Welcome to the Collective.  As Starbucks hired its new CEO Brian Niccol, the company stated in a regulatory filing that it is creating a new office in Newport Beach, CA, where Niccol is located. Perhaps hyper-local offices based on the location of leadership are the real future of “return to office.”

And if you’re commuting tomorrow, we have a treat for you! The Coeus Collective Podcast’s first episode will launch tomorrow on YouTube and all podcast platforms. Our first episode features Kotryna Jukneviciute, Co-Founder of Arête, an AI fashion styling app. Don’t miss it!

— Antonio DiMeglio & Leon Li

Starbucks Told “Guac is Extra,” Pays $113 Million

Brian Niccol has been hired as the next CEO and Board Chair of Starbucks. The move to hire Niccol came as the company’s stock was down over 21% year-to-date prior to the announcement of the hiring, and global same-store sales have fallen for two consecutive quarters.

Niccol’s total compensation package is worth more than $113 million, a staggering number that can only be justified by the stellar executive track record that he gained at Chipotle. Since he took over the fast-casual burrito giant in March of 2018, Chipotle stock rose 700%, which is almost six times the return of the S&P 500 in that timeframe.

Niccol faces an onslaught of current global difficulties for Starbucks. In China, Starbucks sales are down 14% quarter-over-quarter. Furthermore, the company seems to be having an identity crisis. Is Starbucks meant to be a “third place” for comfort between work and home as Founder Howard Schultz intended it to be? Or is it meant to be a convenient spot to pick up your caffeine fix through a mobile order?

These visions for the business are clearly at odds, and the company’s recent performance and lack of brand identity reflect this. Schultz recognizes this - stating on the Acquired podcast this June that the company’s mobile app is the company’s “achilles heel.” Niccol will likely have to pick one direction to re-frame Starbucks’ global brand positioning.

PS: Niccol starts his mornings at 5:45 am with physical activity followed by a smoothie, as told in a TikTok video published by FORTUNE last year.

Higher Stakes, Lower Savings

Starbucks isn’t the only one making massive bets these days. A study titled Gambling Away Stability: Sports Betting's Impact on Vulnerable Households, authored by academics at Northwestern University, the University of Kansas, and Brigham Young University, has found that the “sharp increases in sports betting following legalization… significantly reduces households' savings allocations.”

Casinos see studies like this as comparing apples to oranges, noting that betting is for entertainment purposes and, therefore, money spent on betting should not be compared to money set out for investing. Nevertheless, since the great GameStop “short squeeze” saga led by Roaring Kitty in 2021, the line between investing and gambling has been blurred.

Those involved in the sports and entertainment space should remind themselves that the sports betting industry has been continuously on its heels since legalization. The study includes some particularly concerning statistics, such as finding that “household investments are reduced by roughly $2 for every dollar wagered.” If effects like this continue to be seen, policymakers may have the leverage to push for changes that redefine the industry, despite how the sports betting landscape continues to seek expansion both in the US and globally.

Amazon’s $80M Bet on AI Seeks to “Perceive” the Future

Amazon is set to acquire chip maker and AI model compression company Perceive, a subsidiary of publicly traded technology company Xperi, for $80 million in cash. So, what is AI model compression, and what does this mean for Amazon?

AI model compression helps reduce the size of a neural network without compromising accuracy, leading to enhanced memory and energy efficiencies. A move like this should not come as a surprise, as Amazon has continuously bolstered its presence in the world of AI this year. This acquisition is an internal move, but the company has expanded its footprint in artificial intelligence externally as well, investing $2.75 billion into Claude-creator Anthropic earlier this year.

Startup founders in the AI space should be relieved to see that a company like Amazon has maintained its interest in AI and continued to “put its money where its mouth is.” And the Amazon growth engine sees no signs of slowing down: as reported on August 1, AWS generated a record $26.3 billion in total sales during the second quarter of 2024, growing 19% year-over-year.

Kaleidoscope Focused: Key News

• SpaceX’s launch on Aug. 26 will be the private company’s first attempt at a spacewalk

• An AI school textbook program has South Korean parents skeptical

• SoftBank and Intel were in AI chipmaking talks, seeking to rival Nvidia

• Mark Bezos, brother of Jeff, raises an $100M inaugural venture fund, with 6 startups already backed

• Jeep-maker Stellantis will invest $370M into Archer Aviation, an air-taxi company

Curated Picks: Company Spotlight

Company: Cosm

What They Do: “Transport” you to a live televised event through stadium seating and a 360-degree screen.

In The Spotlight: This weekend, Cosm went viral as the Premier League soccer season began in England, and fans gathered to watch matches at Cosm in Los Angeles. Cosm has a partnership with NBC Sports to show Premier League games in “shared reality.” As you can see in the photo below, the setting looks eerily similar to being at the match itself!

Releasing tomorrow…

Tomorrow, we will publish our podcast with Arête Co-Founder Kotryna Jukneveciute and officially launch the Coeus Collective social channels. Stay tuned!

Grow the Collective

Some special surprises may be in store for our first referrers! 👀

Thanks for reading! We’ll be back on Wednesday. In the meantime, stay tuned with us on socials @CoeusCollective.