10 episodes

Business Breakdowns is a series of conversations with investors and operators diving deep into a single business. For each business, we explore its history, its business model, its competitive advantages, and what makes it tick. Learn more and stay up to date at www.joincolossus.com

Business Breakdowns Colossus

    • Business
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Business Breakdowns is a series of conversations with investors and operators diving deep into a single business. For each business, we explore its history, its business model, its competitive advantages, and what makes it tick. Learn more and stay up to date at www.joincolossus.com

    Calm: The Sleeping Giant - [Business Breakdowns, EP. 08]

    Calm: The Sleeping Giant - [Business Breakdowns, EP. 08]

    Today, we will be breaking down Calm. Founded in 2012, Calm is the leading app for sleep and meditation. Today, Calm has over 4 million subscribers and has been generating cash flow since its inception. In this Breakdown, we touch on how Calm used data to unlock a non-obvious source of demand, how the upfront subscription cost has allowed for pure operational focus, and what the competitive landscape looks like moving ahead.
     
    To break down Calm, I am joined by my brother, Vinny Pujji, Partner at Left Lane Capital, an early-stage investment firm.
     
    For the full show notes, transcript, and links to mentioned content, check out the episode page here.
    -----
    This episode is brought to you by Tegus. We created Business Breakdowns to uncover the lessons and frameworks behind every business, and that's what makes Tegus our perfect launch partner. Much of the foundational prep for these episodes start with research on the Tegus platform. 
     
    With Tegus, you can learn everything you’d want to know about a company in an on-demand digital platform. Investors share their expert calls, allowing others to instantly access more than 15,000 calls on Coinbase, Hinge Health, Farfetch, or almost any company of interest. All you have to do is log in. If you're ready to go deeper on any company and you appreciate the value of primary research, head to tegus.co/breakdowns for a free trial.
     
    -----
    Business Breakdowns is a property of Colossus, Inc. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.
     
    Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.
     
    Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss
     
    Show Notes
    [00:02:37] - [First question] - What is Calm and what its businesses do
    [00:03:31] - How people pay for it
    [00:03:55] - The top use cases and value proposition for customers
    [00:05:19] - Who started Calm and the unique insights that led them to create it 
    [00:05:30] - Major inflection points that drove their business forward 
    [00:07:54] - An investor’s perspective on freemium funnel models
    [00:10:01] - Key factors that led to Calm’s success 
    [00:10:56] - Breaking down their subscription offer
    [00:12:34] - Analysis of customer retention and breakdown of unit economics
    [00:15:36] - The difference between their unit economics and other consumer businesses
    [00:17:28] - What’s unique about Calm from a cash flow perspective
    [00:19:40] - Capital efficiency when it comes to customer acquisition
    [00:21:02] - How they learned that sleep was a primary use case and making a shift to provide more content in that area
    [00:23:09] - Competing with and surpassing Headspace’s popularity 
    [00:24:19] - Ways that the future might play out for Calm and the mental wellness industry
    [00:25:38] - Other insights that led to a shift from a meditation focus to a sleep focus
    [00:26:47] - Designing content with a utility and enrolling celebrities
    [00:30:06] - Productizing and monetizing on pre-existing consumer habits
    [00:32:07] - Variable versus fixed cost models
    [00:33:09] - App distribution and generating widespread brand adoption
    [00:36:28] - Simultaneously, a software and a consumer business
    [00:39:19] - COVID-19’s impacts on Calm and how it drove their growth
    [00:41:19] - Potential contributing factors to Calm’s growth over the coming years
    [00:44:12] - Practical brand extensions already being implemented 
    [00:45:24] - Risks and challenges that may be faced in the coming decade
    [00:46:50] - Integrating new features and other risks that may need to be solved
    [00:49:27] - Whether or not switching behavior will affect Calm’s trajectory
    [00:51:09] - Bigger players in the ecosy

    Visa: The Original Protocol Business - [Business Breakdowns, EP. 07]

    Visa: The Original Protocol Business - [Business Breakdowns, EP. 07]

    Today we will be diving into Visa. Starting in 1958 as a BankAmericard credit card program in Fresno, California, it then became a non-profit consortium of banks that operated the Visa network. Over the first few decades of its existence, Visa became the protocol layer that allowed essentially all the banks in the world to communicate with one another.
     
