check out our respective Twitter feeds you 0:01:18.280 --> 0:01:20.520 can see them. They're so good at posing. Oh my god, 0:01:20.560 --> 0:01:23.000 everybody at Bloomberg was so jealous that we had them 0:01:23.000 --> 0:01:26.040 and they didn't. But first, remember the Bloomberg fifty. We 0:01:26.040 --> 0:01:28.960 were celebrating that in just the past couple of weeks. Well, 0:01:29.080 --> 0:01:32.400 we caught up with one of the members of that list, 0:01:32.640 --> 0:01:35.720 the CEO and co founder of Beyond Meat, Ethan Brown. 0:01:35.959 --> 0:01:38.200 What about this year surprised you the most? What was 0:01:38.240 --> 0:01:41.240 the most challenging? You know, it always is around continue 0:01:41.280 --> 0:01:43.759 to educate not only the consumer of the media, around 0:01:43.840 --> 0:01:47.440 just how healthy and how much our company is driven 0:01:47.440 --> 0:01:49.560 by the human health imperative. If you look at the 0:01:49.560 --> 0:01:53.480 products we're creating, take the Duncan sausage for example, that 0:01:53.480 --> 0:01:56.920 product is fifty percent less fat. It has percent less 0:01:56.960 --> 0:02:01.160 saturated fattent less sodium and has more protein and more iron. 0:02:01.240 --> 0:02:03.240 So when you're beginning with a blank canvas and you're 0:02:03.280 --> 0:02:05.400 able to build a piece of meat directly from plants, 0:02:05.640 --> 0:02:07.280 you can leave out a lot of the things that 0:02:07.320 --> 0:02:09.080 you wouldn't want to be consuming on a daily basis, 0:02:09.120 --> 0:02:12.440 such as cholesterol, and you can lower things like saturated fat, 0:02:12.680 --> 0:02:14.600 and you can provide the consumer with a very healthy 0:02:14.639 --> 0:02:17.519 product that they get to enjoy. Yet continue to move 0:02:17.520 --> 0:02:19.440 the ball forward year every year and making the products 0:02:19.440 --> 0:02:22.359 healthier and healthier. So as we get into you'll see 0:02:22.400 --> 0:02:24.799 us continue to drive toward goals that will enable the 0:02:24.840 --> 0:02:26.560 consumer to eat what they love, but do it in 0:02:26.560 --> 0:02:28.640 a way that's healthier for them. We'll talk about that 0:02:28.680 --> 0:02:31.639 because I feel like that comes up often about maybe 0:02:31.639 --> 0:02:34.320 this becoming even a healthier product because there is still 0:02:34.360 --> 0:02:36.040 a fair amount of sodium and so on in it. 0:02:36.520 --> 0:02:38.919 Do you guys think about doing some kind of reformulating 0:02:39.240 --> 0:02:42.240 to lower calories, are a lower sodium amount? Is that 0:02:42.320 --> 0:02:44.640 kind of in the future. So if you look at 0:02:44.639 --> 0:02:47.120 the DNA of the company, we are an innovation driven company. 0:02:47.200 --> 0:02:50.320 We produce all of our products here in the US, 0:02:50.360 --> 0:02:54.480 and we have our our innovation center here in Los Angeles. 0:02:54.480 --> 0:02:56.640 We call that Innovation Center of the Manhattan Beach Project. 0:02:56.960 --> 0:02:59.280 We do that because we're near Manhattan Beach, but more importantly, 0:02:59.280 --> 0:03:02.440 weren't to voke that sense of urgency and scale that 0:03:02.520 --> 0:03:04.960 occurred in the Second World War with the Manhattan Project itself. 0:03:05.240 --> 0:03:07.720 Were brought together the very best scientists, the best engineers, 0:03:07.720 --> 0:03:09.560 the best managers and gave him a clear goal, which 0:03:09.600 --> 0:03:12.160 is to build meat directly from plants. Now, when you're 0:03:12.200 --> 0:03:14.800 doing that, you're always improving, and we have these parameters 0:03:14.800 --> 0:03:17.679 we call the fat, flavor, aroma, punters, and texture. We 0:03:17.800 --> 0:03:20.880 were constantly driving towards making the products better in each area, 0:03:21.080 --> 0:03:22.880 and nutrition would of course be part of that, but 0:03:22.919 --> 0:03:25.639 it's also about marketing and helping people understand the products. 