WEBVTT - Year-End Fiscal Cliffs Approaching 0:00:00.240 --> 0:00:03.240 This is Bloomberg Business Week. I'm Karl Masser. Every day 0:00:03.279 --> 0:00:05.200 we're bringing you the latest news from the world's of 0:00:05.200 --> 0:00:08.920 business and finance, plus technology, politics. So much going on 0:00:08.960 --> 0:00:12.160 in the world of politics, economics, and it's all harnessing 0:00:12.160 --> 0:00:14.840 the power of Business Week reporters and editors. If you 0:00:14.880 --> 0:00:18.280 can download Bloomberg Business Week on iTunes, SoundCloud, or Bloomberg 0:00:18.320 --> 0:00:20.480 dot com. If you can also listen to a radio 0:00:20.560 --> 0:00:23.439 show at two pm Eastern on Bloomberg Radio and be 0:00:23.440 --> 0:00:26.280 sure to watch us too on YouTube by searching Bloomberg 0:00:26.360 --> 0:00:29.520 Global News. There is a lot going on talk about 0:00:30.120 --> 0:00:33.199 a self testing kit for home that happening in the 0:00:33.280 --> 0:00:35.920 United States. Over in Europe, though, you did see a 0:00:35.960 --> 0:00:39.680 protest over Germany strategy to quell the virus turning violent. 0:00:39.840 --> 0:00:42.600 So yeah, it's really rough out there and this is 0:00:42.640 --> 0:00:45.600 a place environment we all know far too well. Back 0:00:45.640 --> 0:00:48.440 with us to see what she is seeing and concerned 0:00:48.440 --> 0:00:50.800 about is a Lissa rap CEO of the healthcare solutions 0:00:50.840 --> 0:00:53.880 company Surgical Solutions. She is with us on the phone 0:00:53.880 --> 0:00:57.600 from Deerfield, Illinois. Um, Alissa, good to have you here. 0:00:57.720 --> 0:01:00.600 How are you And when you see these headlines, uh, 0:01:00.640 --> 0:01:02.520 you're out there in the Midwest. I mean, that's really 0:01:02.520 --> 0:01:05.720 been a tough spot. It has, Caroline, thanks for having 0:01:05.720 --> 0:01:09.240 me back being a rise and surge across the country. Candidly, 0:01:09.400 --> 0:01:13.880 are incidences of exposure or even positivity in our own 0:01:13.920 --> 0:01:17.400 company amongst our tuner and fifty employees across nine states 0:01:17.400 --> 0:01:20.920 and thirty five hospitals is pretty much even. We've seen 0:01:20.959 --> 0:01:25.920 additional you know, exposure or positivity in New York, Kinnesseed, Texas, Kentucky, 0:01:26.080 --> 0:01:29.880 and it is obviously back. I'm not an epidemiologist, as 0:01:29.920 --> 0:01:32.400 you know, so I know that the viral load of 0:01:32.400 --> 0:01:35.040 the virus changes over time and it makes it easier 0:01:35.080 --> 0:01:38.280 to transmit. So hopefully people who are getting this version 0:01:38.280 --> 0:01:41.720 of this horrible COVID nineteen flu are not gonna be 0:01:41.840 --> 0:01:44.080 as sick if they're healthy and young. But it is 0:01:44.120 --> 0:01:46.280 still it is back that the numbers are real. We're 0:01:46.280 --> 0:01:48.640 seeing it across the country well, and it's interesting. We 0:01:48.720 --> 0:01:50.720 just talked a story. We just talked about a story 0:01:50.920 --> 0:01:53.040 Charlie Pellet and I about how COVID is really, you know, 0:01:53.160 --> 0:01:55.520 ravaging those long term care centers and we know that's 0:01:55.520 --> 0:01:59.120 where the elderly population is. We understand those numbers, but 0:01:59.160 --> 0:02:01.440 I've just talking to it individual here at Bloomberg and 0:02:01.960 --> 0:02:05.360 uh talked about her nephew succumbing to the virus. So 0:02:05.400 --> 0:02:08.359 we do understand that as much as we know some 0:02:08.440 --> 0:02:10.760 of COVID nineteen is predictable, we also know that there 0:02:10.760 --> 0:02:13.440 are outliers and we don't know still a lot about 0:02:13.440 --> 0:02:17.120 this virus. Having said that, the vaccine and the developments 0:02:17.120 --> 0:02:18.720 we've had over the last week and a half from 0:02:18.760 --> 0:02:23.400 Fiser and from Maderna, what's your takeaway there? I find 0:02:23.400 --> 0:02:26.959 it incredibly encouraging. I think the vaccines are going to 0:02:27.040 --> 0:02:29.359 be game changers, needless to say. And the only real 0:02:29.440 --> 0:02:32.000 question of my mind as a health care service provider 0:02:32.080 --> 0:02:35.079 is a question around distributions. They need to be stored 0:02:35.120 --> 0:02:39.120 between UH fifty and hundred blow fahrenheit. Then obviously we 0:02:39.200 --> 0:02:41.840 need the military and FedEx and UPS working together on 0:02:41.919 --> 0:02:46.160 a on a combined distribution strategy that leverages single sites 0:02:46.280 --> 0:02:49.160 that have these massive freezers as well as mobile sites. 