The Best One Yet
📕 “Hedge Fund University” — Harvard’s $2B battle. Coachella’s Pay-Now-Party-Later. Netflix’s Dr. Evil plan.
Wed, 16 Apr 2025
Harvard is taking on the Trump admin for $2B… so we looked at the Economics of Endowments.60% of Coachella ticket sales were payment plans… it’s not buy-now-pay-later, it’s pay-now-party-later.Netflix thinks it’s recession-proof… So its new internal goal? Hit $1 trillion Dollars.Plus, what’s the most forgetful day of the year?... Uber’s Lost & Found data just told us$NFLX $SPOT $UBERWant more business storytelling from us? Check out the latest episode of our new weekly deepdive show: The untold origin story of Subscribe to The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinks to listen.“The Best Idea Yet”: The untold origin stories of the products you’re obsessed with — From the McDonald’s Happy Meal to Birkenstock’s sandal to Nintendo’s Susper Mario Brothers to Sriracha. New 45-minute episodes drop weekly.—-----------------------------------------------------Subscribe to our new (2nd) show… The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinksEpisodes drop weekly. It’s The Best Idea Yet.GET ON THE POD: Submit a shoutout or fact: https://tboypod.com/shoutouts FOR MORE NICK & JACK: Newsletter: https://tboypod.com/newsletter Connect with Nick: https://www.linkedin.com/in/nicolas-martell/ Connect with Jack: https://www.linkedin.com/in/jack-crivici-kramer/ SOCIALS:Instagram: https://www.instagram.com/tboypod TikTok: https://www.tiktok.com/@tboypodYouTube: https://www.youtube.com/@tboypod Anything else: https://tboypod.com/ Subscribe to our new (2nd) show… The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinksEpisodes drop weekly. It’s The Best Idea Yet.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
Chapter 1: What is Harvard's $2 billion battle about?
Right, because countless breakthrough technologies that have changed the world— occurred first on college campuses thanks to federal funding footing the bill. Professor Jack, could you whip out the whiteboard and please list some of these incredible technological advances? How about the internet? Ever heard of it? Big thing.
GPS, lithium-ion batteries, even the nuclear bomb, all of them originally started with funding from the government for academic institutions. Now, on an annual basis, Harvard gets a little under $700 million in federal money. So we know what you must be thinking, besties.
Surely, with Harvard's $50 billion endowment, an endowment worth more than the company of Volkswagen, Harvard can afford this cut in funding. It's not just Harvard, and not just the Ivy Leagues either. Over 100 colleges and universities in America have endowments over a billion dollars.
Another way to think about the university system is that our biggest colleges are actually hedge funds that use education as their marketing arm.
That's kind of a cynical way to look at it, but you could look at it that way.
Financially, you could look at it that way. Well, here's what universities do with those endowments. Spoiler, they don't spend them. So Jack, what's the takeaway for all our buddies in education? You don't spend the endowment. You only spend the returns. Now, Yetis, many of you are probably thinking, yeah, Harvard, they got the smallest violin in the world right now. $50 billion is an endowment.
Why would they need taxpayer money? But the point of an endowment isn't to spend it. It's only to spend the returns. The point of the endowment is to not spend the endowment. Seriously. That's the point. Let's say conservatively that Harvard's endowment makes 5% in returns a year because that endowment is invested in stocks and bonds, which grow every year.
Those 5% returns, that's the part that Harvard actually spends. But they do not spend the principal, the $50 billion endowment. And that 5% return on a $50 billion endowment, Jack, can you do the math for us, please, over there? We're talking $2.5 billion a year that goes to the university's budget thanks to the endowment. $2.5 billion in returns just from the endowment.
Jack and I crunched the numbers on it. Technically, that is more than enough to cover the tuition of all undergrads and grads at Harvard every year. Now, if you spent the $50 billion principal part, then every year the endowment would get smaller and smaller, and eventually it would become zero.
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Chapter 3: Why is Netflix considered recession-proof?
Here's what else you need to know today. First, trade war almanac day 15. How tariffs have been messing with our economy. Jack and I have been keeping track for you from the tariff trenches. China's latest escalation, they're done buying US-made Boeing airplanes. Bigger escalation from China, they're no longer selling us rare earth metals.
That last one is huge, and we're probably going to cover it in tomorrow's pod. Spoiler And second, Zuck testified in his court case yesterday, and he admitted something surprising. Juicy stuff here. In 2018, Zuckerberg must have known that an antitrust lawsuit like this was coming, so he thought about preempting the courts.
Yeah, he actually considered splitting off Instagram years ago to get ahead of all these monopoly court things. But he didn't, so he's on trial today. Oh, another juicy detail. Apparently Zuck had a crazy idea a few years ago to wipe everyone's friends clean and you had to start from scratch. So like your newsfeed wouldn't have anything in it. You'd have to like start over selecting your friends.
We'd lose all of our picks from the dorm room, Jack. That would have been like Y2K. And finally, Trader Joe's $3 canvas tote bags are back in stock. Actually, I'm sorry, they're gone. They're out of stock. And they're gone. Yeah. We covered last year how Trader Joe's most popular product can't be eaten because their most popular product is a 12-inch tote bag.
Demand, though, was so high, they're already selling for $1,000 on the secondary market like eBay. Now time for the best fact yet. This one whipped up by Michaela having a fantastic time down at Coachella. It turns out the hate against Ticketmaster goes back 32 years. That's right, it didn't begin with Taylor Swift.
Pearl Jam hated Ticketmaster's control of the ticketing business, so they put together a concert at a venue that Ticketmaster did not control. Back in 1993, it was a polo field in the desert in the country. Coachella Valley. So Coachella's roots are rebellion against Ticketmaster spearheaded by Pearl Jam.
Back in 93 and to this day, neither Ticketmaster nor its parent Live Nation have any involvement with the Coachella Festival, the biggest music fest in America. Yetis, you look fantastic today. Jack, you look great, but just don't forget that Viking horn cup. Have you seen it? I can't find it. Do you know where it went?
I can't believe the Uber driver reported that missing instead of just taking it.
Yeah, I'd like to report a urinal that I left in the backseat. I don't know. I just forgot to bring it out with me.
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