0:03:25.840 --> 0:03:28.280 So if you look at it beyond Burger, for example, 0:03:28.680 --> 0:03:31.880 that has sixteen percent daily value of sodium, not sixty 0:03:31.960 --> 0:03:35.400 but six, which is well within reason for many many 0:03:35.440 --> 0:03:38.160 meals that folks will consume, such as two flower tortillas 0:03:38.240 --> 0:03:40.360 or half a couple of mare narrow sauce, etcetera. So 0:03:40.400 --> 0:03:43.320 a lot of it is just separating the misinformation and 0:03:43.400 --> 0:03:46.040 hype from reality. This product has an extremely healthy product. 0:03:46.040 --> 0:03:48.600 It's one that I consume almost daily. It's something I 0:03:48.600 --> 0:03:50.840 feel very good about giving to my own children. And 0:03:50.880 --> 0:03:54.080 so it's really about let's educate consumers about the health 0:03:54.200 --> 0:03:56.480 of our products and about the process. We're very proud 0:03:56.520 --> 0:03:58.360 of our process. If you look at how we produce 0:03:58.880 --> 0:04:01.800 meat from from plants. Instead of running a lot of 0:04:01.800 --> 0:04:05.000 plant material through animals and the antibiotics that go without 0:04:05.000 --> 0:04:07.800 other hormones depending on the species of veterinary drugs, et cetera, 0:04:08.160 --> 0:04:11.000 what we're doing is taking that protein directly from the plant. 0:04:11.280 --> 0:04:13.280 We're running it through heating, cooling, and pressure, and that 0:04:13.360 --> 0:04:15.800 resets the bond so that they take on that fibrous 0:04:15.840 --> 0:04:18.560 texture of muscle. That's it for me. That's a much 0:04:18.600 --> 0:04:20.440 better process than one that we can be proud of. 0:04:20.839 --> 0:04:23.159 We offer complete transparency. You'd be welcome to come to 0:04:23.160 --> 0:04:25.279 our facilities, knock on the door and we'll give you 0:04:25.320 --> 0:04:28.440 a tour. People should be able to see where and 0:04:28.440 --> 0:04:30.280 how their food is made. And we believe very strong 0:04:30.279 --> 0:04:33.200 in that principle. And so Ethan, speaking of a different 0:04:33.200 --> 0:04:36.360 sort of process, walk us through the process of assessing 0:04:36.400 --> 0:04:38.839 these partnerships. You know, you name checked some of the 0:04:38.880 --> 0:04:41.799 best known when it comes to you know, fast food. 0:04:41.880 --> 0:04:45.000 You've also got some partnerships in casual dining. How does 0:04:45.080 --> 0:04:48.760 that work? Because pun intended, it feels like everybody wants 0:04:48.800 --> 0:04:51.240 a piece of this market right now, right so you 0:04:51.240 --> 0:04:53.479 always want to align yourself with the marquete players. And 0:04:53.520 --> 0:04:55.400 that's what we've done from the beginning of the company. 0:04:55.440 --> 0:04:58.320 So when we decided to go into retail way back 0:04:58.320 --> 0:05:01.200 in two thousand nine, the first company who called was 0:05:01.240 --> 0:05:02.800 Whole Foods, and then we've been able to clif right 0:05:02.839 --> 0:05:05.400 out through Kroger, etcetera. But when then you look at 0:05:05.400 --> 0:05:08.200 our venture history, the first venture firm we worked with 0:05:08.200 --> 0:05:09.680 the client of Perkins and now we have a great 0:05:09.720 --> 0:05:13.200 list including Great Point Ventures and many others. Um But 0:05:13.360 --> 0:05:16.560 if if you're now looking at the fast food space 0:05:16.640 --> 0:05:18.560 or a quick serve restaurant space, you also want to 0:05:18.560 --> 0:05:21.760 adopt the same philosophy. Who are the marquee players and 0:05:21.800 --> 0:05:24.640 how do you become uh of service to them? And 0:05:24.640 --> 0:05:27.680 that's what we're able to do. Whether it's McDonald's, whether Subway, 0:05:28.279 --> 0:05:32.240 whether it's KFC or Duncan. We're constantly looking Carl's Jr. Hearties, etcetera. 