0:02:49.600 --> 0:02:52.760 And I think creativity and real genius in terms of 0:02:52.800 --> 0:02:55.000 logistics and planning is going to be what needs to 0:02:55.040 --> 0:02:58.280 happen between now and say April May June, when we 0:02:58.320 --> 0:03:01.560 get to true general pop relation roll out of the virus. 0:03:01.639 --> 0:03:05.120 But for frontline healthcare workers, I'm still pretty bullish and 0:03:05.160 --> 0:03:08.000 optimistic because if those vaccines can start happening in our 0:03:08.000 --> 0:03:12.240 major metropolis and major sites in December, the second shot 0:03:12.320 --> 0:03:15.400 in January, whether it's the Visor Maderna or any other vaccine, 0:03:15.720 --> 0:03:17.840 that means that if we can get first responders and 0:03:17.880 --> 0:03:21.560 frontline healthcare workers vaccinated, then the most at risk, then 0:03:21.600 --> 0:03:25.079 the then the rollout further. There should be an abatement 0:03:25.400 --> 0:03:27.880 of the spread and it should meet it provides some 0:03:27.960 --> 0:03:30.040 relief to our healthcare system. Well, and you've got to 0:03:30.040 --> 0:03:33.280 be thinking unless about your workers specifically, right and making 0:03:33.320 --> 0:03:36.680 sure that they are frontline workers. Uh, and they need 0:03:36.720 --> 0:03:39.280 to have access to this vaccine. Um. You know, I'm 0:03:39.320 --> 0:03:42.640 curious how you're approaching it. Would you make sure that 0:03:42.680 --> 0:03:44.960 they are among the first to get it? Are your 0:03:44.960 --> 0:03:47.960 workers comfortable getting it? And are you concerned about having 0:03:48.000 --> 0:03:51.000 access ultimately to the vaccine as we kind of try 0:03:51.040 --> 0:03:55.120 and figure out the distribution and logistics problems of getting 0:03:55.120 --> 0:03:58.080 the vaccine out a great Those are all great questions. 0:03:58.160 --> 0:04:02.120 I feel confident in our frontline healthcare workers ability to 0:04:02.120 --> 0:04:06.000 get access to the vaccine because we follow each hospital's 0:04:06.280 --> 0:04:09.520 protocol for all things clinical. When we work with our 0:04:09.560 --> 0:04:11.880 hospital partners, and if their frontline teams are going to 0:04:11.960 --> 0:04:14.600 be asked to vaccinate, ours will too. And so if 0:04:14.600 --> 0:04:17.960 it's being provided to hospitals across the country for their 0:04:17.960 --> 0:04:20.520 frontline workers, I am hopeful and confident we will get 0:04:20.560 --> 0:04:23.479 that access. And I think that the first twenty million 0:04:23.880 --> 0:04:27.400 UH doses of the vaccine seemed pretty locked and loaded 0:04:27.440 --> 0:04:30.160 for December. So again, if we can make sure that 0:04:30.160 --> 0:04:33.160 that happens and nothing stops it, I think the frontline 0:04:33.520 --> 0:04:36.400 and first responder should be in good, good shape. It's 0:04:36.480 --> 0:04:39.360 really that next wave of rollout, Carol, that I personally 0:04:39.400 --> 0:04:42.360 am curious about. Once our frontline healthcare workers are taken 0:04:42.360 --> 0:04:45.480 care of, and the countries, after the prioritization for the 0:04:45.800 --> 0:04:48.400 for the elderly and the most at risk, how then 0:04:48.440 --> 0:04:52.120 do we ensure that mass distribution happens. I'm confident by 0:04:52.120 --> 0:04:55.440 the spring will have mass production of vaccine. Mass distribution 0:04:55.480 --> 0:04:58.040 becomes a bigger challenge. Yeah, listen, I think about that too, 0:04:58.080 --> 0:05:00.320 in terms of it getting out, and you know, we've 0:05:00.320 --> 0:05:02.440 been done a lot of reporting about that's