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The latest jobs report is one of 6 key economic statistics. Here's what each of them signal, and how often they're released.

Fri, 09/06/2019 - 3:41pm  |  Clusterstock

  • The latest US jobs report is just one of several critical measurements watched by investors, politicians, and analysts to forecast the economy's future.
  • While some metrics are published by government agencies, surveys from the Institute for Supply Management and the University of Michigan are also regarded as important indicators.
  • Here are six of the most watched economic metrics, how frequently they're released, and what they measure.
  • Visit the Markets Insider homepage for more stories.

A recent US employment report revealed a hiring slowdown in August and offered the latest look into how the nation's economy is handling the US-China trade war.

Government data is among the most reliable economic indicators, and previews how big-picture trends might affect everyday consumers. Other establishments like the Institute of Supply Management also provide high-quality statistics closely watched by investors, government officials, and economists.

Following these metrics can help discern whether the economic landscape is trending upward or heading toward a recession. Here are six of the most important measurements of the US economy, what they mean, and how often they're published.

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Unemployment rate

  • Focus: The US Bureau of Labor Statistics gathers nonfarm payroll data every month, highlighting updates to the unemployment rate and average wages. The data is broken down by gender, age, level of employment, and sector. Any considerable drop in wages or employment can signal a downturn, as unemployed consumers will likely spend less and stave off economic expansion.
  • Frequency: The Employment Situation reports are released at 8:30 a.m. ET every first Friday of the month. The report on September hiring trends is set for an October 4 release.
  • Source: Bureau of Labor Statistics

GDP growth

  • Focus: Gross domestic product has been the main tool for measuring economies around the world for nearly eight decades. The monetary figure measures the value of a nation's final goods and services produced in a specific time period. While it leaves out crucial variables like sustainability and social welfare, GDP's simplicity makes it a go-to stat for determining the rate of a country's economic expansion.
  • Frequency: The third and final measurement for quarterly US GDP is released every three months. The figure for the second quarter of 2019 will be published September 26.
    • However, preliminary estimates are released each month, and the first third-quarter estimate will be published October 30.
  • Source: Bureau of Economic Analysis

Federal Reserve interest rate

  • Focus: The Federal Reserve uses the federal funds rate as a policy tool to either encourage borrowing or saving across the US. Interest rate hikes and cuts are voted on at Federal Open Market Committee meetings, when the Fed chair and regional presidents convene to discuss the current economic outlook.
  • Frequency: The FOMC holds meetings eight months each year, with additional meetings planned if deemed necessary. The next meeting is slated for September 17 and 18.
    • Many economists tune in to Fed officials' speeches and interviews throughout the year to find hints at future FOMC policy decisions. Some analysts even assign positive or negative values to officials' public statements in an attempt to quantify their sentiment toward the economy.
  • Source: The Federal Reserve

Housing starts

  • Focus: Homes are often consumers' biggest investment, and a slowdown in house construction could stem from collective uncertainty toward economic conditions. The housing starts report reveals national construction trends as well as regional views that indicate which areas of the US are seeing increased homeowner and developer interest.
  • Frequency: Reports on new residential construction are released on the twelfth workday of every month, at 8:30 a.m. ET.
  • Source: Census Bureau

Consumer sentiment

  • Focus: This survey measures a random sample of consumers' views on the economy, their own financial positions, and how they view the economy compared to the past. Consumer spending drives about 70% of the national economy, so a consensus shift can bring major consequences. By surveying consumers instead of using other, less direct indicators, the sentiment index gives a hugely relevant look at how spending habits shift.
  • Frequency: Every other Friday, with a preliminary estimate arriving in the middle of the month and a final reading released at the end of the month or start of the following month.
  • Source: University of Michigan Survey of Consumers

ISM Purchasing Managers' Index

  • Focus: The Institute for Supply Management is the oldest such association in the world, and publishes an index tracking purchasing managers' inventory counts and spending activities. Though manufacturing has been a shrinking sector over the past several decades, purchasing managers play a massive role in forecasting whether companies should ramp up or slow down production. If the index falls below 50, it indicates the manufacturing sector may be contracting.
  • Frequency: The index is updated on the first workday of every month at 10:00 am ET, with the next report arriving October 1.
  • Source: Institute for Supply Management

Mutual funds like Fidelity's famed Contrafund have slashed valuations on their WeWork stakes

Fri, 09/06/2019 - 3:38pm  |  Clusterstock

  • WeWork's mutual-fund investors, like Fidelity's massive Contrafund, have changed up their valuations of stakes in the coworking company. 
  • Fidelity slashed its valuation of the fund's private WeWork shares by nearly a third between the end of 2018 and this summer, while T. Rowe Price boosted the value of its stakes.
  • Hartford's Capital Appreciation Fund increased the value on the shares it holds from one round of funding and cut the value of shares from a separate round.
  • Those mutual funds do agree on one thing: WeWork is classified as a real-estate company in all their filings. 
  • Click here for more BI Prime stories.

WeWork's valuation is confusing to everyone, even seasoned asset managers. 

Mutual funds offered by Fidelity, T. Rowe Price, and Hartford Funds all recently changed up the valuations they are putting on shares of the real-estate-technology-wellness company founded and run by Adam Neumann.

The coworking firm is considering the drastic move of cutting its $47 billion valuation in half before its planned IPO, according to media reports. It had unveiled its financials in a move toward listing on the public markets — exposing the numbers behind its wide losses and attracting high-profile criticism in the process.

Fidelity, which has exposure to WeWork through its massive Contrafund, slashed the fund's valuation on WeWork shares between the end of last year and the middle of this summer, according to a regulatory filing.

Read more: The SEC is stepping up scrutiny of mutual funds that have poured money into unicorns like WeWork and Airbnb

The mutual-fund giant once valued the company significantly higher than its peers but has cut the valuation of WeWork shares in the Contrafund by roughly a third. Across the shares the firm holds in WeWork's Series A, E, and F funding rounds, the devaluation resulted in a drop of more than $120 million from the fund's assets.

To be sure, the Contrafund's overall holdings are $117.5 billion, but the move shows how much privately held shares can fluctuate. And how exactly funds put a price tag on private stakes is something the Securities and Exchange Commission is looking at more closely. 

Other funds, like T. Rowe Price's Diversified Mid-Cap Growth Fund, have upped the value of their WeWork stakes.

Hartford's Capital Allocation Fund increased the value of its shares from WeWork's Series D-1 funding round but cut the value of the shares it holds from WeWork's Series D-2 round. 

There does seem to be one thing that all the funds can agree on: WeWork is listed in the real-estate section of each funds' reports. 

The funds and WeWork declined to comment or did not immediately respond to requests for comment. 

Read more: A Viking Global hedge fund is helping startups turn into unicorns. Now it's hiring more people to ramp up investments.

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Dispensed: uBiome gets dumped by CVS, Jeffrey Epstein's wacky plan to sell DNA data, and 19 unicorn startups to watch

Fri, 09/06/2019 - 3:38pm  |  Clusterstock

Happy Friday, Sept. 6th!

Bringing you this week's fresh batch of healthcare and biotech news is me, Erin Brodwin, subbing for the fabulous Lydia Ramsey while she wraps up her honeymoon festivities.

While my East Coast coworkers mourn the end of summer, the Bay Area is just starting to heat up. Hello, iced coffee — it's been too long.

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Earlier this week, buzzy Silicon Valley microbiome startup uBiome filed for Chapter 11 bankruptcy. The company had previously convinced VCs that testing poop was a business worth $600 million. Among them: Andreessen Horowitz and 8VC, who now own 11% and 20% of uBiome, according to the bankruptcy filing:

Poop-testing startup uBiome was once valued at $600 million by Silicon Valley's top VCs. It just filed for bankruptcy.

Chapter 11 bankruptcy isn't as extreme as other forms of insolvency: uBiome won't be liquidating as it would if it had declared Chapter 7 bankruptcy, for example. Instead, the company is looking for a buyer and attempting to save what it can of the business. That could be tough if uBiome's foundational science is flawed, as insiders previously told me.

Which brings me to my next bit of news: Zachary Tracer and I had the scoop on an unfortunate turnout for uBiome's plans for salvation. The company was going to try selling its only product, a test called Explorer, at CVS stores. CVS, however, told us it's not feeling the deal:

uBiome was banking on CVS selling its tests — but the chain just turned it down

Prospective uBiome buyers face other risks too, as my colleague Emma Court lays out below. Among them: potentially millions of dollars in refunds from health insurers including Cigna, UnitedHealth, and Kaiser. Three of the claims exceed $1 million:

Some of uBiome's largest creditors are health insurers saying they're owed millions in refunds.

And in non-poop-related news, tooth-straightening darling SmileDirectClub is eyeing an IPO. The company's top investors stand to be smiling widely as each of them could make billions from the deal, as Lydia and Emma reported on Tuesday:

SmileDirectClub is set to go public at a $7.9 billion valuation. That could make the startup's top investors into billionaires.

Does SmileDirect's bright news have you wondering what other lucrative startups are trying to transform the way we get care? You're in luck. Check out this round up of leading healthcare unicorns courtesy of Emma and Clarrie Feinstein:

The 19 billion-dollar startups to watch that are revolutionizing healthcare in 2019

  • 19 healthcare startups have reached unicorn status, the $1 billion-and-over valuation mark.
  • Johnson & Johnson bought robotics surgical company, Auris Health, and health insurance startup Oscar Health announced expansion in 12 new markets for next year.
  • Some of the billion-dollar healthcare companies like 23andMe, Tempus, and One Medical are worth watching.

Speaking of bold plans to revolutionize healthcare, I learned this week that Jeffrey Epstein — yes, that Jeffrey Epstein — once had a plan to sequence people's genes and sell the data to drug companies.

That's according to a document obtained as part of a public records request. After outlining his DNA-sequencing plan, the late financier added, "I am not a mad man."

Jeffrey Epstein had a 'Frankenstein'-like plan to analyze human DNA in the US Virgin Islands

I don't want you leaving our newsletter with only thoughts of bad news to fill your weekend, so I'll let you in on some more personal news. My dog, Dax (bonus points if you can guess who he's named after), just got off the waitlist at our SF bureau's WeWork. He'll be starting at his new post on Monday.

