08/15/2024
I created this short video on the $20 billion man ~ deconstructing how one person can be worth over $20 billion.
💵💰 In the course of 24 hours, this one person increased the value of a company by $20 billion.
He didn't even do anything. He only said one word.
The word was "yes" and the person is Brian Niccol.
"Yes" is what he said when he was offered the position of CEO and Board Chair at Starbucks.
Starbucks is going through massive performance issues; their stock is down, customers are unhappy, customers are unhappy, employees (or partners as they are called at Starbucks) are unhappy, and shareholders are unhappy. They have two activist investors who have been agitating for change.
In one day and with one word, Brian Niccol increased the value of their holdings by around 25%. That's massive. It's unheard of actually. There are very very few people who have the influence to do anything like that - and this was the single largest increase in Starbucks' market cap in a single day.
★He's been called the LeBron James or the Tom Brady or the Messi of the restaurant industry.
That's high praise.
And it comes with massively high expectations.
I've gone deep and done the research and work to understand exactly what it is that the Starbucks board found so appealing in Niccol, and why the market responded so positively.
So what is the new CEO bringing to the party (or the coffee store?)
1. HIGHLY RELEVANT experience - dealing with quality and performance issues, complex supply chain operations, activist investors, and a board and stakeholders.
2. PROVEN TURNAROUND experience - resulting in an 800% increase in share price for Chipotle Mexican Grill and an increase in same store sales when competitors are all down.
3. BRAND understanding - he understands the power of brands and harnessing social media to amplify what he knows his consumers want. And what is Starbucks if not a brand?
4. DEEP MARKET and CONSUMER knowledge - he understands what his consumers want (reliable, quality, affordable) and he meets their needs with an offering to match, keeping prices lower whilst others ramped them up during inflationary pressure. He knows you can't grow by increasing prices.
5. Proven PEOPLE-LEADER - Walmart appointed Niccol to their board and called him a "dynamic leaders with a passion for excellence"; he has created a people-centric innovation culture.
Starbucks needs ALL of this.
In addition, there are some pretty big differences between the operations of Chipotle and Starbucks (covered towards the end of the video), but the market's message is "we believe in this guy; he's got what it takes to turn this thing around."
As further evidence of this, the Chipotle stock was notably down following his appointment, so taken together Niccol's appointment caused a net impact of close to $30 billion in market valuation changes across Starbucks and Chipotle.
https://youtu.be/4zJ4PLMqJww
Would love to know what you think.
What did you like?
What did I miss?
In the course of 24 hours, this one person increased the value of a company by $20 billion.And he actually only said one word.The word was "yes" and the pers...
