The Hub Cool News

Air vs. Overheads

overhead-binsSolving the overhead bins problem may take some airlines a decade, reports Scott McCartney in The Wall Street Journal (6/25/15). For many airlines, the problem is of their own making. By cutting the number of flights to fill more planes to capacity they made it impossible for some passengers to bring bags on board. A Boeing 737-900, for instance, “has about 180 seats” but only enough bin space for 125 carry-on bags. Charging fees for checked bags further compounds the problem, as it motivates passengers to use carry-ons instead. Some note that airlines may have this backwards. “We give away the most valuable space on the airplane — the overhead bin — and we charge for the least expensive space — in the belly,” says David Cush, CEO of Virgin America, which has no plans to change its policy.

Southwest has taken a different approach to solving the problem; it simply doesn’t charge for checked bags, which tends to reduce the number of carry-ons. The airline’s bins also accommodate carry-ons that are “2 inches longer, 2 inches wider and 1 inch deeper than American, Delta and United.” Southwest reports that this “makes it more attractive to travelers, and revenue from extra passengers exceeds potential bag-fee revenue.” Passengers on Spirit Airlines, on the other hand, must pay more for carry-ons ($35) than checked ($30) bags. Those rates go up to $55 and $50, respectively, at the airport. This also reduces the number of carry-ons, and Spirit says it also has improved its record of on-time departures because “flight attendants aren’t frantically checking bags that don’t fit.”

Delta’s possible solution is a valet service that has “airline staff load passengers’ carry-on bags,” on the theory that they can do so faster “and with less wasted space” than passengers. Boeing, meanwhile, is working on “a new bin design … with a bin that pivots up into the ceiling rather than being a fixed cabinet.” New planes can also be ordered with so-called “space bins that are large enough to turn roll-aboard bags on their side instead of lying them flat. That means six bags in each 60-inch long bin instead of four.” Then there’s the Air Transport Association, which proposes “worldwide guidelines that would shrink maximum carry-on sizes by about 21%.” This would force travelers either to buy new bags or pay to check their existing ones — either way paying “to solve a problem airlines created.”

Harley Kickstarts

harley-logoFor Harley, the new counterculture is where the rubber hits the road. As reported by James R. Hagerty in The Wall Street Journal (6/20/15), the motorcycle maker’s new CEO spends “much of his time thinking about how to pull today’s young people away from their electronic devices and onto the road.” It’s not that Matt Levatich necessarily thinks there’s anything wrong with screen time, just that perhaps people are ready for something else. “People are going to want to actually live for real,” he says, “and I think we have a product that has a great fit with that outlet.”

That product may not be your father’s Harley — “many of which sell for more than $30,000.” Harley now has Street bikes “priced as low as $6,800″ and “has demonstrated prototypes for a battery-powered LiveWire motorcycle designed for young, urban riders who think gasoline engines are bad for the planet.” Harley hasn’t given up on Baby Boomers, “catering to them by offering three-wheeled models and lower-slung two-wheelers that are easier to mount.” But the real challenge is to get a new generation on wheels, which is uphill even when it comes to Matt’s own teenaged sons.

Matt tried getting his kids interested in dirt bikes, but they didn’t bite. It was only after his older son’s Yale roommate expressed astonishment that “the son of a top Harley executive didn’t ride motorcycles” that he finally got himself a biker’s license. Harley’s other priority is to attract women and minorities, and hopes that its “smaller, nimbler” Street bikes will appeal to urban riders. It is also now making bikes in India as a gateway into Asia, which it expects to become its biggest market for Street bikes. Overall, Harley anticipates its greatest future growth will happen outside the US.

Narragansett Cool

narragansettA former industrial beer becomes cool by tapping into the local, craft-beer trend, reports Rebecca Greenfield in Bloomberg (6/12/15). In its heydey — the 1960s — Narragansett beer “produced up to two million barrels a year.” “It had a 65 percent market share, and it was a part of the very fabric of New England,” says Mark Hellendrung, its current owner. By the time Mark bought the brand in 2005, it was brewing “fewer than 600 barrels,” having become a watered-down shadow of its former self. The first thing Mark did was engage the brewery’s former brewmaster, Bill Anderson.