- Erin

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A venture-capital insider dishes on why WeWork's original valuation was way too high (WE)

Fri, 09/06/2019 - 3:21pm  |  Clusterstock

  • WeWork is reportedly slashing its targeted value in its upcoming IPO by as much as half.
  • For Manhattan Venture Partners, a merchant bank specializing in pre-IPO companies, the move couldn't have been more apt. 
  • Santosh Rao, the firm's head of research, said in an interview that many of WeWork's practices might fly as a private company, but not on public markets.
  • Visit Business Insider's homepage for more stories.

WeWork's lofty valuation for its initial public offering has been slashed to nearly half of the original $48 billion, according to reports by Bloomberg and the Wall Street Journal.

That's a relief for some analysts and investors watching the IPO who say the original target defied reality, especially given some of the criticisms facing the company's complex structure and appearances of self-dealing.

"Given the risk-reward in this whole business model, I think $47 billion was a real stretch," Santosh Rao, the head of research at Manhattan Venture Partners, told Business Insider in an interview. The firm initiated coverage of WeWork last month with a $28 billion valuation.

"Maybe if WeWork had come out before Lyft and Uber, they would have got a pass. But now, seeing how the appetite for companies without a path to profitability has gone down, I don't think they will get the benefit of the doubt," Rao said.

Both Uber and Lyft have stumbled out of the gate following their public-market debuts earlier this year. Many investors from later private rounds are now in the red, as the stocks have fallen 24% and 43%, respectively, in the months since.

Other criticisms, like the appearance of self-dealing in the $5.9 million purchase of a trademark from CEO Adam Neumann that was later canceled or a complicated corporate-governance structure, have put more pressure on WeWork to fully justify its lofty valuation targets, Rao said.

Read more: These are the unusual ways WeWork founder Adam Neumann has made millions, and stands to make more, from his $47 billion company about to go public

"When you're a private company, maybe you can get away [with these things] because you have time to explain to investors what the long-term vision is, and people look past the small things in favor of a broader vision of where the company's gong and what the future potential is," he said.

"But when you're a public company, you have to execute and you have to perform," he added.

Then there's the recession question.

Many companies are seen as flocking to public markets in order to raise capital before the long-running economic expansion reaches an eventual end, with WeWork proving to be no exception.

"They have to make sure the leases are rock-solid," Rao said. "Forty percent of the base is enterprise clients, which puts a floor on that, depending on how long the downturn is. Mature markets are doing well, but they will need to venture beyond just the most major of cities."

WeWork is expected to kick off its roadshow, when executives and bankers will travel around the world to pitch the stock to investors, as soon as next week, Bloomberg reported on Tuesday. The offering could be the second-largest this year, behind Uber.

More on WeWork's IPO:

SEE ALSO: The history of WeWork — from its first office in a SoHo building to a global company preparing for a much-hyped IPO

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NOW WATCH: Amazon is reportedly seeking a new space in New York City. Here's why the giant canceled its HQ2 plans 5 months ago.

Chase Offers can get you cash back at Casper, J. Crew and more just for having a card — here are some of the best deals available now.

Fri, 09/06/2019 - 3:19pm  |  Clusterstock

  • If you have a Chase credit card or debit card, you could be eligible for Chase Offers. 
  • Chase Offers are cash-back deals for shopping at merchants like Starbucks and New Balance.
  • I have the Chase Sapphire Reserve, and I currently see offers for cash back at Rosa Mexicano, Sam's Club, and more than a dozen other brands.
  • You're not guaranteed to see Chase Offers attached to your Chase account, but if you have multiple Chase cards, you will likely have offers attached to at least some of your cards.
  • To use an offer, you just need to click to add it to your account and make a qualifying purchase with your eligible Chase card.

Chase has a diverse lineup of credit cards, including options that earn cash back, more premium cards that earn Ultimate Rewards points, hotel and airline cards, and business credit cards. 

If you have a Chase credit card or debit card, you could be eligible for Chase Offers. These deals get you cash back on purchases with a variety of retailers and restaurants once you add the offer to your card. Keep reading to see how it works, and what kind of offers you can expect to find.

Read more: The best Chase credit cards you can sign up for now

What are Chase Offers?

Chase Offers are deals available to select holders of Chase credit and debit cards. These offers get you cash back at a variety of retailers, from Rite Aid to New Balance to Starbucks.

Chase Offers generally get you cash back in the form of a percentage. For example, on my Chase Sapphire Reserve account I currently see an offer for 10% back at restaurant Rosa Mexicano, with a $10 maximum. However, some offers get you a flat cash-back amount, such as $10 back at big-box retailer Sam's Club.

Read more: How to use Chase Offers to earn discounts from retailers like Airbnb and Starbucks

Each Chase Offer has an expiration date — in your account this will be displayed as how many days you have left to use it. Keep this date in mind, since you won't be eligible for cash back if you don't make a purchase in time.

To use a Chase Offer, you need to add it to your card account — you can do so by simply clicking on it. Then, you just make a qualifying purchase while the offer is still valid with your Chase card, and you'll receive the cash back as a statement credit to your account.

Keep in mind that not every Chase cardholder will see Chase Offers associated with their account. For example, I have five Chase accounts (including both debit and credit), and I only see offers associated with three of them. 

Read more: I use Amex Offers to find discounts at stores and restaurants like Amazon and Starbucks — here are some of the offers you can get right now

Current Chase Offers

Here are some Chase Offers that are currently available. Keep in mind that you may see different deals in your own account. Additionally, some of these offers may no longer be available, though this list will be updated on a regular basis.

  • Get 5% back at Airbnb, with a maximum of $28 back
  • Get 10% back on a purchase of over $350, with a maximum of $50 back
  • Get 10% back at Cole Haan, with a maximum of $21 back
  • Get 10% back at Dunkin' Donuts, with a maximum of $3 back
  • Get 10% back at Massage Envy, with a maximum of $8 back
  • Get 10% back at Maggiano's, with a maximum of $12 back 
  • Get 10% back at Rite Aid, with a maximum of $4 back
  • Get $10 back on your Sam's Club membership purchase when you spend $45 or more
  • Get 5% back at Starbucks, with a maximum of $3 back
  • Get $5 back at Stitch Fix
Don't have a Chase card? Here are some top options to consider:
  • Chase Sapphire Preferred Card One of the best all-around travel cards, because it earns 2x points on travel and dining and a high sign-up bonus and offers valuable travel coverage like primary rental car insurance, all for a $95 annual fee.
  • Chase Sapphire Reserve The higher-end sibling to the Preferred has a higher annual fee of $450, but offers 3x points on travel (excluding ther $300 travel credit) and dining and a $300 credit toward travel purchases each year.
  • Chase Freedom Unlimited It's one of our top picks for college students and others who are new to credit cards. There's no annual fee, and you can convert the cash back you earn to points redeemable for travel if you have another Chase card like the Preferred.
  • Ink Business Preferred Credit Card — This business credit card earns bonus points on a wide variety of spending categories and offers a high sign-up bonus and other perks like primary rental car insurance, with a $95 annual fee.

SEE ALSO: All our credit card reviews — from cash-back to travel rewards to business cards — in one place

Join the conversation about this story »

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The top 20 cities around the world that are ready to welcome Gen Z workers

Fri, 09/06/2019 - 2:59pm  |  Clusterstock

The oldest members of Generation Z — those born in 1997 — have just graduated from college. For those considering a new place to live and work, a select group of cities could have the most to offer.

The 2019 Generation Z City Index by apartment search site Nestpick found the best cities around the world for Gen Zers to live in. Nestpick used Pew Research Center's January 2019 definition of Generation Z: anyone born between 1997 and 2012. But that's not all that defines them. According to Nestpick, Gen Zers are "digital natives who value security, diversity, and autonomy, and aim to achieve it through pragmatism and determination."

The study examined 110 prominent international cities, focusing on 22 factors that were split into four main categories: digitalization, business, principles, and leisure. The sub-categories across all four major categories included government digitalization, education, environmental action, LGBT+ equality, right to protest, affordability, and concerts, among others. Each city was given a score out of 100, the total of the weighted averages of each of the four categories. You can read a full explanation of the study's methodology here.

The top spot went to London, which earned perfect scores in three sub-categories: concerts, coworking spaces, and social entrepreneurship. Other highly-ranked cities included Stockholm, Los Angeles, and Toronto.

Here are the 20 cities best equipped for Generation Z's particular wants and needs.

SEE ALSO: 80% of Gen Z college students say they're voting in 2020 — and they've singled out student debt as their biggest concern

DON'T MISS: The 25 best states to live for 20-somethings, where jobs are booming and rent is affordable

20. Seattle, USA

Total score: 77.71

Top-scoring categories: government digitalization (94.13), access to healthcare (91.77), environmental action (89.48)

In 2013, Seattle unveiled its Climate Action Plan, which aims to limit the greenhouse gas emissions of road transportation, building energy, and waste.

19. Brussels, Belgium

Total score: 77.72

Top-scoring categories: right to protest (98.05), access to healthcare (93.51), LGBT+ equality (92.08)

Belgium was the second country to legalize gay marriage (after the Netherlands), in 2003. And its capital, Brussels, is known for being an LGBT+ friendly destination.

18. Malmo, Sweden

Total score: 78.96

Top-scoring categories: digital banking (100), right to protest (100), access to healthcare (97.96)

Malmo is at the forefront of digital banking, like most of Sweden. Most of its citizens haven't used cash for recent purchases, according to a March report by The Guardian. As cash becomes more obsolete, credit cards and apps like Swish are making digital payments easier.

17. Frankfurt, Germany

Total score: 79.35

Top-scoring categories: right to protest (98.05), government digitalization (94.07), access to healthcare (91.77)

Like all German cities, Frankfurt offers universal access to healthcare. In fact, it's illegal not to have health insurance, and providers can't turn down patients.

16. Gothenburg, Sweden

Total score: 79.46

Top-scoring categories: right to protest (100), digital banking (90.99), environmental action (98.85)

Gothenburg prides itself on its environmental policies. According to the Global Destination Sustainability Index, Gothenburg was named the world's most sustainable destination in 2016, 2017, and 2018.

15. Montreal, Canada

Total score: 80.00

Top-scoring categories: right to protest (98.05), access to healthcare (94.76), connectivity/5G (90.99)

The citizens of Montreal may speak two different languages (French and English), but they're still part of the same healthcare system as the rest of Canada, meaning they have access to free or affordable healthcare.

14. Helsinki, Finland

Total score: 80.33

Top-scoring categories: access to healthcare (98.79), LGBT+ equality (98.48), right to protest (98.05)

Finland made gay marriage legal in 2017 after thousands of its citizens petitioned for the law. Like other Nordic countries, Finland is known for its forward-thinking policies towards the LGBT+ community.