0:05:32.279 --> 0:05:36.039 We're constantly looking to serve the very best partners in 0:05:36.080 --> 0:05:38.680 the space so we can grow with them. What's the focus. 0:05:38.720 --> 0:05:40.560 Is it retail or food service or will it be 0:05:40.560 --> 0:05:44.360 a split going forward? Our focus is entirely on the consumer. 0:05:44.400 --> 0:05:46.560 It's our relationship with the consumer that makes the business 0:05:46.640 --> 0:05:48.640 so special. We listen to what they say. They told 0:05:48.680 --> 0:05:51.120 us no GMOs, they told us nothing artificial, they said, 0:05:51.200 --> 0:05:53.680 keep everything natural. So that's what we do um and 0:05:53.680 --> 0:05:55.080 that makes it harder. By the way, we would be 0:05:55.160 --> 0:05:58.480 much easier genetically modified plant material to make it, uh 0:05:58.560 --> 0:06:02.160 take on the text r and appearance and aroma of 0:06:02.160 --> 0:06:04.800 of of animal protein. But we won't do that. And 0:06:04.839 --> 0:06:07.600 so we're constantly focused on what the consumer wants. We'll 0:06:07.600 --> 0:06:09.680 need to consume where they are. So if it's if 0:06:09.680 --> 0:06:12.400 it's it's quick ser of restaurants will be there for them. 0:06:12.400 --> 0:06:15.280 If it's retailed before them. Right now, it's about and 0:06:15.440 --> 0:06:17.400 market will tell us which direction. Okay, so it could 0:06:17.480 --> 0:06:21.000 change going forward, right and that's beyond meat CEO Ethan Brown. 0:06:21.080 --> 0:06:25.120 For our full conversation, download this week's Bloomberg Extra podcast. 0:06:25.160 --> 0:06:28.119 We've covered a wide range of topics. I mean, look, 0:06:28.240 --> 0:06:30.520 this is a company that is in the middle of 0:06:30.600 --> 0:06:33.599 so many megatrons. It's essentially a lifestyle brand. Yeah, and 0:06:33.600 --> 0:06:35.680 this is why he's part of the Bloomberg fifty list. 0:06:35.720 --> 0:06:37.320 But I also think this is gonna be a big 0:06:37.360 --> 0:06:41.520 story for as well. Provocative remarks in the magazine this 0:06:41.560 --> 0:06:44.200 week with the headline the problem with female CEOs isn't 0:06:44.200 --> 0:06:47.320 that they are female, It's that they are CEOs. This 0:06:47.480 --> 0:06:50.640 is one that everybody needs to stop and read, and 0:06:50.920 --> 0:06:52.440 you're going to talk about it after you read it. 0:06:52.480 --> 0:06:54.520 We've been talking about that big time, So now we're 0:06:54.560 --> 0:06:56.960 gonna talk about it with the author, Rebecca Greenfield. She 0:06:57.200 --> 0:07:00.680 runs all of our diversity coverage here. Edwin Rate, the 0:07:00.680 --> 0:07:04.680 managing diversity team recently promoted to run that. Congratulations. Yeah, 0:07:04.760 --> 0:07:08.160 I'm I'm living the truth that I write about women. 0:07:08.160 --> 0:07:11.520 We have to rise through the ranks exactly. And you 0:07:12.400 --> 0:07:14.480 really put it out there in this story in a 0:07:14.520 --> 0:07:17.240 lot of ways and capture a moment that's really important. 0:07:17.480 --> 0:07:20.600 Give us the thesis. Yeah. So I noticed something that 0:07:20.680 --> 0:07:23.840 was happening, which was there are lots of companies that 0:07:23.880 --> 0:07:26.440 are run and founded by women, but they also have 0:07:26.520 --> 0:07:29.480 these missions that are you know, we are all for 0:07:29.560 --> 0:07:31.760 gender equality, and our products are going to create this 0:07:31.840 --> 0:07:35.720 gender equality, and that's great um, but then there would 0:07:35.760 --> 0:07:39.800 be these scandals where employees would say, actually, I'm a 0:07:39.840 --> 0:07:41.920 woman who works at this company, and you are not 0:07:42.000 --> 0:07:45.120 practicing what you preach um. And we saw this happen 0:07:45.280 --> 0:07:47.920 for a few years. We saw it happen at Thinks, 0:07:48.000 --> 0:07:50.760 which was a company that makes underwear for women to 0:07:50.760 --> 0:07:53.680 wear whether they're on their period. We saw this happen 0:07:53.840 --> 0:07:56.840 at Nasty Gal, which was like a retailer for women. 