Rishi Taparia - Issue #102
This week we look at where WeWork was right, the Philadelphia Eagles’ management team, Rolls-Royce’s electric plane, Amazon’s virtual medical clinic, why the creator of the labradoodle regrets his work and more. Enjoy!
WeWork’s Adam Neumann Was Right About One Thing: Someone Needs to Reinvent Work
The gripping saga that is WeWork reached a crescendo this week as CEO Adam Neumann (and most of his close compatriots) stepped down. Neumann is transitioning to a non-executive Chairman role and his voting rights have been slashed by 85%. There are a number of pieces on how we got here, but this one from the WSJ struck me as unique. Writer Sam Walker suggests Neumann was able to raise so much money and paint such a lofty picture of WeWork because he was taking aim at work itself, the rulebook for how we work, written a century ago by another innovator with a messianic streak: Henry Ford. Ford not only reengineered the automobile, he “viewed building a company as a chance to re-engineer society”. He established the 9-5 a century ago, its repetition and mundaneness largely unsatisfying but enough to satisfy life’s other needs. However, life’s needs have changed significantly, and understandably so.
Modern workers aren’t just content to be happy at home. They want work to be fulfilling, too…young workers have never been less likely to thrive in the old Ford system. Research shows they’re better educated, more concerned with finding social purpose at work and less resistant to changing jobs. High debt loads often force them to delay or forgo buying a home, getting married or having kids.
Today workforce management is more critical than ever, as employees demand more than just a steady paycheck. Workers demand scheduling flexibility, compelling work and the ability to grow. Investors know this, companies know this and workers know this. This is what Adam Neumann seemed to be tapping into - a new way to work, live and play built for the millennial age.
Mr. Neumann may not be the Millennial Prophet, but it’s easy to understand why investors might have tolerated, or even appreciated his quirks and grand ambitions. After all, Henry Ford was a deeply flawed fellow with a messianic streak.
It’s also possible that there simply isn’t any profitable way to turn offices into human fulfillment zones. Maybe the problem with work is that no matter how you dress it up, it’s still work. Maybe Henry Ford’s deal is the best one we’ll get.
One thing is certain, though. There’s a fortune to be made by trying.
We will just have to wait and see.
Neither, and New: Lessons from Uber and Vision Fund
This week Ben Thompson wrote a fantastic piece on companies that are “Neither and New”, certainly worth reading in its entirety. A snippet below, describing one reason companies like the Vision Fund, investing heavily in companies like Uber and WeWork that are neither technology companies nor can they be compared to the traditional counterparts, is applying faulty logic:
The problem, though, is Vision Fund may have confused “big capital needs” with “big opportunity”. What is striking about the firm’s portfolio is the paucity of “tech companies”. Almost everything falls in the “Neither and New” category defined by Uber: entire categories like real estate and logistics are defined by their interaction with the physical world, almost everything in the consumer category uses technology to enable real-world services, and the other major category, fintech, by definition needs huge amounts of capital. Most of these companies may have income statements that seem attractive in isolation, but when viewed from a total revenue perspective in fact have extremely low gross margins (relative to tech companies) and very high marginal costs.
The NFL Team Run by Women
Let’s get one thing out of the way: I am a Philadelphia Eagles fan. I’m not going to hide it. Please don’t let this impact your reading of this article which, I admit, I loved.
There aren’t enough women and minorities at senior levels at companies across the board. There are more men named John who are CEOs of Fortune 500 companies than women. When it comes to sports and the NFL, “only 35% of jobs in the league office are held by women.” Enter the Philadelphia Eagles: winner’s of Superbowl LII, defeaters of Aaron Rodgers and the Green Bay Packers this past Thursday and where more than half of the senior leadership team are women.
Rolls-Royce Looks to Develop the World’s Fastest Electric Plane
Commercial aviation is among the hardest things to turn electric. Storing the amount of energy required to power a jet over long distances via batteries has historically led to insurmountable weight challenges - it just gets too heavy. This week Rolls Royce announced their attempt to solve this problem. The ACCEL plane, expected to have its inaugural flight next year, will be able to travel 200 miles on a single charge (London to Paris no problem), traveling at a speed of up to 300mph. Certainly slower than the usual 500-600mph of a fuel based plane, if they can pull it off it could be a major milestone in conquering flight and the 2% of global emissions that come from airlines a year.
Amazon launches Amazon Care, a virtual medical clinic for employees
Last year Amazon announced a partnership with JP Morgan and Berkshire Hathaway to combat rising costs of care. This week Amazon introduced Amazon Care, a virtual primary care clinic with an option for nurses to visit employees in the home. Currently only a benefit for employees, Amazon Care will provide a way for the company to test some of its ideas before commercializing them.
Labradoodle Creator Says the Breed Is His Life’s Regret
“The inventor of the labradoodle, the ubiquitous, mopheaded designer dog, said that creating the mixed breed was one of his life’s regrets.” That’s the opening line of this NY Times article that followed an interview by Wally Conron, creator and crossbreeder extraordinaire who, among other things, bred the world famous labradoodle. I admit, this was the article this week that totally shocked me, and that’s saying a lot considering the insanity that has been this week (yes, each of those is a separate article…). Every labradoodle I’ve encountered has been nothing but a bundle of licks, yips and hugs and every doodle owner I know (literally every. single. one.) has tried to convince my wife and I to get one. And oh, have we come close! I’m sure he has his reasons, some of which he discusses, but dang.
I mean, how can you not love that!
Taps’ Notes: The Untethered Soul
I read The Untethered Soul a few years ago on the recommendation of a close colleague. If I had to summarize what The Untethered Soul offered me in a short phrase, it would be an alternative approach. In it, Michael Singer (who also wrote The Surrender Experiment) outlines the importance of coming to terms with the self, what understanding “You are not the thinking mind; you are aware of the thinking mind” unlocks for the individual, and his approach to looking inward. Prior to reading it I had never put much stock into things like meditation and didn’t take time on a very regular basis to reflect on myself and the activities and individuals in my life that were sources of energy. I now try to meditate on a regular basis and practice gratitude and joy by starting every morning by writing for myself, a take on Morning Pages that Julia Cameron espouses in The Artist’s Way. Despite the book dragging a bit and a bit heavy handed with platitudes, I found value in the reading.
Quote I’ve been thinking about: “If you choose that man, the man who did something no one else had done, and can figure out how he did it, you get insights into the essence of power.” - Robert Caro