13. Copenhagen, Denmark

Total score: 80.70

Top-scoring categories: right to protest (100), government digitalization (100), LGBT+ equality (95.77)

The Danish government grants its citizens full freedom of speech, which includes the press. Denmark won first place in the Press Freedom Index three times in the last 15 years.

12. Manchester, UK

Total score: 81.18

Top-scoring categories: government digitalization (97.69), right to protest (97.08), environmental action (90.62)

While London is known for its booming tech scene, the city of Manchester is also pioneering digital technologies: It's currently investing £4.1 billion in digital businesses and services throughout the city.

11. Paris, France

Total score: 82.13

Top-scoring categories: digitalized mobility (100), government digitalization (94.46), environmental action (92.19)

Paris became the site of a global climate change conference in December 2015, which created the Paris Agreement. World leaders made promises to limit global warming to below 2°C in the first legally binding agreement of its kind.

10. Vancouver, Canada

Total score: 82.48

Top-scoring categories: right to protest (98.05), access to healthcare (95.03), connectivity/5G (89.53)

Vancouver, British Columbia, is modernizing quickly. It made plans to provide citizens access to mobile kiosks, making it easier for them to contact city services.

9. Amsterdam, Netherlands

Total score: 83.02

Top-scoring categories: access to healthcare (99.02), right to protest (98.05), LGBT+ equality (95.99)

Amsterdam is known for the uninhibited nature of its citizens, and they've got a progressive attitude towards the LGBT+ community. The city also has its own annual gay pride parade, which attracts thousands of visitors each year.

8. San Francisco, USA

Total score: 83.09

Top-scoring categories: AI industry (100), entrepreneurial spirit (100), government digitalization (94.13)

San Francisco is home to Silicon Valley, America's startup hub. Countless tech companies got their start in the region, including Apple, Google, Tesla, Twitter, and Facebook.

7. Munich, Germany

Total score: 83.11

Top-scoring categories: right to protest (98.05), government digitalization (94.07), access to healthcare (91.91)

German healthcare is among the best in Europe. It also has one of the oldest healthcare systems, dating back to the 1880s.

6. Berlin, Germany

Total score: 84.53

Top-scoring categories: right to protest (98.05), government digitalization (94.07), access to healthcare (91.68)

The German government is taking big steps to bring Berlin into the digital age. The city has set aside €2.4 billion for digital infrastructure to boost its internet.

5. New York, USA

Total score: 86.03

Top-scoring categories: coworking spaces (98.12), concerts (96.97), government digitalization (94.13)

New York City is full of opportunity, and that includes opportunities for small businesses and freelancers. That's why it earned a high score for its coworking spaces, proving that the industry is here to stay.

4. Toronto, Canada

Total score: 86.20

Top-scoring categories: right to protest (98.05), access to healthcare (95.05), social entrepreneurship (91.48)

Canada is famous for its single-payer universal healthcare system, which makes Toronto one of the best cities in the world for access to healthcare.

3. Los Angeles, USA

Total score: 89.40

Top-scoring categories: education (96.87), concerts (95.36), government digitalization (94.13)

Los Angeles is a hub for entertainment, with legendary venues like the Walt Disney Concert Hall, the Greek Theatre, and the Hollywood Bowl all in one city. 

2. Stockholm, Sweden

Total score: 89.88

Top-scoring categories: digital banking (100), environmental action (100), right to protest (100)

Stockholm is known for its environmental policies — in fact, it's one of the greenest cities in the world. 100% of its energy comes from renewable resources, and it plans to be free of fossil fuels by 2040.

1. London, UK

Total score: 100

Top-scoring categories: concerts (100), coworking spaces (100), social entrepreneurship (100)

London scored perfectly in three different categories. One of its strengths is its high ranking for social entrepreneurship — according to a 2016 Reuters poll, the UK was named the No. 3 country for social entrepreneurs.

CULTIVATED: Recruiters share their 3 best tips for landing a job in cannabis, Headset CEO walks us through his pitch deck, and vape-related illnesses

Fri, 09/06/2019 - 2:46pm  |  Clusterstock

Introducing Cultivated, our new weekly newsletter where we're bringing you an inside look at the deals, trends, and personalities driving the multibillion-dollar global cannabis boom. Sign up here.

Happy Friday everyone,

September is officially upon us, which thankfully means cooler weather and the oft-cited "Fall Sprint" in media circles.

A bit of bad news, however: I was really excited for some big, quality hurricane-fueled surf out at Rockaway Beach this weekend — forecasts like this are once in a blue moon for the East Coast. Unfortunately, Mayor De Blasio's office has other ideas and has closed all New York City beaches to surfing this weekend over concerns about rip currents. 

Your friendly cannabis industry reporter is pretty bummed about that. 

Anyway, let's get to it:

On Thursday, we held our inaugural cannabis industry webinar with Headset CEO Cy Scott, joined by Poseidon Asset Management Partners Emily and Morgan Paxhia.

In the webinar, Scott walked us through his tips for crafting the perfect pitch deck to hook potential investors. Headset raised a $12 million Series A earlier this year, led by Poseidon.

You can watch the webinar in its entirety here

In other news, vaping related illnesses and deaths continued to climb over the week. Regulators and doctors are still unsure of the root cause of these, but it appears that the illnesses stem from both nicotine-containing vapes, as well as THC-containing vapes.

And it's not yet clear whether illicit vapes are solely to blame, as state health officials in Oregon confirmed that a middle-aged man had died after purchasing cannabis oil from a regulated dispensary. Former FDA chief Scott Gottlieb has an editorial in The Washington Post going over the dangers of vaping both nicotine and THC. 

On the Canadian cannabis front, CannTrust's woes continue. A recent report from BNN Bloomberg found that senior staff at CannTrust brought illicit cannabis seeds into their licensed production facilities, resulting in illegally-grown pot entering the regulated market. 

The company has since laid off 20% of its staff — or 180 people — as it restructures in light of all the recent turmoil 

In (slightly) more upbeat news, I had the pleasure of sitting down with Brendan Kennedy, Tilray's CEO, in BI's Manhattan offices on Wednesday where he laid out his view of the cannabis landscape. Cowen analyst Vivien Azer slashed her price target on Tilray by 60% but still maintained her outperform rating on the stock. 

More stories from around the BI newsroom:

We spoke with the top recruiters in the booming cannabis business. Here are their 3 best tips for landing your dream job in the industry.

Cannabis companies are growing rapidly. They're a great place to look for jobs, from entry-level retail positions all the way up to senior management.

To get a sense of how to best land a job in the booming industry, Business Insider spoke with some of the top recruiters in the cannabis world.

They told us their best tips — and explained why being passionate about cannabis isn't enough to land a new role.

The CEO of cannabis-tech startup Headset told us why having a concise mission statement is crucial to successfully pitching investors

The CEO of Headset, a data-analytics provider for the cannabis industry, revealed his key advice for making a successful pitch to potential investors.

Scott emphasized the importance of having a clear and concise mission statement that "aligns everyone to the organization" and hooks investors.

The company recently brought in $12 million from its series A funding round.

The mysterious rash of vaping lung illnesses is hitting young marijuana users especially hard, and experts still don't know why

This one is from my colleague Hilary Brueck on Insider's science and health team, who has been doggedly covering the vape illness story all week.

On Friday, the Centers for Disease Control and Prevention (CDC) said more than 450 "possible cases" of vaping-related lung illnesses have been tallied so far. At least four people have died after vaping.

Many of the cases involve vaping THC and other cannabinoids, but some happened after vapers inhaled only nicotine.

The safest thing to do, the CDC says, is "consider not using e-cigarettes."

Capital raises, M&A activity, partnerships, and launches
  • NASDAQ-listed Greenlane Holdings has entered into a partnership with Omura, a vape company, to distribute Omura vapes throughout the US and Canada.
  • Canadian cannabis cultivator Aurora dumped its stake in The Green Organic Dutchman (TGOD), selling just over 28.8 million shares. The company did not disclose who it sold the shares too.
  • Canopy Rivers, the venture capital arm of Canadian cannabis giant Canopy Growth, has received final approval to list on the TSX. It will start trading when markets open on September 9. 
Executive moves
  • California cannabis company Shryne Group names John Avidor as its new Executive Chairman. John, a former M&A lawyer who previously worked at Sullivan & Cromwell, previously served as the chair of Shryne's board. 
  • Vertically-integrated cannabis retailer Glass House Group has appointed Jared Cohen as the firm's chief investment officer. Cohen previously spent close to 10 years at Fortress Investment Group. The company has also appointed Groovy Singh, who has two decades of marketing experience, as its new chief marketing officer. 
  • Namaste Technologies appoints interim CEO Meni Morim to full-time CEO. The company came under attack from short-seller Andrew Left last year, as concerns over former CEO Sean Dollinger's leadership came to light.
Chart of the week

It's worth revisiting this chart in light of the vape-related illnesses, from a story we published back in April. In the story, we obtained exclusive results from one of California's top cannabis testing labs, CannaSafe.

The lab found in a blind analysis that less than 15% of CBD products actually contained what the labels said. On top of that, some of the tested products had high levels of solvents and dangerous gases like ethylene oxide and ethanol that are particularly dangerous when vaporized and inhaled.  

Check out the results of the study:

Stories from around the web

Psychedelic drugs draw some investor attention — and much skepticism (Wall Street Journal)

Black market pot entered CannTrust facility, flowed into legal market last year: Sources (BNN)

CEO of cannabis giant Canopy is on a media blitz to ease concerns (CNN Business)

The baffling legal gray zone of marijuana at the airport (Wall Street Journal) 

Vape pen lung disease has insiders eyeing misuse of new additives (Leafly)

Join the conversation about this story »

NOW WATCH: Sharks aren't the deadliest creatures on Earth. Here are the top 10.

12 cheap capital cities everyone wants to visit

Fri, 09/06/2019 - 2:22pm  |  Clusterstock

  • Most world capitals are the biggest cities in their countries.
  • Some capitals offer a better bang for your buck when it comes to traveling.
  • Using a list of the most affordable capitals and the most popular travel destinations of 2018, we compiled the list of budget-friendly capital cities everyone wants to visit.
  • Visit Business Insider's homepage for more stories.

A country's biggest city is almost always its capital — in fact, there are only 35 countries where that's not the case.