0:07:56.960 --> 0:07:59.720 And then more recently we've seen it or I wrote 0:07:59.720 --> 0:08:01.880 about how it's kind of happening at the wing right now, 0:08:02.000 --> 0:08:05.680 the coworking space, and there's been a huge backlash to 0:08:05.760 --> 0:08:09.200 these companies because there's this kind of irony I think happening, 0:08:09.320 --> 0:08:11.920 or like you're not practicing what you're preaching. So I'm 0:08:12.000 --> 0:08:17.640 exploring that phenomenon in this piece and saying, yeah, that's 0:08:17.640 --> 0:08:21.200 going to happen, because women when they become CEOs act 0:08:21.240 --> 0:08:24.480 a lot like men when they become CEOs. Well, there's 0:08:24.560 --> 0:08:26.160 so much there's a lot of talk to you. No, 0:08:26.240 --> 0:08:27.800 I love it. I love it, and you know, I 0:08:27.800 --> 0:08:29.720 do want to first let's start with some of these 0:08:29.720 --> 0:08:31.680 are younger company startups, and I think this is a 0:08:31.760 --> 0:08:34.600 valid point that when you're a startup, like you're costly 0:08:34.640 --> 0:08:39.040 putting out fires. I mean that's an element of it. Yeah, definitely. 0:08:39.080 --> 0:08:41.719 I think when you're a startup, no matter who you are, 0:08:41.800 --> 0:08:44.079 what you run, what your mission is, you are under 0:08:44.160 --> 0:08:46.240 a lot of constraints. Right, You get a lot of 0:08:46.280 --> 0:08:48.280 money and you have to grow really quickly. You're learning 0:08:48.280 --> 0:08:51.160 how to scale something. And I think what they're learning 0:08:51.240 --> 0:08:55.160 is when you scale you it's hard to have you know, 0:08:55.280 --> 0:08:59.600 feminism be your mission. That doesn't square with creating a big, 0:08:59.600 --> 0:09:02.800 success full company, and maybe it shouldn't have to, or like, 0:09:02.880 --> 0:09:05.400 why would we expect that. One of the things that 0:09:05.480 --> 0:09:07.680 I really took away from this that I thought was 0:09:07.800 --> 0:09:11.040 such a in many ways profound point. And you're dealing 0:09:11.120 --> 0:09:14.840 with this every day, as we said running the diversity coverages. 0:09:16.400 --> 0:09:18.839 There is a distinct difference, and keep me honest here 0:09:18.840 --> 0:09:23.120 in the in the telling of this, between the benefits 0:09:23.240 --> 0:09:26.320 of having women on a board or women in management 0:09:26.640 --> 0:09:30.000 versus diversity. That seems to be at the core of 0:09:30.040 --> 0:09:33.240 what you're arguing here, right. Yeah, So I think there's 0:09:33.240 --> 0:09:37.280 this fallacy that we want more women to lead companies 0:09:37.320 --> 0:09:41.520 because women are more compassionate than men, They're more ethical, 0:09:41.640 --> 0:09:46.040 they're more and moral, they create safer workplaces, and that's 0:09:46.120 --> 0:09:49.000 just not true. The research has found that's not true. 0:09:49.040 --> 0:09:52.679 And in fact, that's just another gender stereotype. UM. I 0:09:52.720 --> 0:09:55.760 talked to a researcher who just put it out there 0:09:55.800 --> 0:09:58.360 and said, women aren't different than men in the way 0:09:58.400 --> 0:10:02.520 that they lead. UM And that's the reality. And the 0:10:02.559 --> 0:10:06.640 benefits of diversity come not because women are different than men, 0:10:06.760 --> 0:10:10.920 because they're not that different than men, but because they're 0:10:10.960 --> 0:10:14.160 diverse and that they are different than the ten men 0:10:14.360 --> 0:10:16.760 who are in the room. And that's