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Get your popcorn, the ousting of Zuckerberg might be happening soon

(BUSINESS NEWS) Zuckerberg holds total control over Facebook, but activists and shareholders stress there needs to be a balance – and they are prepared to fight him on it.

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Do not pass go

After endless back and forth, a consumer watchdog group is calling for Facebook founder, Mark Zuckerberg to abscond his position as chairman of the board. Speaking of boards, have you every played Monopoly with someone who gets so mad they flip it so no one can win? Zuckerberg seems to be about to do that, or worried his investors might take away his lead.

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What did Zuck do?

A recent lawsuit filed against Zuckerberg claims his latest move to retain control over Facebook was tainted. As in, he was sneaky texting under the desk during class to cheat during the exam. As we’ve reported, Zuckerberg was covertly communicating with another committee member to get inside details during a hearing addressing Facebook’s capital structure.

He was receiving inside information about how to best sway other board members to retain his position. So not quite a board flip, but shady playing nonetheless.

Zuckerberg holds total control over Facebook, but activists stress there needs to be a balance.Click To Tweet

SumOfUS, the group who introduced a proposal, says Facebook needs “a balance of power between the CEO and the board” in order to succeed.

Shareholders in cahoots

The group notes that Facebook’s board cannot effectively represent the interest of all shareholders if Zuckerberg retains his position.

They emphasize the need for greater accountability on Facebook regarding hate speech, harassment, and fake news.

Additionally, SumOfUs warn that Facebook could act against investors without repercussion if there is not an independent board chair.

Since SumOfUs sent the proposal to Facebook, at least 1,500 shareholders have signed. Out of those, four investors have agreed to help SumOfUs file the shareholder proposal. SumOfUs cites Facebook’s nonvoting stock decision last year as the tipping point. They note this is indicative of potentially problematic behavior that comes from having one person serve as both chairman and chief executive.

Will Zuck agree to the terms?

Zuckerberg’s changes to shares means that stocks are split up so that even if he gives the promised 99 percent to charity, he will not lose any voting power. The new Class C shares don’t entail voting rights, so selling any would not change his position, which essentially spells lifetime control over Facebook. This isn’t necessarily a bad thing for those who agree with Zuckerberg’s leadership.

However, it does mean that shareholders who oppose him will have very few routes to do so in a meaningful way.

Zuckerberg’s sneaky shareholder infiltration last year doesn’t bode well with many.Click To Tweet

In most other developed countries, the roles of chief executive and chairman of the board go to separate people. While there is no conclusive evidence that splitting these roles benefits a company, one person filling both can be a conflict of interest.

In Zuckerberg’s case, we still have yet to find out if he’s going to pack up his game and go home or give other people a chance to play.

#Zuckerberg

Business News

$100m reimagined convenience store startup to open 25 stores in 2022

(BUSINESS) Foxtrot is looking to redefine the convenience store as we know it. This startup is looking to make it a whole new experience.

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Laptop with Foxtrot convenience store locations in Chicago.

Move over 7-11, there’s a new player in town! There’s always room for competition, even in the world of convenience stores. Yes, you read that right, Quick Trip has some serious competition from a newcomer, Foxtrot.

Foxtrot is a curated, modern convenience store offering a brisk 30-minute delivery and 5-minute pick-up. It was created by Mike LaVitola and Taylor Bloom in 2014. These stores will undoubtedly be popular in walkable areas, but also with their online ordering convenience. This modern version of a convenience store offers the combination of an upscale corner store with a digital-first e-commerce platform. Sounds pretty glorious, right?

However, the original convenience store is safe as long as people are traveling and need to stop for gas or a restroom break.  If you’re from Texas, then you know and love, Buc-ee’s, the Texas-born chain. Buc-ee’s have been creating their own in-store products garnering a cult following among their customers. Still, Buc-ee’s doesn’t have an online ordering or delivery option unless it’s offered through a third party.

Foxtrot has raised $160 million in Series C funding and they are expecting to open 25 locations in many cities in 2022. There are a few different levels of funding. If a company makes it to Series C funding, they are already successful and looking to expand or develop new products per Investopedia.

According to Retail Dive, “About half of the new stores will be in Chicago, Dallas and Washington, where all of the 16 stores Foxtrot currently operates are located, LaVitola said. The tech-focused retailer is also planning to begin operations in Boston and Austin, and intends to open four or five new stores in each of those cities during the next year and a half, he said.”