That means when you're traveling to a new country, there's a good chance you'll be spending time in the capital. 

But which capitals offer travelers the most bang for your buck? The travel site Cuba Holidays ranked more than 100 capital cities by how affordable they are, comparing each city by the average price of a hotel, transportation, a mid-range meal for two, a pint of beer, a cup of coffee, and entry to the city's 10 most popular attractions.

Of the 60 most affordable capital cities to visit, 12 of them are among the biggest tourist hotspots in the world, appearing on Euromonitor's list of the top 100 most-visited cities in 2018.

The two lists, when combined, provide the dozen capital cities that are not only popular for travelers, but won't blow up your budget, either. We ranked the cities below by affordability.

Take a look at the budget-friendly capital cities that people can't stop visiting.

SEE ALSO: The 31 most popular cities in the world for travelers

DON'T MISS: Breathtaking photos of the highest points in 31 different countries, from Denali to Everest

12. Bangkok, Thailand

11. Doha, Qatar

10. Warsaw, Poland

9. Kuala Lumpur, Malaysia

8. Lima, Peru

7. Riyadh, Saudi Arabia

6. Moscow, Russia

5. Mexico City, Mexico

4. Cairo, Egypt

3. Phnom Penh, Cambodia

2. Buenos Aires, Argentina

1. Jakarta, Indonesia

With a US Department of Justice move against automakers, the Trump administration is now officially antibusiness (F)

Fri, 09/06/2019 - 1:37pm  |  Clusterstock

  • The US Justice Department has opened an investigation into Ford, VW, Honda, and BMW after the automakers signaled their intent to follow a California standard for vehicle emissions.
  • President Donald Trump has been engaged in a battle with California over the state's prerogative to set its own emissions standards. His administration wants to roll back standards set during President Barack Obama's administration.
  • The DOJ is reportedly investigating the automakers on antitrust grounds.
  • The car business is finding out the hard way that Trump isn't interested in modern business.
  • The Republican Party might be in favor of corporate tax cuts, but it's ignoring Trump's attacks on American business.
  • Visit Business Insider's homepage for more stories.

For my lifetime, and for decades before I was born, the Republican Party was, notably, the party of business. I occasionally met an adult Democrat who was passionately pro-business, but, for the most part, when I encountered business folk, I assumed that they pledged allegiance to the GOP.

The modern GOP remains the party of corporations, which is to say, enormous financial architectures and repositories of capital that — thank the Citizens United decision — can be deployed to political ends. This constituency was amply rewarded by the Trump-propelled tax cut of 2017.

But when it comes to the actualities of business, a schism has developed between the GOP and American companies. The Trump trade war is Exhibit A, but trashing NAFTA (and then reviving it essentially unchanged, just renamed) and jawboning assorted CEOs about their production outsourcing have to be taken into account. And who can forget the once threatened border tax on stuff made by US companies in Mexico and then imported to the US?

Read more: Trump thinks more fuel-efficient cars would be more expensive and less good. He's wrong.

On Thursday, the antibusiness attitude hit a new low, as the US Justice Department announced it would investigate a consortium of four automakers — Ford, VW, Honda, BMW — for cutting a deal with California to meet its emissions standards for new vehicles, rather than following a more lax standard from the Trump administration, itself a blow to regulations implemented by President Barack Obama's administration.

Trump versus California and Detroit

"The Justice Department investigation, preliminary in nature, is the latest salvo from a Trump administration that is intent on curbing California's influence on the auto industry," The Wall Street Journal reported.

"California has power rivaling the federal government's in setting environmental rules for cars and trucks, irritating the president and several high-ranking officials in his administration who are working to eliminate authority they think the state has abused."

The Golden State dustup is Trumpist business "dealing" in a nutshell: It has nothing to do with business and everything to do with Trump's addiction to crude theater. Detroit is vaguely pro-Trump, but the leaders of the auto industry don't want to deal with a dual national emissions standard and would prefer that the president stop telling them to shutter factories in China so that they can build more plants in the US and hire more Trump voters.

Detroit execs are on the front lines of managing what a lot of longtime Trump observers have known for years: The president claims to be a dealmaking business genius, but his business background is small-time real-estate development for a rinky-dink family operation punctuated with bankruptcies and bilked partners. More recently, even the real-estate part was supplanted by a branding-and-media hustle.

Automakers, meanwhile, are managed by well-educated and experienced executives who oversee vast global operations that send tens of billions of dollars sloshing through their balance sheets every quarter. Since he was elected — thanks to a skinny margin in several auto-industry-exposed Midwestern states — Trump has demonstrated a reliable ignorance of how the 21st-century car business operates.

See also: Apply here to attend IGNITION: Transportation, an event focused on the future of transportation, in San Francisco on October 22

This is hell on car-company executives, but Trump and the administration's tangles with the automakers play well, particularly if California — a renegade kingdom of blue — can be brought into the fight.

On a procedural level, the DOJ has a mandate to investigate collusion among businesses that might undermine consumers. "Officials are concerned the deal might artificially limit the types of cars and trucks the auto companies offer to consumers, the people familiar with the matter said," The Journal reported.

Fair enough, but in truth, that's a nonstarter. The US has the most competitive auto market. Consumers are awash in choice.

No, Ford, VW, Honda, and BMW didn't ally with California to deny consumers their right to choices. They joined up out of desperation, believing that a show of unity and force would convince Trump that it really would be very bad to compel huge car companies to plan their production for the next decade with two US emissions regimes to please.

But maybe that was the wrong move. Businesspeople, for increasingly baffling reasons, think they can deal with Trump as a businessman. The sooner they figure out his business is fake business, the better off they'll be.

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Join the conversation about this story »

NOW WATCH: Watch Ford's delivery robot that walks on two legs like a human

WeWork says it has a $3 trillion market opportunity and has signed up only 0.2% of its potential customers. Here's why real-estate experts say those numbers don't add up.

Fri, 09/06/2019 - 1:37pm  |  Clusterstock

  • WeWork, in its initial-public-offering paperwork, says it's operating in an enormous market, and it's only barely started to crack the surface of it.
  • The company says its potential market is the $3 trillion it estimates businesses are spending on office space for some 255 million desk workers around the world; only 0.2% of those workers are in WeWork spaces today.
  • But real-estate analysts told Business Insider those numbers vastly overstate the company's market opportunity.
  • WeWork's service isn't a good fit for many types of businesses and office work, and it has yet to prove that its business model works outside city centers, the analysts said. 
  • Read all of Business Insider's WeWork coverage here.

WeWork is reportedly having trouble convincing investors that it's worth anything close to the $47 billion valuation it fetched in its last private-funding round.

Here's another reason why they should be skeptical: The company has likely vastly overstated its potential market.

In its recently released initial-public-offering paperwork, WeWork said its current members account for only 0.2% of what it sees as its potential customer base and that its potential market is worth around $3 trillion a year.

"We believe that our leadership position in this market, which we expect will benefit from trends enabling the re-invention of work, provides us a strong runway to continue growing," the coworking giant said in its IPO filing.

WeWork may well continue to post strong growth as it moves into new cities and opens up new locations, real-estate experts told Business Insider. But the company seems to be implying that its potential market includes just about every desk job in the cities it either operates in already or in which it plans to open space eventually. And the market, as it defines it, seems to include not just those cities' dense urban cores, where almost of WeWork's space is to date, but also their surrounding suburbs.

Jeff Langbaum, a real-estate analyst with Bloomberg Intelligence, said he took WeWork's market-size estimates with a grain of salt because they were "so far out there."

"I don't disagree with the premise that there is opportunity for them to continue to expand," Langbaum said. "I don't think it's anywhere close to that $3 trillion."

WeWork says it has huge potential

Reports this week in The Wall Street Journal and Bloomberg indicated that WeWork's planned IPO was facing significant skepticism from potential investors. According to the reports, the company is considering going public with a market capitalization of as little as $20 billion — less than half its last private valuation — or even shelving its IPO entirely. 

The company faces numerous questions about its business and governance, including how it might survive a recession and how much investors should trust its CEO, Adam Neumann, after a series of eyebrow-raising moves and transactions.

Read more: Here's how WeWork answered the 5 biggest questions about its business — and why analysts are still worried about its upcoming IPO

Central to WeWork's pitch to investors is the notion that it has only brushed the surface of an enormous market. It mentions its 0.2% market penetration estimate on Page 4 of its IPO paperwork and its $3 trillion total addressable market on Page 6.

"We are just getting started," the company said in its document. The italicized text for emphasis is in the original filing.

WeWork operates its coworking spaces in 111 cities today, according to the document. But it plans to eventually offer office space in 280 cities around the world.

The company appears to define its addressable market in the US to include everyone who works at a desk job in one of the cities in which it either offers space already or plans to do so. Outside the US, it counts as potential WeWork members anyone in its current or target cities who works in a wide variety of white collar professions, including managers, professionals, technicians, associate professionals, and clerical-support workers.

"We assume that these individuals need workspace in which they have access to a desk and other services," the company said in its filing. "We view this as our addressable market because of the broad variety of professions and industries among our members, the breadth of our solutions available to individuals and organizations of different types and our track record of developing new solutions in response to our members' needs."

WeWork estimates that there are 149 million workers in such professions in the cities in which it operates. It figures there are 255 million in the 280 cities it eventually wants to be in. About 527,000 people — or about 0.2% of that 255 million — work in a WeWork space today, the company said. Even in its most mature markets — New York and London — only about 1.2% of workers with desk jobs work in a WeWork space.

The company figures that businesses in the cities in which it plans to operate spend about $11,700 per year per worker on office space. By multiplying that figure by the 255 million office workers it thinks it could eventually serve, WeWork gets to the $3 trillion market opportunity it sees.

"We believe these total opportunities reflect the amount employers are willing to spend and present an opportunity for us to capture greater wallet share," the company said in the filing.

Not every desk job is likely to move to a WeWork space

But real-estate analysts think WeWork is greatly inflating its opportunity.

The company doesn't specifically list which industries or types of workers are included in its 255 million potential-member estimate, so it's hard to know how accurate that number is in terms of the number of desk workers in the areas it plans to operate in. The WeWork spokesman Erin Clark declined to comment for this story or provide more details on how the company defines its potential customers.

But even if WeWork's number is a fair estimate, it's highly unlikely that all those desk workers really represent potential customers, analysts said.

