Business Owners Aren’t Buying Remote
Will they be able to keep their best employees?
Good morning!
Here are today’s highlights:
It’s like a dating app for co-founders.
Is Salesforce overpriced?
Facebook copies another innovative startup that’s getting traction.
HUMAN RESOURCES
Business owners say remote work hurts productivity. Can they keep their employees? “In a survey of more than 1,000 U.S. business owners released last week by Digital.com, a Seattle-based review site focused on small businesses, 45 percent reported that their companies aren't getting as much done while their employees are working from home. The survey further suggests employers disagree with research that finds people are equally or more productive while working from home: 39 percent of respondents said they would fire employees who refused to return to the office. Among companies that reported their employees were completely office-based before the pandemic, that figure rose to 44 percent.”
“‘Companies that focus on physical location and hours worked will be behind the curve,’ Dennis Consorte, Digital.com's small business expert, said in the survey results. ‘Otherwise, their most valued employees may seek out remote opportunities elsewhere.’” READ MORE
Y Combinator releases a platform to connect co-founders: “Its new co-founder matching service will allow founders to fill out profiles about what their interests are and what attributes they're looking for in a co-founder. ‘We realized this is a problem a lot of founders face, particularly internationally," [Kyle] Corbitt said. ‘I think it's less of a problem if you've gone to Stanford or live in San Francisco where there's a stronger established network that makes it easier to find people, but our community is all over the world. We have startup founders in 190 countries.’
“A common match is non-technical founders looking for technical founders, said Catheryn Li, an engineer at YC who built the service.”
“After founders match, YC sends them a survey and encourages them to work on a project together. It's even templated an agreement to help dodge co-founder disputes.” READ MORE
SMALL BUSINESS TECHNOLOGY
Is Salesforce overpriced? Gene Marks, whose company implements Salesforce and other CRMs, says it depends: “For starters, it depends on what you want from your CRM system. If you just want simple contact management for a relatively small workgroup, then Salesforce Essentials – its lowest-priced product at $25 per user per month for up to 10 users – is perfectly fine. Other CRMs may come in a few dollars less or more, but for the most part it’s competitively priced and does position you to scale if your company grows. ... At the next level up, Salesforce starts to get pricier. Its Professional version is priced at $75 per month per user and pretty much has the same features and functionality as Zoho CRM (and others) where the pricing can be half as much.”
“Whenever I encounter a company unhappy with Salesforce it’s almost always because it wasn’t implemented the right way (or the company is only using a fraction of what it offers). You’re never going to get fired for choosing Salesforce.” READ MORE
RETAIL
Shopping mall owners are looking to ghost kitchens for revenue: “[Sam] Nazarian said his new venture, Creating Culinary Communities, which counts investors such as shopping-mall giants Brookfield Asset Management and Simon Property Group, has plans for 1,000 ghost kitchens by the end of the year. ... The company’s first food hall will open in New York City at Manhattan West in September, as people return to work as summer ends. The 40,000-square-foot space will include some of C3’s more than 40 brands, among them Umami Burger and Krispy Rice, a delivery-only sushi-restaurant concept.”
“As more kitchens reopen for dine-in service, C3 and its investors say they don’t expect an easing of pandemic restrictions to take the luster off their delivery businesses.”
“Sales in markets that have reopened might dip for a week or two, but then ‘we seem to go right back to full steam ahead,’ said Michael Beacham, REEF’s president of kitchens.”
“‘Every type of restaurant is looking for alternatives to brick-and-mortar right now,’ said Jon Goldsmith, CEO and co-founder of Local Kitchens, a San Francisco-based ghost-kitchen startup.” READ MORE
COMPETITION
Facebook is doing it again: “Whenever a new online medium gains momentum — whether it’s photo-sharing (Instagram), messaging (WhatsApp), live video (Meerkat), ephemeral stories (Snapchat) or social audio (Clubhouse) — Facebook is sure to follow. So it was no surprise when the company announced last week a near-clone of Substack, the fast-growing newsletter platform that connects notable writers directly with subscribers [the 21 Hats Morning Report is published on Substack]. But how, skeptics wondered, could Facebook — whose relationship with journalists is notoriously frayed — compete against a start-up that has built its reputation on catering to writers’ needs? The answer, it turns out, is by offering them financial terms that Substack can’t match.
