Buzzfeed News Music: Business
Showing posts with label Business. Show all posts
Showing posts with label Business. Show all posts

Wednesday, March 23, 2016

TGI Fridays Is Trying A New Restaurant Design To Bring In Younger Customers

TGI Fridays Is Trying A New Restaurant Design To Bring In Younger Customers

The new restaurant includes a weekend “Hangover Brunch” with buckets of bacon and chicken and waffles.

TGI Fridays is now courting the children of its baby boomer patrons under a redesigned restaurant with a new name, Fridays.

TGI Fridays is now courting the children of its baby boomer patrons under a redesigned restaurant with a new name, Fridays.

TGI Fridays

The restaurant chain is testing out the new decor and menu to keep up with younger guests who have different tastes than older patrons when it comes to choosing a place to work or socialize, said Fridays spokesperson Mary Ann Schoppman to BuzzFeed News.

The restaurant chain is testing out the new decor and menu to keep up with younger guests who have different tastes than older patrons when it comes to choosing a place to work or socialize, said Fridays spokesperson Mary Ann Schoppman to BuzzFeed News.

TGI Fridays

"Since the inception of Fridays (you know, when it was a singles bar), our guests have expected us to be a place where they can have fun and meet up with new and old friends," said Schoppman. "But that looks differently today. We're testing and making changes to the Fridays brand to align with what our guests are looking for today."

The Corpus Christi restaurant's brighter and more vibrant contemporary design includes new "flexible areas, where guests can make the space their own to relax and enjoy comfortable however they’d like," said Schoppman.

The Corpus Christi restaurant's brighter and more vibrant contemporary design includes new "flexible areas, where guests can make the space their own to relax and enjoy comfortable however they’d like," said Schoppman.

TGI Fridays


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Tuesday, March 22, 2016

Instacart Fires Its Delivery Drivers In Minneapolis

Instacart Fires Its Delivery Drivers In Minneapolis

Leo Chen / Via Flickr: hjc218

Instacart, the grocery delivery startup, has run into challenges in Minneapolis, one of its newer markets, and will dismiss its delivery drivers there, an email obtained by BuzzFeed News shows.

The change, while relatively minor, shows how the four-year-old Instacart is continuing to evolve as it seeks to become profitable. While the company once relied entirely on contractors doing both shopping and delivery, its delivery drivers are part of an effort to divide labor in a bid for increased efficiency.

But the Minneapolis market, where Instacart arrived last September, seems to have challenged the logic behind this effort.

"Given the market’s size and geographic layout, we’ve found it difficult to efficiently provide enough opportunities for delivery drivers to receive orders," Instacart said in an email to its Minneapolis drivers on Friday. "As our market has evolved, we've found that the delivery driver service is not the best fit for the Minneapolis market at this time."

The email said drivers, who are independent contractors, would be dismissed on April 3.

An Instacart spokesperson, Esther Hallmeyer, said in an email, "This is really a non-story."

A person close to the company, who insisted on anonymity, said Instacart was "still operating" in Minneapolis and "growing very quickly." The change follows several reports showing how Instacart is seeking to make its business sustainable without continued infusions of venture capital.

Recode reported this month that Instacart was cutting pay for some high-performing workers, while Quartz reported on strict new policies for workers in New York.

Bloomberg News reported that the company had started an advertising program with major consumer goods companies. That article also said that the majority of Instacart orders lose money.

College Opens New Frontier In Education Outsourcing

College Opens New Frontier In Education Outsourcing

Afp / AFP / Getty Images

A community college in Ohio has opened a new frontier in the outsourcing of public education to private companies, striking an unprecedented deal for its student marketing, recruitment, admissions, and retention efforts to be handled by Pearson, the world's largest education company.

Pearson's deal with Cincinnati State Technical and Community College, a two-year school of some 9,000 students, is the first time the company has taken over recruiting for an entire university. It's also the first time Pearson will handle recruiting for a community college — earning as much as 20% of the school's tuition revenue from new students.

"This deal really represents the pushing of boundaries in a bid to combat declining enrollments and weak finances," said Phil Hill, an industry analyst. "This deal gets into uncharted territory."

Cincinnati State is partnering with Pearson, which had a valuation of $10.5 billion as of Monday, for one main reason: money. Like thousands of community colleges across the country, the school needs more students, and it needs more of them to graduate.

The school's enrollment has slid sharply in recent years, prompting widespread concerns over its finances that led to the resignation of the school's president last year. And a looming funding provision in Ohio will soon tie more of Cincinnati State's funding to its performance — metrics like the percentage of the school's students that graduate, an area that Pearson is promising to improve with its retention plans.

Pearson has long handled marketing and recruiting for online programs that make up only a small fraction of a school's total enrollment, like Arizona State University's. But a contract obtained by the website Inside Higher Education shows that at Cincinnati State, Pearson will be at the end of virtually every interaction between students and the college, outside of academic programs: the company will create and direct marketing and advertising and handle recruiting and enrollment services once students reach out about signing up for classes. Once students enroll, Pearson will be in charge of retaining them.

Facing flagging sales, Pearson has been working to make itself into more than a textbook company, investing deeply in businesses that provide services to colleges, like recruiting and managing of online programs at schools like ASU. If it can figure out how to translate those businesses to in-person students, as it is experimenting with at Cincinnati State, the company could significantly expand its footprint in education services, working with colleges that don't have or want robust online programs.

But Pearson's business recruiting students for online programs hit some snags in the past when the company failed to live up to its promises. Two schools, the University of Florida and Cal State, ended lucrative contracts with the company after it couldn't recruit enough out-of-state students. A University of Florida spokeswoman called the inability to bring in out-of-state students a "significant failure."

The Cincinnati State deal, which was first inked in October 2015, will leave the two institutions closely entwined, with a financial relationship that is especially complex. Pearson will collect fees based on how many new students it brings into Cincinnati State, as well as how many existing students remain enrolled in the school. Pearson even pays the salaries of some Cincinnati State employees.

Among the questions raised by Pearson's new business, Hill, the analyst, said: "What does it mean to have an open-access institution compensating a company to increase enrollment?"

The deal could strain some Education Department rules meant to rein in the unrestricted recruiting of students — a practice that led in the past to serious violations by for-profit colleges. While Department regulations allow schools to pay outside companies, like Pearson, based on the numbers of students they enroll, it justifies those rules because the college — not the recruiter — is the ultimate arbiter of admissions criteria and enrollment numbers.

The problem arises, Education Department rules say, "when the recruiter is determining the enrollment numbers and there is essentially no limitation on enrollment."

But because it is an open-access community college, Cincinnati State has no limitation on its enrollment, and almost no admissions criteria beyond rules about materials applicants must supply, like high school transcripts. That means that Cincinnati State must accept virtually every student Pearson recruiters send its way.

"When we say that community colleges are open admissions, we don't mean that literally," said Todd Hitchcock, a Pearson executive overseeing the Cincinnati partnership. "There are still requirements that students must meet, and Cincinnati oversees all of those."

The Education Department declined to comment on specific colleges' adherence to regulations.