A receptionist in a medical office is a desk job, but it's not at all clear that a doctor would want to set up shop in a WeWork coworking space. Likewise, lawyers are typically desk-bound, but it's not clear that a law firm would want to set up shop in a coworking environment, given the confidential and sensitive information they handle.

Even with specialized offerings, in which WeWork customizes entire floors of buildings for individual companies and handles the facilities' management, its subleasing model isn't right for everyone. 

A corporation likely isn't going to want to put its research-and-development department, responsible for developing proprietary technologies, in a WeWork space, said Walter Johnston, who focuses on the real-estate market as a vice president of credit ratings at the research firm Morningstar. 

Part of WeWork's business model is to concentrate a greater number of workers in a particular amount of space that is less than typical amount in commercial real estate. That's how it can advertise to potential customers that its spaces cost them less money — at least on a per-employee basis.

But many companies may not want to cram their workers in such tight spaces, Johnston said. WeWork saying that every desk worker could work in one of its offices is kind of like a pickup-truck manufacturer saying that every single car driver is a potential customer, he said.

"Not every desk job is suited to a WeWork-type environment," Johnston said. "There are certain office types that just aren't, at least at the moment, being served by WeWork," he added, "and it's [unclear] if they ever could be."

Apple is unlikely to turn its 'spaceship' over to WeWork

Another problem with WeWork's market-size estimate: However many desk workers there may be in its markets, its ability to provide office space for them is likely limited. The company owns few properties. It instead leases them from other building owners. And it's in competition for those spaces not only with traditional tenants but also with other coworking companies, such as Regus and Industrious.

At least some industry figures, such as the real-estate tycoon Sam Zell, are starting to talk about the need for the industry to limit the amount of space it leases out to coworking companies, worrying that such businesses are ultimately unsustainable.

Additionally, many companies with office workers already own their own buildings or properties. It's highly unlikely that they would want to somehow turn over management of those offices to WeWork or have WeWork remake them in its own image.

Take Apple, which recently spent $5 billion on a new headquarters in Silicon Valley. Most of the employees at its new "spaceship" campus likely work desk jobs. But Apple would seem to have no incentive to turn the spaceship into a WeWork space, Johnston said.

"Apple just spent all this money to own their own building," Johnston said. "Right now, they're the owner, they're the landlord, and the tenant. There's no reason for them to insert somebody in the middle."

It's unclear if WeWork works in the 'burbs

WeWork doesn't give a precise definition of what it means by "cities" when it talks about the areas in which it operates or plans to open space. Clark, the company spokeswoman, declined to offer an explanation.

However, the company appears to be looking not just at urban areas but also their surrounding suburbs.

For example, it said in the filing that when it discusses its market penetration in San Francisco, it's including spaces it operates everywhere from the financial district of that city to Oakland and California suburbs such as Mill Valley and Mountain View. Likewise, the Los Angeles market for WeWork includes the spaces it operates in El Segundo, Costa Mesa, in Orange County, and Pasadena.

While WeWork may operate some buildings in such far-flung places, it's not clear that its model really works there, or for most suburban office spaces, analysts said. To date, most of its success has been in dense urban areas, said Tom Smith, a cofounder of Truss, an online commercial-real-estate marketplace. In New York, for example, nearly all of WeWork's space is in Manhattan, he said.

Regus, which pioneered the coworking industry and is WeWork's top rival, has had success in the suburbs, Smith said. But it doesn't try to pack as many people into its spaces as WeWork does. And WeWork hasn't shown that its own model will work outside city centers, Smith said.

"I don't know, necessarily, that WeWork's [model] plays as well everywhere, and that would severely limit their ability to expand into ... this addressable market they're referring to," he said.

And then there's the $3 trillion market-size number — a staggering number by any measure (as a point of reference, there is only $1.7 trillion of physical US currency in circulation, according to the Federal Reserve). The $3 trillion figure obviously would be smaller if it turned out that there really weren't 255 million potential WeWork members.

But there's another problem with that number, the analysts said. WeWork makes clear that the $3 trillion figure represents what businesses are spending on office space for those 255 million workers today. Part of the company's appeal is that what it charges for space on a per-worker basis is significantly less than the average amount businesses are paying today. While there's probably room for WeWork to raise its rates, it's not at all clear that it could boost its rates up to the average amount that businesses are paying elsewhere, analysts said.

WeWork seems to be talking out of both sides of its mouth, Johnston said.

The company seems to be saying, "the product we offer is cost saving and then our market opportunity is eliminating those cost savings," he said.

If you add up all of those factors, the market opportunity ahead for WeWork is much smaller than it says in its IPO paperwork, analysts said.

WeWork's estimate of its market penetration — 0.2% — "could be grossly understated," Smith said.

Got a tip about WeWork or another company? Contact this reporter via email at, message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.

SEE ALSO: WeWork wants investors to think of it as a tech company. These 5 slides illustrate how its numbers tell a different story.

Join the conversation about this story »

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WATCH: The founder of buzzy cannabis-tech startup Headset walked us through the pitch deck that helped him raise $12 million and ink deals with Nielsen and Deloitte

Fri, 09/06/2019 - 1:13pm  |  Clusterstock

Headset, an analytics startup for the nascent marijuana industry, raised a $12 million Series A round backed by prominent investors earlier this year and has inked deals with market research firm Nielsen and accounting firm Deloitte.

In this webinar, Headset CEO Cy Scott talks to Business Insider's cannabis industry reporter, Jeremy Berke, about crafting the perfect pitch deck to hook potential investors.

Scott and Berke were also joined by Emily and Morgan Paxhia, the brother-and-sister duo and founding partners of the cannabis investment fund Poseidon Asset Management. Poseidon led Headset's Series A, and they shared their insights on what parts of Scott's pitch catalyzed their decision to invest in the round.

Read moreWe got an exclusive look at the pitch deck buzzy marijuana tech startup Headset used to raise $12 million and ink deals with Nielsen and Deloitte

To Scott, who said he pitched 20 to 30 investors over a six-month period to get the round closed, one of the most critical pieces of a solid pitch is a clear, concise mission statement.

"It demonstrates real discipline by a founder to have a clear mission statement," Poseidon partner Emily Paxhia said.

Join the conversation about this story »

These were the most delayed airports in the US this summer

Fri, 09/06/2019 - 1:11pm  |  Clusterstock

  • Flight delays are an inevitable part of travel, but some airports this summer saw more delays than others.
  • Factors ranging from severe weather in some areas, to airline operational problems, to mechanical and even alleged labor issues, led to more than one-third of all flights being delayed at some airports this summer.
  • Passenger advocacy company AirHelp compiled a list of the 10 most delayed US airports this summer — take a look to see which performed the worst.
  • Visit Business Insider's homepage for more stories.

Summer travel can be a lot of fun, but the logistics of crowded airports and delayed flights can add a degree of stress to any vacation.

Unfortunately for Americans traveling this summer, some of the country's biggest airports saw what felt like a constant stream of delays — in some cases, with more than one-third of all flights leaving well behind schedule.

AirHelp — a passenger advocacy company that helps people claim compensation for flight delays — sourced flight data from all around the US and ranked the most delayed major airports.

For the comparison, AirHelp included any flight that left more than 15 minutes after it was scheduled, or that was cancelled, as "delayed." The data collected were from June 1–July 31 — complete August data were not available yet — and focused on major commercial airports. A representative for the company said that data were pulled from "a variety of reliable sources such as government agencies, airport databanks, flight-tracking vendors, historical resources and commercial data brokers."

Scroll down which US airports had the most delays. If you were on a delayed flight this summer, you can check AirHelp's eligibility tool to see if you might be owed compensation from the airline.

See also: Apply here to attend IGNITION: Transportation, an event focused on the future of transportation, in San Francisco on October 22.

SEE ALSO: Apply here to attend IGNITION: Transportation, an event focused on the future of transportation, in San Francisco on October 22.

DON'T MISS: A summer meltdown at New York's LaGuardia Airport has travelers walking on the highway to get to their flights

10. Los Angeles International Airport (LAX)

LAX has a 77.5% on-time performance

9. Hartsfield-Jackson Atlanta International Airport (ATL)

Atlanta's on-time performance was 76.7%

8. John F. Kennedy International Airport (JFK)

While all three major New York City-area airports made the top 10, JFK had the best on-time performance: 73.7%. Despite being on the list, that's actually fairly impressive considering that one of JFK's runways was shut down for repairs this summer.

7. Charlotte Douglas International Airport (CLT)

Charlotte Douglas Airport was just behind JFK with a 73.3% on-time rate.

6. George Bush Intercontinental Airport (IAH)

Houston's major international airport had a rough summer, with a 71% on-time performance rate.

5. Dallas/Fort Worth International Airport (DFW)

Dallas/Fort Worth had a tough time getting flights out on time this summer for a few reasons. Frequent storms led to weather-related delays, while American Airlines — for which DFW is a hub — had problems with delays stemming from myriad maintenance and alleged labor issues. The airport's on-time departure rate was just 68.5%.

4. Denver International Airport (DEN)

Denver also had a rough summer, with just 66.1% of its departures leaving on-time

3. New York City's LaGuardia Airport (LGA)

Travelers flying from LaGuardia faced plenty of inconveniences this summer. Between construction causing 45-minute delays getting to some terminals, and severe weather throughout the Northeastern US all summer, LaGuardia had an on-time percentage of just 66.0%.

2. Chicago O’Hare International Airport (ORD)

Chicago's O'Hare International Airport also had a rough summer, with just 64.9% of flights departing on schedule.

1. Newark Liberty International Airport (EWR)

While both LaGuardia and JFK were impacted by this summer's frequent thunderstorms, Newark Liberty International Airport bore the worst of the delays. Only 63.9% of flights departed the airport on-time.

An American Airlines mechanic is accused of sabotaging a plane in Miami because of stalled contract negotiations

Thu, 09/05/2019 - 10:12pm  |  Clusterstock

  • An American Airlines mechanic was arrested on Thursday on suspicion of sabotaging a plane in Miami this summer, according to the Miami Herald.
  • The mechanic glued a hard foam material inside a tube leading to the plane's air-data module, which measures air speed, pitch, and other crucial flight information. The pilots aborted takeoff when they noticed an error message.
  • He said that he was upset over stalled labor contract negotiations between the airline and the union, and was trying to get the flight canceled so he could work overtime.
  • The airline and union have been locked in a contentious dispute all summer, with the airline accusing mechanics of an illegal organized work slowdown, saying it caused performance issues this summer.
  • Visit Business Insider's homepage for more stories.

