Discover more from The 21 Hats Morning Report
What If You Have 98 Employees?
For businesses that aren’t quite covered by the vax-or-test mandate, this is a tricky time.
Reminder: I recently posted my plan to turn 21 Hats into a sustainable business. You can READ MORE HERE. The upshot is I’m asking readers to sign up as either a Paid Subscriber or as a Founding Member.
Here are today’s highlights:
It’s going to be harder to target customers on Facebook and Instagram.
Here’s an inside look at what it takes to get into Y combinator.
Is Facebook’s metaverse dead on arrival?
The labor shortage has reached the North Pole.
The government might just have done something significant about ransomware: “In early July, heading into the holiday weekend, a ransomware attack against the IT management firm Kaseya incapacitated hundreds of businesses, their data encrypted by the notorious REvil ransomware group. Now, U..S authorities have announced a development as unprecedented as the incident itself: The alleged perpetrator, a Ukrainian national, was arrested in October and is currently awaiting extradition from Poland.”
“The arrest and pending extradition of 22-year-old Yaroslav Vasinskyi shows that officials are capable of apprehending key players when they slip up.”
“And another major announcement, the seizure of $6.1 million in alleged ransomware payments received by Russian national Yevgeniy Polyanin, shows that authorities can disrupt their targets even when they can't take them into custody.” READ MORE
It’s going to be harder to target customers on Facebook and Instagram: “Meta, the social media company formerly known as Facebook, said on Tuesday that it planned to eliminate advertisers’ ability to target people with promotions based on their interactions with content related to health, race and ethnicity, political affiliation, religion, sexual orientation and thousands of other topics. The move, which takes effect on Jan. 19, affects advertisers on Meta’s apps such as Facebook, Instagram and Messenger and the company’s audience network, which places ads in third-party apps. The Silicon Valley company said it was making the changes to limit the way that its targeting tools can be abused.”
“Meta relies on targeted advertising for the bulk of its $86 billion in annual revenue. The company has excelled at giving advertisers a place to personalize promotions, with brands often able to aim their ads at Facebook, Instagram and Messenger users who are interested in topics as specific as L.G.B.T.Q. culture or Catholicism.”
“In 2019, the Department of Housing and Urban Development sued Facebook for allowing landlords and home sellers to unfairly restrict who could see ads for their properties on the platform based on characteristics like race, religion and national origin.”
“But Meta’s latest changes may be unpopular with the millions of organizations that rely on the company’s tools to expand their audiences and build their businesses.” READ MORE
The legal battle over President Biden’s vax-or-test mandate is just beginning: “The Biden administration told the U.S. Court of Appeals for the 5th Circuit this week that the Occupational Safety and Health Administration rules are designed to address ‘grave dangers posed by covid-19 in the workplace’ and will ‘save thousands of lives and prevent hundreds of hospitalizations. Blocking the mandate, the Justice Department said, is likely to ‘cost dozens or even hundreds of lives per day.’”
“David Vladeck, an occupational law expert at Georgetown Law School, said OSHA was well within its power to issue the rules. But how the agency will fare in court is another question.”
“The federal government has a strong case, Vladeck said, because the point of the specific act it invoked is ‘to ensure that workers are safe in the workplace.’”
“‘It’s going to be controversial because it’s covid,’ he said. ‘Not because OSHA has somehow overextended its jurisdiction.’” READ MORE
The mandate cut-off is 100 employees. What if you have 98? “Christie Thompson’s company, which sells and services semitrailers, is looking to fill a handful of open positions. But the challenge isn’t just finding qualified workers. Currently, 98 people work at the company. Adding two more employees would mean crossing the 100-person threshold that the Biden administration set as its standard for compliance with a new rule requiring large companies to mandate coronavirus vaccines. ‘As the person who’d be in charge of making all this work, it’d be a nightmare,’ said Ms. Thompson, who runs human resources for Apex/Rentco Trailer Sales & Service, based in Jeffersonville, Ind. She estimates that three-quarters of the employees are unvaccinated.”
“Some small-business owners with under 100 workers have put vaccine mandates in place anyway, concerned about their own safety and that of their clients and customers.”
“Others were pleased to learn they fell outside the scope of OSHA’s rule, anxious about losing workers during the country’s labor shortage — though the experience of Tyson Foods, a large employer with a vaccine mandate, indicates the impact on staffing might be limited.”
“A recent national survey of 1,000 small-business owners, by Small Business for America’s Future, found that 68 percent supported vaccine requirements for large businesses.” READ MORE
Dylan Gastel started making backyard hockey rinks in college. Last year, when so many were stuck at home, his company hit $16 million in revenue: “In his sophomore year, Gastel conceived a tensioned-strap system that's enabled EZ ICE to bring backyard rinks to neighborhoods across the U.S. and Canada. ‘I spent the spring and summer of 2016 learning everything I could about plastics, injection molding, blow molding, extruding, and the other manufacturing processes,’ he said. Hundreds of hours of calls to plastics manufacturers across the United States and a 68-page patent application later, EZ Ice was formed. The product officially launched on Thanksgiving Day in 2016. Gastel said he sold out of all $120,000 of inventory — 52 rinks — in just 19 days.”
“Gastel now counts dozens of NHL players and coaches as loyal customers, which he said has served as a great testament to the product.”