Trace Urdan, an analyst at Credit Suisse, pointed to echoes between Pearson's arrangement with Cincinnati State and several arrangements that have run afoul of accreditors, the third-party organizations that give colleges a stamp of approval on behalf of the government.

Earlier this month, the Higher Learning Commission, which also accredits Cincinnati State, rejected a plan that would have had Grand Canyon Education, a for-profit company, handling many of the services for a nonprofit, Grand Canyon University, in a complicated spinoff plan. And the HLC also killed a 2013 partnership between a community college, Tiffin University, and a for-profit company over concerns about the school's independence.

But both of those plans involved a private company's involvement with university academics, according to HLC statements — something Pearson is carefully avoiding.

"We're very aware" of regulations, said Hitchcock. "We're offering a very finite set of resources that don’t cross those lines."

Investors Dump Timeshare Companies After News Of Federal Inquiry

Investors Dump Timeshare Companies After News Of Federal Inquiry

David Manning / Reuters

Investors are dumping stock in timeshare operators in the wake of news that federal regulators are taking a close look at the largest player in the industry.

On Friday, BuzzFeed News reported that the Consumer Financial Protection Bureau is looking into the sales, marketing, and financing practices of Westgate Resorts, the country's largest privately held timeshare operator. On Monday, the share prices of its publicly traded competitors dropped sharply.

Diamond Resorts International, the subject of two recent extensive media investigations, closed the day down more than 11%, while Marriott Vacations and Wyndham Worldwide both fell over 4%. A Wyndham spokesperson declined to comment, while Diamond and Mariott Vacations did not respond to requests for comment

At one point on Monday Diamond shares were down 16%, the biggest drop since the New York Times published a lengthy report on its sales and marketing practices, in late January.

BuzzFeed News was first to report on Friday that the CFPB had denied Westgate's request to modify or set aside its civil investigative demand. Such demands, which are similar to a subpoena, do not necessarily mean the recipient is under investigation; the CFPB could be looking at the industry more broadly, or at a company that does business with Westgate.

Carlo Santarelli, an analyst at Deutsche Bank, said in a note Monday that he "expect[s] the investigation to be lengthy" and that it will be an overhang on the entire industry. Santarelli also said that the CFPB inquiry "appears broad" and described the information requested as "abundant."

A Westgate attorney told the Orlando Sentinel: "Westgate cannot comment on the pending investigation except to say that it believes that it is in compliance with all consumer protection finance requirements under the CFPB's jurisdiction.”

The company's petition to the CFPB said the regulator was looking at “information and documents that go to the heart of non-financial matters in what is, in essence, a real estate development and management company," and said that the financial elements of its business are "merely a piece of a much larger vertically integrated operation.”

Isaac Boltansky, an analyst at Compass Point, described Westgate's response to the regulator — which included claims that the CFPB was unconstitutional — as "both inflammatory and unsuccessful."

Boltansky suggested that Siegel, best known outside the timeshare industry for his appearance in the documentary Queen of Versailles and for a strongly worded letter where he encouraged Westgate employees to vote for Mitt Romney in 2012, "suggests that a protracted and public enforcement battle between the bureau and Westgate may lie ahead which could ultimately weigh on the whole space."

An investigation into the timeshare industry isn't a complete surprise. In a February regulatory filing, Diamond Resorts International said "certain third parties have indicated that the Consumer Financial Protection Bureau (“CFPB”) might increase their oversight of the vacation ownership industry," but said that it would not be affected by rules that concern real estate financing and mortgages.

According to data cited by Diamond, there are 1,600 resorts that make up the timeshare industry, with 198,000 individual units and 8.7 million "ownership week equivalents." Timeshare sales peaked in 2007, right before the financial crisis and have not yet made back to pre-crisis levels, following a construction slowdown and less credit availability. Diamond Resorts said in a regulatory filing that 80% of its revenue comes from sales and financing of timeshares.

While Westgate does not disclose what portion of its revenue comes from sales and what comes from interest on loans — at rates that run around 15% — it regularly bundles loans and sells them to investors as securities and has raised almost $3 billion from investors since 1992.

Westgate itself has 28 resorts and its parent company, Central Florida Investments, has a 10,000-strong staff.



Friday, March 18, 2016

This On-Demand Economy Startup Is Giving Workers Equity

This On-Demand Economy Startup Is Giving Workers Equity

Managed by Q

Office management startup Managed by Q is giving all employees — cleaners, handymen, and field staff — the option to have an ownership stake in the company.

Co-Founder and CEO Dan Teran announced the new stock option plan with U.S. Secretary of Labor Tom Perez at the company's headquarters on 6th Avenue in New York Friday. The Secretary praised Teran's stated goal of creating "real ownership in the company for the people working tirelessly to make it a reality."

Over the next five years, Q will give 5% of shares in the business to front-line workers, allocated based on experience, role, and tenure.

Q is about two years old and has raised $17.4 million in funding to date; $15 million in the most recent round, led by RRE Ventures.

Unlike on-demand companies like Uber and TaskRabbit, who run on the labor of so-called independent contractors or freelancers, Q employs its workforce directly, providing them with healthcare, 401(k) plans, and paths for career development.

"The company has always treated its cleaning staff in the same way as its office staff— as employees," said Rebecca Smith, Deputy Director of the National Employment Law Project, a labor law advocacy group. "That means that its cleaners have the same legal rights and benefits, the same access to flexible work hours, and now, the same option to purchase stock in the company as its office staff."

US Labor Secretary Tom Perez steps off Air Force One with International President of the Service Employees International Union Mary Kay Henry.

Mandel Ngan / AFP / Getty Images

So-called 1099 contract workers (after the tax form they file) have less employment security and fewer protections than full employees, who file W2 forms. W2 workers are covered by anti-discrimination law and have a guarantee of compensation iIf hurt on the job, for example. For forgoing these rights, 1099 workers receive a much-touted autonomy and be-your-own-boss flexibility, so the theory goes.

But some on-demand companies are changing course, finding better pay, benefits, and job stability can lead to reduced turnover and a more loyal workforce. Still-young companies that began with a 1099 model, but have switched to W2 employees include home-care provider Honor, grocery delivery service Instacart, and packaging service Shyp.

"This is not an act of charity," said Secretary Perez Monday. "This is an act of enlightened self-interest."

As the IRS counts both cash and equity compensation as taxable income, employees may be required to pay taxes on the stock options, a spokesperson from Q confirmed. The company will provide accounting and tax advice for workers related to the options, the spokesperson said. (Q recently had employees come to their offices to help them prepare their taxes free of charge, Teran said Monday.)

Q also hopes to have more information on the secondary market liquidity of the shares by the time the program launches in July. Equity holders at DropBox were burned recently when a sale of common stock was offered at a 34% discount, reflecting doubts over the company's valuation. EquityZen, a company that lets startup employees and others sell stock in privately held startups, facilitated the transaction.