kind of 0:05:02.440 --> 0:05:06.960 our next big headache. And because you know, countries have 0:05:07.080 --> 0:05:11.719 relationships and deals with various UM drug makers and so 0:05:11.720 --> 0:05:13.880 so you really do wonder, you know, what kind of 0:05:13.880 --> 0:05:16.200 horse trading might ultimately be going, you know, going on. 0:05:16.279 --> 0:05:18.400 And that kind of terrifies me, especially when I think 0:05:18.400 --> 0:05:21.039 about people who really need it. When I think about 0:05:21.040 --> 0:05:24.480 developing markets, I mean, it's really going to be, I think, 0:05:24.520 --> 0:05:28.440 a logistics nightmare. Globally, it's going to be challenging. And remember, 0:05:28.440 --> 0:05:31.120 the regular food vaccine can be stored at thirty seven 0:05:31.160 --> 0:05:35.039 degrees terrified and below, and and even that sometimes poses challenges, 0:05:35.040 --> 0:05:38.039 and this hundred degree below is a real thing. But 0:05:38.160 --> 0:05:40.839 I know that the biggest sites of points of distribution 0:05:40.839 --> 0:05:44.240 are already shoring up for those capabilities. I'm confident that 0:05:44.279 --> 0:05:48.840 in our country specifically, the ingenuity around distributional logistics means 0:05:48.880 --> 0:05:50.400 that we should be able to come up with a 0:05:50.560 --> 0:05:57.440 mobile UM mechanism for distributing even this very unusually cold vaccine. 0:05:57.520 --> 0:06:00.240 So I'm hopeful. I think that we'll see a lot 0:06:00.360 --> 0:06:02.680 of opening up come next summer. So listen, I know 0:06:02.720 --> 0:06:04.880 we've talked about schools. I know last time around we 0:06:05.000 --> 0:06:07.320 talked about UM and I think you you said that 0:06:07.360 --> 0:06:10.560 you don't think children are super spreaders. Because we were 0:06:10.560 --> 0:06:12.760 talking about schools reopening. I have to say, you know, 0:06:12.760 --> 0:06:14.720 it's interesting, I'm getting a lot of emails from around 0:06:14.720 --> 0:06:18.000 the newsroom about city looks New York City schools are closing. 0:06:18.120 --> 0:06:20.400 I actually think cities are being smart that as soon 0:06:20.440 --> 0:06:22.840 as they start to see numbers go up, UH in 0:06:22.880 --> 0:06:24.520 certainly just around the country. As soon as they start 0:06:24.560 --> 0:06:26.039 to see those numbers go up, I mean, New York 0:06:26.040 --> 0:06:28.640 remembers how bad it was, and I think they quickly 0:06:28.680 --> 0:06:30.840 moved to say we gotta we gotta pull back, and 0:06:30.839 --> 0:06:33.640 that's how we hopefully can maybe prevent this from becoming 0:06:34.040 --> 0:06:38.800 New York City back in March, April and May. Yeah. There. 0:06:38.800 --> 0:06:41.279 You know, there are two different questions, right Carol. One 0:06:41.360 --> 0:06:44.280 is our children super spreaders, and there's an abundance of data, 0:06:44.279 --> 0:06:46.120 and you've had many people on your show that have 0:06:46.160 --> 0:06:48.000 talked about how they may or may not be and right, 0:06:48.080 --> 0:06:50.880 we aren't. But there are other stakeholders. And stakeholders are 0:06:50.880 --> 0:06:54.520 teachers and the elderly family members of UH children in 0:06:54.560 --> 0:06:58.440 schools who are living in multigenerational, generational households. So I 0:06:58.480 --> 0:07:00.160 think it's the answer to whether to keep them open 0:07:00.240 --> 0:07:03.800 or closes is a function from whose stakeholders eyes you're looking, 0:07:03.920 --> 0:07:07.880 And I think that it's likely, um and probable that 0:07:08.120 --> 0:07:12.160 many public schools will end up closing post Thanksgiving, pre 0:07:12.280 --> 0:07:15.200 winter break quote unquote, or even right after winter break, because, 0:07:15.240 --> 0:07:19.640 as we discussed earlier, this vaccine access is likely going 0:07:19.640 --> 0:07:23.880 to be healthcare workers and first responders first, and then 0:07:23.920 --> 0:07:27.000 hopefully in the second wave as soon as January, even 0:07:27.480 --> 0:07:31.000 teachers and others who we consider a central workers. So 0:07:31.120 --> 0:07:34.680 I'm