There Are More Snakes than Ladders
There Are More Snakes than Ladders
A new platform is designed to let underrepresented employees share honest reviews of their employers.
Good morning!
Here are today’s highlights:
Shanghai’s lockdown is coming to an end.
Elon Musk takes a stand on remote work.
The big players are starting to eye the cannabis industry.
FINANCE
The Treasury is releasing new funding for small businesses: “A federal pandemic aid program aimed at boosting small businesses’ access to capital is getting off the ground more than a year after it was authorized, when firms are now facing the headwinds of high inflation and the growing risks of an economic downturn. The Treasury Department this month began distributing nearly $200 million to five states through the State Small Business Credit Initiative, a $10 billion program that directs money to states, territories and tribal governments for programs that provide capital or encourage private lending. The initial money will fund venture financing in Maryland and lending to small manufacturing businesses in Michigan, among other programs.”
“State officials say the program could help spark small-business job creation ahead of any potential economic slowdown and makes funding available at a time when firms face rising economic uncertainties.”
“‘In the immediate term, things are good, but looking out ahead, there’s a huge amount of uncertainty,’ said William Dunkelberg, chief economist at the National Federation of Independent Business, a small-business advocacy group.” READ MORE
HUMAN RESOURCES
An entrepreneur, Ekow Sanni-Thomas, built a platform where diverse workers can share honest reviews of their employers: “His negative experience at his last job sparked the idea for his startup, Inside Voices, an online platform for diverse workers to submit anonymous reviews of their employers. It's similar to other review sites, like Glassdoor or Indeed, but it's designed to share the unique perspectives of underrepresented employees. Sanni-Thomas says transparency is one way to equip workers of color with the knowledge they need to find the right company.”
“‘The only reason that companies are able to get away with this is because there's no transparency,’ Sanni-Thomas said. ‘There's no place for us to hold them accountable. That's where Inside Voices intends to come in.’”
“Charting a career as a Black employee in the corporate world is like a game of Snakes and Ladders, Sanni-Thomas said, referring to the board game where ladders send you up toward your goal and snakes take you back toward the starting line.”
"’There's a lot more snakes than there are ladders.’” READ MORE
Seattle passed a bill to raise wages for gig workers: “The bill, co-sponsored by Councilmembers Lisa Herbold and Andrew Lewis, requires companies to pay per-minute and per-mile rates to delivery drivers on apps like DoorDash, Uber Eats and Grubhub, beginning when drivers accept an order. The new requirement, which goes into effect in 2023, is designed to allow contract workers to earn the city’s $17.27 minimum wage and receive the standard mileage reimbursement set by the Internal Revenue Service.” READ MORE
OFFICE SPACE
Elon Musk weighs in on employees who don’t want to come into the office:
Crypto companies are grabbing office space in Manhattan: “The cryptocurrency market has been in a meltdown. Digital currencies, along with other blockchain-based properties, have plunged in value, lending credence to skeptics who have regarded the crypto phenomenon as a fad. But crypto companies appear to be here to stay in New York, at least for the foreseeable future, judging from the way they have been leasing Manhattan office space. It would seem contradictory that businesses known for decentralization and digital assets are even interested in real-world space.”
“Remote work is common at many web3 companies, which include cryptocurrencies and platforms for nonfungible tokens, or NFTs.”
“But for the last couple of years, cryptocurrency firms have been setting up or expanding offices in New York, often in edgier, somewhat peripheral locations, as opposed to marquee parts of Midtown Manhattan.” READ MORE
THE ECONOMY
Shanghai’s two-month lockdown is ending: “The easing of restrictions takes effect Wednesday, but already Tuesday evening social-media posts showed residents swarming the streets, chanting and dancing and posting images of themselves eating out at local restaurants. The majority of the 25 million residents of China’s financial capital can leave their homes and return to work starting Wednesday, the Shanghai government said. Aside from those in high-risk areas, all businesses can reopen, buses and trains will resume normal operations, and restrictions on private vehicles will be lifted.”
“A 50-point plan to accelerate the city’s recovery was unveiled by officials over the weekend, with tax cuts for companies and measures to stabilize supply chains and encourage consumption, including incentives for buyers of electric vehicles.”
“The city alone accounts for almost 4 percent of China’s gross domestic product, supporting a vast hinterland of suppliers in neighboring provinces that have seen outbreaks and lockdowns of their own.” READ MORE
U.S. Home prices had their biggest surge in 35 years: “The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, rose 20.6 percent in the year that ended in March, up from a 20 percent annual rate the prior month. March marked the highest annual rate of price growth since the index began in 1987. The inventory of existing homes on the market in March sat well below normal levels for that time of year, making it difficult for buyers to compete and pushing prices higher.”