what we want 0:10:16.760 --> 0:10:19.640 from diversity. We want a mixture of different types of people, 0:10:19.679 --> 0:10:21.840 different point of views to kind of push back on 0:10:21.880 --> 0:10:25.360 the type of homogeneous thinking that leads to bad decisions. Well, 0:10:25.400 --> 0:10:27.760 and that's exactly it. That one of the things that 0:10:27.800 --> 0:10:30.880 we're all trying to fight as managers in many ways 0:10:31.320 --> 0:10:33.320 is group think. Right. You know that you have the 0:10:33.360 --> 0:10:36.280 same experience. You have a great line in your piece 0:10:36.440 --> 0:10:39.040 that talks about, you know, ten white dudes who all 0:10:39.040 --> 0:10:41.640 went to the same three business schools, they're going to 0:10:41.800 --> 0:10:44.160 kind of think the same way. And so what you 0:10:44.280 --> 0:10:48.880 need is this diversity of opinion and experience that doesn't 0:10:48.880 --> 0:10:53.000 necessarily just mean a different sort of group things exactly. 0:10:53.040 --> 0:10:56.360 And I mean Sally Crocheck has said, I mean that's 0:10:56.520 --> 0:10:59.200 this is one of her lines that she thinks that 0:10:59.200 --> 0:11:01.160 that kind of group things exactly what led to the 0:11:01.200 --> 0:11:05.040 financial crisis. And I should note that Wall Street still 0:11:05.080 --> 0:11:07.400 looks pretty much the same as it did before the 0:11:07.440 --> 0:11:10.760 financial crisis. And so I think, yeah, that's that's the 0:11:10.800 --> 0:11:14.080 real benefits of diversity. And that's a lot of these companies, 0:11:14.120 --> 0:11:17.720 these startups are also not diverse. They're just a lot 0:11:17.840 --> 0:11:21.439 hiring people that are like themselves, other women, their experience, 0:11:21.440 --> 0:11:23.320 their friends. They hire the people they know, they hire 0:11:23.360 --> 0:11:25.960 the people in their networks. They often talk about how 0:11:26.000 --> 0:11:30.040 they hire a lot of women, which is great because 0:11:30.360 --> 0:11:32.360 you know, most companies don't look like that. So their 0:11:32.400 --> 0:11:34.440 company is going to be diverse and a group of 0:11:34.480 --> 0:11:37.640 other companies, but it can lead to the same group thing. Rebecca, 0:11:37.679 --> 0:11:39.160 I think this is so important. You and I have 0:11:39.200 --> 0:11:42.040 had this conversation because I'm very anti like, Okay, you 0:11:42.040 --> 0:11:44.720 have the women's group, you have the LGBTQ community, like 0:11:44.800 --> 0:11:47.720 separating everybody into groups, like unless we all work together 0:11:48.240 --> 0:11:51.199 and really, you know, everything is together, and really think 0:11:51.200 --> 0:11:54.600 about diversity with all of its different layers. I mean, 0:11:54.760 --> 0:11:57.320 that's what it's all about, right, that's the goal. Yeah. 0:11:57.400 --> 0:11:59.160 I mean I think it can help when you aren't 0:11:59.240 --> 0:12:04.160 in a company where you're not part of the majority group, 0:12:04.240 --> 0:12:07.959 to talk to other people about your experiences. Um, that 0:12:08.000 --> 0:12:12.920 can help you. But I think when everyone's siloed, you're 0:12:12.960 --> 0:12:16.600 not getting the benefits of someone else having a different perspective. 0:12:17.000 --> 0:12:18.840 There was a study I talked about in here where 0:12:18.840 --> 0:12:21.040 it talk Look, you know, there's a body of research 0:12:21.080 --> 0:12:24.640 going back saying boards with women on them act more ethically. 0:12:24.920 --> 0:12:27.679 So people have kind of jumped to the conclusion that 0:12:27.960 --> 0:12:31.760 women are more ethical, But this researcher I talked to 0:12:31.760 --> 0:12:34.040 you said, that's not actually what we think is happening. 