Foxtrot is testing out technology equipment that would allow customers to leave the store without stopping to checkout at the counter. They plan isn’t to go entirely self-service, but as the creator LaVitola stated, “the more hours we can allocate towards sampling and storytelling and interacting with customers and less [on] tasks that don’t add on to value, like checkout, that’s great.”

Foxtrot is redefining convenience by including carefully curated products. They aim to offer local popular products as well core pantry items. They aim to make the commonly unpleasant experience of convenience stores enjoyable. Let’s hope they succeed.

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Business News

What small business owners can learn from Starbucks’ new D&I strategy

(BUSINESS) Diversity and inclusion have been at the forefront of Starbucks’ mission, but now they’re shifting strategy. What can we learn from it?

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Hands of all different skin colors on green background representing Starbucks' D&I.

Starbucks was one of many companies that promised to focus on diversity and inclusion efforts after the death of George Floyd by Minneapolis police in 2020. What sets Starbucks apart from other companies were its specific goals.

How It Started

They began with hiring targets and have now added goals in corporate and manufacturing roles. Starbucks’ plans and goals revolve around transparency for accountability. They released the annual numbers for 2021 as a way to help hold themselves accountable. The data they’ve released so far show that they’ve met nearly a third of their 2025 goals according to Retail Brew. Because of this information, we can see why they are choosing to move in the direction of manufacturing and corporate jobs. In 2021, POC’s fell to 12.5% of director-level employees from 14.3% in 2020 in manufacturing.

How It’s Going

Per Starbucks’ website stories and news, “[I]t will increase its annual spend with diverse suppliers to $1.5 billion by 2030.  As part of this commitment, Starbucks will partner with other organizations to develop and grow supplier diversity excellence globally.” To put that into perspective, they spent nearly $800 million with diverse suppliers in 2021. With these moves, by 2030, it will increase by almost double.

As part of their accountability and progress, they plan to partner up with Arizona State University to give out free toolkits to entrepreneurs on fundamentals for running successful diverse-owned businesses. Another goal they’ve listed is to boost paid media representation by allocating 15 percent of the advertising budget to minority-owned and targeted media companies to reach diverse audiences.

At the heart of all this information on their goals and future plans, data transparency and accountability are what’s forcing them to look at the numbers to make specific goals. They are doing more than just throwing money at the problem, they are analyzing how they can do better and where the money will make a difference. Something that, as entrepreneurs, we should all do.

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Business News

Peloton is back-pedaling: Reports of price increases, layoffs, and cost cuts

(BUSINESS) After a recording of layoffs leaks, ‘supply chain’ issues cause shipping increases, and they consult for cost-cutting, Peloton is doomed.

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Man riding Peloton bike with instructor pointing encouragingly during workout.

Is Peloton in Trouble?

According to many reports, Peloton had success early in the pandemic when gyms shut down. Offering consumers a way to connect with a community for fitness along with varying financing options allowed the company to see growth when many other industries were being shuttered.

After two years, CNBC reports that the company is “being impacted by …supply chain challenges” and rising inflation costs. According to the report, customers will be paying an additional $250 for its bike and $350 for its tread for delivery and setup.

As demand has decreased, Peloton is also considering layoffs in their sales and marketing departments, overheard in a leaked audio call. The recording details executives discussing “Project Fuel” where they plan to cut 41% of the sales and marketing teams, as well as letting go of eCommerce employees and frontline workers at 15 retail stores.

Nasdaq reported that the stock fell 75% last year, after a year where it soared over 400%.

Peloton reviewing its overall structure

According to another report from CNBC, Peloton is working with McKinsey & Company, a management consulting firm, to lower costs as revenue has dropped and the growth of new subscriptions has slowed since the pandemic. Last November, according to NPR, Peloton had “its worst day as a publicly-traded company.” It also anticipates greater losses in 2022 than originally predicted. It makes sense that the company would reexamine their strategy as the economy changes. They aren’t the only one that is raising prices amid supply chain issues.

It will be interesting to watch how Peloton fares

Peloton has a large community that pays a monthly fee for connected fitness. While growth has slowed, the company still has a strong share of consumers. Although it is facing more competition in the home fitness market and more gyms are reopening, as Peloton adjusts to the new normal, it should remain a viable company.

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