🍋 Hedge Fund Saves the Day

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Good Morning and Happy Friday! Genesis is adding to the crypto-lender dumpster fire - the lender is cutting the cord on 30% of staff. A new study found hospitals average 100% staff turnover every five years, which is costing the healthcare industry billions of dollars.

Bed Bath & Beyond is teetering on the brink of bankruptcy. The FTC is moving to put an end to all those sneaky non-compete agreements. And on a brighter note, Pickleball's popularity exploded last year, with a 630% increase in people playing.

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1. Story of the Day: Hedge Fund Saves the Day

Barnes & Noble is making a comeback thanks to a bit of help from activist hedge fund Elliott Management. Barnes & Noble was once the dominant player in the bookseller space. But Amazon threatened to turn B&N into a relic of the past.

Elliott clearly had a plan when it came to taking over Barnes & Noble. They followed the classic activist strategy of cutting costs and streamlining management, but they also knew that the key to success was turning B&N back into a real bookstore. Elliott also gave local store managers more control over inventory so they could get rid of all those unnecessary products that turned B&N into a cluttered mess.

B&N is planning on opening 30 new stores in 2023 and is even taking over abandoned Amazon Books stores, showing that they're not afraid to go head-to-head with the online giant.

The pandemic may have hurt Barnes & Noble's bottom line in 2020 and part of 2021, but the company used the closures to give the stores a makeover and reassess their inventory. And it looks like it's paying off, as a spokesperson for Barnes & Noble says they are "experiencing a period of tremendous growth."

Who would have thought that a hedge fund could be the hero for brick-and-mortar retail, let alone the leading bookseller?

Takeaway: Barnes & Noble is set to experience its first year of net store growth in over a decade thanks to its hedge fund management. Elliott is actually trying to revive the physical retail giant rather than just strip it for parts, and it’s looked like a good bet so far.

2. Markets Rundown

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Stocks dropped on reports of strong jobs data.

Movers & Shakers

• (+) T-Mobile ($TMUS) +3% after strong subscriber growth from Q4.

• (–) Bed Bath & Beyond ($BBBY) -30% after the company warned of possible bankruptcy.

• (–) Silvergate Capital ($SI) -43% after the crypto bank wiped out years of profits.

Private Dealmaking

• OpenAI, the startup behind ChatGPT, in talks to sell existing shares at a $29 billion valuation

• Tokyo Gas Co. is in advanced talks to buy Rockcliff Energy for $4.6 billion

• BC Partners will buy Madison Logic, a B2B digital marketing services platform, for $750 million

• Silicon Ranch, a renewable power producer, raised $600 million

• Arcadia, a carbon footprint tracker for businesses, raised $125 million

• Advanced Navigation, an AI robotics developer, raised $68 million

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Top Reads

• The streaming boom is over (Vox)

• Lots of layoffs, few jobless claims (Axios)

• What the job market could look like in 2023 (CNBC)

• Citadel posts record hedge-fund profit in 2022 (WSJ)

• Rivian stock hits new 52-week low after missing 2022 production target (CNBC)

• The bond market’s rosy inflation view (Axios)

• How SBF negotiated his bail (NYT)

• Delta announces free Wi-Fi beginning Feb 1 (Fox)

• Peloton pays $17 million fine for delays in disclosing treadmill defects (NPR)

• Inflation fears fade as geopolitical risks rise (CNN)

4. Book of the Day: Mindset

After decades of research, world-renowned Stanford University psychologist Carol S. Dweck, Ph.D., discovered a simple but groundbreaking idea: the power of mindset.

In this brilliant book, she shows how success in school, work, sports, the arts, and almost every area of human endeavor can be dramatically influenced by how we think about our talents and abilities.

People with a fixed mindset—those who believe that abilities are fixed—are less likely to flourish than those with a growth mindset—those who believe that abilities can be developed.

Mindset reveals how great parents, teachers, managers, and athletes can put this idea to use to foster outstanding accomplishment.

In this edition, Dweck offers new insights into her now famous and broadly embraced concept.

She introduces a phenomenon she calls false growth mindset and guides people toward adopting a deeper, truer growth mindset.

She also expands the mindset concept beyond the individual, applying it to the cultures of groups and organizations.

With the right mindset, you can motivate those you lead, teach, and love—to transform their lives and your own.

“It’s not always the people who start out the smartest who end up the smartest.”

*****

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5. Short Squeez Picks

• 15 inconvenient truths that weak-minded people won’t live by

• Why flying stopped being glamorous

• How to learn from people you disagree with

• Advice for transforming your life in the next 6 months

• 8 psychological tips to get more done

• Twilio stock had a year to forget 2022, down 82%. If you are interested in modeling out where Twilio goes from here, Daloopa is giving away Twilio's detailed financial model to Short Squeez readers. Download TWLO's model.

6. Daily Visual: Deep Discounts Drive Record Holiday Online Shopping

US Online Holiday Spending

Source: Axios

7. Daily Acumen

"Put together these two forces – the inherent difficulty of making predictions in the exponential age, and the inherent slowness of institutional change – and you have the makings of the exponential gap.

As technology takes off, our businesses, governments and social norms remain almost static.

Our society cannot keep up."

The Exponential Age will transform economics forever. Dig deeper.

8. Memes of the Day

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