0:12:34.240 --> 0:12:36.160 What we think is happening is that somebody's in the 0:12:36.240 --> 0:12:39.120 room who again is seeing things from a different perspective 0:12:39.160 --> 0:12:41.319 and is pushing back against the group think that makes 0:12:41.360 --> 0:12:44.960 unethical decisions, or the group just by having an outside 0:12:45.000 --> 0:12:47.559 member in it isn't going to be so bold and 0:12:47.679 --> 0:12:50.520 doing things that are unethical. They kind of check themselves. 0:12:50.520 --> 0:12:52.920 And so that's the kind of benefits of diversity that 0:12:53.000 --> 0:12:55.080 I think we want to see. So one of the 0:12:55.080 --> 0:12:58.320 things that I think folks might react to when they 0:12:58.360 --> 0:13:02.240 read the story is the US and we've seen this 0:13:02.360 --> 0:13:04.840 with me too to some extent, sort of the backlash 0:13:04.880 --> 0:13:07.559 to the backlash right, and this idea that all right, well, 0:13:07.559 --> 0:13:10.440 we're just giving up on women running companies now. So 0:13:10.559 --> 0:13:13.719 that didn't work, So let's go back to where we 0:13:13.720 --> 0:13:16.560 were before. Do you worry about that sort of happening 0:13:16.600 --> 0:13:19.000 in the world. Um, I hope that's not the message 0:13:19.000 --> 0:13:22.880 of this story is getting across. Um. Men, companies run 0:13:22.880 --> 0:13:24.800 by men act like this all the time. I can 0:13:24.880 --> 0:13:29.080 name so many. I mean, there's Uber, there's we Work, 0:13:29.480 --> 0:13:34.079 There's lots of companies run by men that have similar problems. 0:13:34.120 --> 0:13:37.280 So I don't think women are any worse than men. 0:13:37.400 --> 0:13:40.000 I just think it's a setback for us to set 0:13:40.000 --> 0:13:42.520 them to this higher standard because when they don't mean 0:13:42.520 --> 0:13:45.199 it them, you know, they're penalized even more than that. 0:13:45.200 --> 0:13:48.679 That's Rebecca Greenfield, who drives our diversity coverage in the magazine, 0:13:48.720 --> 0:13:51.600 remarks provocative remarks in the magazine this week. Yeah, I 0:13:51.640 --> 0:13:56.400 really liked this because it's a nuanced argument in many ways. Obviously, 0:13:57.000 --> 0:14:00.960 gender in the workplace different genders in lee leadership is 0:14:01.040 --> 0:14:03.400 much more complicated than just like, hey, let's have more 0:14:03.440 --> 0:14:05.440 women's CEOs. And I think the message here is it's 0:14:05.440 --> 0:14:09.000 really about good, great leadership if you will not whether 0:14:09.080 --> 0:14:12.240 you're a man or woman running a company. Shares in 0:14:12.320 --> 0:14:15.080 Lulu Lemon Athletica. Man, they have been on quite a tear, 0:14:15.200 --> 0:14:18.760 almost doubling in the past year. And Jason, you know 0:14:18.840 --> 0:14:21.120 this story, so you wrote this story. It's part of 0:14:21.120 --> 0:14:24.080 a remarkable turnaround. Well, and it is. And it involves 0:14:24.120 --> 0:14:26.640 private equity. We talked about private equity a lot in 0:14:26.680 --> 0:14:29.800 the context of those big, well known names Blackstone, kr 0:14:29.880 --> 0:14:33.800 Carlisle and whatnot. This is a firm called Advent. They 0:14:33.840 --> 0:14:36.120 were in it at the beginning, they got out, made 0:14:36.120 --> 0:14:39.560 a lot of money. Then they went back in and 0:14:39.600 --> 0:14:43.720 they did even better. I sat down exclusively with advanced 0:14:43.760 --> 0:14:47.800 managing partner and chairman David Mustafer, as well as Calvin McDonald, 0:14:47.840 --> 0:14:50.360 he is the CEO of Lulu Lemon. We caught up 0:14:50.400 --> 0:14:53.720 at one of the Lulu stores in New York City. How, 0:14:53.960 --> 0:14:56.400 for lack of better term, sort of broken was it 0:14:56.520 --> 0:14:59.120 when you sort of got back in? I mean, I 0:14:59.160 --> 0:15:03.000 think the business was had its challenges, but at the 0:15:03.160 --> 0:15:07.720 core the issue was alignment and so part of the 0:15:07.760 --> 0:15:11.640 power that that private equity can bring is that alignment. 