Poppi Poops, A New Anti-Woke Exchange, Ultra Basic – less than basic fares, Shein Shines, the Richest Man to have ever lived and advice from Nasir of Bablyon

Greetings, folks, and a warm welcome to the 5th Edition of Friday Finance Weekly. I hope everyone has come back to earth after the euphoria generated by the Bank of Canada cutting their rates by 0.25%. There's lots of buzz about another rate cut in July—do it already! I was going to elaborate on Tesla/Musk/Nvidia, but it's all over the news, so I'll keep it brief. It seems like Tesla is going to punish the company if the shareholders don’t approve his $56B pay package. They already got a taste of this when $500M worth of chips from Nvidia intended for Tesla was diverted to X. Well, X is going to start allowing adult content, so the extra AI might be required for AI-generated content (I think you know what I mean).

If you’re like me and got sucked into the Poppi soda craze, I have news for you. They are being sued as part of a class-action lawsuit.

• The functional beverage brand claims their product improves gut health and features the slogan “Be Gut Happy. Be Gut Healthy” on their can.

• According to the plaintiff, each can of Poppi contains around 2 grams of prebiotic agave inulin fiber, an amount that’s insufficient to provide any meaningful prebiotic benefit. In her lawsuit, the plaintiff cites research showing that daily consumption of 7.5 grams of agave inulin over the course of three weeks was still insufficient to confer a meaningful benefit. Translation: it doesn’t do anything for your gut health, but hey, there is a placebo effect, right?

• Poppi has responded, saying they believe (do they just believe or do they know?) the lawsuit is baseless and vowed to rigorously defend itself against the allegations.

• Financial Data (All figures in USD):

  • Per BevNET, Poppi surpassed $100M in retail sales in 2023, a reported 148% increase relative to the prior year.

  • Per Forbes, Poppi is the number one selling soft drink on Amazon with a 19% market share (1.5 times bigger than Coke).

  • Over the last two years, Poppi has amassed over 204 million social media impressions, helping the company enter 5 million new households in 2024. Their Super Bowl commercial was the most-watched commercial of the game, reaching 29.1 million viewers.

I always wondered if they picked the name Poppi because it was so close to poopy? Anyways, it does seem like this brand may suffer irreparable damage if the claims are true. Then again, health benefits don’t have to be verified, just like naturopaths (Oops, I hope I didn’t offend any ‘Dr’s of naturopathy). (Source: AP)

A new anti-woke (I must admit I still don’t know what this means) exchange is starting. A group of investors out of Texas announced plans to register The Texas Stock Exchange with the SEC later this year.

• So far, they have raised $120M from groups including Citadel and Blackrock.

• The TSXE takes aim at other national listings with its pledge to minimize burdensome regulations and be more 'CEO-friendly' (i.e., unaccountable). This stance draws a clear distinction from the Nasdaq, which requires companies on the exchange to meet diversity requirements or provide an explanation on why they can’t.

• While other groups that have attempted to compete with major exchanges have been unsuccessful, backers of the TXSE see major opportunity in the Southeast’s flourishing economy. Texas is now tied with New York as the state with the second most Fortune 500 companies.

Given the backing of private equity, I suspect this exchange will do well. Heck, sources say Truth Social has already announced a move and will bring the MAGA faithful to the exchange (not confirmed to be true, the sources are my thoughts). I do, however, see all the major oil companies listing on this exchange, especially given their CEO-friendly policies. Want to bribe a government official for an offshore drilling license? Don’t fret, let’s expense it as a consulting fee. (Source: Economist)

You’ve heard of basic fares; now get ready for ultra-basic. WestJet is giving customers the option of flying with even fewer services at a lower cost.

• The new offering, which replaces WestJet’s basic fare, mimics strategies used by ultra-low-cost carriers like Flair Airlines.

• Passengers who select the “UltraBasic” fare option will be allowed one personal item, which must be stored under their pre-assigned seat at the back of the aircraft.