Financial Regulators Are Looking Into America's Largest Timeshare Seller

Financial Regulators Are Looking Into America's Largest Timeshare Seller

billy kerr/flickr / Via flic.kr

The federal government is looking into Westgate Resorts — the largest privately-held seller of timeshares in the United States.

The Consumer Financial Protection Bureau demanded reams of information on Westgate's sales and marketing practices in October, documents posted online by the regulator show. BuzzFeed News is first to report on the legal order.

Westgate, like other timeshare companies, aggressively markets its properties. Tactics include free information sessions at vacation destinations where Westgate employees put on the hard-sell. The regulator is also looking into the financing for the purchases, which is provided by Westgate.

The Orlando-based Westgate contested the CFPB's legal order for documents — also known as a civil investigative demand — claiming the regulator did not have constitutional authority to investigate, that its document demands were too burdensome, and that the CFPB were looking at parts of the company that didn't relate to the selling of a consumer financial product. Westgate did, however, partially comply before requesting to modify the demand.

A civil investigative demand does not necessarily mean the company receiving it is the target of an investigation — the CFPB also uses them to gather information from companies related to another company being investigated. The scope of the demand contested by Westgate, however, shows that the CFPB is looking into many aspects of its operations.

Westgate said the CFPB is demanding "information and documents that go to the heart of non-financial matters in what is, in essence, a real estate development and management company that develops, markets, sells and operates timeshare resorts, where financing a consumer transaction is merely a piece of a much larger vertically integrated operation."

Westgate's core business is selling timeshares in its 28 resorts, many of which it built and developed. Westgate then markets partial ownership to buyers and finances the purchases by lending them money to buy the timeshare. Westgate also manages the resorts. Westgate has locations in popular vacation areas like Orlando and Las Vegas.

A CFPB spokesperson declined to comment, saying the Bureau could not comment on potential enforcement matters. Westgate's chief operating officer, Mark Waltrip, did not immediately respond to a request for comment.

Westgate has run into trouble with federal regulators before for its marketing practices. In 2009, Westgate and companies affiliated with it settled with the Federal Trade Commission for over $1 million for violating Do Not Call rules with its telemarketers. Last April, Westgate lost a lawsuit in Tennessee over its high pressure sales tactics resulting in a $500,000 judgment. A couple sued Westgate claiming that commitments made during the sale of a timeshare were not followed up on after they bought a unit in the Tennessee mountain town Gatlinburg — the couple won $500,000. Westgate claimed that the case was not representative of the company's operations.

Another timeshare operator, Diamond Resorts, has come under scrutiny recently, with a long New York Times article questioning aspects of its sales and marketing practices.

Westgate's founder and chief executive officer David Siegel became widely known outside the timeshare industry when he wrote a memo to his employees saying that "our present government believes that taking my money is the right economic stimulus for this country" and that if taxes were increased in a second Obama term "I will have no choice but to reduce the size of this company." Siegel founded Central Florida Investments, Westgate's parent company, in 1970.

Westgate says that its timeshares are a better value for vacationing families, claiming that timeshare buyers can get 25 years of one-week vacations for $25,000 along with the value of its timeshare ownership, while it would cost $84,000 at hotels

Siegel also appeared in the critically acclaimed documentary Queen of Versailles, which follows he and his family as they construct the largest residential estate in the United States in the midst of the 2008 financial crisis.

While Westgate is a privately held company, it is active in selling off its timeshare receivables as securities to investors. In November, Westgate sold $156 million worth of securities and has sold $2.75 billion since 1992. Loans included in a 2013 securitization deal had an average mortgage rate of 15% with a term of almost 10 years. Rates for ten year mixed residential mortgage loans are closer to 3%.

In October, Westgate sought to modify or even set aside the CFPB's subpoena, claiming that it was too broad, burdensome to comply with, and rested on uncertain constitutional authority.

Westgate's petition gives an idea of how broad the CFPB's inquiry is. Westgate said the CFPB "seek[s] a list and description of all methods of advertisement employed to solicit buyers of its timeshares," as well as data on the compensation of its sales staff and data on how often borrowers refinanced their mortgages.

The company claimed that the CFPB wanted to look into non-financial aspects of its operation, including the marketing, which Westgate says is mostly taking prospective buyers on tours of the resorts.

The CFPB said in a response to Westgate's petition that it had requested the identities of everyone who worked at Westgate since September 1, 2012, except for greeters. The regulator said that Westgate only then "provided the identities of those employees who processed mortgage applications, but withheld the identities of its sales employees who engaged in the offering and sales of the timeshare properties."

"Westgate has various means of marketing its timeshares, in most cases—
especially at the stage of simply bringing consumers to a property to take a tour—such marketing would not touch upon any financial aspects of the transaction," the company said in its request to the CFPB.

Westgate said the CFPB had requested "documents and information that precede the first contact with a consumer," and thus are not strictly related to financing the timeshare purchase.

Consumer complaint websites abound with accounts of tourists being invited to Westgate presentations with inducements like casino chips and free flights and then going through a mutli-hour, intense sales process.

The CFPB, in its denial of Westgate's petition, said that "Westgate has not shown that the sales process is completely separate from the financing of the timeshares," and the CFPB said it has obtained complaints that "suggest that sales representatives made statements directly relating to financing." The CFPB also argued that Westgate couldn't show its demands "would unduly hinder its day-to-day operations."

The CFPB also said that Westgate had withheld consumer complaints "that it deemed to be unrelated to its financing of timeshares."

In its decision to deny Westgate's request, the CFPB said that its enforcement staff had met with Westgate's lawyers in October and narrowed some of its requests.

Westgate's petition:

CFPB's denial:


Thursday, March 17, 2016

Dropbox Shares Offered At 34% Discount In Secondary Market

Dropbox Shares Offered At 34% Discount In Secondary Market

Dropbox CEO and co-founder Drew Houston.

Toshifumi Kitamura / AFP / Getty Images

Dropbox, the cloud storage startup facing questions about its $10 billion valuation, is expected to authorize a sale of its common stock at a 34% discount to its most recent round of private funding, according to documents obtained by BuzzFeed News.

The shares, to be sold by shareholders on the so-called secondary market, have been priced at $12.60 each. Yet, in January 2014, in its Series C round of funding, Dropbox sold shares to big investors at $19.10.

The deal is being handled by EquityZen, a company that allows startup employees and others to sell stock in closely held tech startups whose shares aren't publicly traded. EquityZen says on its website that all of its deals are approved by the companies whose shares are being sold.

While Dropbox itself is not the seller, the previously unreported transaction will likely be seen as setting a market price for the startup's stock.

Representatives of Dropbox and EquityZen declined to comment.

Dropbox, founded in 2007 and based in San Francisco, has faced skepticism from investors over its $10 billion valuation, amid a frosty climate for highly valued startups in general. Last fall, The Information reported that two of the startup's mutual fund investors had marked down their shares by a little more than 20%. Later, a third mutual fund company marked down its shares by 51%.

Valuing privately held startups is a tricky business, since their shares rarely change hands. Dropbox investors tend to look to Box, a publicly traded cloud storage company, as a point of reference. Box's shares have fallen 47% from the closing price after their trading debut in early 2015.

