Acquired

In 1999, Microsoft became the most valuable company in the world. And in 2019, Microsoft became the most valuable company in the world, again. But… what happened in the twenty years in between? The answer, as we discovered in our research, is probably not what you think.

In this episode we explore and analyze the browser wars and the DOJ case, Windows XP through 8, Surface, Xbox, search, Yahoo!, Bing, the iPhone, Nokia, mobile, social, Facebook… and oh yeah, a little thing called Azure and the enterprise — which ended up becoming so big that no failures mattered. Tune in for Microsoft, Volume II.

Chase Center Live Show in SF:

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Sponsors:

Many thanks to our fantastic Season 14 partners:

• J.P. Morgan Payments
• ServiceNow
• Pilot

Links:

• Bill Gurley on Android’s “Less Than Free” business model
• All episode sources

Carve Outs:

• Meta Ray-Bans
• Ozlo Sleepbuds
• M3 Macbook Air
• Model Y

More Acquired:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

Note: references to Fortune in ServiceNow sponsor sections are from Fortune ©2023. Used under license.

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

Starbucks. You’d be hard pressed to name any brand that’s more ubiquitous in the world today. With nearly half a billion global customer purchases per week across its stores and 3rd party retail channels, a significant portion of the human population gets their daily fix in the green and white paper cup. (Including our own Ben Gilbert who famously enjoys his daily spinach feta wrap. :)

But it wasn’t always this way. Long before the frappuccinos and the PSLs and the cake pops, Starbucks was just a small-time Seattle roaster that only sold beans — and was started not by Howard Schultz but rather the guys who later ran Peet’s (!). Starting from six tiny stores when Howard took over in 1987, this quirky coffee company named after a character from Moby Dick has scaled to nearly 40,000 locations worldwide.

Today, in a first for Acquired, the protagonist himself joins us as a third cohost to tell the whole story of Starbucks. And Howard is in the perfect moment to do this — after three separate stints as CEO he’s now retired, off the board of directors, and in his own words “not coming back.” So place a mobile order (or not! as you’ll hear Howard speak about), sit back with your own favorite Starbucks items, and enjoy.

Sponsors:

Many thanks to our fantastic Season 14 partners:

• J.P. Morgan Payments *
• ServiceNow
• Pilot

The Biggest Thing We’ve Ever Done:

• San Francisco. September 10, 2024. Mark your calendars.

Links:

• Howard’s letter “The Soul of a Brand”
• Worldly Partners’ multi-decade Starbucks analysis
• Starbucks S-1

More Acquired:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

** Future capabilities of biometric payments are under development; features and timelines are subject to change at the bank’s sole discretion.*

Note: references to Fortune in ServiceNow sponsor sections are from Fortune ©2023. Used under license.

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

Microsoft. After nearly a decade of Acquired episodes, we are finally ready to tackle the most valuable company ever created. The company that put a computer on every desk and in every home. The company that invented the software business model. The company that so thoroughly and completely dominated every conceivable competitor that the United States government intervened and kneecapped it… yet it’s STILL the most valuable company in the world today.

This episode tells the story of Microsoft in its heyday, the PC Era. We cover its rise from a teenage dream to the most powerful business and technology force in history — the 20-year period from 1975 to 1995 that took Bill and Paul from the Lakeside high school computer room to launching Windows 95 alongside Jay Leno and the Rolling Stones. From BASIC to DOS, Windows, Office, Intel, IBM, Xerox PARC, Apple, Steve Jobs, Steve Ballmer… it’s all here, and it’s all amazing. Tune in and enjoy… Microsoft.

Sponsors:

Many thanks to our fantastic Season 14 partners:

• J.P. Morgan Payments
• ServiceNow
• Pilot

Links:

• Congress changing copyright law in 1980 to include “computer programs”
• Acquired “classic” on Microsoft’s 1987 acquisition of Forethought / PowerPoint
• Quartr's charts on Microsoft's revenues, market cap, IBM comparison, and more
• All episode sources

Carve Outs:

• LGR
• André 3000’s new album + GQ Interview
• Meta Ray-Bans
• Visual Designer Julia Rundberg
• Summer Health

More Acquired:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

Note: references to Fortune in ServiceNow sponsor sections are from Fortune ©2023. Used under license.

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

Renaissance Technologies is the best performing investment firm of all time. And yet no one at RenTec would consider themselves an “investor”, at least in any traditional sense of the word. It’d rather be more accurate to call them scientists — scientists who’ve discovered a system of math, computers and artificial intelligence that has evolved into the greatest money making machine the world has ever seen. And boy does it work: RenTec’s alchemic colossus has posted annual returns in the firm’s flagship Medallion Fund of 68% gross and 40% net over the past 34 years, while never once losing money. (For those keeping track at home, $1,000 invested in Medallion in 1988 would have compounded to $46.5B today… if you’d been allowed to keep it in.) Tune in for an incredible story of the small group of rebel mathematicians who didn’t just beat the market, but in the words of author Greg Zuckerman “solved it.”