A mechanic for American Airlines was arrested in Miami on Thursday on a sabotage charge after he was accused of tampering with a plane because he was upset over stalled union contract negotiations.

The mechanic, named Abdul-Majeed Marouf Ahmed Alani, according to a criminal complaint filed in a Miami federal court and cited by the Miami Herald, is accused with tampering with an aircraft's air-data module. 

According to the complaint, Alani is suspected of gluing a hard foam substance inside a tube that connected a sensor on the nose of the airplane — called "pitot tubes" or static ports  — with a computerized system — the air-data module, or "ADM" — that reads air pressure from the sensor and computes the aircraft's air speed, along with other information like pitch.

The July 17 flight, AA2834 to Nassau, Bahamas, never took off, and no one on the plane was injured. As pilots powered up the thrusters on the runway in Miami, they received an error alert from the ADM, leading them to abort the takeoff.

The flight was canceled and the plane — a Boeing 737-800, according to data from FlightRadar24 — was taken out of service for maintenance, according to the criminal complaint. During an inspection, a different mechanic found the obstructed tube.

Alani is charged with "willfully damaging, destroying or disabling an aircraft." He's expected to appear in Miami federal court on Friday, according to the Miami Herald. The charge carries a penalty of up to 20 years in prison, if convicted.

Read more: These were the most delayed airports in the US this summer

After he was arrested, Alani said that he was not trying to hurt anyone on board the plane or cause lasting damage to the aircraft, according to the criminal complaint.

Instead, the alleged act of sabotage was because Alani was "upset" over stalled contract negotiations between American Airlines and its mechanics' labor unions. He claimed that "the dispute had affected him financially," and that his objective was to cause "to cause a delay or have the flight canceled in anticipation of obtaining overtime work."

Alani was arrested by federal air marshals working as part of the FBI's Joint Terrorism Task Force.

American Airlines has been locked in a contentious battle this summer over stalled contract negotiations with the union representing its mechanics, the TWU-IAM Association — which is formed of the Transport Workers Union of America (TWU) and the International Association of Machinists and Aerospace Workers (IAM). The union represents a total of 30,000 ground workers at American Airlines.

The airline accused the union of organizing an illegal work slowdown, and filed a lawsuit in May seeking a permanent injunction against the mechanics — the court ruled for American in August. The unions denied that there was an organized slowdown, but nevertheless urged employees to abide by the ruling.

The airline has been negotiating with mechanics since December 2015, but talks stalled and there has not been a meeting between the airline and unions since April.

See also: Apply here to attend IGNITION: Transportation, an event focused on the future of transportation, in San Francisco on October 22.

On Wednesday, TWU-IAM announced that it was resuming contract negotiations with American later this month at the National Mediation Board in Washington, DC.

"The delays in this process have been frustrating for our members but they have remained fully supportive of the Association," Alex Garcia, vice director of the TWU-IAM Association, in a press release announcing the new round of negotiations. "We will use this opportunity to finally close these negotiations, if American Airlines is a willing partner."

TWU-IAM did not immediately return a request for comment regarding Alani's arrest.

In a statement, American Airlines said that it was cooperating with the federal investigation:

On July 17, flight 2834 from Miami to Nassau, Bahamas, returned to the gate due to a maintenance issue. Passengers boarded a new aircraft which then re-departed for Nassau. At American we have an unwavering commitment to the safety and security of our customers and team members and we are taking this matter very seriously. At the time of the incident, the aircraft was taken out of service, maintenance was performed and after an inspection to ensure it was safe the aircraft was returned to service. American immediately notified federal law enforcement who took over the investigation with our full cooperation.

The FBI declined a request for comment on Thursday night.

SEE ALSO: American Airlines cancelled an industry-worst 7,500 flights due to a perfect storm of mishaps this summer

Join the conversation about this story »

NOW WATCH: Inside Roborace: the Formula One for self-driving cars

Palantir's IPO could be delayed until 2023 as the embattled, Peter Thiel-founded data firm looks overseas for private funding

Thu, 09/05/2019 - 7:25pm  |  Clusterstock

  • The controversial data-analytics company Palantir may be pumping the breaks on going public. 
  • On Thursday, Bloomberg reported that the Palo Alto, California based tech firm was in talks with private investors to raise "significant funding."
  • Previously, Palantir was reportedly targeting an IPO in 2020. 
  • Bloomberg said that Palantir co-founder and Chairman Peter Thiel has told employees that the company would not be going public within the next two to three years.
  • That could set a potential Palantir IPO date back to 2022 or 2023. 
  • Visit Business Insider's homepage for more stories.

The controversial data-analytics company Palantir may be pumping the breaks on going public. 

On Thursday, Bloomberg reported that the Palo Alto, Calif. based tech firm — last valued at $20 billion — was in talks with private investors to raise "significant funding." Previously, Palantir was reportedly targeting an IPO in 2020. 

Palantir has courted Singapore's Temasek Holdings, SoftBank Group, and other non-US investors to participate in the potential round, according to people familiar with the matter who spoke to Bloomberg. 

Palantir co-founder and Chairman Peter Thiel told employees recently that the company would not be going public within the next two to three years, Bloomberg reported. That could set a potential Palantir IPO date back to 2022 or 2023. 

Palantir did not immediately respond to Business Insider's request for comment. 

Palantir, which has never been profitable, had reportedly been making efforts to gear up an upcoming public offering, which included hiring its first-ever sales team and eliminating lavish employee perks, like 13-course tasting-menu lunches, that could raise eyebrows among public market investors. Employees were also reportedly no longer allowed to expense last-minute international airfare and at least one person was fired for expensing off-the-wall purchases like lingerie. 

Read more: This $20 billion startup is reportedly cutting lavish perks as it tries to kill its employees' 'entitlement syndrome' ahead of a possible IPO

Because of Palantir's work with the US military and government agencies, the data-mining firm has long been subject to scrutiny by outside critics. Most recently, Business Insider learned that Palantir employees themselves are becoming increasingly split over the company's ties to government work — specifically its business dealings with the US Immigration and Customs Enforcement (ICE), the federal agency involved in detaining and deporting undocumented immigrants.

SEE ALSO: Palantir could be heading for a huge IPO, but its CEO says it almost went out of business several times because he didn't know how to pitch to investors

Join the conversation about this story »

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Activist investor Starboard bought a 7.5% stake in Box. Experts say that what comes next could be restructuring, layoffs, and maybe even a big sale to a competitor. (BOX)

Thu, 09/05/2019 - 7:20pm  |  Clusterstock

  • On Tuesday, Starboard Value disclosed it had purchased a 7.5% stake in cloud storage company Box.
  • The activist hedge fund will now be the third-largest stakeholder in the company behind the Vanguard Group and BlackRock.
  • Starboard has waged proxy wars in the past, and most notably laid the groundwork for Verizon's acquisition of Yahoo when it successfully negotiated four board seats away from the search company's existing investors.
  • We spoke to analysts, who say that Box's recent ups-and-downs on the public markets made it an attractive target for an activist investor — and that Box should expect anything from layoffs and cost reductions, to a sale to a larger rival. 
  • Click here for more BI Prime stories.

Tuesday might go down as a turning point for cloud storage company Box.

According to a regulatory filing, activist hedge fund Starboard Value purchased 11 million shares of the company, giving it a 7.5% stake. That makes Starboard the third-largest stakeholder in Box, behind Vanguard Group and BlackRock.

Starboard's involvement is poised to put Box cofounder and CEO Aaron Levie in a predicament, several reports note, because the hedge fund has a track record of waging intense proxy battles for company ownership, ousting existing management, and spearheading major acquisitions.

Perhaps most notably, Starboard is credited with helping make it possible for Verizon to acquire Yahoo in 2016, after it successfully negotiated control of four board seats. 

Read More: Peloton's CEO once bragged on TV that the company was 'weirdly profitable,' but the startup's IPO filing reveals years of losses

In the filing disclosing its stake, Starboard says only that Box is "undervalued and represented an attractive investment opportunity." 

Box CEO Aaron Levie seconded that sentiment on Thursday: "In the case of Starboard and many of our investors, there's a belief we're undervalued right now and there's an opportunity to grow that value," he said on stage at the TechCrunch Sessions Enterprise event in San Francisco. 

To that end, Business Insider spoke to several analysts, and the consensus appears to be that Starboard's most likely play is to pressure management into improving the company's profit margins. That could, potentially, lead to Box having to cut costs — which could mean layoffs. Besides that, analysts say, Box could well end up get gobbled up by a larger tech company. 

"Starboard, as a more value-oriented activist, saw a very good product here and a company that was, let's say, still trying to figure it out and maybe hasn't fully adapted to the fact that the growth rate of the business is a lot lower than they expected it to be a couple of years ago," Jason Ader, cohead of technology equity research for analyst firm William Blair, told Business Insider.

Amid all of this, Box has had a difficult year on the public markets, even as it continues to compete with cloud behemoths like Google and Microsoft in the enterprise cloud storage space. At the time of writing, it was trading around $17 a share. That's up from the $15 or so it was trading at before Starboard announced its stake, but well below its 52-week high of about $25. 

"The company is in this purgatory between growth investors and value investors right now, which presents interesting opportunities for activism," Ader said. "An activist could really accelerate growth and attract growth investors, or try to accelerate profitability to attract value investors, but I would think it's more the latter with Starboard."

"While we do not comment on interactions with our investors, Box is committed to maintaining an active and engaged dialogue with stockholders. The Board of Directors and management team are focused on delivering growth and profitability to drive long-term stockholder value as we continue to pioneer the Cloud Content Management market," a Box spokeswoman told Business Insider. 

That, too, echoes Levie's comments on Tuesday. 

"We're extremely focused on accelerating our growth rate," said Levie. "With Starboard or any other investor, that's what we tend to be focused on."

Here's what we know about Starboard, and what its investment may mean for Box's future.

Rosalie Chan contributed reporting to this story.

SEE ALSO: We still don't know if Jeffrey Epstein's money is floating around Silicon Valley, but several top venture capital firms say they've never accepted funds from the disgraced financier

Starboard Value is an activist hedge fund run by CEO Jeff Smith.

The New York-based hedge fund is known to take active positions in its portfolio companies, according to multiple reports, and can remain involved for up to three years depending on whether or not it gets a board seat, according to CNBC.

Starboard doesn't outline a particular area of investment focus, but has invested previously in tech companies like Yahoo and Symantec. It has also taken a significant stake in Newell Brands, which makes Sharpie pens.

