CBx Vibe: “Nike Boots” Wale
Heads continue to roll at sportswear giant Nike (NKE +1.20%), since the departures of Nike president Trevor Edwards. Now Antoine Andrews, head of diversity and inclusion, and Danny Tawiah, VP of global brand digital marketing innovation, have left the company. Will Nike be able to turn around its business and achieve its $50 billion revenue target by 2020?
Why This Matters: Nike is nearly rudderless as the company continues with a turnaround plan developed by several of the executives now leaving. During the company’s Investor Day last fall, Trevor Edwards had a large speaking role charting the path forward for Nike returning to dominance of the sportswear category. On the call, he detailed how the company would hit its $50 billion revenue target. The company forecasts its women’s business doubling to $11 billion and its direct-to-consumer business growing to $7 billion. It is unclear who will take over responsibility for hitting these targets.
Another departing executive, Daniel Tawiah has been at the company since 2006 and led high-profile campaigns, like Nike’s branding for the 2014 World Cup. With so many of these executives leaving, the ability of the company to hit these targets is becoming questionable.
Situational Awareness: Nike CEO Mark Parker announced he would be staying at the company until 2020. How long until Parker’s leadership is challenged considering the apparent boy’s club environment at the company? Investors are sure to ask this question and more as details about the company’s culture comes to light. Read More
CBx Vibe: “Maintain” Belly
Home Depot (HD +0.37%) announced a “home-improvement project” of its own in the form of a massive tech hiring spree. The $200 billion dollar home improvement retailer is embarking on the biggest technology hiring binge in its history, as it plans to bring on more than 1,000 I.T. workers. What impact will this bold hiring move have on black workers across the country?
Why This Matters: The uptick in hiring for Home Depot will occur across three cities, Atlanta, Austin, and Dallas. The company already employs 2,800 I.T. people. New hires will focus mainly on software engineering and improving the digital user experience across the company’s slate of retail services.
About 90% of the software the company runs is already written by in-house engineers. At least two of the cities where they will be actively recruiting for more engineers have high diversity rates for STEM workers. In Atlanta for example, about 24% of the STEM workforce is black and 18% of the STEM workforce in Dallas is black, according to SmartAsset. This means Home Depot should have a large pool of African American engineers to select from.
After the end of its fiscal year in January Home Depot reported revenues of $100.9 billion, with its stock up 30% over the past two years. The plan to hire more than 1,000 tech workers this year is part of a broader $11 billion three-year strategic investment to hopefully fend off Amazon (AMZN -0.63%). Read More
CBx Vibe: “Cut It” O.T. Genasis
Walmart (WMT -1.01%) is gearing up for another battle to win over low-end consumers through a new pricing strategy. The front lines of this war will play out in minority communities across the country, as they battle chains like Big Lots (BIG -0.24%), Dollar General (DG +0.70%) and Family Dollar. Just how valuable is the black consumer’s dollar for the budget friendly chains Walmart is trying to dethrone?
Why This Matters: When it comes to spending power African Americans make up 14% of the U.S. population but have outsized influence in this arena. Financial firm Raymond James put out a note highlighting the price impact Walmart has on other discount chains, which happen to have a large black shopper demographic. “Walmart pricing for national branded consumables, which includes laundry detergent and cereal is now 4.4% lower compared to Dollar General and 6.5% below Family Dollar,” the note said.
If we look at the power of the black dollar across these same consumables, black people spend nearly $830 million a year on detergent and more than $573 million on personal soap and bath needs, according to Nielsen. It’s not just low income shoppers that frequent these dollar stores. Customers with household incomes of more than $70,000 claim they also shop at dollar store chains. Read More
CBx Vibe: “No Security” Skepta
TaskRabbit took its website and app down April 16 through April 18, as a result of a cybersecurity breach. The company has since brought its site back online, with an ongoing investigation underway. Has TaskRabbit CEO Stacy Brown-Philpot set a new precedent for how technology companies should handle cybersecurity breaches?
Why This Matters: News of cybersecurity breaches at some of the most high-profile companies in the world seems to be the new normal. What’s unique about this breach is the speed with which TaskRabbit addressed it. The company took immediate action to communicate with TaskRabbit users soon after discovering the breach, while also setting the expectation for future updates.
Equifax (EFX +0.62%), Uber, and Yahoo (VZ +1.59%) on the other hand, are examples of companies that did not respond effectively. They took as little as two months or up to two years before going public with news of their breaches. Companies took an average of 191 days in 2017 to discover a breach, and another 66 days to contain it, according to the Ponemon Institute.