Bill “tweaked the recipe to add more hops and a maltier flavor,” which “also affected the color of the brew.” “It’s an aesthetic thing,” says Adam Bohanan, a bartender at Brew Inn, in Brooklyn, NY. “It actually looks slightly darker than PBR (Pabst Blue Ribbon). People see that, and they’re like, ‘oh, it’s a darker beer, and darker beers are normally better.'” Mark “also tapped Narragansett’s 125-year-old history to appeal to the younger, hipper crowd.” That history includes a memorable pop culture moment, a cameo in the movie Jaws. (video)

This has given Narragansett a point-of-distinction relative to PBR and Budweiser, and sells for “$4 to $6 for a 16-ounce can. PBR is around $3 to $4 for a standard 12-ounce can.” GuestMetrics reports it is “the cheapest of the top four fastest-growing beers in Brooklyn in the past year … trumped only by Allagash, Bell’s and Blue Point, three craft beers that can sell for almost twice as much as Narraganssett.” In 2014, Narragansett produced more than 78,000 barrels, generating $12 million in revenues, “up from just $100,000 in 2005.”

My Corona

coronaAn obscure winemaker is now one of America’s top breweries, reports Tripp Mickle in The Wall Street Journal (6/16/15). You may know Constellation Brands as makers of Mondavi and Clos du Bois wine, but is also the long-time distributor of Corona beer via a joint venture with Grupo Modelo called Crown Imports. When Anheuser-Busch InBev acquired Grupo Modelo, it had to let go of the Crown Imports deal as well as Nava Brewery, which involves 10 beer brands “and the rights to peddle Modelo beers in the US.”

Because it already had a deal with Grupo Modelo, Constellation was the obvious buyer, and the deal instantly made it “the US’s third-largest beer company by volume.” This surprised even Bill Hackett, Constellation’s head of beer. Beer now accounts for 53 percent of Constellation’s sales, driving its operating profit “to $1.02 billion from $448 million since 2013, dwarfing operating profit of $647.3 million from wine and spirits.” The challenge was that the US Justice department stipulated that Constellation make “100 percent of the beer it sells by June 2016.”

“The biggest question I got when this was announced was: What the hell do you know about brewing beer?” says Bill. Fortunately, “the 650 Modelo employees operating the Nava Brewery” know how to make beer. The real problem is making enough beer, as Nava currently produces only about 50 percent of the volume needed to satisfy the US market. So, the Nava Brewery will be doubled in size, and another brewery is planned near California. “We’re doubling capacity and brewing at the same time,” says Michael Othites of Constellation. “There’s nothing like it in the brewery world.”

Responsibly Grown

responsibly-grownWhole Foods is expanding its definition of what ‘best’ means, reports Stephanie Strom in The New York Times (6/13/15). The grocer’s new program, Responsibly Grown, designates fruits and vegetables as ‘good,’ ‘better,’ and ‘best’ based not only on how the produce was produced, but also “things like establishing a garbage recycling program, relying more on alternative energy sources, eliminating some pesticides and setting aside a portion of fields as a conservation area.” The net effect is that some growers not certified as organic can earn a rating higher than those who do.

This naturally has some farmers upset, with some saying “the program is a subtle way of shifting the costs of a marketing program onto growers.” “The reports we’re getting from speaking to farmers around the country are that they are spending anywhere from $5,000 to $20,000 to comply with this program,” says Tom Willey, a farmer of organic produce. Others suggest that Responsibly Grown is part of a Whole Foods effort to compete on price against the likes of Walmart and Costco by blurring distinctions between conventional and organic goods.

Not so, says Matt Rogers of Whole Foods. “Organic is an incredibly deep standard, and at Whole Foods we celebrate that in very consistent, long-term ways,” he says. “But the organic standard does not cover water, waste, energy, farmworker welfare, and all of these topics are really important, too.” The program arrives as Whole Foods loses its position as the top seller of organic foods to Costco, and announces a new chain of smaller-format stores designed to appeal to Millennials. The retailer has not yet said whether the new stores will carry organic produce.