    In 2007, Visa completed a corporate restructuring that took it public and now boasts a larger market cap than all of the banks that previously owned it as part of the consortium.
     
    In this Breakdown, we set the stage with Visa's role in a card transaction, describe the lifeblood of Visa’s revenue, interchange, and then dive into its unique history as a consortium turned multi-hundred billion-dollar public business. We then explore Visa’s unique moat and network effect, how Visa makes money today, and look at the potential threats from other businesses and macroeconomic forces. Visa is a fascinating business, and I recommend you check out our website at JoinColossus.com, where we provide additional articles, books, and podcasts for those who want to keep unpacking the Visa story.
     
    To help me break down Visa, I'm joined by Alex Rampell, a general partner at Andreessen Horowitz, where he focuses on investing in financial services. Prior to joining Andreessen, Alex co-founded multiple companies, including Affirm and TrialPay, which was acquired by Visa in 2015.  



    For the full show notes, transcript, and links to mentioned content, check out the episode page here.
    -----
    This episode is brought to you by Tegus. We created Business Breakdowns to uncover the lessons and frameworks behind every business, and that's what makes Tegus our perfect launch partner. Much of the foundational prep for these episodes start with research on the Tegus platform. 
     
    With Tegus, you can learn everything you’d want to know about a company in an on-demand digital platform. Investors share their expert calls, allowing others to instantly access more than 15,000 calls on Coinbase, Hinge Health, Farfetch, or almost any company of interest. All you have to do is log in. If you're ready to go deeper on any company and you appreciate the value of primary research, head to tegus.co/breakdowns for a free trial.
    -----
    Business Breakdowns is a property of Colossus, Inc. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.
     
    Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.
     
    Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss
     
    Show Notes
    [00:03:20] - [First question] - Key players and functionality of a credit transaction
    [00:05:50] - How $3 would be split up amongst the network after a $100 purchase is made
    [00:10:55] - How Visa came to be a central player and why banks don’t talk to each other
    [00:16:26] - Other businesses that have dominating protocol effects in fragmented sectors
    [00:19:47] - What the internals of a business like Visa looks like and 
    [00:24:48] - Visa’s topline revenue is almost entirely exclusive to transaction fees
    [00:26:11] - Thinking of Visa as a tax and simultaneous enabler of commerce writ large
    [00:30:48] - Why concentration poses a risk to their business model
    [00:34:56] - How international standards may play a role in Visa’s future
    [00:41:52] - Would it be worth it for merchants to build something competitive 
    [00:44:33] - Thoughts on new value transfer tech companies and their relevance to Visa
    [00:48:59] - Plaid’s role in the payment ecosystem and as a potential competitor
    [00:50:40] - Parallels between the crypto space, their protocols, and open-source payments 
    [00:52:54] - Business lessons for en

    Twilio: Messaging, Margins, and Markets - [Business Breakdowns, EP. 06]

    Twilio: Messaging, Margins, and Markets - [Business Breakdowns, EP. 06]

    Today we will be diving into Twilio. Twilio was founded just over a decade ago by Jeff Lawson, with the vision of enabling developers to access the world's communication infrastructure through APIs. Twilio has over 200,000 customers and powered nearly 1 trillion interactions last year through SMS, voice, video, email, and more. 
     
    In this business breakdown, we'll cover Twilio's unique approach to distribution, how lower gross margins versus peers can actually be a moat, and why Twilio's revenue model aligns incentives with its customers. We closed with the bull and bear case for Twilio over the next five years and what investors and operators can take away from studying Twilio more closely. 
     
