Peloton Fables and Tales
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Peloton stock dropped to a record low record low was down. I don’t know 24 25% down over 30% this year. I’m going to go back in time where I was ridiculed at the time. And social media various different places of my take on a lot of these.
pandemic stocks, these actually pre pandemic stocks. Peloton, I described as, yeah, it’s great. It’s an exercise, but it’s an exercise bike with a iPad attached to it. And it always, I thought about it. I remember my grandmother, my aunt’s house, they had this ancient, this ancient had to be early 1960s 1950s exercise bike.
And we used to drive my aunt crazy because we’d go nuts on that thing when we were over at the house and she tried to get us off it. But anyway, neither here nor there. Nothing new, nothing new. It is an exercise bike. They attached an iPad to it. And all of a sudden Wall Street said it was awesome. And the folks on CNBC and Fox Business said it was great. And you gotta bring the CEO on this company.
Wow, look what they’re doing. And we warned you. We warned you. And it reminded me, and I think I mentioned on the program, the television show, Billions. There was an episode where the lead character in the show, Bobby Axelrod, is trying to talk his wife out of taking her company public or raising money publicly.
basically the company that she started, she was a former nurse, was a mobile house call service where they would come to your house and they would give you an IV or they’d come to your office. So if you’re some Wall Street guy and you were out the night before, get yourself into…
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a little bit too inebriated at the strip club, whatever it may be, you could call on the service, they’d come and get rid of your hangover and give you an IV right there in the office. Well, she realizes she’s got her business, it’s doing okay. And she sees that somebody else is looking to get in and compete in that space and she wants to make it bigger. She wants to raise money.
But she doesn’t want to use her money. She doesn’t want to use the family’s money. She wants to use Bobby’s money. So she goes out and she goes to Wall Street, speaks with some private equity people and firms out there. And she didn’t get it. She didn’t get it. She starts talking to her husband about her negative experience that she’s having speaking with some of these hedge fund people. She’s not too happy. And this is what…
Bobby had to say, I pulled it up because I wanted to get it verbatim in the show because you spot on. What is it that you do that you’re the best in the world at? You offer a service you didn’t invent, a formula you didn’t invent, a delivery method you didn’t invent. Nothing about what you do is patentable or unique user experience. You haven’t identified an isolated market segment. You haven’t truly…
branded your concept, you want me to go on? So why would an investment bank put serious money into it? I all but told you ahead of time, but you wouldn’t listen. Now you’ve heard it, but it’s too late. You weren’t ready. And again, told his wife that, it’s a bit of a bitter pill for her to swallow. And he was spot on. The only thing that…
I disagree with in regard because again, it’s a television show. It’s a fictional television show is that once these investment banks and private equity companies found out that Bobby Axelrod’s wife was there, they’d find a way to give her the money. Wall Street’s a lot more crooked. Private equity is a lot more crooked. And for example, it’s like a Peloton or many of the other companies that have gone public that didn’t have sustainable business models. They didn’t care.
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All they cared about was taking that company public to get their insiders out. And that’s, you know, that’s a God’s honest truth. Most of these private equity guys that we’ve explained this in the past, Wall Street as well, the big investment firms out there. When they’re going public, they’re selling their stock to you after they’ve laddered it up over a 10 year period of time. But again, you can.
File this one under ACI Told You So and throw in a Don’t Doubt Me as well. Watchdog on wallstreet.com