Any investors in the Dropbox deal won't be buying shares directly. They'll purchase an interest in an EquityZen fund that is expected to buy the common shares, according to the documents. Investors, who must be wealthy enough to be considered "accredited" in the eyes of regulators, have until April 5 to commit to buying shares. BuzzFeed News could not determine how many shares are being offered for sale.

These investors will be at a significant disadvantage compared with the institutional investors that have provided Dropbox with capital. The EquityZen documents pitching the investment do not contain any confirmed information about Dropbox's financial health.

Instead, the documents cite information from outside parties, like the data provider Crunchbase and the news sites Business Insider, VentureBeat, and TechCrunch.

"All figures are publicly reported unless noted otherwise," a disclaimer reads. "When not reported by the company or any of its representatives, financial information may not have been verified by the company."

Wednesday, March 16, 2016

The McDonald’s Model Goes On Trial

The McDonald’s Model Goes On Trial

John Parra / Getty Images

In courtroom 238 in New York’s Federal Plaza this week, McDonald's executives testified publicly for the first time about shop-floor and top-level operations of their global franchise operation.

The legal case against the company, now being heard before the National Labor Relations Board, could up-end the existing fast food franchise model for all casual chains in the United States. McJobs are having their day in court.

What's specifically at stake: whether McDonald's corporate is responsible for labor conditions at restaurants that bear its name.

Since 2012, cooks and cashiers at the burger chain have protested for better pay and working conditions, while filing hundreds of charges of unfair labor practices before the country's highest labor board.

Spencer Platt / Getty Images

The workers say they experienced illegal retaliation — firings or discriminatory treatment by managers — as a result of the strikes and walkouts. The Service Employees International Union, the country's largest union for service workers, helped prepare the charges and pay the workers' legal fees.

Now the labor board's lawyers argue that McDonald's USA is equally liable — with franchise operators — for the alleged retaliation. The company denies responsibility, its lawyers arguing that McDonald's does not substantially control the day-to-day of line cooks, cashiers and drive-through workers.

But if the board's arguments win the day — or the months, as the trial is likely to stretch on — low-wage, first-rung workers could potentially unionize and bargain collectively with McDonald's as a result. That could in turn set precedent for the approximately 4.7 million people who work serving food and beverages in the United States to leapfrog franchise owners and negotiate with corporations themselves.

John Parra / Getty Images

On Wednesday, McDonald’s USA’s vice-president of U.S. franchising, Troy Brethauer, took the stand for his third day of testimony. He fielded questions on his familiarity with store-level layouts and alleged retaliation against workers.

Brethauer denied, as he did in previous testimony, granular knowledge of on-the-ground operations, saying he had not seen floor plans of stores, nor was he personally involved in the hiring, firing, or decision-making related to specific store employees.

The NLRB's general counsel has requested about 350 documents and business records from the company and has a long list of witnesses still to call, as the trial will move to two other cities before returning to New York for McDonald's HQ to argue its defense.

Beyond the trial, fast food workers continue to strike and march, most recently outside the Republican and Democratic debates. Thanks to the prompting of the protesters, the candidates, too, have been answering tough questions about wage and hour standards in low-wage jobs in America.

Chipotle Gave Away More Than 3 Million Burritos To Prove They're Safe

Chipotle Gave Away More Than 3 Million Burritos To Prove They're Safe

Andrew Renneisen / Getty Images

Chipotle handed out around 3.5 million free burritos to prove their food was safe amid health concerns and to make its restaurants less "eerie" to customers, the chain's executives said Wednesday.

After outbreaks of norovirus, salmonella, and E.coli at Chipotle locations all around the country last year, sales tanked and the company closed all locations on February 8th to have an all-employee safety meeting.

The revamped safety guidelines were accompanied by an ongoing massive marketing push centered around sending out coupons for free burritos. Mark Crumpacker, Chipotle's chief creative officer, said at a Bank of America Merrill Lynch conference that the company had expected the promotion to "go viral" and that 2.5 million would redeem the coupons.

Over about five hours, he said, 5.3 million people requested coupons, and about two thirds of them actually used them — "an extraordinarily high number." Crumpacker said that Chipotle was planning on sending out 21 million pieces of direct mail, and that between six and 10 million had already been sent out.

Hartung said that another benefit of the coupons was that it made Chipotle locations — many of which were nearly empty before the Center for Disease Control declared the E.coli outbreak — feel less “eerie.”

“We also wanted to show that this is what Chipotle looks like and it was kind of eerie, and we've heard this from customers, they would walk by our restaurant and see, God that was always busy and now there is no line whatsover, that's not the case anymore,” Hartung said.

Chipotle's sales are still falling this month, but are starting to climb back this year overall after plunging 40% in January, the company's co-chief executive officer, Steve Ells, added at the conference.

Ells's comments came after Chipotle announced on Tuesday that it was anticipating its first quarterly loss ever as a public company — and that its comparable sales in February had declined 26%.

Comparable sales reached their low in the middle of January, falling about 40% on an annual basis in the middle of the month. Ells said now they got back up to negative 20% at the beginning of March before dipping again after a suburban Boston location closed after employees called in sick on March 8.

"Our teams did an awesome job, they followed the protocol fully. And as a result, they protected our customers and no customers were affected. So, this was a really good thing," he said.

Chipotle put a brave face on what otherwise looks like sobering data, saying in a presentation that a "comparable sales recovery [is] underway." After the Boston area closing, Chipotle chief financial officer Jack Hartung said, "our comps declined..to about (negative) 27%."

Chipotle Mexican Grill / Via file:///Users/matthewzeitlin/Downloads/Chipotle_BAML_Final.pdf


But since Chipotle previewed its quarterly earnings and reported its monthly sales, the company's stock is still down slightly and has fallen over 26% in the last year.

"Our earnings and margins are not going to be very impressive in the short term," Hartung said, pointing not only to the poor consumer perception of the chain, but also supply chain issues introduced by the burrito coupons that led to more food waste, along with higher marketing and legal costs spurred by a Department of Justice investigation into its food safety practices. Ells said that the company has gotten closer to identifying the source of the E.coli outbreak.

"We have many more fresh ingredients in the typical fast-food restaurants. And so, there are potentially a lot of sources for such an incident," Ells said. "We have been looking with the CDC, with our epidemiologist, with food safety experts, with local health departments and nobody initially could identify what the source was. We think we have a pretty good idea, but not definitively are we going to say what it was."

Ells said the changes, despite being costly and time-intensive, have been good not just for the safety of the food, but for how it tastes. "Every single ingredient now that we bring in has been scrutinized, every single cooking technique has been scrutinized and we've made a number of changes and a lot of these changes also have been for the better, I mean the food actually tastes better."




Monday, March 14, 2016

Kellogg Says There Is A Criminal Investigation Into Assembly Line Peeing Incident

Kellogg Says There Is A Criminal Investigation Into Assembly Line Peeing Incident

flic.kr / Via Roadsidepictures

Cereal maker Kellogg said Monday that a criminal investigation has been launched into a video that appears to show a man urinating on a company assembly line.

