Or, in Toys âRâ Usâ case, Chapter 11.
[The Hustle]( Wed, Sep 20
Apparently, Toys âRâ NOT Us
Sorry kids, but on Monday, Toys âRâ Us filed for Chapter 11 bankruptcy, in an attempt to fix itâs outstanding $6.6B debt.
This is the [second largest]( retail bankruptcy of all time, in terms of assets at the time of going under (Kmart leads the pack, and itâs a big olâ gap).
This year, more than a dozen large retail chains have filed for bankruptcy, due in large part to one-stop online shops like Amazon and âheavy discountersâ like Wal-Mart.
But letâs take a step back
The 6-year-olds inside all of us canât put all the blame on Amazon for these money issues. Back in 2005, Toys âRâ Us became stricken with debt from a $6.6B [buyout]( by a group of investors such as KKR Group, Bain Capital, and Vornado Realty Trust.
And, according to TRU CEO David Brandon, reports earlier this month of the company hiring a law firm specializing in bankruptcy set off a âdangerous game of dominoes:â within days, nearly all of the companyâs vendors refused to ship products without cash in advance.
This forced Geoffrey the Giraffe and his 1,600 stores to scramble to raise [$1B for its suppliers](.
Which proved to be pretty poor timingâ¦
Because of course, Toys âRâ Us is currently building their inventory for the Q4, AKA the holiday season -- which accounts for 40% of their sales.
But luckily, yesterday, Christmas came early when courts granted Toys âRâ Us Inc. permission to borrow more than $2B to start paying suppliers up front and delay what we hope is not the inevitable for the former toy giant.
Unfortunately, they still have a long way to go. But, hey, if Santa can deliver toys to every boy and girl in a single night, maybe Geoffrey the Giraffe can figure something out after allâ¦
Readers, meet optimism
Patreon gets a big cash infusion
The platform where fans can fund their favorite artists, podcasters, and writers with monthly donations has just raised a [$60m Series C]( round, placing their valuation somewhere in the ballpark of $400-450m.
In the past 4 years, Patreon has grown to support a stable of 50k artists who rake in a combined $150m in contributions for everything from music to erotic art.
Still, Patreon is only set to make $7.5m in 2017 -- and investors are banking that the companyâs business model will draw in creators from other, more popular platforms.
The companyâs got a different ethos
Back in [2013]( a guy named Jack Conte poured his life savings into creating a music video⦠but, when he published it on YouTube, it didnât make enough in ad revenue to cover his expenses. So, he launched Patreon with the intent of âfunding the creative class.â
From the beginning, Patreon has only taken a [5% cut]( on the money its creators raise, compared to the 55%+ that YouTube and Facebook take. Instead of relying on ad dollars, artists on Patreon raise directly from the fans who appreciate their work.
Money in the coffer
Patreon says it intends to use the latest funding round to expand its team (currently at 80 employees) and grow its fan base (which currently sits at 1m subscribers, paying an average of $12/month each).
The site is adamant about sticking to its 5% cut, but eventually, theyâre hoping to [make money]( through services like marketplaces for merch and event tickets -- and in the meantime, artists donât have to starve.
[Will podcast 4 food](
âOhh how the tables have turnedâ -- Uber
In what Bloomberg calls â[a rare legal offensive]( Uber is now suing their own ad agency, Fetch, for $40m.
And thatâs not just a dig at their recent legal troubles -- or the 250 other lawsuits brought against them over the years. As a company, Uberâs typically been the last to lawyer up: theyâve only launched 2 federal cases against an outside party in their history.
Why the falling out with Fetch?
According to the [lawsuit filed Monday]( Uber began getting complaints about their ads showing up on Breitbart, despite blacklisting the site from their ad campaign.
To cover their tracks, Uber claims that Fetch misattributed clicks from Breitbart to sites like âMagic_Puzzles,â and âSnooker_Champion.â
And, despite spending $82.5m on advertising through Fetch from 2016 through Q1 2017, Uber says they saw no net drop in installations (paid mobile attribution fell, but organic downloads made up for it).
So now, theyâre suing Fetch for fraud, saying they wasted millions on ânonexistent, nonviewable, and/or fraudulent advertising,â and that they claimed credit for downloads that happened âwithout a customer ever clicking on an ad.â
Seems like reason enough for a lawsuitâ¦
And looking like the good guy for once doesnât hurt either
Aside from publicly shunning a sketchy site like Breitbart, if it turns out Uberâs right and their user growth has been almost completely organic, not from paid advertising, thatâs a really good look for their company.