hopeful that once teachers are have access more broadly 0:07:34.680 --> 0:07:37.280 to the vaccine, then they'll be even greater comfort with 0:07:37.400 --> 0:07:40.000 keeping the schools open. But I think it's likely that 0:07:40.120 --> 0:07:43.120 to continue to quote flatten the curve. You can agree 0:07:43.200 --> 0:07:45.240 or disagree, but I think it's likely that schools will 0:07:45.240 --> 0:07:47.400 close for some portion of winter. Yeah, And I guess 0:07:47.440 --> 0:07:49.680 what I was kind of saying is right. I think 0:07:49.680 --> 0:07:52.160 I agree with you because just my own experience with 0:07:52.320 --> 0:07:55.480 my daughter in school, like the schools have been. I feel, 0:07:55.520 --> 0:07:58.040 like knock on wood, we're not necesarily talking about colleges 0:07:58.040 --> 0:08:00.720 and universities. They have had their own strug as um, 0:08:00.760 --> 0:08:04.239 but I think at large things have actually gone gone 0:08:04.240 --> 0:08:07.320 fairly well. And I guess what I'm is interesting, is 0:08:07.360 --> 0:08:09.760 that you're seeing, whether it's the West coast, whether it's here, 0:08:10.240 --> 0:08:13.520 major cities who saw it so badly in the springtime, 0:08:13.600 --> 0:08:16.760 Like we remember this, It wasn't that long ago, right, 0:08:16.800 --> 0:08:18.160 and we don't want to go back to it, so 0:08:18.200 --> 0:08:19.880 that you start to as soon as you start to 0:08:19.880 --> 0:08:21.640 see those numbers go up, you kind of rain things 0:08:21.720 --> 0:08:24.880 in just as hopefully slow it down and more importantly 0:08:24.880 --> 0:08:27.800 hopefully to stop it from spiking once again into that 0:08:27.880 --> 0:08:31.200 kind of out of control area. Yeah, and I think 0:08:31.240 --> 0:08:34.600 that it's also a function of how things have been managed. Right, 0:08:34.720 --> 0:08:36.880 If we're in a hybrid learning environment in our public 0:08:36.880 --> 0:08:39.880 school district here in the suburbs of Chicago, and you know, 0:08:39.920 --> 0:08:43.360 all the children have plexiglass shields, everyone's mass or classrooms 0:08:43.360 --> 0:08:46.120 eight students or less. We we certainly may end up 0:08:46.160 --> 0:08:48.520 in a virtual learning mode for a portion of winter, 0:08:48.800 --> 0:08:51.720 just like most public schools. But none of the transmission 0:08:51.720 --> 0:08:54.800 in our our suburban school district has happened within the schools. 0:08:54.840 --> 0:08:57.000 It's happened from people bringing it in from the outside. 0:08:57.040 --> 0:08:59.680 So that is I think many parents great comfort at 0:08:59.720 --> 0:09:02.320 schools are safe, kids are safe in schools. It's the 0:09:02.440 --> 0:09:04.240 community spread is going to be what it is. But 0:09:04.280 --> 0:09:06.920 again I stand by my earlier claim that I don't 0:09:06.960 --> 0:09:09.640 personally believe from the data i've read that children under 0:09:09.800 --> 0:09:12.480 ten are super spreaders by and large themselves. But I 0:09:12.600 --> 0:09:17.000 understand when taking into account multiple stakeholder groups why schools 0:09:17.040 --> 0:09:19.839 may choose and districts public districts may choose to close 0:09:19.840 --> 0:09:22.520 for a portion of winter until these vaccines are more 0:09:22.520 --> 0:09:25.800 widely disseminated. Right, Well said, hey, listen, Um, I want 0:09:25.800 --> 0:09:27.200 to go back to something you said to listen because 0:09:27.200 --> 0:09:29.000 I think it's really important and we've only got about 0:09:29.000 --> 0:09:31.800 a minute or so left here about you said, logistically, 0:09:31.800 --> 0:09:35.240 we're gonna need military and partnership with fed X. People 0:09:35.280 --> 0:09:38.640 have been saying since March April that we are at war, 0:09:38.840 --> 0:09:41.120 it's a health war, and we need kind of a 0:09:41.200 --> 0:09:44.920 military you know, a military aspect and reaction to it, 0:09:44.960 --> 0:09:47.640 if you will, and we really kind of haven't gotten that. 0:09:47.720 --> 0:09:50.800 Do you think a new administration will move in that direction? 