Kris Charles, a Kellog spokesperson, said in a statement that the video, which appeared on WorldStarUncut.com on Friday, was recorded at Memphis facility in 2014.

The graphic video shows a man urinating in the factory and then pans to a Kellogg's logo. It appears to be shot by the urinating man himself.

Via worldstaruncut.com

Via worldstaruncut.com


Charles said that the products that could have been contaminated "include Rice Krispies Treats, granola clusters used in a couple of products, and a few other puffed rice treats that we no longer make."

Charles said that "any products that could have been potentially impacted would be very limited and past their expiration dates."

The company's stock was down about .5% in early afternoon trading on Monday.

"Food quality is of the utmost importance to Kellogg Company," Charles said. "We are outraged by this completely unacceptable situation, and we will work closely with authorities to prosecute to the full extent of the law.”

Why Even Wealthy Black Students Have More Student Loan Debt

Why Even Wealthy Black Students Have More Student Loan Debt

Michaeljung / Getty Images

For white students, family wealth acts as a shield from the burden of student loan debt, allowing them to start off their careers steps ahead of their peers. But the same isn't true for wealthy black students, according to a new study in the journal Race and Social Problems.

In fact, it's at the top of the wealth spectrum that the disparity between white and black student debt levels is the highest, the study found — a sign that student loan debt could sharply destabilize the black middle class, giving young blacks higher risk without the reward of being able to shield their own children from debt.

The Dartmouth-funded study, "Young, Black, and (Still) In Debt," found that while white youth at the top of the wealth spectrum had much less debt than their low-income and middle-class counterparts, the same wasn't true for black students.

Specifically, white families with a net worth of $150,000 had half as much student loan debt as those with a net worth of zero. But there was no difference in debt between zero net-worth black families and those with $150,000 in wealth. "The racial disparity in debt increases across the wealth distribution, such that black adults from wealthier families are more indebted than their white peers, relative to black adults from less wealthy families," according to the report.

At the root of the disparities are differences not only in income, but also in how black and white families acquire wealth (which includes home equity, savings, and inheritance) and pass it on to their children, the study said. Wealthy white families tend to have the kinds of wealth that are easily liquidated and also easily passed among generations, like stocks, savings, and home equity (which can be accessed in the form of home equity loans, according to the study).

The wealthy black families in the study had only half of the financial assets and less equity in their homes — making them less able to pay down their own debts and contribute readily to their children's educations and living expenses. Though wealthy white families contributed, on average, $12,000 to their child's college educations, wealthy black families gave just $4,200.

The result, the study's authors said, is the possibility that student loan debt could scar the already "fragile" black middle class — forcing young black students to drop out of college at higher rates and making it more difficult for them to acquire their own wealth.

The study shows both "how racial wealth inequalities are created, but also how they are compounded intergenerationally," said Fenaba Addo, an assistant professor at the University of Wisconsin-Madison and one of the study's authors, in a release.

Looking beyond just wealthy families, the Race and Social Problems study also found that sharp gaps among all families that are able to send their children to college: the median net worth of white families in the study was $101,376, while for black families, it was $9,497. On the whole among all income brackets, black students have almost 70% more student loan debt than their white counterparts.

These Companies Are Eliminating Their Gender Pay Gaps

These Companies Are Eliminating Their Gender Pay Gaps

SpaceX COO Gwynne Shotwell, the highest paid woman at the company.

Michael Kovac / Getty Images

Elon Musk, CEO of aerospace tech company SpaceX, committed last month to eliminate the gender pay gap at the company, which has 4,000 employees.

"I was asked today if we'll audit pay," Musk said at an event about pay and gender co-hosted by enterprise software company Salesforce's CEO Mark Benioff In February. "We will do that."

Musk didn't comment on whether he would audit his electric car company Tesla as well, which employs about 10,000 people. A spokesperson told BuzzFeed News that Musk “plans to talk with Gwynne Shotwell, President and COO of SpaceX, on this topic and will take it from there.”

Musk is following Salesforce's lead in pledging to comb through salary data. On International Women's Day this week, Salesforce announced the results of its own internal pay audit for 17,000 global employees. The company spent $3 million to make salary adjustments for approximately 6% of workers to eliminate discrepancies, according to Cindy Robbins, executive vice president of global employee success.

"Moving forward, Salesforce plans to monitor and review salaries on an ongoing basis — making equal pay a part of our company’s DNA," Robbins wrote.

Salesforce has also invested in additional training for female employees, which resulted in a 33% increase in promotions for women at the company, according to Robbins.

Lculig / Getty Images

Salesforce and SpaceX are not alone in internally auditing pay for gender equity. Apple and Google have put resources towards ensuring equal pay, and Gap completed an internal audit last year. Computer chip manufacturer Intel announced it had found no meaningful discrepancies in pay after a review.

At Apple's shareholder meeting last month, Tim Cook said that a year-long, third-party audit for the company's 70,000 U.S. employees revealed women made 99.6 cents for every dollar a man makes, and under-represented minorities make 99.7 cents per dollar. Cook said the company was working to eliminate the gap and would release results of the survey every year so employees know where they fall on the pay-scale.

At Google, a spokesperson said the company's "People Analytics team" constantly analyzes performance, compensation, and promotion to "ensure that there is no gender pay gap at Google."

"Further, since we set salaries based on the market rate of the job (rather than a person's pre-Google salary), we find that, on average, women get larger pay increases than men when they join Google," said the spokesperson.

This strategy — paying based on the going market rate of a job, rather than an employee's previous salary — has been shown to help help reduce the gender pay gap, and some companies are looking into banning salary negotiations for that reason.

Still, even at Google, which uses market rates at hiring to avoid having to course-correct, salary transparency remains a taboo subject. Before leaving the company in 2015, Google engineer Erica Baker created a spreadsheet for workers to voluntarily share information about pay. She then ran into friction with a manager for collecting this data. Baker said on social media some employees asked for and received more equitable pay based on the spreadsheet, which is still live at Google, run by a co-worker of Baker's.

A Google spokesperson said that the company doesn't comment on specific cases of current or former employees and that employees are free to share salary information. (This is also the case everywhere, under U.S. labor law.)

Twenty percent of human resources managers said men are paid more than women at their companies, according to a recent survey by Human Resources software company CareerBuilder. Nationally, the median woman who works full time makes 79 cents for every dollar the median man makes, according to the most recent U.S. Census data.

California Now Has the Country's Toughest Equal Pay Law

A Marxist Social Policy Is Gaining Ground In Silicon Valley

Tech Takes The Lead on Parental Leave, But Low-Wage Workers Get Left Behind


Friday, March 11, 2016

Hot Pockets Wants To Be The Next Trendy Health Food

Hot Pockets Wants To Be The Next Trendy Health Food

Mike Mozart / Via Flickr: jeepersmedia

Nestlé, the world's largest food and beverage company with $92 billion in global revenue in 2015, wants to reinforce its "passion for nutrition," CEO Paul Bulcke said in an interview with BuzzFeed News.