Sponsors:

Many thanks to our fantastic Season 14 partners:

• J.P. Morgan Payments
• ServiceNow
• Vanta

Links:

• The Man Who Solved the Market
• The Quants
• Bloomberg’s 2016 RenTec profile
• Quartr's visualization of RenTec's returns
• All episode sources

Carve Outs:

• Modern Treasury’s Transfer Conference Registration
• The New Look
• Cole Haan x Acquired!
• Class of Palm Beach (and the Mini Kelly inside the Birkin!!)

More Acquired:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

Note: references to Fortune in ServiceNow sponsor sections are from Fortune ©2023. Used under license.

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

In luxury, there’s Hermès… and there’s everyone else. Stewarded by one French family over six generations, Hermès sells the absolute pinnacle of the French luxury dream. Loyal clients will wait years simply for the opportunity to buy one of the company’s flagship Birkin or Kelly bags. Unlike every other luxury brand, Hermès:

• Doesn’t increase supply to meet demand (hence the waitlists)
• Doesn’t loudly brand their products (IYKYK)
• Doesn’t do celebrity endorsements (stars buy their bags just like everyone else)
• Doesn’t even have a marketing department! (they barely advertise at all)

And yet everyone knows who they are and what they represent. But, despite all their iconoclasm, this is not a company that’s stood still for six generations. Unbeknownst to most, Hermès has completely reinvented itself at least three times in its 187-year history. Including most recently (and most dramatically) by the family’s current leaders, who responded to LVMH and Bernard Arnault’s 2010 takeover attempt by pursuing a radical strategy — scaling hand craftsmanship. And in the process they turned the company from a sleepy, ~$10B family enterprise into a $200B market cap European giant. Tune in for one incredible story!

Sponsors:

Many thanks to our fantastic Season 14 partners:

• J.P. Morgan Payments
• ServiceNow
• Vanta
• NVIDIA GTC (Code "ACQUIRED" for 20% off)

Links:

• Visuals for: 
  • Quartr's Hermès: Two Centuries of Craftsmanship and Excellence (with graphs)
  • 00:23: Haut a Courroies, the “high-belted bag” to carry saddles and boots
  • 00:45: Chaine d'ancre, “Chain of anchors”
  • 00:49: Jeu des Omnibus et Dames blanches, “White ladies at play”
  • 00:53: Screen printing each color on a scarf individually
  • 00:57: The Hermès oranges
  • 01:06: Sac à Dépêches (today: the Kelly Bag)
  • 01:07: Grace Kelly photo in LIFE Magaine
  • 01:26: Steps to sew a saddle stitch
  • 01:48: The Birkin Bag
  • 03:17: Petit h
• The saddle stitch (video)
• Inside the Saddlery at the Faubourg
• Hermès 2022 Annual Report
• Axel Dumas Interview
• All episode sources

Carve Outs:

• Anker GaN Prime 100W charger
• Matter
• Perplexity
• The Score Takes Care of Itself

More Acquired:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

Last year Novo Nordisk, the Danish pharmaceutical company behind Ozempic and Wegovy, overtook LVMH to become Europe’s most valuable company. And the pull for Acquired to finally tackle healthcare (18% of US GDP!) became too strong for us to resist. While we didn’t know much about Novo Nordisk before diving in, our first thought was, “wow, seems like these new diabetes and obesity drugs mean serious trouble for big insulin companies.”

And then… we realized that Novo Nordisk IS the big insulin company. And in a story befitting of Steve Jobs and Apple, they’d just disrupted themselves with the drug equivalent of an iPhone moment. Once we dug further, we quickly realized this company has it all: an incredible 100+ year history filled with Nobel Prizes, bitter personal rivalries, board room dramas, a generation-defining silicon valley innovation, lone voices persevering against all odds — and oh yeah, the world’s largest charitable foundation at its helm. Tune in for one incredible story!

Sponsors:

Many thanks to our fantastic Season 14 partners:

• J.P. Morgan Payments
• ServiceNow
• Vanta

More Acquired:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

Links:

• Chart: US Healthcare Spend by Category
• Chart: US Distribution and Reimbursement System (for pharmaceutical drugs)
• Chart: Insulin Supply Chain
• YouTube Talk: What People Get Wrong about the Finances of the Drug Industry
• Alex Telford: The pharma industry from Paul Janssen to today: why drugs got harder to develop and what we can do about it
• Out-of-Pocket Health: Obesity Drugs
• Out-of-Pocket Health: US Healthcare System Problems
• All episode sources

Carve Outs:

• Noxgear Tracer 2 running vest
• Drops of God
• Wool by Hugh Howey
• Mere Mortals at San Francisco Ballet
• Blackberry

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

Ben has some big news. Actually, double big news! On what has become a holiday tradition here at Acquired, we cozy up to the fire to do our annual review of the show “in public”. We reflect on what can only be described as an absolutely mind-blowing 2023 (LVMH! Jensen! Costco! Charlie! Half a million plus listeners!) and look ahead to some big things cooking for 2024. Plus as always, we wrap with extended carve outs (joined this year by some surprise guests) for anyone still shopping for those holiday perfect gifts.