    To help me break down Twilio, I'm joined by Ro Nagpal, a senior investment professional at the Holocene advisors.
     
    For the full show notes, transcript, and links to mentioned content, check out the episode page here.
    -----
    This episode is brought to you by Tegus. We created Business Breakdowns to uncover the lessons and frameworks behind every business, and that's what makes Tegus our perfect launch partner. Much of the foundational prep for these episodes start with research on the Tegus platform. 
     
    With Tegus, you can learn everything you’d want to know about a company in an on-demand digital platform. Investors share their expert calls, allowing others to instantly access more than 15,000 calls on Coinbase, Hinge Health, Farfetch, or almost any company of interest. All you have to do is log in. If you're ready to go deeper on any company and you appreciate the value of primary research, head to tegus.co/breakdowns for a free trial.
    -----
    Business Breakdowns is a property of Colossus, Inc. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.
     
    Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.
     
    Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss
     
    Show Notes
    [00:02:53] - [First question] - What is Twilio?
    [00:03:36] - How the world received text updates before Twilio
    [00:04:14] - The scale of Twilio today
    [00:05:02] - How expensive designing infrastructure of this magnitude can be
    [00:05:34] - How to use Twilio and gain access to its functionality
    [00:06:33] - The insight that led to developing the company
    [00:08:37] - Other aspects of Twilio’s services beyond SMS
    [00:09:50] - Unit economics of the business
    [00:12:01] - Case studies of likely and unlikely customers to use Twilio
    [00:15:17] - Original use cases and how they’ve evolved since
    [00:16:12] - Developer insights and what innovation it’s led to
    [00:19:19] - Twilio becoming a pioneer in the user software API space
    [00:22:15] - How big the TAM can be and why it’s bigger than people may think it is
    [00:23:38] - Why the API data and growth rate of Twilio separates it from its competitors
    [00:26:02] - How having a lower gross margin actually works to their benefit
    [00:27:28] - Who their competitors are and why Twilio beats them out
    [00:29:11] - Strategic acquisitions they’ve made like SendGrid, Segment, and Syniverse
    [00:31:18] - Unifying themes in their M&A strategy
    [00:32:08] - Fees associated with using iMessage and WhatsApp
    [00:32:43] - Improving margins as SMS becomes less pivotal in their operations 
    [00:33:21] - Things about Jeff Lawson that makes Twilio so special
    [00:35:25] - What’s their bear case is
    [00:36:19] - Lessons for builders and investors
     

    Cinnabon: The Omnichannel Approach to Indulgence - [Business Breakdowns, EP. 05]

    Cinnabon: The Omnichannel Approach to Indulgence - [Business Breakdowns, EP. 05]

    Today we will be diving into Cinnabon. Founded in Seattle in 1985, Cinnabon is the market leader among cinnamon roll bakeries and is owned by parent Company Focus Brands. Cinnabon currently operates in almost 50 countries with over 1,500 franchised locations, primarily in high-traffic venues such as shopping malls and airports.
     
    In this breakdown, we start with Cinnabon's scale and an overview of the franchise's fascinating history. We then dive into what really makes Cinnabon special - its omnichannel ecosystem and how it balances franchisees, licensing deals, and distribution through other retails while maintaining its differentiated and relevant brand. 
     
    To help me break down Cinnabon, I'm joined by Kat Cole, the former COO and President of North America for Focus Brands. Before that role, she was the president of Cinnabon. Kat's operating and investing experience in this space and her deep understanding of the brand make her the perfect guest to break down Cinnabon. Please enjoy this Business Breakdown.
     
    For the full show notes, transcript, and links to mentioned content, check out the episode page here.
    -----
    This episode is brought to you by Tegus. We created Business Breakdowns to uncover the lessons and frameworks behind every business, and that's what makes Tegus our perfect launch partner. Much of the foundational prep for these episodes starts with research on the Tegus platform. 
     