0:15:12.040 --> 0:15:14.880 And so in this case, we had a situation where 0:15:14.920 --> 0:15:18.640 the founder wasn't aligned with the board and the management team, 0:15:18.640 --> 0:15:21.880 and so you've seen some turnover of the senior management. 0:15:22.480 --> 0:15:27.640 You also didn't have the company uh in sync with 0:15:27.840 --> 0:15:31.240 the ability to make investments. They were following Wall Street 0:15:31.280 --> 0:15:34.520 and thinking about what they needed to do that quarter. 0:15:35.080 --> 0:15:38.520 And so I feel like what we saw as this 0:15:38.800 --> 0:15:43.560 fundamental opportunity was to help regain that alignment and put 0:15:43.600 --> 0:15:46.479 the platform in place so that the company could establish 0:15:46.840 --> 0:15:51.560 a really strategic proposition, not just here and now, but 0:15:52.280 --> 0:15:55.680 part of the real opportunity is to help them get 0:15:55.680 --> 0:15:58.520 out of the penny a share game and make some 0:15:58.640 --> 0:16:02.560 of these investments that had been deferred. Right, I want 0:16:02.560 --> 0:16:05.240 to get to the moment where Calvin, you come into 0:16:05.240 --> 0:16:08.480 the company, you do have a series of of C 0:16:08.520 --> 0:16:12.200 e O s um so leadership becomes something at the 0:16:12.240 --> 0:16:13.960 at the top level that you also have to deal 0:16:14.000 --> 0:16:18.400 with in terms of the the various issues you have 0:16:18.520 --> 0:16:22.360 to address. Firstly, we had a situation where the board 0:16:22.560 --> 0:16:26.480 really was interested, loves this company and wanted to see 0:16:26.600 --> 0:16:29.600 its succeed and so in that regard when we came back, 0:16:31.280 --> 0:16:35.920 we were able to create some of that alignment pretty 0:16:35.920 --> 0:16:43.400 easily and help create the UM, the ability to put 0:16:43.480 --> 0:16:46.280 some of these ideas in place, the idea of a 0:16:46.320 --> 0:16:50.480 longer term plan. But you're right, I think some of 0:16:50.520 --> 0:16:53.880 those challenges with the founder made it hard and so 0:16:54.440 --> 0:16:59.120 UM at the point that UM that the founder exited 0:16:59.160 --> 0:17:02.320 the company into was in fifteen, we were really able 0:17:02.360 --> 0:17:06.600 to begin assembling a world class management team and so 0:17:07.359 --> 0:17:12.920 UH with a CFO who is initially with Stewart now CEO, 0:17:13.160 --> 0:17:19.199 and then talent along the way, leading to people like 0:17:19.320 --> 0:17:24.399 Glenn and Calvin and Son and a host of really 0:17:24.920 --> 0:17:29.040 world class business leaders. And the exciting part is that 0:17:29.359 --> 0:17:34.159 this business had that potential, it just needed the opportunity 0:17:34.280 --> 0:17:39.040 and the the framework. From this point and beyond, it 0:17:39.160 --> 0:17:42.800 really feels like the business is just getting started. At 0:17:42.880 --> 0:17:47.120 that moment where you where you do start to dig in, Calvin, 0:17:47.280 --> 0:17:50.600 I mean, what's what's the opportunity do you see to 0:17:51.000 --> 0:17:54.879 sort of take it to the next level. So for me, 0:17:55.000 --> 0:17:58.080 the first assessment was as an opportunity here to be 0:17:58.119 --> 0:18:00.280 even more than what Lulu Lemon is, not just with 0:18:00.359 --> 0:18:03.480 the North American internationally UH. And I think the clear 0:18:03.640 --> 0:18:06.720 resounding answers absolutely. I mean, the vision we have today 0:18:06.800 --> 0:18:08.600 is to nite a community of people to live the 0:18:08.600 --> 0:18:11.520 sweat life UH. And we're going to express that not 0:18:11.640 --> 0:18:14.560 just through incredible product that will keep developing because there's 0:18:14.600 --> 0:18:17.920 