0:09:52.040 --> 0:09:55.760 I think that it's likely that a new administration would 0:09:55.960 --> 0:09:59.520 be willing to leverage all tools at its disposal, including 0:09:59.520 --> 0:10:03.400 the US military, to ensure the broadest dissemination of this 0:10:03.559 --> 0:10:06.600 vaccine as quickly as possible. And I also believe that 0:10:07.040 --> 0:10:10.880 our US military is probably uniquely qualified to provide support 0:10:10.920 --> 0:10:13.600 to commercial parties like that X and ups in that way. 0:10:13.640 --> 0:10:16.560 So I really hope for a public private partnership in 0:10:16.640 --> 0:10:18.840 terms of distribution of the vaccine. I think it gives 0:10:18.880 --> 0:10:22.560 us the greatest probability of the greatest dissemination the fast. 0:10:22.600 --> 0:10:24.680 If we don't get that, what what what what? Then? 0:10:24.960 --> 0:10:28.439 Just quickly, I'm not thinking about again. I'm thinking positively, Carol, 0:10:28.440 --> 0:10:30.280 We're gonna get it down so we can have more 0:10:30.360 --> 0:10:34.880 normal lives by next time. Uh hallelujah. I'm off I'm 0:10:34.920 --> 0:10:36.640 an optimist too, and I'd like to get back to 0:10:36.640 --> 0:10:39.200 a more normal life. Um, Alyssa, thank you so much 0:10:39.520 --> 0:10:41.760 for finding time once again for us. Alissa rap she 0:10:42.000 --> 0:10:45.640 is chief executive officer of Surgical Solutions, joining us on 0:10:45.679 --> 0:10:50.240 the phone from Deerfield, Illinois, and again uh, watching those 0:10:50.320 --> 0:10:54.960 virus headlines, but optimistic about the vaccine and ultimately, if 0:10:55.000 --> 0:10:56.880 we do it right in terms of how we get 0:10:56.880 --> 0:11:00.240 it out logistically and the distribution, we can move much 0:11:00.240 --> 0:11:05.280 closer and much uh faster to a more normal life. 0:11:05.679 --> 0:11:07.640 So that's what we're kind of all hoping for this 0:11:07.960 --> 0:11:11.839 is Bloomberg Business Week with Carol Messer from Bloomberg Radio. 0:11:12.120 --> 0:11:15.160 You're listening to Bloomberg Business Week and the cover story 0:11:15.160 --> 0:11:16.560 this week, And I gotta say, I don't know if 0:11:16.559 --> 0:11:17.960 I can say this, Jill Weber. Can I just say 0:11:18.000 --> 0:11:21.040 I got a peek at the cover art you did 0:11:21.440 --> 0:11:24.760 last night. I have to say it truly encapsulates the 0:11:24.920 --> 0:11:29.680 essence of this story. Yeah, it's a fun one. Um. 0:11:29.760 --> 0:11:31.720 And this is one that, um, I think we were 0:11:31.920 --> 0:11:34.200 we we've been interested in for a while because looks 0:11:34.240 --> 0:11:37.720 like the staff of Business Week has a lot of 0:11:37.760 --> 0:11:40.520 cats and dogs at home. Um, And there have been 0:11:40.600 --> 0:11:44.120 acquisitions that were made during the pandemic. And if you 0:11:44.160 --> 0:11:46.240 have a dog and go to a dog park like 0:11:46.320 --> 0:11:48.600 I do, you also recognize that there were many, many, 0:11:48.640 --> 0:11:51.280 many more dogs in this neighborhood than there were before 0:11:51.320 --> 0:11:54.160 the pandemic. And one of the big beneficiar areas of 0:11:54.160 --> 0:11:58.120 this has been Chewy, the online pet retailer that does 0:11:58.160 --> 0:12:00.360 pet deliveries. And that's what our stories about, all right. 0:12:00.440 --> 0:12:02.960 So of course, Bloomberg Business Week editor Joe Webber, sorry 0:12:02.960 --> 0:12:04.240 I jumped the gun there, but I wanted to bring 0:12:04.320 --> 0:12:06.600 you in because I love the cover. Uh, and let's 0:12:06.600 --> 0:12:08.760 also bring in Bloomberg News Wealth for Porto, Andrew's mail 0:12:08.800 --> 0:12:11.959 in reporting for Business Week and on the phone from Orlando, Florida, 0:12:12.160 --> 0:12:15.040 Joel on the phone from the remote access from Brooklyn, 0:12:15.400 --> 0:12:17.520 it is and I gotta say, Joel, it's one of 0:12:17.559 --> 0:12:19.760 those things in the shutdown that as I would walk 0:12:19.880 --> 0:12:23.000 my dog Scout around the very quiet neighborhood, I would 0:12:23.000 --> 0:12:25.840 see boxes of things and I often saw Chewy boxes 0:12:25.960 --> 