    With Tegus, you can learn everything you’d want to know about a company in an on-demand digital platform. Investors share their expert calls, allowing others to instantly access more than 15,000 calls on Coinbase, Hinge Health, Farfetch, or almost any company of interest. All you have to do is log in. If you're ready to go deeper on any company and you appreciate the value of primary research, head to tegus.co/breakdowns for a free trial.
    -----
    Business Breakdowns is a property of Colossus, Inc. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.
     
    Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.
     
    Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss
     
    Show Notes
    [00:03:04] - [First question] - The operational scale and complexity of Cinnabon
    [00:05:48] - Origins and humble beginnings of Cinnabon
    [00:10:07] - Diversified stakeholders involved in franchised businesses
    [00:14:44] - A focus on brand relevance and differentiation
    [00:19:38] - Building brick and mortar traffic during a recession and partnering with Pillsbury
    [00:23:21] - Cinnabon’s ability to thrive and support an omnichannel brand ecosystem
    [00:26:57] - Partnering with Burger King and fast-food market exposure
    [00:32:55] - Building successfully collaborative equity buckets
    [00:36:52] - Focus Brands and advantages of being part of a bigger ecosystem
    [00:41:52] - Balancing licensing opportunities while maintaining core channel partners
    [00:45:37] - Lessons for operators and investors we can take away from Cinnabon

    Costco: Relentless Focus on the One Thing - [Business Breakdowns, EP. 04]

    Costco: Relentless Focus on the One Thing - [Business Breakdowns, EP. 04]

    Today, we will be diving into Costco. Costco is a favorite business story and model for many operators and investors. It was founded in 1983 in Seattle, and it has grown into a juggernaut with over $169 billion in sales and almost 60 million members globally. To me, Costco is the best example of doing one thing for customers and getting better at it constantly for decades.
     
    To help me break down Costco, I talked to both Zack Fuss and Chris Bloomstran. Zack is an investor at Continental Grain, a 200-year old family-owned business that is focused on investing and operating businesses throughout the food and agriculture ecosystem with assets across the US, Latin America, and Asia. Chris is President and Chief Investment Officer of Semper Augustus Investments Group and a long-time shareholder in Costco.
     
    In this Breakdown, we'll start with Zack by diving into the Costco business model, examining the relentless focus on efficiency that separates Costco from its peers, and exploring the secrets behind its private label brand, Kirkland. I'll then talk to Chris about Costco's growing international opportunities and the lessons that operators and investors can take away from studying the business and founder Jim Sinegal. I hope you enjoy this Breakdown of Costco.
     
    For the full show notes, transcript, and links to mentioned content, check out the episode page here.
    -----
    This episode is brought to you by Tegus. We created Business Breakdowns to uncover the lessons and frameworks behind every business, and that's what makes Tegus our perfect launch partner. Much of the foundational prep for these episodes starts with research on the Tegus platform. 
     
    With Tegus, you can learn everything you’d want to know about a company in an on-demand digital platform. Investors share their expert calls, allowing others to instantly access more than 15,000 calls on Coinbase, Hinge Health, Farfetch, or almost any company of interest. All you have to do is log in. If you're ready to go deeper on any company and you appreciate the value of primary research, head to tegus.co/breakdowns for a free trial.
    -----
    Business Breakdowns is a property of Colossus, Inc. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.
     
    Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.
     
    Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss
     
    Show Notes
    [00:03:03] - [first question] - The fundamental equation that makes Costco work
    [00:04:02] - Dynamics of a shared scale economy business
    [00:06:45] - Jim Senegal’s devotion to perfecting one model for decades
    [00:10:10] - Examples of how far Costco is willing to go to provide value for its members
    [00:12:27] - Analysis of a private label strategy, and why Kirkland is such a success
    [00:15:35] - Key differences that separate Costco from their competitors
    [00:18:19] - An open-source retailing relationship with suppliers
    [00:21:10] - How they maximize sales per square foot over time
    [00:25:45] - Thoughts on leverage in unit-concept stores and why Costco doesn’t use leverage to accelerate growth 
    [00:28:02] - Lessons that can be learned and applied to other businesses   
    [00:30:47] - How Costco approaches international expansion
    [00:33:54] - Why Jim Sinegal is such an exemplary CEO

    Alibaba: A Giant Among Giants - [Business Breakdowns, EP. 03]

    Alibaba: A Giant Among Giants - [Business Breakdowns, EP. 03]

    Today, we will be breaking down the world's largest e-commerce company, Alibaba. Alibaba was founded in 1997 by Jack Ma and almost 20 other co-founders as an online bulletin board that allowed small Chinese manufacturers to tell buyers around the world that they were open for business. Today, Alibaba operates a sprawling ecosystem of businesses that includes e-commerce marketplaces, cloud computing, food delivery, logistics, and financial services. 
     
    In this breakdown, we discuss the staggering scale Alibaba's business, how Alibaba went from copycat to innovator, the looming threat to Alibaba from the next generation of Chinese juggernauts, and how competition is viewed differently in China versus the West. 
     
    For this episode, I'm joined by a special guest host, Claire Cormier Thielke, who many of you will remember from her appearance on Invest Like the Best. Claire is the managing director of Asia Pacific for Hines and brings her first-hand view of what Alibaba has built in China and her daily experience using the company's products. 
     
    To help us break down Alibaba, we're joined by Ram Parameswaran, the founder and managing partner of investment firm Octahedron Capital. Ram has invested in some of the biggest Chinese companies of the past decade, including Pinduoduo and Bytedance, and is the first person I thought of when wanting to discuss Alibaba.
     
    For the full show notes, transcript, and links to mentioned content, check out the episode page here.
    -----
    This episode is brought to you by Tegus. We created Business Breakdowns to uncover the lessons and frameworks behind every business, and that's what makes Tegus our perfect launch partner. Much of the foundational prep for these episodes starts with research on the Tegus platform. 
     
    With Tegus, you can learn everything you’d want to know about a company in an on-demand digital platform. Investors share their expert calls, allowing others to instantly access more than 15,000 calls on Coinbase, Hinge Health, Farfetch, or almost any company of interest. All you have to do is log in. If you're ready to go deeper on any company and you appreciate the value of primary research, head to tegus.co/breakdowns for a free trial.
     
    -----
    Business Breakdowns is a property of Colossus, Inc. For more episodes of Business Breakdowns, visit joincolossus.com/episodes.
     
    Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here.
     
    Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss
     
    Show Notes
    [00:03:13] - [First question] - What Alibaba is
    [00:04:29] - Tmall and Taobao
    [00:06:48] - The many faces of Alibaba as a country-scale business
    [00:09:58] - What defines a company as being country-scale
    [00:11:29] - Adaptive business models for cities of multiple tiers and mimetic behavior of other large-scale companies
    [00:18:15] - Alibaba’s ability influence the physical infrastructure of cities and China as a whole
    [00:19:01] - Full stack solution company JD Global
    [00:21:03] - Tencent
    [00:21:47] - Key players in the monetization of commerce in China: JD, Pinduoduo, Meituan
    [00:26:35] - Reducing friction may be the number one reason for internet businesses to scale
    [00:31:15] - Is it worth it for Alibaba to explore the social media space?
    [00:34:05] - Why Chinese companies are naturally more competitive and aggressive than North American ones 
    [00:38:46] - How China perceives and adopts language such as the Seven Powers framework
    [00:40:23] - What the West can learn from China and Alibaba
    [00:43:28] - Adopting Chinese practices for Western brick and mortar stores
    [00:45:35] - Connectography: Mapping the Future of Global Civilization
    [00:45:51] - Learn

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