Many of the brands owned by the 150-year-old Swiss food company clearly fit this mission: there's Gerber baby food, a cereal called Fitness, the vitamin drink Boost, and all that bottled water it sells under labels including Nestlé Pure Life, Poland Spring, S. Pellegrino, and Perrier. Perhaps Nestlé's Lean Cuisine would even fall under the nutrition category.

And then, there are Hot Pockets. The microwavable pouches of frozen meat and cheese wrapped in a pastry casing can run over 300 calories as a snack. They come in flavors like pepperoni pizza, Philly steak and cheese, and cheddar cheeseburger. Crust choices include garlic buttery, crispy buttery, croissant crust, seasoned crust, and pretzel bread — and for those watching their butter intake, there's whole grain crust too.

Hot Pockets are, for the average consumer, not the obvious choice for a nutritious snack — and that's something Nestlé wants to change about the 33-year-old brand.

"There's something very important happening. We call it millennials, but at the end of the day it's new, refreshed expectations of consumers," Bulcke said. "Does [Hot Pockets] play into those new expectations of closeness, freshness, organic, natural, also clean label?

"They want to have simplicity. These are the things we have to rewire."

Nestle / Via youtube.com

Ingredients in a Ham 'n Cheese Hot Pocket

Ingredients in a Ham 'n Cheese Hot Pocket

Nestle / Via nestleprofessional.us

Hot Pockets has been aware of this perception issue for some time. Some of the things the brand (and other brands at Nestlé) is reevaluating include calories, portion sizes, simplifying the ingredients list, and satiety of the pockets. "There's a lot of science going into it," Bulcke told BuzzFeed News.

In 2013, Nestlé gave Hot Pockets a "foodie" makeover, emphasizing the “premium cuts of meat” and "real cheese" on the menu. It launched ads featuring celebrities including Snoop Dogg, Kate Upton, and Larry King to attract the attention of millennials. From 2013 to 2015, it also removed artificial flavors and reduced sodium levels by 10%. Last year, it introduced bite-sized pockets.

Despite Nestlé's recent efforts, sales continued to lag. In 2013, dollar sales of Hot Pockets fell by 2.2%, according to IRI, a Chicago-based market research firm. In 2014, the decline worsened to 10.2% to about $862 million. Last year, as dollar sales recovered somewhat, IRI data show that volume sales (measured as a UPC scan, regardless of package size) continued to fall.

So, more changes are in the works. "There is, I think, in Hot Pockets more to come," Bulcke told investors in February. Specifically, trendy new Hot Pocket varieties with "interesting and bold flavors, inspired by our deep study and tracking of food trends," according to a spokesperson.

Nestlé would not reveal what it believes might make a fitting modern Hot Pocket in 2016 — perhaps bulgogi? carnitas? kale? samosas? chicken tikka masala? We'll find out soon. A launch is planned for the spring.

Upton and Snoop sing about hot pockets.

Neslte / Via youtube.com

As it makes nutritional tweaks to its foods, Nestlé has a "60/40" rule, meaning "while enhancing nutritional value" of a product, at least 60% of people in a blind taste test have to pick Nestlé's product over a competitor's.

Hot Pockets, Bulcke said, can be part of a healthy diet if people understand what they are eating. "Now, don't eat four of them at the same time. That's the problem a little bit: there's no such thing as bad food, per se. There's bad habits and bad diets."

Hot Pockets were launched in 1983 by an Englewood, Colorado company called Chef America. Nestlé acquired the company in 2002 for $2.6 billion as it tried to boost its frozen food business. When the deal was made, Nestlé's then-chief executive Peter Brabeck-Letmathe said in a New York Times story, ''Chef America is an ideal and strategically important complement to our own frozen-food activities in the U.S.A."

Yet as microwavable food gradually fell out of fashion, so did Hot Pockets.

"We have been doing quite a bit already in this area, but I feel there's so much more upside to be done there to make it relevant. It doesn't mean you reposition a brand, you make it just answer what people expect from the brand," said Bulcke.

Instagram: @alcorcong

LINK: A New Frontier In Low-Carb Snacking: Meat Snacks, Like Lunchables For Adults

LINK: Why Walgreens Got The Exclusive On Hot Dog–Flavored Pringles

Thursday, March 10, 2016

Foreign Tech And Engineering Students Can Now Stay In The U.S. Longer

Foreign Tech And Engineering Students Can Now Stay In The U.S. Longer

Frank Franklin Ii / AP

Some foreign students will be allowed to work in the United States on their student visas for as long as three years after graduating thanks to a new federal rule, which will go into effect Friday.

The rule, which only applies to students studying science, technology, engineering, and math (STEM), requires them to attend accredited universities in order get the visa extension. Those who attend unaccredited schools can only stay in the U.S. for one year.

The regulation is meant to attract high-demand tech and engineering talent to the U.S., but it's also an attempt to close a loophole that for years allowed so-called visa mills to flourish, bringing in thousands of students to unregulated — and in some cases essentially nonexistent — American colleges.

The passage of the Obama administration rule, which grants a 24-month work extension to international STEM students, is a boost both for foreign students and for the American universities that have been increasingly trying to recruit them.

Foreign students are increasingly important sources of revenue for many American colleges.

The vast majority of foreign students pay full tuition, without relying on institutional scholarships or even federal student loans. They came to the United States in droves in 2015, growing at the fastest rate in 35 years. Most, especially those studying science and technology, came from China and India.

"This extension is absolutely going to help colleges in the competition for the limited pool of international students [that want] a top-flight education in an advanced industrial economy," said Bill Stock, the incoming president of the American Immigration Lawyers Association.

"As a kid, you have this craze of going to the U.S. to study," said Sapan Patel, an Indian student who graduated in 2012 with a master's degree from NYU's Tandon School of Engineering. "But the worry and stress of getting a job in the U.S., to have that hanging over your head, that scares you." The difficulty of the process is enough, Patel said, that "some of my friends might decide to go to Canada, where getting a work permit and becoming a citizen is much easier, or to Australia."

Typically with student visas, foreign students are given a year to work in the U.S. after graduation.

The work period is called "optional practical training," or OPT, and it also gives students time to apply for a competitive H1-B visa. But a strict cap on the number of skilled worker visas meant that many foreign students lost out on the lottery and were forced to return home immediately.

A 2008 Bush administration rule allowed students with degrees in science and engineering to stay in the country an additional 17 months. The new regulation by the Department of Homeland Security extends that time period to two years. That extra time can be crucial because it allows students to enter the lottery for an H-1B visa for a third or even fourth time, increasing their chances of being allowed to work in the U.S. long-term.

It's "important have that extra year to file for a work visa," said Patel. "And you have more time to prepare, to not have the stress that you'll be kicked out of the country after 29 months."

The Obama's new two-year extension requires student to study at accredited schools.

Previously, even students at schools that had not received a stamp of approval from the Education Department's accrediting agencies could take advantage of the rule — a loophole that to the proliferation of unaccredited, mostly for-profit schools offering science degrees, said Neil Ruiz, a professor at George Washington University who has studied the makeup of foreign students in the U.S.