Whole Foods Values

Hub Live: Jeannine D’Addario, CMO of Whole Foods, on translating the warmth of the in-store shopping experience to the digital world. (video)

Glass Eyes

google-glassGoogle Glass is finding a fertile market on factory floors, reports Bob Tita in The Wall Street Journal (6/315). The smart glasses don’t look so smart on people but they do make people look smart on assembly lines. The main problem Google Glass solves is the room for error inherent in looking back and forth between the task at hand and written instructions. At Boeing, for example, factory workers “had to rely on paper maps” to determine whether they were placing “dozens of coded wires into corresponding holes.”

With Google Glass, “an assembler reads out loud the coding on a wire” and “the correct hole on the electronic version of the map lights up and flashes, providing an easy-to-follow guide.” In addition to reducing “the error rate for wire insertions … to zero from about 6 percent … the time needed to assemble a wire harness has dropped by more than 60 percent.” Fred Edman of Boeing says Google Glass also is a comfortable fit with “a lot of the Millennials in the wire shop” who “are very knowledgeable about technology” and “took to it very quickly.”

So, while Google Glass fizzled on the consumer market perhaps because they looked goofy, it’s another story at factories, where people often wear goggles anyway. “Style points don’t get you very far in an industrial environment, but productivity does,” says Tom Bianculli of Zebra Technologies, which sells its own computer headset “for rugged industrial use.” The potential downside is that increased “work speeds could increase the risk of accidents or injuries,” as could the distraction of the pop-up messages. Others note that the devices could compromise “secure computer networks.”

The Elio

elioThe Elio has three wheels, costs $6,800 and gets 84 miles to the gallon. It will be made by Elio Motors — if founder Paul Elio can get another $230 million in funding, reports Jeff Bennett in The Wall Street Journal (6/4/15). That’s on top of the $70 million Paul has already raised from an angel investor and some 41,000 true-believers who have plunked down a deposit “ranging from $100 to $1,000” for a place on a waiting list. Those who opted for a non-refundable deposit — which is most of them — will get priority.

Paul’s goal is to sell 250,000 of his three-wheelers annually. “It’s a lot of vehicles, right?” he says. “But I believe we can sell to people in the new-car market, used-car market, those who drive clunkers and those who just want it, too … The Elio is personal transportation, and people are going to want one even though they own other cars.” Even if Paul is right about the potential market, he faces huge hurdles when it comes to financing his vision. “Our capital markets aren’t set up to fund a new car company,” he says.

Most venture capitalists “heads pop off” when they hear the Elio needs $300 million before it can start making money, says Paul, who is trying to cobble together most of the rest of what he needs through a loan from the US Department of Energy. If he succeeds, Paul plans to build the car in a former General Motors plant and sell it “directly to consumers through company-owned stores,” like Tesla. Paul is not a billionaire like Elon Musk, though — he has had to take a job as a roofer to pay bills while pursuing his three-wheeler dream.

Stubborn Soda

stubborn-sodaPepsiCo is bringing a “craft beer” sensibility to its latest soda fountain machine, reports Mike Esterl in The Wall Street Journal (6/5/15). Having watched the industrial beer business lose its head to small, local craft breweries, PepsiCo hopes to avoid a similar fate in the soda business with eight newfangled flavors, including agave vanilla cream, black cherry with tarragon, lemon berry acai, orange hibiscus and pineapple cream. The move comes as niche soda companies like Jones and Reed’s show significant growth.

Called Stubborn Soda, the new line will be dispensed from a machine resembling a beer tap, where users will pull on a handle to pour their drink. It follows last year’s introduction of Spire, a machine “that allows customers to make hundreds of drink combinations by touching a screen.” PepsiCo last year also “began slowly rolling out Caleb’s Kola, a craft cola in a glass bottle and marketed as containing ‘sustainable Fair Trade cane sugar and kola nuts from Africa’.” Using cane sugar and glass bottles are other key features of the “craft soda” boomlet.