• Comparing rates for EconoFlex versus UltraBasic, I found the following:

  • Vancouver to Cancun: $262 v. $396 (34% cheaper)

  • Vancouver to Honolulu: $235 v. $295 (20% cheaper)

  • Vancouver to Toronto: $154 v. $299 (49% cheaper)

To maximize revenue, they are offering additional seats in the cargo hold. It's cold, so you can buy a parka for $200. I mean, isn’t anything less than basic mean the new less-than-basic is the new basic? I guess calling it ultra-basic makes more sense somehow? Air Canada is going the other direction by offering free beer and wine on all North American routes. Air Canada, well played, and you win! (Source: Calgary Herald)

Heard of Shein Fashion Group? They're bigger than H&M. In a big win for the London Stock Exchange (yes, you almost forgot about the LSE), online fashion retailer Shein said it was planning to confidentially file for a London listing ahead of an initial public offering in the UK. I don’t really understand how you can confidentially file for a public listing, but anyways.

• The Singapore-domiciled company had initially planned an IPO in New York; however, tensions between Washington and concerns of Chinese state involvement caused Shein to reconsider.

• The on-demand e-commerce group, which was last valued at $66B, recorded profits exceeding $2B in 2023. For reference, rival H&M reported net profits of just $826M in their most recent fiscal year.  

• Estimated Financial Data:

  • Estimated revenue of $32.5B in 2023 – a 43% increase relative to 2022.

  • An estimated 88.8 million active shoppers with 17.3 million in the US.

  • 238 million downloads in 2023 – the most downloaded fashion app of the year.

Fast fashion brands are taking over the retail space. Zara pioneered the model, but it appears that other groups are perfecting it. There is a debate of if it's pronounced ‘shine’ or ‘sheen’. Let’s see how this group does; they are obviously doing something right. The fast fashion trend only continues to grow and explains why old styles keep coming back. Just please don’t bring back tie-dye shirts. (Source: FT)

The richest man to have ever lived is actually not Bezos or Musk; it's Mansa Musa. "Contemporary accounts of Musa's wealth are so breathless that it's almost impossible to get a sense of just how wealthy and powerful he truly was," Rudolph Butch Ware, associate professor of history at the University of California, told the BBC. Here is a BBC ranking of the richest men in history:

1. Mansa Musa (1280-1337, king of the Mali empire) wealth indescribable

2. Augustus Caesar (63 BC-14 AD, Roman emperor) $4.6tn (£3.5tn)

3. Zhao Xu (1048-1085, emperor Shenzong of Song in China) wealth incalculable

4. Akbar I (1542-1605, emperor of India's Mughal dynasty) wealth incalculable

5. Andrew Carnegie (1835-1919, Scottish-American industrialist) $372bn

6. John D Rockefeller (1839-1937) American business magnate) $341bn

7. Nikolai Alexandrovich Romanov (1868-1918, Tsar of Russia) $300bn

8. Mir Osman Ali Khan ( 1886-1967, Indian royal) $230bn

9. William The Conqueror (1028-1087) $229.5bn

10. Bernard Arnault (1949-present) $207B

To give you an idea of Mansa Musa’s wealth, when he traveled on a pilgrimage to Mecca, he traveled with 60,000 people, 21,000 kilograms of gold, 100 elephants, and 80 camels. He spent so much money on his trip that he caused the value of gold to plummet and inflation to skyrocket in Cairo. That brings me to the last part of the post.

This week's book summary is ‘The Richest Man in Babylon, Six Laws of Wealth by Charles Conrad.’

This book tells the story of Nasir from Babylon – a 7,000-year-old tale of a man who accumulated an incredible fortune through his six secrets to wealth. The key takeaway from this story is that through determination and consistently following the six laws of wealth accumulation, anyone can become rich.

• The first law of wealth is to save at least (and never less than) 10% of your income for yourself.

• Put your savings to work as soon as possible but be sure to invest wisely. Do your research before investing, focus on businesses you feel passionately about, and be sure to fully understand how the industry works.

• Before you start investing, pay off your debts and don’t incur new ones. Prioritizing your debts and paying them down consistently will help you establish credibility.

• Never sign up for get-rich-quick schemes. A business to invest in should be making a consistent profit and returning dividends to investors.

• Diversify your investments and establish business partnerships. Look for a variety of ways to invest your money and never put all your eggs in one basket. If you’re not confident about the industry you’re investing in, find a trustworthy business partner who can help you vet your options.

• The end beneficiary of your investment is always yourself. Safeguard your ever-growing wealth by diversifying your assets and purchasing reliable insurance.

Apologies if this was a bit lengthy, feedback is appreciated. As always I welcome feedback (mostly positive) and don’t hesitate to forward this to friends or family.

Have a great weekend.

Cheers,

Sam