“Last year, he tripled the size of his team and opened a half-dozen new manufacturing and distribution centers.” READ MORE
Here’s an inside look at what it takes to get into the best known startup accelerator in the world. SEE THE THREAD
Tech startups are offering new tools to help retailers count crowds, track foot traffic, and eliminate check-out lines: “This tracking of consumer activity within the store — where shoppers look and linger, with cameras capturing their interactions and their near-misses — is part of a growing effort to use data collection to make commercial real estate more efficient. ‘Checkout is kind of the killer app, but that’s just the tip of the iceberg,’ said Mr. Fisher, the chief executive of Standard AI, which hones camera accuracy in high-volume, high-density environments. ‘You have a system that understands where people are in real time, down to the centimeter. It’s all about utilization of real estate.’”
“At the FTX Arena, where the Miami Heat play, digital messaging on concourse entrances powered by WaitTime tells fans not just where to find food and drinks but the length of the lines.”
“‘The pandemic pushed people who weren’t using this technology over the edge,’ said Sanford D. Sigal, the chief executive of NewMark Merrill, which owns more than 80 shopping centers, and the chairman of BrightStreet Ventures, a firm that develops retail technology. ‘Is this technology aspirin, that you take when you’re feeling bad, or penicillin, where it saves your life? Today, it’s definitely penicillin.’”
“‘I’m a fan of fact-based decision-making, but there are a lot of charlatans promising things that aren’t reasonable in terms of outcomes,’ said Mark A. Cohen, the director of retail studies at Columbia Business School.” READ MORE
Scott Galloway, the podcaster and professor of marketing, says Mark Zuckerberg’s metaverse is dead on arrival: “In actuality, Facebook is basically spending $10 billion on a prayer that, in the short run, it might change the conversation. It gives them an opportunity to talk about the metaverse instead of insurrection and teen depression. It gives Mark Zuckerberg a chance to talk about the metaverse instead of saying, ‘Hi, I’m the CEO of Facebook, I’m ruining the world.’ But Facebook’s metaverse won’t work.”
“The fundamental mistake people make around these AR or VR experiences is to immediately think of sight as the entry point into a metaverse. Mark Zuckerberg says, ‘Imagine your friend is at a great concert around the world and you can join her.’ Let’s play that out.”
“I get a text message from my friend and I’m at the mall, or a movie, or at school. Am I going to pull out my handy Oculus and throw it on my head and start jamming to the Weeknd? It doesn’t make any sense.”
“The Oculus is not a wearable. In fact, it’s prophylactic. No one’s going to get near you. It’s basically the fastest way to say, ‘I don’t date.’” READ MORE
EY has released its annual list of Entrepreneurial Winning Women: The winners include:
Anouk Gotlib: “Belgian Boys is on a mission to turn up the happy, one treat at a time. From breakfast to after-dinner dessert, the business makes goodies that bring smiles to eaters of all ages. Belgian Boys delivers whimsical packaging, indulgent flavors and a healthy dose of fun to stores across the United States.”
Christine Moseley: “Full Harvest is solving the $2.5-trillion global food waste problem as the first and only business-to-business online marketplace for imperfect and surplus produce. The company creates value along the entire supply chain by lowering food production costs, significantly reducing wasted food and resources, enabling an additional revenue stream for farmers, and bringing the produce supply chain online and into the 21st century.”
Stephanie Nadi Olson: “We Are Rosie is a flexible talent marketplace for the modern advertising and marketing world. This thriving community of over 9,000 diverse and highly skilled independent marketers helps a variety of companies maximize their agility, resilience, inclusion and creativity by providing curated, on-demand marketing talent, teams and executives.” READ MORE
And now, there’s even a shortage of Santas: “Working Santas are capitalizing on their scarcity value, bumping up hourly rates and packing their schedules. Many Santas stuck to virtual appearances last year due to pandemic concerns. Now, with Covid cases falling and people eager to gather for the holidays, those in the Santa industry say demand has rebounded and then some. Concerns about the virus are still high among a group of workers that skews toward older, heavier-set men, and those in the Santa industry say it is harder than usual to find qualified candidates. The shortage has overwhelmed bookers, sent organizations looking for bearded volunteers and forced some event coordinators to settle for Santa visits in mid-October.”
“As president of American Events and Promotions and founder of a professional Santa school in Denver, [Susen] Mesco says she currently has around 3,000 men in her Santa network. She also has 200 women and says Mrs. Claus is increasingly getting solo bookings.”
“Ms. Mesco said most weekends in late November and December booked up months ago. Of the 43 Santas she works with in Denver, they are all locked in from 8 a.m. until 9 p.m. every weekend until early January.”
“‘I had one lady call me up two days ago in tears. She needed a Santa for her country club,’ said Ms. Mesco. ‘She said, I’m willing to pay anything.’” READ MORE
THE 21 HATS PODCAST
“I Can Do It. I Promise You, I Can Do It:” This week, Dana White takes us along for the ride. After a triumphant trip to Germany, where she expects to open salons on multiple military bases, she’s just returned to Detroit—only to learn that the team she’s counting on is showing serious cracks. Even as she’s signing contracts with the military, getting ready to roll out her franchising plan, and courting newfound investor interest in funding the development of her salon management software, those cracks have shaken Dana and left her questioning her approach as a CEO. Ultimately, she talks about those moments many entrepreneurs experience in the cold of night, when things aren’t going well, and they realize this is all on them. In those moments, Dana confesses, “I’m scared. And I feel alone.”
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