“In recent weeks, the housing market has shifted, said Danielle Hale, chief economist for Realtor.com. ‘As buyer confidence sags and weighs down demand, real-estate markets will rebalance, eventually tilting away from the heavy advantage that recent home sellers have enjoyed.’” READ MORE
LOGISTICS
Supply chain issues are causing a shortage of popcorn: “Now playing at a theater near you: a suspense drama over whether there will be enough popcorn for the summer moviegoing season. The plot was palpable at CinemaCon, an annual convention for movie-theater operators this spring. The Las Vegas event floor had a festive vibe, coming after two years of pandemic-darkened screens. A-list vendors such as Mars Wrigley (M&M’s, Snickers, Twix) hawked sugary wares near makers of polyester theater-worker vests and seating experts modeling the latest in auditorium recliners. But there was also a foreboding. Theaters are finding workers harder to hire, and inflation is hitting costs.”
“Perhaps most chilling, supply-chain issues are foreshadowing shortages behind the concession stand, a crucial profit driver for theaters.”
“‘Popcorn supply will be tight,’ projected Norm Krug, chief executive of Preferred Popcorn, a company of about 150 farmers supplying the kernels to theater chains.” READ MORE
POLICY
Erika Lucas says state abortion laws are already affecting startups in red states: Lucas, a former private equity partner, co-founded StitchCrew, an independent organization that partners with Google and the NBA’s Oklahoma City Thunder to support women and entrepreneurs of color in the region. Lucas has been focused on economic development in Oklahoma for nearly 20 years, and has become a prominent voice in the startup community and an advocate for underrepresented people in the startup industry.”
“The main problem that we're going to see—and I don't think that this is going to affect just startups, but our economy and our industry, in general—is talent.”
“We have an unemployment rate that is actually under 3 percent statewide, which means our local employers that are already here can't find talent.”
“When it comes to entrepreneurship, I will tell you: If I'm talking to women, they're telling me they're not moving here. They're not applying to our programs.” READ MORE
States are punishing companies for trying to protect the environment: “In Texas, a new law bars the state’s retirement and investment funds from doing business with companies that the state comptroller says are boycotting fossil fuels. Conservative lawmakers in 15 other states are promoting similar legislation. And officials in Utah and Idaho have assailed a major ratings agency for considering environmental risks and other factors, in addition to the balance sheet, when assessing states’ creditworthiness. Across the country, Republican lawmakers and their allies have launched a campaign to try to rein in what they see as activist companies trying to reduce the greenhouse gasses that are dangerously heating the planet.”
“‘We’re an energy state, and energy accounts for hundreds of millions of dollars of tax revenue for us,’ said Riley Moore, the West Virginia state treasurer. ‘All of our jobs come from coal and gas. I mean, this is who we are.’”
“‘We have an existential threat here,’ Mr. Moore said. ‘We have to fight back.’” READ MORE
CANNABUSINESS
Most players in the cannabis industry are small and little known: “In that mix, however, is a 154-year-old company that is a household name: Scotts Miracle-Gro. Over the past decade, the lawn and garden giant has quietly entrenched itself in the young and fast-growing industry. Its Hawthorne Gardening Company subsidiary has scooped up the biggest players in hydroponics, lighting and other supplies used for growing. Now, Scotts is ramping up its involvement by throwing its lobbying weight behind legalization efforts, and funneling money into investments that eventually could enable the company to sell cannabis directly to consumers.”
“In 2021, Hawthorne comprised nearly 30 percent, or $1.4 billion, of Scotts' overall sales, up from 25 percent in 2020 and a 20 percent share in 2019, the company's annual filings with the Securities and Exchange Commission show.” READ MORE
THE 21 HATS PODCAST
What Would Deming Say? This week, Kelly Allan—a consultant who specializes in sharing the principles espoused by the late management guru W. Edwards Deming—returns to the podcast for a conversation with Paul Downs, Jay Goltz, and Laura Zander. The goal was to see if we could figure out what Deming would tell Paul, Jay, and Laura about how they manage their businesses—and whether the three owners would be open to his suggestions. Spoiler alert: Paul’s not really buying it.
You can subscribe to the 21 Hats Podcast wherever you get podcasts.
If you see a story that business owners should know about, hit reply and send me the link. If you got something out of this email, you can click the heart symbol, you can click the comment icon below, and you can share it with a friend. Thanks for reading, everyone. — Loren