Huge thank you to everyone for making 2023 an amazing year again here in Acquired-land, and cheers to even greater things to come in 2023!

Sponsors:

Thanks to our fantastic partners, any member of the Acquired community can now get:

• Your product growth powered by Statsig (and listen to our ACQ2 interview with CEO Vijaye Raji)
• Scalable, clean and low-cost cloud AI compute from Crusoe (and listen to our ACQ2 interview with CEO Chase Lochmiller)
• Mark Leonard and David Senra’s holiday book recommendations on Blinkist, plus our favorite books on Ben & David’s Bookshelf

More Acquired!:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

Links / Extended Carve Outs!

• The Psychology of Money
• The Artist’s Way
• Transitions
• Thinking, Fast and Slow
• Zojirushi hot water heater
• Nike Pegasus Trail 4 GORE-TEX
• Mill
• June Oven
• Silo
• Alias
• Warby Parker Amari glasses
• Hoka Ora recovery shoes
• Adobe Light Room
• The Eureka Theory of Everything is Wrong by Derek Thompson
• The Luxury Strategy
• Candide
• The QB School
• MNF ManningCast
• The Eras Tour
• Uppababy Vista
• The Joolz Aer Plus
• Coco
• At Present

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

To paraphrase Visa founder Dee Hock, how many of you know Visa? Great, all of you. Now, how many of you know how it started? Or, for that matter, who started it? Who runs and governs it? Where is it headquartered? What’s its business model?

For the 11th largest market cap company in the world, Visa’s history and strategy is almost shockingly unknown. A huge portion of the world’s population uses their products on a daily basis (you might say Visa is… everywhere people want to be), but very few know the amazing story behind how that came to be. Or why Visa continues to be one of the most incredible and incredibly durable business franchises of all-time. (50%+ net income margins!! On $30B of revenue!) Today we do our part to change that. Tune in for one heck of a journey.

Sponsors:

Thanks to our fantastic partners, any member of the Acquired community can now get:

• Free access to our episode research on Blinkist plus our favorite books on Ben & David’s Bookshelf
• Scalable, clean and low-cost cloud AI compute from Crusoe (and listen to our recent ACQ2 interview with CEO Chase Lochmiller)
• Your product growth powered by Statsig

More Acquired!:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Check out the latest swag in the ACQ Merch Store!

Links:

• Burger King rolling out credit cards in 1993
• Get your BankAmericard MasterCard today! (!?)
• Episode sources

Carve Outs:

• I Think You Should Leave
• Mistborn

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

We sit down with the legendary Charlie Munger in the only dedicated longform podcast interview that he has done in his 99 years on Earth. We’ve gotten to have some special conversations on Acquired over the years, but this one truly takes the cake. Over dinner at his Los Angeles home, Charlie reflected with us on his own career and his nearly 50-year partnership at Berkshire Hathaway with Warren Buffett. He offered lessons and advice for investors today, and of course he shared his speech on the virtues of Costco once again (among other favorite investments). We’re so glad that we got the opportunity to record and share this with you all — break out your notebooks, tune in, and enjoy the singular wit and wisdom of Charlie Munger.

A transcript is available here.

Sponsor:

• Special thanks to Tiny for being the exclusive sponsor of this episode. You can get in touch with them here (just tell them Ben & David sent you), and order your very own bronze Charlie bust here.

More Acquired!:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Become an LP and support the show. Help us pick episodes, Zoom calls and more
• ACQ Merch Store!

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.

We finally sit down with the man himself: Nvidia Cofounder & CEO Jensen Huang. After three parts and seven+ hours of covering the company, we thought we knew everything but — unsurprisingly — Jensen knows more. A couple teasers: we learned that the company’s initial motivation to enter the datacenter business came from perhaps not where you’d think, and the roots of Nvidia’s platform strategy stretch back beyond CUDA all the way to the origin of the company.

We also got a peek into Jensen’s mindset and calculus behind “betting the company” multiple times, and his surprising feelings about whether he’d go on the founder journey again if he could rewind time. We can’t think of any better way to tie a bow on our Nvidia series (for now). Tune in!

Sponsors:

Thanks to our fantastic partners, any member of the Acquired community can now get:

• Your product growth powered by Statsig
• Scalable, clean and low-cost cloud AI compute from Crusoe (and listen to our recent ACQ2 interview with CEO Chase Lochmiller)
• Free access to Jensen’s favorite business books on Blinkist, plus our favorites on Ben & David’s Bookshelf

More Acquired!:

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Become an LP and support the show. Help us pick episodes, Zoom calls and more
• Merch Store!

‍Note: Acquired hosts and guests may hold assets discussed in this episode. This podcast is not investment advice, and is intended for informational and entertainment purposes only. You should do your own research and make your own independent decisions when considering any financial transactions.