Diverse leadership provides companies with more problem-solving tools, broader thinking, and better solutions, according to research by McKinsey & Company. The companies experiencing these problems will need a broad toolkit to address what can become very expensive issues down the road. The Ponemon Institute also found the average cost of a breach to a U.S. company in 2017 was $7.35 million.
Situational Awareness: On top of tackling cybersecurity breaches, U.S. executives are increasingly concerned about the specter of China dominating the technology space. The country released a report three years ago delineating the 10 industries it planned to control by 2025. All signs point to the country making significant strides in achieving this goal. Look out for how the U.S. private sector and the Trump Administration respond to these two headwinds. Read More
CBx Vibe: “Story” Odie
Obama nominee Mignon Clyburn, who is one of five commissioners for the Federal Communications Commission (FCC) is stepping down. She has been a fierce advocate for net neutrality since joining the FCC in 2009. How will the loss of a major net neutrality advocate further diminish the FCC’s willingness to regulate internet service providers?
Why This Matters: Clyburn’s eight-year tenure focused on the needs of low-income and minority communities is coming to an end. She always weighed the human cost or benefit of a decision on things like net neutrality, broadband access and media regulation. "I’ve done all I know to do. And it’s time for me to serve in another way," she said.
As part of the Democratic majority that approved the net neutrality rules in 2015, she has since been a vocal critic of their repeal in December 2017. The rules required internet service providers like Comcast (CMSA +1.99%) and Verizon (VZ +1.59%) to treat all web traffic equally as it passes through their networks. This is no longer the case for these ISPs going forward, and with Clyburn leaving there’s one less gladiator in the ring protecting the consumer’s experience and interests.
What is Net Neutrality? Simply stated it’s ‘Open Internet’ meaning people can always access any lawful content. Now that the Trump administration has done away with these rules all consumers are vulnerable. Powerful ISPs can favor content providers who have the money to pay for better access. Ultimately this impacts the quality of your internet connection but helps to increase telecommunication companies profits. Read More
CBx Vibe: “Nice For What” Drake
A new kind of ‘immunotherapy’ cancer treatment could become part of the standard medication process. Merck’s (MRK +2.41%) latest finding has the ability to massively affect hundreds of thousands of people with lung cancer. How can this new medical process possibly extend the lives of black cancer patients?
Why This Matters: The second most commonly diagnosed cancers among black men and women is lung cancer. Merck's immunotherapy drug Keytruda along with chemotherapy has cut the risk of death in people with lung cancer by half, according to data presented at the American Association of Cancer Research's annual meeting.
Lung cancer accounts for the largest number of cancer deaths among black men at 27% and black women at 22%. This makes lung cancer the leading cause of cancer death in African Americans. Not to mention, black people have the highest death rate and shortest survival of any racial and ethnic group in the U.S. for most cancers, according to the American Cancer Society.
The new combination Merck has presented of Keytruda and chemotherapy has the ability to lower these statistics. Unlike chemotherapy, which involves administering powerful drugs that kill both cancerous and healthy cells, immunotherapies are designed to help the immune system identify and knock out just the cancerous cells. Read More
CBx Vibe: “Back Then” Mike Jones
Wall Street titans are making a mad dash for black art. Billionaire hedge fund managers Steve Cohen and Kenneth Griffin both recently donated high profile pieces to the Museum of Modern Art (MoMA), an apparent coup for the museum. What will it take for black artists to secure the same sale prices of their contemporaries in the industry?
Why This Matters: Like Mike Jones said, “back then they didn’t want me, now I’m hot they all on me.” Within the last decade, black artists have increasingly become a focus of the art world. Since 2010, the MoMA has secured 430 pieces by black artists. Last year, a painting by Jean-Michel Basquiat sold for $110.5 million, the sixth highest price for a piece at auction.
Curators like Derby English, who the MoMA brought on as an adjunct curator in 2014, and Zoe Whitley, who has been at Tate Modern since 2013 have helped to raise the profile of black art. Yet, the underpinnings of the $45 billion art market are quite narrow and don’t appear conducive to broadening the number of black artists who can secure high-dollar prices for their works. Twenty auction houses account for 70% of the public art market and 30 art dealers control a third of gallery sales, according to Rachel Pownal, Maastricht University finance professor.
What’s Next: Auction house Sotheby’s has an Impressionist & Modern Art auction on tap for May 14, though it has not yet listed the catalog of pieces. Watch out for the number of black artists whose pieces make the catalog and what they ultimately sell for. Read More
CBx Vibe: "Black America Again" Common feat. Stevie Wonder
African American art is at a seminal moment in art history. We are seeing the gains of the Obama administration with regard to more museum and gallery exhibits by African American men and women. While at the same time, a reclaiming of history that has been sparked in no small part by the current administration.