Creating products consumers perceive as “more healthful” is further fueling the craft soda trend. Meanwhile, in the dairy aisle, the trend is toward high-fat yogurt because “consumers want food that is less processed … and that includes letting fat stay put,” reports Ellen Byron in The Wall Street Journal (6/3/15). “Some research has shown that dairy fat may actually lower the risk of obesity … because it makes you feel full,” which might stop you from eating a candy bar, or maybe having a soda, later in the day.

Brown’s Super Store

brownsA Philadelphia grocer has cracked the code on food deserts, reports Maanvi Singh on National Public Radio (5/14/15). Food deserts are urban or rural areas where locals don’t have access to “fresh, healthy and affordable food.” According to the US Department of Agriculture, there were about 6,500 food deserts as of 2012. Attempts to address this by opening supermarkets often fail for a variety reasons, but mainly because it’s hard to turn a profit in the grocery business under any circumstances, but especially in poorer neighborhoods.

Jeff Brown, a fourth-generation grocer, saw the issue differently. He reasoned that profits would be thin no matter what, so the first step was to ensure the store was selling what people wanted to buy. “Before we did anything, we brought together a group of community leaders, and we just asked them to tell us exactly what it is they were looking for in a neighborhood grocery store,” says Jeff. This manifested in offering Halal meat in Muslim neighborhoods and authentic sweet potato pie where African-Americans live, for example.

Brown’s Super Store (video) — of which there are now seven in the Philadelphia area — also “invests in skilled butchers, fishmongers and in-store chefs,” to make healthy choices more appealing. Brown’s also partners with local nonprofits to offer free financial and health services in-store. Jeff is thinking about adding a cafe, because “lower income neighborhoods don’t have a Main Street with bars and restaurants,” and has now started his own nonprofit, UpLift Solutions, to advise other grocers interested in opening stores in other food deserts.

Old Navy News

old-navyOld Navy is on a tear thanks to its new approach to selling clothes, reports Hiroko Tabuchi in The New York Times (5/18/15). Old Navy’s old approach — selling “clothes by the pound” — emphasized low prices with little to no regard for “the aspirations of low-income shoppers.” The basic idea was “to combine the style and quality of Gap clothing with the low prices and big selection of a Home Depot.” Its styles were adapted, “often clumsily,” from items its merchants would pick up from “higher-end retailers like Saks Fifth Avenue.”

“We were taking a product that was in the marketplace and we were bringing it to market maybe a year later,” says Jill Stanton, formerly of Nike and now Old Navy’s design chief. This has been replaced with a strategy Jill calls “fabric platforming” that allows “designers to quickly test various prints, shapes and sizes in small runs in stores before increasing the production of styles that were a hit with shoppers.” A new design team includes recruits from places like “Coach, Reebok and North Face” who obsess “over every detail.”

Old Navy also recruited Ivan Wicksteed, a former Coca-Cola creative chief, whose first order of business was cultural. “You have to start with the employees,” says Ivan. “If you can’t get your own people to want to get on board and change direction, then you’ll never persuade your own customers to do it.” One of Ivan’s first moves was to infuse its headquarters with “pop photography and upbeat music.” Last year, “Old Navy took in almost $6 billion in sales” — nearly as much as its sister chains — Gap and Banana Republic — combined.

Ugly Ducklings

birkenstocksA homely style of sandals is enjoying a run as haute couture accessory, reports Ellen Emmerentze Jervell in The Wall Street Journal (5/11/15). Birkenstocks — “clunky, orthopedically formed slabs with a rubber-cork-mix sole” have long been “a countercultural standard with hippies and tree-huggers,” and considered “the antithesis of fashion.” This image took an unlikely turn two summers ago, when Glamour “named Birkenstocks the shoe of the summer.” Vogue later endorsed the look “with a fresh pedicure and a ladylike dress.”