“Substack makes money by taking a 10 percent cut of writers’ revenue. Facebook’s cut of subscriptions on its newsletter platform, Bulletin, will be a tidy zero percent, at least for now.”
“‘The goal here is to support millions of people doing creative work,’ Facebook chief executive Mark Zuckerberg told reporters.”
“Those familiar with Facebook’s track record could be forgiven for suspecting that the company is motivated by something more than altruism here.” READ MORE
INFRASTRUCTURE
The condo collapse in Florida points to much larger issues: “While this kind of sudden, wholesale building collapse is very rare, the problem of crumbling concrete isn’t at all. It’s a slow-moving crisis that affects much of the world. Billions of tons of concrete in the form of buildings, roads, bridges, and dams may need to be replaced in the coming decades. That will cost trillions of dollars—and generate staggering amounts of climate-change-fueling carbon emissions.”
“Concrete fails and fractures in dozens of ways. Heat, cold, chemicals, salt, and moisture all attack that seemingly solid artificial rock, working to weaken and shatter it from within. (Rising temperatures and atmospheric carbon levels are expected to make things worse.)”
“That threatens not just apartment towers, but our concrete-based infrastructure. A 2021 report by the American Society of Civil Engineers found that more than 20,000 concrete bridges across the U.S. are structurally deficient and nearly half the nation’s public roadways are in ‘poor’ or ‘mediocre’ condition.” READ MORE
MARKETING
Business owners are taking advantage of the Supreme Court ruling on college athletes: “On Thursday, for example, Iowa basketball player Jordan Bohannon made a paid appearance at Boomin Iowa Fireworks, a fireworks store in Windsor Heights, Iowa. Miami football quarterback D'Eriq King has announced endorsement deals with three local businesses--a junk hauling company, a car dealership, and an outdoor bar. Such rapid movement is unsurprising: Some businesses and athletes have been preparing since September 2019, when California Governor Gavin Newsom signed the state's Fair Pay to Play Act into law. That law will allow in-state college athletes to commercialize their names, images, and likenesses as of January 1, 2023—effectively setting a deadline for the NCAA to create its own policy on the issue.”
“For small-business owners looking to get in on the action now, [sports agent Leigh] Steinberg has two pieces of advice:
“Try to find athletes who haven't yet signed partnerships with other companies, because your advertising power is diluted when your spokesperson also represents other brands.”
“Find the right athlete—or athletes—for your specific business, rather than simply snapping up the most easily attainable player. There are research tools that can tell you, if you're in Athens, Georgia, what names carry the most marketing power, Steinberg says.” READ MORE
SPONSORED
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LITIGATION
A lawsuit offers evidence of racism at Tesla’s Fremont factory: “When Aaron Craven clocked in to work every day at the Tesla Fremont factory, he knew he might hear or be called the N-word. When he walked into the bathroom stalls, he knew he might see graffiti of ‘KKK’ or a swastika. I was directly called n----- and n---- approximately 100 times at the Fremont factory,’ Craven said in a sworn statement. ‘I heard the terms n----- and n---- used over 100 times by co-workers, and by my lead Auggie, in the Tesla factory.’”
“‘My understanding is that people refer to the Tesla factory as the Plantation and call employees cotton workers because Tesla treats its Black employees like slaves,’ [Aaron Minor] wrote in a sworn statement.”
“These sworn statements and 103 other declarations sworn under penalty of perjury comprise a 500-page exhibit filed in March 2021 as part of a 2017 lawsuit that alleges Tesla discriminates against Black people and has allowed a racially hostile work environment to fester in its factories.” READ MORE
THE 21 HATS PODCAST
Episode 67: Why Did Your Business Succeed? This week, we talk about how much of success is making the right decisions. How much is being in the right place at the right time? And how much is just luck? “I think that's the thing nobody wants to talk about,” Paul Downs tells us, “because it implies that there's a lot to success that is out of the control of the entrepreneur, and we're much more attracted as human beings to stories of people who have agency and are like, ‘Oh, there's a problem. I did this, and I won.’ That's what we like to hear.” So yeah, there’s always luck involved. But there are always forks in the road, and someone has to decide which way to go. This week we hear how a few of those decisions played out.
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