A handful of those unaccredited schools, which swelled to more than 1,000 students on the boon of the OPT extension, were eventually shut down by the government, which said they functioned essentially as visa mills, allowing students to work out of state without attending classes. School leaders, like the president of Tri-Valley and Herguan University in California, were eventually indicted and jailed for visa fraud.

"It was an unintended consequence," Ruiz said. "It basically created a gray market for students who wanted to work in the U.S., which created Tri-Valleys."

With the new regulation, the Ruiz said, "The Obama administration is trying to make up for that. They're trying to fix mistakes made back in 2008" by requiring accreditation — and thus, increased oversight.

Jupiterimages / Getty Images

A earlier BuzzFeed News examination found indications that some accredited schools are enrolling vast numbers of foreign students with almost no oversight by their accreditor.

At one Education Department-approved agency, the Accrediting Council for Independent Colleges and Schools, oversight of foreign students is significantly more lax than for U.S. students. ACICS does not require schools to submit employment information, which it calls a "top barometer of institutional quality" for foreign students. As a result, one school, Northwestern Polytechnic University, received accreditation from ACICS without submitting employment data for 99% of its graduates.

"There is a question of how stringent" accreditation is, Ruiz said. By requiring students to attend an accredited school, "This regulation improves things. But they have to make sure that the schools are not all just going to the same weak accreditor."

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Moms Are Turning To Crowdfunding To Help Pay For Maternity Leave

Moms Are Turning To Crowdfunding To Help Pay For Maternity Leave

David De Lossy / Getty Images

In a sense, new parents Shawn and Laura Lechette got $1,500 for nothing. In another, it was just for asking.

The couple — whose employers, like most, don't provide paid family leave — raised the sum from friends and family, who donated via GoFundMe, the country's largest crowdfunding site for personal expenses.

Just 12% of Americans, excluding those who work for the government, have access to paid time to spend with their newborns. Some of that 88% are now turning to crowd-funding — a way for social networks to give directly — to pay for the benefit.

"We definitely looked into other sources of funds for maternity leave, but none were available to us," said Mr. Lechette, 31, who works in retail.

While many associate modern crowdfunding with creative and entrepreneurial projects on sites like Kickstarter, personal finance campaigns (where donors don't receive rewards or payback) are also becoming more common, according to Ethan Mollick, an assistant professor at the Wharton Business School who studies the subject.

"Raising money from friends and family is the least financially expensive in a lot of ways, because they don't have the same incentives to make money from you that an investor would," Wollick said of the strategy. "Whether it's 'friends and family' versus venture capital funding or versus a payday loan, going to your own community is a better bet."

Personal crowd-funders sometimes ask for help covering the cost of child care during an emergency, transportation to see a medical specialist, or to replace property lost during a disaster insurance won't cover. Sites like GoFundMe, GiveForward, YouCaring, and “Generosity” (formerly IndieGogo Life) supply platforms for these campaigns, charging modest percentages for facilitating.

Total giving through crowd-funding (for all types) is expected to grow at 25% annually, according to Blackbaud Inc., a technology provider for the sites. Donations on GoFundMe alone — which exclusively funds personal campaigns (such as medical, emergency, and educational causes) rather than business ventures — totaled more than $1 billion in 2015, rivaling America’s top charities.

Seeing a fast-growing model, Accel Partners and Technology Crossover Ventures purchased a majority stake in GoFundMe last summer, valuing the platform at about $600 million, the Wall Street Journal reported.

Via GoFundMe

As predatory lenders rise — whether targeting students looking to pay for college or the 68 million "un-banked" Americans who rely on pre-paid debit cards like RushCard — consumers like the Lechettes have found crowd-funding sites safer and cheaper ways to weather a crisis.

Most platforms charge a one-time facilitation fee (they average 5% to 8%, according to their sites), which are cheap and painless compared with the compounding nature of credit card debt and the high interest rates on payday loans (above 500% in states with no caps).

"Think of it as a loan you never have to pay back," said Dan Saper, CEO of YouCaring, another crowd-funding site dedicated to personal finance campaigns.

How they got here

Laura Lechette, 30, is a full-time veterinary technician. She and Shaun live in Delaware County, Pennsylvania, with their other two children. When Laura became pregnant in June 2015, they were doing well financially. But an unforeseen need for car and home repairs (totaling about $2,000) caused the pair to fall behind on their bills. With their credit rating pummeled, they couldn't get another type of loan and maxed out their credit cards.

Laura's job also abruptly changed her time-off policy: Instead of a week or two of time off available at the beginning of the year (which she planned to use for maternity leave), employees would start to accrue vacation and sick days on January 1st. Under the new system, Laura accrued only eight hours by her due date. The Lechettes's daughter, Arwen, was born Wednesday.

The Lechettes's story is typical for parents in the United States, which still does not have federally mandated paid leave (it's one of the only industrialized nations that lacks it) and a threadbare safety net when it comes to other welfare programs, like food stamps and subsidized housing.

But with money raised via crowd-funding, Laura and Shawn can cover some expenses (mainly rent) while putting earnings towards new needs like baby wipes and formula. Laura will still have return to work shortly after giving birth, however, to keep bringing in wages, like most American mothers.

No savings

A recent financial survey found that most Americans don't have as much as $1,000 of emergency savings, and would turn to a credit card or other sources to pay for in-a-bind expenses. Nearly one-third of members on YouCaring.com make less than $50,000 a year.

Josh Chapman, CEO of GiveForward, said that as more people have participated in campaigns over the years (whether giving or raising funds), the stigma and taboo around asking has lessened, while awareness has increased. Both factors have led to a rise in site use, he said.

"At the highest level, people aren’t taking out a loan when they’re coming to GiveForward," he added. "They’re taking donations that are not going to be returned."

Via GoFundMe

Chapman likened the system to the earliest forms of insurance, where a pool of people share resources to reduce risk — the expectation being that if a community member donates to a campaign, the campaign founder will likely donate to that friend in the future when he or she is in need.

Major insurance provider Nationwide, seeing a trend of increased crowd-funding, even partnered with platform GiveForward recently, investing an undisclosed amount in the site.

While there are some instances of fraud in the space, Wharton's Mollick says those occasions are rare. Since most givers to campaigns are friends and family, there's social oversight built into the system. "When people feel accountable to other folks, the risk decreases," he said. "It’s easier to pull a fraud on strangers than it is on people you know and have a long-term relationship with."

"We went to crowd-funding because it wouldn't hurt our credit further or put us in an even worse spot if it wound up not working out," said Shaun. He called the experience "humbling," and said he and Laura were floored by the generosity of their community. It also left them disappointed in the absence of paid leave that contributed to their circumstances. "It makes you upset the USA hasn't caught on," he said.

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Wednesday, March 9, 2016

Volkswagen America Chief Michael Horn Resigns

Volkswagen America Chief Michael Horn Resigns

Michael Horn

David Mcnew / Getty Images

The head of Volkswagen's U.S. business Michael Horn will leave the company "to pursue other opportunities," the company said today.