This came as a surprise to Oliver Reichert, chief executive of Birkenstock, a “240-year-old” German footwear manufacturer. “Fashion trends tend to roll over us,” says Oliver. The marketing budget for Birkenstock sandals is “close to nothing,” he says. “We are like dinosaurs in this business — we still think that a good product is all you need.” Yes, that plus some help at Paris Fashion Week in September 2012, “when Celine designer Phoebe Philo” paired “sleek clothing with bulky fur-lined sandals,” dubbed “Furkenstocks.”

Other designers followed with their own version of Birkenstocks — at prices as much as ten times that of the originals, which cost “about $100 a pair.” The Birkenstock boomlet is not expected to last past this summer, although some say they are permanently smitten by the sandal’s comforts and may never go back to “walking on a trail of cold metal.” Oliver is unconcerned: “When you have 240 years under your belt, you’ve seen many others come and go,” he says. “And when they’re all gone … Well, we’re still here.”

Zuckerberg’s Palace

gehry-fbFacebook’s new headquarters scales its “garage ethos” to that of an aircraft hangar, reports James S. Russell in The Wall Street Journal (5/7/15). To be precise, Facebook started in a college dorm room and the new Facebook digs is the size of “several hangars.” But the new space, designed by Frank Gehry, apparently is intended to take “Facebook’s workplace culture to a new level of fluidity and transparency,” bring out the hacker in its 2,800 inhabitants and “hatch new ideas.” (photos)

The result is “a soaring fishbowl, a contiguous 434,000 square feet on one floor. No one has a private office, so that everyone … is on view, accessible” — including founder Mark Zuckerberg, a recreational hiker who enjoys roaming its “intimate hallways” that “pass between the conference room clusters … expanses of desks, dappled with the sun from skylights above — a high-tech forest.” The space is designed “to make manifest his products’ style of sharing, collaborating, and organizing face-to-face sociability.”

Mark “and his management team sit in the middle of the floor, placing the maximum number of people at close range.” Workers “can turn or twist their desk clusters to optimize the visual and physical proximity of those with whom they work most closely.” The layout, says Facebook VP of People Lori Goler, “facilitates connection, empathy, openness,” not unlike Facebook itself. Frank Gehry’s design subsumes “his bravura tendencies to Facebook’s pragmatism,” allowing its founder’s vision to emerge “with extraordinary clarity.”

Go Enjoy

go-enjoyRon Johnson is back with a bid to re-invent the e-commerce experience, reports Farhad Manjoo in The New York Times (5/7/15). Ron, as you’ll recall, is both celebrated for his role launching the Apple stores and maligned for his time as CEO of JC Penney. His new venture, an e-commerce play called Enjoy, is designed “to create the friendliness of an Apple Store in people’s homes and offices.” The concept is to “send an expert to hand-deliver tech products” ordered online and help people set up and learn how to use them, “at no additional cost.”

Ron calls the concept “personal commerce.” “E-commerce today is primarily logistics and convenience — you order today, and, boom, get it tomorrow,” he says. While he believes that the traditional model isn’t going anywhere, he also thinks that the smartphone, and “local delivery networks” has introduced new possibilities. The idea does not fall far from the hugely successful Personal Setup service Ron “created at Apple that offers free in-store assistance to people who buy new products.”

“I remember when we launched that, Steve said, ‘Are you sure you can do that? Your stores are busy’,” says Ron. “But I thought it was the right thing to do. And within a matter of weeks of launching it, well over half the purchases were being set up in store.” The Enjoy model calls for a limited selection of “only about a dozen or so high-margin” items. Ron “believes that by limiting selection,” Enjoy can “squeeze enough out of each purchase to cover delivery and personal consultation.” Enjoy initially will be available in New York City and San Francisco only.