so much opportunity in white space for us to develop into, 0:18:18.160 --> 0:18:21.159 but also through our strategy of events on what we 0:18:21.240 --> 0:18:23.919 do with our grow initiatives and seeing what Calvin and 0:18:23.920 --> 0:18:27.600 the team have already done with the manifestation of this 0:18:27.760 --> 0:18:30.879 some of this next step vision in Chicago and with 0:18:30.960 --> 0:18:34.879 the membership and loyalty program, you already are beginning to 0:18:34.920 --> 0:18:38.320 see some of the seeds of thinking about what the 0:18:38.440 --> 0:18:41.280 broader vision might look like. And so what does that 0:18:41.320 --> 0:18:43.560 look like going forward? Because it does feel like we're 0:18:43.560 --> 0:18:46.360 at a very interesting moment in the world of retail. 0:18:46.440 --> 0:18:49.240 We have a huge runway of growth. UM. Not only 0:18:49.320 --> 0:18:52.320 is our women's business continuing to grow at double digit 0:18:52.400 --> 0:18:54.880 with a lot of growth opportunity being entering into new 0:18:54.920 --> 0:18:57.800 categories or we mentioned to and from OTC that doesn't 0:18:57.840 --> 0:19:02.480 even really in our women's uh category exist uh, and 0:19:02.560 --> 0:19:06.000 into our omniguest experience with our digital platform and as 0:19:06.040 --> 0:19:08.480 good as we are, there's a ton of opportunity to 0:19:08.600 --> 0:19:13.040 even more. This is an emotional brand, and our online 0:19:13.040 --> 0:19:15.919 continues to be more transactional and then finally, you know, 0:19:15.960 --> 0:19:18.520 expanding into markets. We still have a lot of opportunity 0:19:18.520 --> 0:19:21.840 in North America, not to mention what's happening internationally and 0:19:21.960 --> 0:19:24.920 in Europe as well as in China. We feel we're 0:19:24.920 --> 0:19:27.480 early innings and everything we're trying to create, and that's 0:19:27.520 --> 0:19:30.800 advent Managing partner and chairman David Mussafer and Kelvin McDonald, 0:19:30.880 --> 0:19:34.639 Lulu Lemon's CEO, we caught up at a store here 0:19:34.680 --> 0:19:38.000 in New York City. Listen. It's a remarkable tale, candidly 0:19:38.160 --> 0:19:42.080 that had not been told before. The stock obviously, anybody 0:19:42.080 --> 0:19:44.840 who's watching it has seen it rise. But the money 0:19:44.840 --> 0:19:47.240 behind it, what it took to fix it, that's a 0:19:47.280 --> 0:19:49.280 whole different story. I think this is a great business 0:19:49.280 --> 0:19:51.800 school case study, right of a company that was had 0:19:51.840 --> 0:19:54.200 done so well, had some problems and really came back, 0:19:54.240 --> 0:19:55.680 and you can look at it at so many different 0:19:55.760 --> 0:19:57.520 levels well, and it's a well known brand and one 0:19:57.560 --> 0:20:00.959 that people really keep an eye on for trend setting, 0:20:01.119 --> 0:20:04.520 but also for investors. Obviously, issues a big Tech. It 0:20:04.680 --> 0:20:07.679 is definitely one of the big themes of a future 0:20:07.680 --> 0:20:10.879 story this week about how Silicon Valley's biggest companies Jason 0:20:11.119 --> 0:20:13.800 fold millions of people into letting temp workers listen in 0:20:14.080 --> 0:20:17.240 on their most intimate moments. I'm creeped out. It is 0:20:17.720 --> 0:20:21.080 a must read for sure. It's the cover story this week. 0:20:21.119 --> 0:20:23.680 And actually you've got to just look at the cover 0:20:24.000 --> 0:20:27.000 and you're gonna be really You're gonna be really creeped out. 0:20:27.119 --> 0:20:29.240 But you're gonna want to know more. Austin Carr is 0:20:29.280 --> 0:20:31.359 here to do just that, to tell us more about it, 0:20:31.600 --> 0:20:34.720 all right, take us back, because this is really about 0:20:34.760 --> 0:20:37.600 a device or a series of devices that so many 0:20:37.600 --> 0:20:41.520