Starboard isn’t afraid of ruffling some feathers.

In fact, Starboard has routinely purchased stock in companies that are struggling with the hopes that a fresh perspective can help turn things around. In the past, Starboard has resorted to proxy battles and ousting existing leadership in its quest to turn a profit on its investment.

The best example is Starboard's involvement with Yahoo. The hedge fund successfully negotiated for four board seats in April 2016, a move that is widely credited as laying the groundwork for the media giant's acquisition by Verizon a few months later

It also engaged in a months-long battle with Newell Brands that ended with the company appointing three independent directors to its board at Starboard's request, one of which was put forward by Starboard, according to a Reuters report.


Box went public in 2015 but has faced significant headwinds as it competes with massive cloud providers like Google and Microsoft.

Levie cofounded the company in 2005 with a focus on consumer cloud storage, but quickly changed focus to the more lucrative enterprise cloud storage market. But with the shift came significant competition with legacy providers like Google and Microsoft.

Now, a little over four years since its IPO, Box has had a tumultous time on the markets, with a 52-week low of $12.46 per share — well under its IPO price of $14. It's faring better now, at around $17 per share at the time of publication, but is still sailing some stormy seas. 

Analysts say that its recent troubles on the market made it an attractive target for an activist investor. 

"With the stock down 12% year to date and trading at a trough valuation, we're not at all surprised that value-oriented investors have taken a significant stake," associate Raymond James analyst Brian Peterson wrote in a note to clients. 

Box is particularly vulnerable to activist investors like Starboard after doing away with a dual-class share structure.

Like many newly public tech companies like Uber and Lyft, Box went public with a dual-class share structure that granted outsized ownership and control of the company to its cofounders, executives, and early investors.

But in June 2018, Box made waves when it announced it was doing away with the dual-class structure in favor of a more traditional one-share, one-vote structure. Wall Street investors and Silicon Valley tech elites praised the cloud company for the move at the time as proof that responsible company governance can work for a former unicorn startup.

Now, however, that leaves Levie and other investors particularly vulnerable to a takeover by Starboard, given they no longer have majority ownership or voting rights on the board. That means that Starboard can rally other investors to its side to push forward whatever agenda it would like, with Box insiders able to put up less of a fight.

"If you are an activist, you shy away from any kind of dual-class structure with super-voting shares because you have no ability to influence the company," Ader said. "Box not having that is a key reason why someone like Starboard stepped in here."

Many predict rough times ahead for Levie and Box now that Starboard is involved.

While it is too early to know exactly what Starboard has planned for the cloud storage provider, history indicates that Starboard is likely to take an active hand in the future of the company.

Among the possibilities is whether or not Starboard would push for Box to sell to an interested buyer, as it did with Yahoo. If current investors and management push back against that initiative, it is not out of the question for Starboard to also pursue an aggressive restructuring of the board and management teams. 

Rishi Jaluria, senior analyst for D.A. Davidson & Co., told Business Insider via email that likely acquirers include IBM, Salesforce, and Microsoft, with Citrix, OpenText and possibly even Google making the list. 

Another less likely, less monumental pursuit would be for Starboard to push Box to divest from portions of its business to focus in on enterprise cloud storage and better compete with Google and Microsoft.  This could include a spate of layoffs and downsizing as Starboard attempts to reign in some of Box's bigger expenses associated with sales and marketing.

"Something needs to change and that's really when you have conditions that are ripe for an activist," Ader said.

CEOs are suddenly having a change of heart about what their companies should stand for — and the diverging fate of 2 major corporations shows why

Thu, 09/05/2019 - 6:36pm  |  Clusterstock

  • CEOs are finally starting to wake up to the idea that long-term investment is better than short-term cuts.
  • This was evidenced by the letter from 181 CEOs of the Business Roundtable, who pledged to lead their companies for the benefit of all stakeholders.
  • A perfect example of why this long-term strategy is better is the divergent paths of Kraft Heinz and Unilever.
  • After Kraft Heinz's attempted takeover of Unilever, the company has tried to cut its way to growth, with disastrous results. Unilever, on the other hand, has invested in the long term, and it's paying off.
  • Dennis Carey is a vice chair of Korn Ferry and founder of the CEO Academy. Brian Dumaine is a contributor to Fortune magazine. Michael Useem is professor and director of The Wharton School's Leadership Center. They are coauthors, with Rodney Zemmel, of "Go Long: Why Long-Term Thinking Is Your Best Short-Term Strategy."
  • This article is part of Business Insider's ongoing series on Better Capitalism.
  • Visit Business Insider's homepage for more stories.

CEOs have for decades chanted the mantra of shareholder supremacy and placed cost cutting and short-term profits above all else. That mindset, however, just might be changing.

On August 19, 181 CEOs, all members of the Business Roundtable, signed a statement pledging they would lead their companies for the benefit of all stakeholders: customers, employees, suppliers, communities, and, of course, investors.

Superstar CEOs including Apple's Tim Cook, Amazon's Jeff Bezos, and JPMorgan's Jamie Dimon, all of whom signed the pledge, have come to the realization that the only way to be successful in the long term is to invest in a way that benefits their workers and communities in the short term.

Why the change of heart? Growing evidence and experience suggest that investing for the long term is better for shareholders. And for a compelling example of why a long view is the best path to future growth, look no further than the wildly different fortunes of the two consumer-products giants: Kraft Heinz and Unilever.

In 2017, Kraft Heinz launched a $143 billion hostile takeover of Unilever, the European behemoth run at the time by Paul Polman. The two companies were very different in how they were led.

"I couldn't think of two more opposite philosophies coming together here" if the takeover succeeded, Polman told us for our book, "Go Long: Why Long-Term Thinking Is Your Best Short-Term Strategy." And he believed that the other's was doomed to fail.

"Frankly, someone who thinks they can buy us because they have a lot of money and think they can leverage up our company and then run it with an entirely different model doesn't make much sense to me," Polman said. "Our system is there to satisfy a few billion people in the world, not a few billionaires."

In the end, Polman successfully fought off the Kraft Heinz takeover bid, and the results since the attempted acquisition have only confirmed the value of the Unilever CEO's long-term thinking.

Heading in opposite directions

The years of deep cost cutting caught up with Kraft Heinz this year.

As The Washington Post wrote, it was "hard to imagine things getting worse" for Kraft Heinz as it announced a $12 billion loss and $15.4 billion write-down.

But things did get worse. This month, Kraft Heinz said that organic sales fell 1.5% year over year, operating income plummeted by more than 50%, and it was pulling its full-year guidance, sending its stock plunging to all-time lows.

The CEO, Bernardo Hees, had blamed the company's operations. We were "overly optimistic on delivering savings that did not materialize by year end," he said to investors on a conference call. What an irony, in our view, that Hees believed the same short-term cost-cutting measures that got the company into such deep trouble would save it now.

Kraft Heinz had not spent a lot of time or money on brand building, innovating products, or motivating employees. And now the company would try to turn itself around for the long run without a long-term strategy for doing so. We'll just cut our way to prosperity, thank you.

By contrast, Unilever's Polman believed in going for the long-term from the start. Yes, he reduced costs — every business in a cutthroat field has to watch expenses — but he also invested, for instance, in environmentally sound new products, a strategy he dubbed the "Unilever Sustainable Living Plan."

Polman had been cutting $1 billion a year at Unilever, but also reinvesting three-quarters of it back into the company for growth. And he gave his workforce a purpose beyond reducing costs and producing immediate profits.

The company promised to increase social impact by, for example, providing products with less salt or fat, and pressing customers with measures as simple as hand washing and teeth brushing. Polman built campaigns around his soap, Dove, for self-esteem among young girls, and Lifebuoy to help young children in the developing world reach the age of 5 through better hygiene.

"The most important thing we did," Polman told us, was to create a long-term business model, the "Unilever Sustainable Living Plan." And in retrospect, it proved a good thing that Polman avoided the clutches of Kraft Heinz, as Unilever's shares are now up 6%.

With that and the Business Roundtable's urging, Wall Street will hopefully now take more note that long-term thinking pays, and good guys can win.

Join the conversation about this story »

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Ray Dalio breaks down why he sees a 25% chance of recession through 2020

Thu, 09/05/2019 - 5:30pm  |  Clusterstock

  • The billionaire Ray Dalio — the founder of Bridgewater Associates, the world's largest hedge fund — told Bloomberg he sees a 25% chance of recession in 2019 and through 2020.
  • He cited the effectiveness of central-bank policies, the wealth gap, the 2020 US elections, and the economic emergence of China as key factors in deciding the intensity of the next economic downturn.
  • The Bridgewater founder also warned the Fed should slowly cut rates by small increments.
  • Visit the Markets Insider homepage for more stories.

Ray Dalio told Bloomberg he sees a 25% chance of economic recession in the rest of the year and through 2020, and that central banks can only do so much to avert it.

Dalio — who founded Bridgewater Associates, the world's largest hedge fund — listed four separate factors that he believes will affect the severity of the next economic downturn. The combined variables are "unique" and haven't existed since the 1930s, Dalio said on "The David Rubenstein Show."

The factors are:

  • Effectiveness of central-bank policies
  • The wealth gap, which will affect how the next recession will look "socially, politically, and so on"
  • The 2020 elections, which he called "an issue between capitalists and socialists, or the rich and the poor"
  • The emergence of China in relation to the US

The billionaire added that central banks around the world "have to face the fact that when the next downturn comes there will not be the power to reverse it in the same way" they recovered from the 2008 financial crisis. He recommended the Fed cut interest rates slowly and by small increments instead of rushing to invigorate the US economy.

Markets Insider is looking for a panel of millennial investors. If you're active in the markets, CLICK HERE to sign up.

The Fed cut interest rates for the first time since the financial crisis on July 31, with Fed Chairman Jerome Powell calling the move a "mid-cycle adjustment."

Though President Trump has repeatedly pushed for large rate cuts, he's likely to be disappointed by the Federal Open Market Committee's September 18 meeting. The national economy is "relatively strong," and rapidly cutting the interest rate could be costly in the future, Boston Fed President Eric Rosengren told The Washington Post on Tuesday.

"You don't want to apply accommodation at a time when you don't need it, in part because you won't have it when you do need it and in part because there are side effects from pushing interest rates very low. It encourages people to take more risk," Rosengren said. 