Stephen Towns: Rumination and a Reckoning at the Baltimore Museum of Art is a must-see exhibit. Town reaches back into the history of quilt making and the incredible women of Gees Bend Alabama who created some of the most important pieces of American Art. "His quilting practice delves into the perspective of women and people of color and draws on that knowledge to interrogate the institution of slavery in American History,” said Cecilia Wichmann, Curator. This reclamation of history in this visual way is powerful and speaks to everyone who experiences it.
For more art insights check out Cheryl McGinnis (Curator, Flatiron Prow Art Space, New York) Read More
CBx Vibe: “Legacy” Jay Z
Travis Holoway figured out the best way to solve his own problem of people wanting to borrow small amounts of money through SoLoFunds. It’s a peer-to-peer lending exchange platform which allows people to obtain loans that are less than a $1,000. The main problem here is traditional banks don’t lend small amounts and payday lenders have high interest rates. “This is not a black and brown issue this is a national epidemic,” Holoway said. People going through a short financial struggle get to set their own terms as borrowers and then the lenders seamlessly loan them the money. SoLo which stands for Social Loans has a unique way of looking at credit worthiness through an individual's social capital. Define social capital. Holoway is aware social capital hasn’t been widely accepted in the U.S. yet, but says “People are a lot more empathetic than society would like us to believe.” The next goal is to graduate people to more traditional financial resources once they’re ready. Read More
CBx Vibe: “Soco” Starboy feat. Wizkid, Ceeza Milli, Spotless & Terri
Kenya-based startup mSurvey raised a $3.5 million series A round led by TLcom Capital Partners to expand its operations to South Africa. Will this six-year old startup bring light to the darkness around consumer data across Africa?
Why This Matters: Consumer spending will reach $2.5 trillion in Africa by 2025, according to McKinsey & Company. The more data companies have on consumers, the better they will be able to target them with products that meet their wants and needs. McKinsey’s projection could be significantly higher considering the low amount of data present on African consumers, particularly those living, working, and consuming in the continent’s informal sector. Africa’s informal economy makes up 38% of Africa’s GDP, according to the IMF.
What is the informal economy? This is the part of an economy neither taxed nor monitored by a government. This lack of monitoring reduces the amount of data companies have available to shape their business decisions. mSurvey is changing this using mobile surveys to provide clients with real-time insights on what’s happening with consumers. This is a solution very similar to what Survey Monkey provides its enterprise clients in the U.S. Around 80% of Africa’s 1.2 billion people use a mobile phone, according to the GSM Association. This provides mSurvey with a large market to gain insights from as it scales to more countries across the continent.
Situational Awareness: mSurvey raised its initial seed funding from Cross Culture VC, a venture capital firm that invests in entrepreneurs who are moving the needle in the technology and consumer industries. The firm has invested follow-on capital in an second seed round, in addition to the $3.5 million series A round. Look out for the additional investments Cross Culture VC will make in Africa’s startup space as a result of the insights mSurvey garners from its conversations with consumers. Read More
Sub-Saharan Africa’s economic growth to hit 3.1% in 2018
Angola, South Africa, and Nigeria are projected to drive Africa’s growth
CBx Vibe: “All the Way Up” Fat Joe, Remy Ma, French Montana
The World Bank projects Sub-Saharan Africa will see its economic growth hit 3.1 percent in 2018, continuing its gradual recovery from the steep drop in commodity prices in 2015. What will African countries need to do to ensure they remain on a steady growth path?
Why This Matters: The news that Sub-Saharan Africa’s growth remains on an upward trend is encouraging. Yet, the continent remains vulnerable to external forces like a reduction in metal prices or another drop in commodity prices. “This underscores the need for countries to build resilience by pushing diversification strategies to the top of the policy agenda,” said Punam Chuhan-Pole, World Bank Lead Economist.
The three countries driving a lot of Africa’s growth are Angola, South Africa, and Nigeria. All of these countries have a significant reliance on resources and have developed plans for diversifying their economies. The key will be to see how they execute on those plans in coming years.
Situational Awareness: The World Bank notes electrification is a key lever for Africa driving higher rates of economic growth. US-based startups Fraym and Nithio are providing solutions to address different parts of the electrification problem. Fraym uses GIS-data to provide hyper local insights to clients like power companies figuring out where the customer demand is in a city. Nithio, is a finance platform focused on scaling off-grid solutions to meet needs of the 600 million people across Africa who don’t have access to modern power. Look out for the impact new entrants into Africa’s energy space will have on increasing rates of electrification across the continent. Read More