As [Quartz]( puts it, âthe entire complaint is basically an ad for how terrific Uberâs organic user growth isâ -- so, ironically, Fetch may have helped them more than clickbait ever could.
[Get âem, Uber](
A new generation to sh*t on
According to a 40-year-long study out of San Diego State University, Gen Zâers (kids born between the early-â90s and mid-â00s) arenât as into scoring fake IDâs or making out in the back of their â77 Dusters as prior generations were.
The study, which worked off a survey taken by[8.3m]( teens between 1976 and 2016, proved todayâs teens were found to be way less likely to drive, work, go on dates, have sex, or even go out with their parents.
Wait, no sex and no hanging out with parents?
What a bunch of prudes
According to the study, by the early 2010s, 12th-graders were going out less, getting wasted less, and fornicating less than eighth-graders did in the early 1990s. (In â91, 54% of high school students were getting busy, as opposed to 41% in the early 2010s.)
Unfortunately, these dips in all things fun over the years have snowballed into significant labels for Gen Zâers: studies show they are definitely the most tolerant of generations -- but theyâve also been labeled less rebellious, less happy, and completely unprepared for adulthood.
So why is this?
Weâre not going all âMillennials suckâ on the Z-team(â¢). As one of the studyâs authors, Jean Twenge, stipulates, todayâs youth arenât any more lazy or lame than prior generations -- they are just a product of their environment.
A majority of the so-called âiGenâ have never known a world without iPhones, Snapchat, or Instagram (Hell, a lot of them donât even know what dial-up Internet is). Some scholars blame the effects of technology for the rocketing [suicide rate]( among young folks.
But the best conclusion to draw from all this is that every generation is more complex and nuanced than grandpas, pundits, and even academics make them out to be. Or, to sum it up in the words of an angsty teen: âYou donât know me!â
[Kids these days](
let's hang out
Hey Hustlers,
A few weeks ago I told you about 2X -- the storytelling event weâre hosting next month. Well, you all seemed puhreeetty excited about it. In fact, weâre practically sold out of tickets already.
And since you were so amped on that, I think youâre gonna really like this new event series that weâre putting together. Itâs called Rise & Grind -- and itâs an event that happens in the morning, before your workday even begins.
Here's how it works: You show up and make yourself a big olâ plate of breakfast and spend some time hanging out with people in your field.
Then, a panel of industry experts share their strategies, stories, and tips. You'll leave the event feeling inspired and energized.
Ok⦠but what are the talks actually about?
Great question. We have 3 of these Rise & Grind events scheduled so far. Hereâs what youâll learn:
- [Sept 27]( How to use content to acquire new customers (San Francisco)
- [Oct 04]( How to become a world class salesperson (Austin, TX)
- [Oct 18]( The benefits and science behind biohacking (San Francisco)
All of these events cost $15 to attend, including breakfast and coffee. And, since they start around 8am, youâll be at work in time for your first meeting.
[Click here to see the speaker list and book your spot](. BTW, we have room for about 100 people at each event.
See you there.
â Kera, event planner + chief dog treat distributor
This edition of The Hustle was brought to you by
Confessions of Becca, a bag-lunch-forgetter
I used to always forget to bring my lunch to work. And it sucked.
Itâs the worst feeling -- and everytime it happened, Iâd end up snacking away my sorrows, or spending way too much on a pad thai lunch special that guaranteed Iâd be dozing off by 3pm.
Then one day, sitting around The Hustle lunch table, I realized everyone else had delicious looking sammies -- B.L.A.T.s, to be exact. I learned theyâd all joined MealPal -- a [subscription lunch service]( that lets them choose a lunch from a huge variety of local restaurants (like 21st Amendment, SOMA Eats, and American Grilled Cheese Kitchen) every day.
Basically, MealPal is the ClassPass of lunch ( it was actually created by the co-founder of ClassPass). Plus, you can order ahead of time to skip lines, and get lunch for less than $6 per day.
SIX DOLLA LUNCH IN SAN FRANCISCO, MAN.
So now, instead of sulk-snacking (or blowing my budget), I just pull up my lilâ MealPal [map in the app]( scope out all of the options around the office, and pick out my grub. No more sad snackinâ for this broad.
[MealPal]( helps hungry peeps like you and me eat lunch all across the world, and they just launched dinner in NYC. Since they like us so much, theyâre letting Hustle readers skip the invite process and sign right up -- [check it out](
--Becca, a well-fed account manager
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