0:12:28.760 on the curb. Yeah, and you know they're coming to 0:12:28.800 --> 0:12:31.600 our house. To um. It's actually in one of our 0:12:31.600 --> 0:12:33.520 story meetings that turns out that you know, there's a 0:12:33.520 --> 0:12:35.520 lot of co op apartments in New York City that 0:12:35.559 --> 0:12:39.360 aren't supposed to have pets, and Chewy Boxes are outing 0:12:39.400 --> 0:12:45.280 them because it's like, oh, look delivery exactly. UM. So 0:12:45.440 --> 0:12:47.560 the story of Chewi though, I think it's it's one 0:12:47.600 --> 0:12:50.400 of these amazing ones because you know, the company has 0:12:50.440 --> 0:12:55.320 been around for for nine years. UH started basically by 0:12:55.360 --> 0:12:58.280 a couple of guys who just realized they were going 0:12:58.360 --> 0:13:02.160 to get into the jewelry business and then realized, wait 0:13:02.200 --> 0:13:05.600 a second, there could be a bigger opportunity and pets, 0:13:06.200 --> 0:13:10.000 and they basically scrapped it out for nine years and 0:13:10.040 --> 0:13:13.520 in the process of that sort of faded from the 0:13:13.559 --> 0:13:16.600 company and the company now has a has a new CEO. 0:13:16.720 --> 0:13:19.920 And the story sort of starts with Andrews crunching some 0:13:20.040 --> 0:13:24.520 numbers and realizing that he's actually incredibly highly compensated. How 0:13:24.640 --> 0:13:30.079 how highly compensated is Andres about a hundred eight million team. 0:13:30.200 --> 0:13:34.240 That's what brought me onto to this story. I am, 0:13:34.280 --> 0:13:37.760 we ran our highest paid CEOs list this summer and 0:13:39.040 --> 0:13:41.360 sume it's sing. Made a d eight million last year. 0:13:41.400 --> 0:13:43.199 And I turned to my editor and said, who in 0:13:43.240 --> 0:13:46.680 the world assume it'sing? And it turns out to see 0:13:46.760 --> 0:13:48.960 the CEO of Chewy And that's yeah, that's where it 0:13:48.960 --> 0:13:51.079 all started, right, And it's kind of like, what is 0:13:51.120 --> 0:13:52.840 to I have to say. We have a market guest 0:13:52.840 --> 0:13:54.720 who comes on and every time she's like, by Chewy, 0:13:54.760 --> 0:13:56.840 by Chewy, by Chewi. I mean, this is a business, 0:13:57.360 --> 0:13:59.480 you know, and you put it in the story and 0:13:59.640 --> 0:14:02.920 there's that it's very much kind of akin to Amazon 0:14:03.000 --> 0:14:07.239 in its early days. Yeah, it really is. It's it's 0:14:07.280 --> 0:14:11.040 what sets it apart from Amazon. Amazon was a model 0:14:11.120 --> 0:14:15.960 for much of the the quickness, the ease, and the pricing, 0:14:16.120 --> 0:14:18.200 but will really sets to a part is the fact 0:14:18.240 --> 0:14:20.640 that you actually have a customer service number to call, 0:14:20.720 --> 0:14:23.120 and if you call it, there's a person that responds 0:14:23.160 --> 0:14:25.720 to you within six seconds and it's willing to talk 0:14:25.760 --> 0:14:28.600 to you four hours. If that's what you feel like 0:14:28.720 --> 0:14:31.760 about your pet, about pet food, about the fact that 0:14:31.960 --> 0:14:35.160 you know anything, I've heard stories of customer service agains. 0:14:35.200 --> 0:14:37.480 You have literally been on the phone for several hours 0:14:37.720 --> 0:14:42.400 with with pet owners that call in. One of the things, Carol, 0:14:42.440 --> 0:14:44.320 that I think is really interesting about the businesses. You know, 0:14:44.360 --> 0:14:48.360 Amazon when it started, it had that one area of 0:14:48.400 --> 0:14:51.600 expertise that it just nailed, which was books. It's like, 0:14:51.640 --> 0:14:54.320 how do we bring as many books as we possibly 0:14:54.400 --> 0:14:57.880 can online and do um e commerce as a as 0:14:57.880 --> 0:15:00.680 a bookstore right right? And I think we actually kind 0:15:00.680 --> 0:15:04.480 of like it's almost like they surveyed the landscape and said, 0:15:05.000 --> 0:15:08.840 what's the thing that we could have recurring payments with 0:15:09.480 --> 0:15:13.000 that Amazon hasn't thought to do yet, and how do 0:15:13.080 --> 0:15:15.040 we figure out what that is and then do it 0:15:15.120 --> 0:15:19.160 at warp speed effectively? And they recognize that pets, So 0:15:19.280 --> 0:15:23.400 this thing, it's the number in the story, nine billion 0:15:23.440 --> 0:15:27.920 dollars a year being spent by Americans on pets. If 0:15:27.920 --> 0:15:31.080 you could get one slice of that, it's a great business. 