The statement did not mention Volkswagen's emissions cheating scandal, but Horn is just the latest senior executive to leave in the wake of the discovery. The company's chief executive officer Martin Winterkorn resigned in September after it emerged that Volkswagen engineers had installed software on millions of cars that allowed them to pass emissions tests despite far exceeding regulatory guidelines while actually on the road.

Volkswagen USA said that, effective immediately, the chairman of Volkswagen USA, Hinrich Woebcken would take over as interim CEO. While Horn has not been directly linked to any wrongdoing, he testified in front of Congress in October to explain Volkswagen's behavior.

Alexander Koerner / Getty Images

Horn told lawmakers that almost 500,000 cars on the road in the U.S. would require some kind of fix. He described the installation of the "defeat device" as "not a corporate decision" and that internal and external investigations would "find out what drove those people into these decisions and those actions." At a product launch soon after regulators revealed the emissions cheat, Horn said "we have totally screwed up." Volkswagen has said that up to 11 million vehicles have the cheating software.

Horn had worked at Volkswagen for over 25 years, the company said, and took over as head of Volkswagen's US division in 2014.

Square Is Growing Quickly, But Still Losing Money

Square Is Growing Quickly, But Still Losing Money

ray.k / Via flic.kr

Tech mogul Jack Dorsey's other public company is having some trouble making money. After a rough few quarters at Twitter, Dorsey's Square, which processes payments for merchants and sells software to small- and medium-sized business, reported its earnings for the first time as a public company on Wednesday.

Despite Square's quarterly loss, investors liked what they saw in the earnings report, sending the stock up almost 3% in after-hours trading.

Square had total revenue of $374 million in the fourth quarter, above analysts' expectations of $345 million and a 49% increase from a year ago, while it recorded a net loss of just over $80 million. All told the company processed some $10.2 billion in payments in the last three months of 2015, a 47% jump.

Square IPOed for $9 a share in November, with the stock surging to $13 on its first day of trading. By early February, however, Square shares dropped below the initial price and became a representative of the post-IPO doldrums of technology companies. Since then, however, the stock has surged, closing at just over $12, rising over 4% just on Wednesday.

Mark Palmer, an analyst at BTIG Research, said in an note last week that today's earnings report was "its first opportunity to change the narrative."

Square is best known for its payments service, a fiercely competitive business that requires Square to give up a big chunk of its fees to credit card networks (a little more than half of Square's annual revenue is coughed up in transactions costs). Its other businesses, including scheduling software, analytics software, and even cash advances, are growing faster than payments but still represent a small fraction of overall revenue.

Square's Non-Payment Business Is Growing Quickly

Square's Non-Payment Business Is Growing Quickly

The red line represents software and data product revenue as a share of revenue excluding Square's Starbucks business.

Square/BuzzFeed News / Via square-production.s3.amazonaws.com

"From payment processing to point of sale, hardware to software, business financing to payroll (and more), we have built a cohesive commerce ecosystem that helps sellers start, run, and grow their businesses," the company said in an investor letter.

Analysts at Royal Bank of Canada called Square Capital, the merchant cash advance business, "arguably one of the more important drivers to total revenue growth." As a whole, however, all the software and analytics revenue, some $22 million, made up only 6.7% of all the company's revenue, excluding revenue from Starbucks, in the last three months of year. (Payment processing at Starbucks locations makes up about 13% of Square’s revenue, but the companies’ payments deal expires later this year.) The $22 million in revenue, however, was a 272% jump from a year ago.

The company said that it had "extended over $400 million through more than 70,000 advances in 2015," with $150 million of that coming in the fourth quarter.

National Museum of American History / Via Flickr: nationalmuseumofamericanhistory


Thousands Of Independent Restaurants Are Closing As Chains Expand

Thousands Of Independent Restaurants Are Closing As Chains Expand

Jacob Ammentorp Lund / Getty Images

Americans are increasingly choosing chain restaurants over their independent counterparts, despite all the hype over locally-cultivated foodie-ism, new research shows.

Restaurant visits by consumers in the year ending December 2015 rose by 700 million compared to 2010, almost returning to pre-recession levels, research firm NPD Group found. Yet independent restaurants — which the researchers define as those with just one or two locations — are not seeing the benefit.

As a result, the number of independent eateries had shrunk by more than 7,100 last fall compared to a year earlier. Meanwhile, the total number of chain restaurants increased by more than 3,200, according to NPD.

The restaurant industry was hit hard by the recession and is just now recovering, said NPD spokeswoman Kim McLynn.

"Chains have been heavily investing in advertising and 'dealing' to drive customer traffic these past several years and independents don’t have the resources to compete," she said.

BuzzFeed News

The trend has affected fast food in particular, a segment where the number of chain restaurants grew by 1.5% as the independent fast food restaurant count declined by 2.2%.

Starbucks added 559 U.S. locations in fiscal year 2015. Both Taco Bell and Chipotle each added about 200 stores in 2015, and Dunkin' Donuts increased its store count by 349.

Still, even some of the big chains have struggled. McDonald's ended 2015 with 91 fewer U.S. locations than 2014, KFC shed 100, and Pizza Hut lost 41.

Justin Sullivan / Getty Images

Among full-service restaurants (those with waitstaff), both chains and independents experienced declines. Visits to quick service restaurants, which represent 79% of total industry traffic, were up 1%. But full service restaurant traffic, representing 21% of total visits, declined, according to NPD.

"The restaurant business is challenging and in the end it’s the survival of the fittest," said McLynn. But overall, she said, "dining out in the U.S. is alive and well."

America Lost A Bunch Of Pizza Huts And KFCs Last Year

McDonald’s Closed 154 U.S. Restaurants In 2015

Tuesday, March 8, 2016

Chipotle Just Closed A Restaurant In Massachusetts Due To Norovirus Concerns

Chipotle Just Closed A Restaurant In Massachusetts Due To Norovirus Concerns

Eric / Via Flickr: sirira2000

A Chipotle restaurant in Massachusetts has voluntarily closed for a cleaning because of norovirus concerns after at least one employee contracted the virus, according to the local news station WHDH.

"After learning that four of our employees were not feeling well, our restaurant in Billerica, Mass. was closed for a full sanitization," a Chipotle spokesperson told BuzzFeed News. "No customers illnesses are connected to this restaurant."

It is not clear when the Billerica restaurant will reopen.

The closure comes just a month after the restaurant chain closed all of its restaurants for a morning to discuss new food safety protocols with its employees. A norovirus outbreak at a Chipotle restaurant in California last year prompted a criminal investigation, where federal prosecutors subpoenaed the company's food safety records. There was also a norovirus outbreak in Boston in December.

A series of norovirus, E. coli, and salmonella outbreaks in 2015 also caused the company's sales to drop sharply: Chipotle said its sales fell almost 15% in the last three months of 2015.

The company's stock fell 4% in after hours trading on Tuesday.

Brian Wilkins / Via Flickr: brianwilkins


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