Art of Tiffany

tiffany-boxFrancesca Amfitheatrof has “the daunting task of restoring artistic luster to Tiffany,” reports Guy Trebay in The New York Times (4/16/15). “You have a company that’s 177 years old and still here,” notes Stellene Volandes of Town & Country. However: “if you really think of Tiffany & Company in the last couple of decades, there’s not been very much new or creative,” says Daniela Mascetti of Sotheby’s. “They have a legacy to respect but at the same time need to come up with new ideas to bring Tiffany to the forefront again.”

It’s an interesting challenge because, on the one hand, Francesca needs to design “high jewelry,” costing hundreds of thousands of dollars. For example, she created a $400,000 “jeweled bib” worn by Cate Blanchett at the Oscars that involved hundreds of carats of turquoise, diamonds and aquamarines “all contrived to imitate the effect of sunlight refracted through water.” (image) It set off a “frenzy of social media ‘likes’ and ‘favorites’.” Such pieces “increase the luster of a luxury brand in an increasingly competitive market.”

On the other hand, “Tiffany’s bottom line is built on far more prosaic stuff,” such as “Elsa Peretti’s silver heart on a chain — priced at $200.” (image) Francesca seems equally comfortable with both. “I don’t think about the value of the materials all that much,” Francesca says. Indeed, she’s known to pair “relatively worthless minerals like rock crystal with platinum, setting semiprecious gems like opals in diamond-studded bracelets.” “In general I try not to be intimidated,” says Francesca, “and just focus on the design.”

Brown Gold

brown-formanLike every astute marketer, George Garvin Brown, founder of the Brown-Forman Company, began with a keen insight. The year was 1870. Mr. Brown was a pharmaceutical salesman and his new venture was selling bourbon to pharmacies. The insight was that his product’s purity would set it apart. So, he produced the first-ever bourbon sold in bottles, which he sealed and personally signed at the distillery. That was a very cool innovation, made possible by emerging bottling technologies. The depth of George Brown’s insight did not stop there, however. It wasn’t so much that his bourbon was the first to be bottled; it was that the brand was sold that way exclusively. It was his way of assuring customers that the integrity of his bourbon hadn’t been compromised.

Can you name that drink? It wasn’t Jack Daniel’s, a whiskey which records show wasn’t established until about five years later. It was Old Forester, which legend has it was named after a pharmacist, and is today the world’s oldest bourbon brand (it outfoxed Prohibition by gaining designation as a medicinal product). Brown-Forman didn’t acquire Jack Daniel’s until 1956.George Brown’s great-great grandchildren continue to build both labels, which are currently riding an astonishing, millennial-fueled whiskey revival.

Jack Daniel’s is, of course, the best known of the company’s many brands, a genuine article of Americana and pop culture, unbound by the usual brand shackles of generation, geography or psychology.What makes this possible? Chief Brands & Strategy Officer Lawson Whiting says it’s all about real people, real stories and a real place: Lynchburg, Tennessee. “Stories about a town with one stoplight resonates with many different age groups,” says Lawson. “At first glance it might not seem to, but it really does.”Authenticity may have devolved into a marketing cliché in a world draped in artifice, but for Brown-Forman, it is a time-honored way of life. Read The Hub Q&A with Lawson Whiting of Brown-Forman.

Tough Lovin’

tough-lovinScarcely a day goes by without news-media coverage about what’s gone wrong at McDonald’s and what to do about it. With a new CEO coming on board, we thought this would be a good time to ask Cool News readers to weigh in: Can McDonald’s recover? What should it do? Clearly, all that glitters is not Golden Arches at the moment. Our survey found that 73 percent are “not lovin’ it” and give Mickey D’s just two gold stars out of a possible five. The overwhelming majority of respondents (96%) said they eat fast food, with 64 percent of those doing so at least once a month.

However, 50 percent said they ate at McDonald’s less frequently than two years ago, and just eight percent said they were eating at McDonalds more often today. This pattern didn’t exactly parallel overall opinions of the chain, which 55 percent said was unchanged relative to two years ago, and 34 percent said had worsened. Only 11 percent said their opinion of McDonald’s had improved.To some extent, these changes in dining habits had to do with life stage: “I haven’t eaten at McDonald’s since my kids were little,” wrote one respondent. For others, it was just the reverse: “I have kids now and don’t want them to get used to it.”