0:15:31.640 --> 0:15:33.440 And what they figured out was that there's a lot 0:15:33.480 --> 0:15:36.280 of things that you can do that are recurring payments, 0:15:36.320 --> 0:15:40.040 whether it's dog food deliveries or medications, and all of 0:15:40.080 --> 0:15:43.800 those things are just cruise controlled. That's a subscription revenue model, 0:15:44.320 --> 0:15:46.400 and it has just allowed them to go sort of 0:15:46.440 --> 0:15:49.400 warp speed. And they were on a pretty good trajectory 0:15:49.440 --> 0:15:52.640 before the pandemic, and then the pandemic really played to it. 0:15:52.800 --> 0:15:55.240 And so Andrews tell us about what they how how 0:15:55.280 --> 0:15:59.320 they've really capital capitalized on everything this year. Yeah, they've 0:15:59.400 --> 0:16:02.080 already in the first two quarters they added more customers 0:16:02.080 --> 0:16:05.320 than in all of the prior fiscal years, and they're 0:16:05.320 --> 0:16:09.840 on track to finally turned EBIT down positive this year. 0:16:10.760 --> 0:16:13.120 And they are also on track to hit roughly seven 0:16:13.160 --> 0:16:16.920 billion dollars of revenue from if I don't misremember, around 0:16:16.920 --> 0:16:21.200 four point nine. So it's it's really super charged them 0:16:21.200 --> 0:16:24.240 this year. And they were sort of kind of like Peloton, 0:16:24.440 --> 0:16:28.479 just perfectly in position to take advantage of the coronavirus. 0:16:28.640 --> 0:16:31.080 We've been buying our scout, she's a little Irish terrier man. 0:16:31.200 --> 0:16:33.160 She's been getting toys, you know, and we we've got 0:16:33.160 --> 0:16:34.920 a subscription thing that we do every month too, and 0:16:34.920 --> 0:16:36.840 it's like, yep, we just we don't even think twice 0:16:36.840 --> 0:16:39.320 about it. We're like, it's essential. It's kind of crazy. 0:16:39.440 --> 0:16:41.280 So wait a minute, though, we said they were like 0:16:41.640 --> 0:16:44.600 kind of Amazon right in many ways, and it sounds 0:16:44.600 --> 0:16:47.360 like there are two also like Amazon for a long time. 0:16:47.880 --> 0:16:52.800 They're not profitable, not yet. And you know, that's a 0:16:52.840 --> 0:16:56.160 story that is not too unfamiliar these days, that you 0:16:56.720 --> 0:17:00.520 set assign profitability and instead focus on growing very quickly. 0:17:00.600 --> 0:17:03.920 And that's what they did, and founder Ryan Cohen and 0:17:04.000 --> 0:17:07.400 his team they actually ripped the page out of Amazon's 0:17:07.400 --> 0:17:10.159 playbook and said, we're going to plow every dollar or 0:17:10.240 --> 0:17:14.320 free cash flow that we get into marketing and customer acquisition. 0:17:15.000 --> 0:17:18.000 And but he points out in the story that at 0:17:18.040 --> 0:17:20.960 any point they could have turned off that marketings pigots, 0:17:20.960 --> 0:17:23.359 and the company would have been profitable even back in 0:17:25.200 --> 0:17:29.439 So it's really about you know, running and getting scale 0:17:29.920 --> 0:17:32.040 um as long as you can, as long as your 0:17:32.240 --> 0:17:35.280 careful ways allows you to do that. And that's what 0:17:35.320 --> 0:17:37.439 they that's what they've done, and that's why they're so 0:17:37.520 --> 0:17:40.600 big today. And and actually I love it because the 0:17:41.080 --> 0:17:43.040 CEO brought this up when when you guys kind of 0:17:43.040 --> 0:17:46.200 put it to him, is this this fly wheel? Um, 0:17:46.520 --> 0:17:50.000 this this idea that it's a vaunted when that Amazon's 0:17:50.040 --> 0:17:52.120 really excelled is sort of like, once you can start 0:17:52.119 --> 0:17:55.880 spinning off cash, it feeds all the other aspirations that 0:17:55.640 --> 0:17:57.919 you that you have. What did he have to say 0:17:57.960 --> 0:18:02.160 about