Bridgewater's main hedge fund — Pure Alpha — is reportedly down about 6% as of August 23, despite other macro-focused funds rising through 2019. Bridgewater has about $160 billion in managed assets.

Now read more markets coverage from Markets Insider and Business Insider:

A top Apple executive reveals the company thinks crypto has 'interesting long-term potential'

A hedge fund reportedly hemorrhaged $1 billion in August because it bet on Argentina before the country's markets crashed

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Here's how much space $1 million will get you in 25 major US cities

Thu, 09/05/2019 - 5:15pm  |  Clusterstock

Just because a home is worth seven figures doesn't necessarily mean it's spacious. 

In fact, depending on where you live, the amount of space that comes with a $1 million price tag can vary widely. 

Business Insider teamed up with Zillow to find out just how many square feet $1 million will get you in 25 major US cities.

Read more: Here's how much space $1,000 in rent will get you in 11 major US cities

Zillow provided Business Insider with the median square footage of homes between $950,000 and $1,050,000 in 25 major US cities. Also included in the list below is the median listing price in each city, which was collected from the Zillow Home Value Index.

For consistency, each city's median square footage has been rounded to the nearest full square foot. Note, too, that the homes pictured below are for illustrative purposes only and do not represent actual $1 million homes in each city.

Keep reading to see the full list, ranked from the city where $1 million gets you the most square footage, to the city where it gets you the least. 

SEE ALSO: NYC landlords were caught renting out 'micro rooms' for $600 a month. Here are 7 places in the US where you can legally rent an apartment for that much — or less.

DON'T MISS: 48 US cities where you can buy a mansion for under $1 million

Louisville, Kentucky

Median square footage of a $1 million home: 4,807

Median listing price: $219,000

San Antonio, Texas

Median square footage of a $1 million home: 4,712

Median listing price: $241,225

Las Vegas, Nevada

Median square footage of a $1 million home: 4,021

Median listing price: $300,000

Charlotte, North Carolina

Median square footage of a $1 million home: 3,950

Median listing price: $298,000

Tucson, Arizona

Median square footage of a $1 million home: 3,714

Median listing price: $225,000

Jacksonville, Florida

Median square footage of a $1 million home: 3,616

Median listing price: $219,000

Dallas, Texas

Median square footage of a $1 million home: 3,551

Median listing price: $389,000

Indianapolis, Indiana

Median square footage of a $1 million home: 3,498

Median listing price: $295,000

Houston, Texas

Median square footage of a $1 million home: 3,411

Median listing price: $295,000

Orlando, Florida

Median square footage of a $1 million home: 3,351

Median listing price: $285,000 

Phoenix, Arizona

Median square footage of a $1 million home: 3,123

Median listing price: $285,000

Portland, Oregon

Median square footage of a $1 million home: 2,930

Median listing price: $464,900

Austin, Texas

Median square footage of a $1 million home: 2,785

Median listing price: $400,000

Denver, Colorado

Median square footage of a $1 million home: 2,443

Median listing price: $485,000

Chicago, Illinois

Median square footage of a $1 million home: 2,202

Median listing price: $339,000

Philadelphia, Pennsylvania

Median square footage of a $1 million home: 2,100

Median listing price: $234,900

Seattle, Washington

Median square footage of a $1 million home: 1,900

Median listing price: $695,000

San Diego, California

Median square footage of a $1 million home: 1,803

Median listing price: $699,000

Nashville, Tennessee

Median square footage of a $1 million home: 1,780

Median listing price: $325,262

Los Angeles, California

Median square footage of a $1 million home: 1,763

Median listing price: $849,500

Boston, Massachusetts

Median square footage of a $1 million home: 1,748

Median listing price: $745,000

New York, New York

Median square footage of a $1 million home: 1,696

Median listing price: $789,000 

Washington, DC

Median square footage of a $1 million home: 1,673

Median listing price: $598,870

San Jose, California

Median square footage of a $1 million home: 1,574

Median listing price: $968,888

San Francisco, California

Median square footage of a $1 million home: 1,089

Median listing price: $1,299,000

We spoke to the top recruiters in the booming cannabis business. Here are their 3 best tips for landing your dream job in the industry.

Thu, 09/05/2019 - 4:38pm  |  Clusterstock

  • Cannabis companies are growing rapidly. They're a great place to look for jobs from entry-level retail positions all the way up to senior management.
  • To get a sense of how to best land a job in the booming industry, Business Insider spoke to some of the top recruiters in the cannabis world. 
  • They told us their best tips, and explained why being passionate about cannabis isn't enough to land a new role.
  • Click here for more BI Prime stories.

If you're looking for a new gig, the burgeoning cannabis industry is probably a good place to start. 

As the industry grows and cannabis becomes legal in more parts of the US, the number of cannabis-related job postings has quadrupled, from 231 per million in May 2016 to 915 per million in May 2019, according to data from the job search site Indeed. 

More people are looking for jobs in the industry as well. Over the same time period, cannabis-related job searches have skyrocketed 650%.

"There are very few industries that have seen a sevenfold increase in job-seeker searches in three years," Andrew Flowers, an economist at Indeed and the author of a recent report on cannabis hiring told Business Insider in an August interview.

While reliable numbers are hard to come by, a recent report from the Toronto-based investment bank Echelon Wealth Partners predicts the US cannabis industry will become a $60 billion market if legalized federally, up from under $20 billion under the patchwork laws today. 

The cannabis industry is complex, and companies are hiring people with a range of backgrounds, from entry-level retail to senior-level finance and M&A positions, to pharmacists, biochemists, and horticulture experts. 

To get a sense of how to best land a job in the booming industry, Business Insider spoke to some of the top recruiters in the cannabis world. 

Here are their best tips.

Tip #1: Bring a 'startup' mindset 

Like any new, exciting space, cannabis companies are growing rapidly. But unlike many other industries, cannabis companies are operating in a murky legal climate where regulations are constantly shifting and businesses are sometimes forced to pivot on a dime.

"People call it 'cannabis time' because things are just moving so fast," said Katherine Kramer, a research associate at the executive search firm Whitney Partners. "You have to be very comfortable with uncertainty and a constantly changing market."

Karson Humiston, the CEO of Denver, Colorado-based Vangst, a startup that places job candidates into cannabis companies, agrees.

"There's a ton of hype around the cannabis industry right now," Humiston said.

If you're coming from a big, established company where everything is organized and every department is laid out with standard operating procedures, you may have a tough transition into the cannabis world "where every company is still a startup," she said. 

Read more: 'It's a once in a decade opportunity': How top VC firms like Greycroft and Lerer Hippeau are cautiously opening their doors to the potentially $194 billion cannabis industry

"Don't go into cannabis if you want to be able to hide behind other people," Humiston said. "You need to go in being ready to provide value and roll up your sleeves and do a ton of different jobs."

To Humiston, the most successful candidates in cannabis have come from hyper-growth startups in other industries. "They get ready to pivot and jump a million ways and they're excited and energized by all the changes," she said.

On that front, Ed Schmults, the CEO of the cannabis company Calyx Peak Capital, previously told Business Insider he's focused on recruiting "nimble" employees from small startups.

"I think what you really want at the start of an industry are people who've been involved in smaller companies who can work fast, be nimble, and wear multiple hats," Schmults said. 

Tip #2: Look at US cannabis retailers (multi-state operators) and cannabis tech startups. Bonus if you have finance experience. 

As cannabis companies mature, they're looking for senior executives across accounting, finance, marketing, and retail roles to help build out their teams.

One of the biggest trends that Humiston said she's seen this year is publicly traded US cannabis companies is that they're leveling up their teams by hiring more experienced leaders.

These companies, like Green Thumb Industries, Columbia Care, and Cresco, among others, are expanding rapidly into new markets and have "really aggressive" growth goals, she said.

"They need that level of VPs, executives, and directors who have experience in traditional retail and other mature industries," said Humiston, especially as these companies go from managing, say, three or four pot shops in one state, to a network of hundreds of stores across many states — all with their own specific regulations.

Read moreCBD and hemp startups are using creative loopholes to skirt Facebook's ad ban. Here's how they're doing it.

On top of that, cannabis companies, like any other emerging industry, are increasingly fighting for market share and hunting for acquisitions. That means they're in a period where they're raising lots of capital, so they need financial experts and people with investment banking experience.

"Companies maybe went from having a more entry-level bookkeeper to really saying, okay, we need to hire a CFO," says Humiston. "I think that what's happening is you're bringing in that top-level person — potentially a CFO or the VP of finance — and then they're getting involved and saying, here are six additional accounting rules that we need to support this growing business. And so we've seen just a ton of finance roles this year."

Read more: These execs are leaving behind careers at companies like Coke and Victoria's Secret to tap into the $194 billion marijuana industry

A quick scan of cannabis retailer Green Thumb Industry's open jobs reveals hundreds of open positions across every division from human resources, to retail, to accounting. 

And like any other business, there's high turnover among entry-level retail and cultivation employees.

"There's a constant need to recruit budtenders and entry-level horticulturalists," Humiston said. 

Besides the bigger, publicly-traded cannabis companies, tech startups that serve the industry — like cannabis marketplace LeafLink or cannabis vaporizer company Pax — are also growing rapidly, according to Humiston.

Pax, for its part, has over a hundred job openings in multiple states for positions ranging from sales to user experience research. 

Tip #3: Being passionate about cannabis isn't enough

While cannabis companies may certainly appreciate a candidate being passionate about the product, you need to bring "hard skills" to the table, says Humiston. 

"Saying, 'I love cannabis' isn't enough," Humiston said. "Now companies need real hard skills and real hard experience that are going to add value to their business."

Kramer, from Whitney Partners, said employers in cannabis are looking for experienced workers.

"Having an industry background is super helpful," says Kramer. "Whether its consumer retail, industrial, or cultivation, there are so many subsectors in cannabis.

Kramer's best advice: "find your niche and run with it."

And don't be scared to switch up your geography if you really want to land a cannabis job. Humiston said Oklahoma, which legalized cannabis for medical use last year, has one of the fastest-growing cannabis industries in the US. It's a direct effect of the number of medical licenses the state has issued. 

"We've seen a ton of growth in states like Oklahoma, Florida, and Nevada this year," says Humiston.

For those of you who are still in school, Humiston expects cannabis companies to recruit from colleges and universities with cannabis programs — like Niagara University in Ontario.

"It's still early days," Humiston said. "It's a great chance for people to get in with a company and be a part of building the industry."

Join the conversation about this story »

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