Still others said their kids no longer liked the food, with one reporting that “kids are taught at school not to eat at McDonald’s.” The primary reason, however, simply seems to be the quality of the food, which only one percent deemed ‘excellent’ and just eight percent said was ‘very good.’ A respectable 34 percent said the food is ‘good,’ however slightly more (38%) said it was just ‘fair,’ and 18 percent judged it ‘poor.’ Several commented that the food gives them a stomachache. In terms of what McDonald’s needs to do to fix this, ‘fat content’ was the number-one issue, cited by 58 percent of respondents. Continue Reading.

Work Rules!

work-rulesGoogle spends twice as much on recruiting than the average company, reports Daniel Freedman in a Wall Street Journal review of Work Rules! by Laszlo Bock (4/8/15). That’s all the more startling given that Google attracts “around two million applicants every year for a few thousand positions.” The reason is that “the best and brightest are usually not looking for a job.” So, Google cultivates them, “sometimes over years … networking with them through phone calls and emails, doing whatever it takes to get them hired.”

In some cases, this has meant “agreeing to hire away entire teams and open new offices.” Also unlike other companies, Google doesn’t “limit where they recruit from and the avenues from which to apply.” Instead, they “increase access” and use “smarter filters. In Google’s case this involves using an internal tool called qDroid that provides interviewers with pre-formulated questions.” Most important is a “work test.” For example, “watching how the person would solve a coding challenge” is a more useful filter than reading a resume.

Google stays away from job boards and recruiting firms — the former because they produce few hires and the latter because they “tend to provide specialists and Google wants generalists.” While “it’s harder to get a job at Google than it is to get accepted at Harvard … the company today prefers ‘to take a bright, hard-working student who graduated from the top of her class at a state school over an average or even above-average Ivy League grad’ because Google prioritizes resilience and overcoming hardship.”

PayPal Mafia

paypalA surprising number of today’s most valuable tech companies have their roots in PayPal, reports David Gelles in The New York Times (4/2/15). Uber, Airbnb, LinkedIn, Pinterest, Yelp, Square, YouTube and, yes, Tesla, all include PayPal people in their family tree. The phenomenon is all the more striking given that PayPal’s own success happened “against all odds,” notes co-founder Max Levchin. “Like veterans of an intense military campaign, we fall back on lessons learned, and relationships established in our early 20s,” says Max.

After eBay acquired PayPal in 2002, its founders “emerged as among the few willing to invest in new tech startups.” “We went from this bunch of misfits to the center of the ecosystem,” says Keith Rabois, now a partner in Khosla Ventures. “Entrepreneurs needed capital, and the only place to get the capital was from us.” Informally, the PayPal alumni are known as the PayPal Mafia, and are “all men, mostly white, and under the age of 50.” In many ways, their story underscores the old adage that “success begets success.”

“If you have a name that’s associated with success, people will seek you out,” says Jeremy Stoppelman, a former PayPal vp of engineering. “Why do smart people go to Harvard? Because previous smart people went to Harvard,” he says. Adds Scott Banister, a former PayPal board member: “We have a very good collective resume … It’s not just that you’re associated with the company, it’s that you’re associated with the other people associated with the company.”

Delivering Joy

krispy-hubliveKrispy Kreme Is About More Than Doughnuts. Since 1937, Krispy Kreme guests have lined the block for a taste of its signature hot “Original Glazed” doughnuts. Now in 23 countries, this iconic brand’s secret to success comes from knowing their business is about more than selling doughnuts: it’s about delivering joy.

At Hub Live: The Retail Experience Symposium (April 23, NYC) Chief Marketing Officer Dwayne Chambers explains how Krispy Kreme’s simple purpose “to touch and enhance lives through the joy that is Krispy Kreme” drives the decisions that have shaped the experience people crave today. And, yes, there will be Krispy Kreme doughnuts and coffee for everyone! Tap Here For More Information & Registration Details.