his flywheel, Well, they essentially saying that it's I mean, 0:18:02.200 --> 0:18:04.639 it's a very surty model. As long as you have 0:18:05.000 --> 0:18:07.240 as long as you're not burning too much cash, then 0:18:07.480 --> 0:18:09.960 then that's something that you can keep up. And as 0:18:09.960 --> 0:18:13.879 long as you keep acquiring customers at a fast enough clip, 0:18:14.119 --> 0:18:19.359 then then that fly will keeps up. And thanks to shoot, 0:18:19.440 --> 0:18:21.720 Chewi's focused on autoship and the fact that people have 0:18:21.880 --> 0:18:23.760 to return to them every once in a while to 0:18:24.200 --> 0:18:27.560 buy cat litter and food and and so on, and 0:18:27.720 --> 0:18:31.640 and you can put that on automation. Um, that really 0:18:31.680 --> 0:18:35.440 helps to underwrite this whole model and it works anders 0:18:35.480 --> 0:18:38.679 really quickly. So Smit saying, the CEO of chewies up 0:18:38.680 --> 0:18:42.120 there with Elon Musk Apples, Tim Cook, some other well 0:18:42.160 --> 0:18:45.520 known CEOs as among the highest paid. Does he deserve 0:18:45.600 --> 0:18:47.280 to be there considering what he's done at the company 0:18:47.280 --> 0:18:50.480 and just got about thirty seconds. Well, I think if 0:18:50.520 --> 0:18:53.520 you're if you bought you right after the I p oh, 0:18:53.800 --> 0:18:55.840 and you still hold it now, I'm sure you're very 0:18:55.840 --> 0:19:00.760 happy regardless of how much he got paid. Um. We 0:19:00.800 --> 0:19:03.040 spoke to some former employees who pointed out that the 0:19:03.160 --> 0:19:05.600 company with an excellent shape already when he took over. 0:19:05.800 --> 0:19:08.080 Interesting kind of feel kind of feel bummed out for 0:19:08.119 --> 0:19:11.040 the two founders though. Man Um, it's a great, great read, 0:19:11.200 --> 0:19:12.879 And I told you you've got to check out the 0:19:12.880 --> 0:19:14.720 cover because I think I'm gonna go home and frame 0:19:14.760 --> 0:19:18.560 it because it's just adorable. You're listening to Bloomberg Business 0:19:18.600 --> 0:19:22.040 Week with Carol Messer on Bloomberg Radio. All right, so 0:19:22.119 --> 0:19:25.119 this story definitely caught my attention. I was reading in 0:19:25.200 --> 0:19:28.440 pretty early this morning on my way into one Lexington 0:19:28.560 --> 0:19:31.080 here at Bloomberg headquarters. It's a top story in my 0:19:31.200 --> 0:19:33.720 view at this hour, since as we watch closely COVID 0:19:33.760 --> 0:19:37.000 nineteens impact on our economy and its recovery, which has 0:19:37.000 --> 0:19:39.199 been so well described I think by Peter atwater over 0:19:39.200 --> 0:19:42.199 at William Mary as the K shaped recovery, which illustrates 0:19:42.400 --> 0:19:45.160 some Americans, they have been largely untouched by the pandemic. 0:19:45.200 --> 0:19:47.280 For others, the lower leg of the k it has 0:19:47.280 --> 0:19:50.280 been catastrophic. And maybe there's some folks in between that 0:19:50.359 --> 0:19:53.400 as some of the relief efforts start to come undone 0:19:53.440 --> 0:19:55.920 and stop, they're going to be in a tough way. 0:19:55.920 --> 0:19:58.199 This story is among the most read on the Bloomberg. 0:19:58.640 --> 0:20:00.600 It is about the year end fis school clifs that 0:20:00.600 --> 0:20:03.359 are approaching for millions of Americans. Let's get into a 0:20:03.400 --> 0:20:06.879 three picker. She's US economy reporter at Bloomberg and she 0:20:07.440 --> 0:20:10.800 is joining us on the phone in New York City. Read. Um, 0:20:10.840 --> 0:20:12.760 this is an important story. I really do think everybody 0:20:12.760 --> 0:20:15.679 has to stop listen because if we're worried about kind 0:20:15.680 --> 0:20:17.640 of where we are because of COVID, if we're worried 0:20:17.640 --> 0:20:19.600 about what's going to happen in the economy, especially with 0:20:19.600 --> 0:20:22.600 a lack of stimulus, you really lay it out what's 0:20:22.640 --> 0:20:26.520 at risk. So first of all, give us the big picture. Yeah, 0:20:26.560 --> 0:20:28.399 of course, and thank you for so much for having 0:20:28.400 --> 0:20:30.439