Wednesday, 11 June 2025
Tuesday, 10 June 2025
Starbucks is taking a page out of competitors' playbooks to woo Chinese customers this summer
Song Mingkun/VCG via Getty Images
- Starbucks is selling cheap drinks in China in the summer.
- The chain is selling Frappuccinos and iced teas for as low as $3.20 to woo budget customers.
- The promotion brings Starbucks' prices closer to those of its competitors, like Luckin Coffee.
Starbucks is serving up cheap drinks in China this summer.
Starting Tuesday, the coffee chain is lowering the prices of more than 20 drinks in its Frappuccino, iced shaken tea, and tea latte product lines, Starbucks representative Kok Kuan Tan told BI. He said the company hasn't determined an end date for the promotion.
The chain said in a Monday post on Chinese social media site Weibo that prices will be brought down to as low as 23 yuan, or about $3.20, for the summer.
Tan said Starbucks' grande drinks in the three lines will get cheaper by an average of 5 yuan. The move aims to offer "more accessible pricing" for a group of "popular non-coffee beverages," he said.
Per checks by BI, the regular price of drinks in the three product lines in China ranges between 29 to 39 yuan. Starbucks had more than 7,700 stores in China as of March.
The price cut comes as Starbucks China grapples with weakened consumer confidence and strong competition from local players.
After the price reduction, Starbucks' offerings are closer in price to those of its biggest Chinese competitor, Luckin Coffee.
Luckin Coffee, which had more than 24,000 outlets in China as of March, serves customers with aggressive discounts year-round. The non-discounted price of iced tea on Luckin Coffee's app was 26 yuan on Tuesday. But it cost 14 yuan after discounts.
Luckin Coffee's iced lattes cost 32 yuan at the regular price and 19 yuan after the discounts.
Starbucks is not the only Western brand betting on cheaper deals to lure Chinese consumers. Pizza Hut saw great success with its $7 pizza offering in China last year, with its sales increasing 50% in 2024 compared to the year before.
Its parent company, Yum China, also reduced the price of 30 popular items in Pizza Hut, starting from 9.9 yuan for drinks and desserts. It introduced Pizza Hut Wow, the chain's budget wing, which serves smaller, cheaper versions of its regular fare.
The summer deals come as Starbucks has seen slowing performance in China. In 2024, sales dropped 2%, to $3.01 billion, from the year earlier.
Starbucks' CEO, Brian Niccol, told Bloomberg in February that the chain was eyeing a major expansion in China.
"Today, we have over 7,000 stores. There will be many more thousands of stores in China in our future," he told Bloomberg.
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Monday, 9 June 2025
A sleepy beach town in New Jersey is rebranding as a luxury travel destination. Thanks to the condo market, business is booming.
Williams New York
- Long Branch, New Jersey's luxury push is attracting a wealthier crowd with new developments.
- The condo market in particular is revitalizing the seaside destination.
- Business and locals benefit from the revitalization, but old landmarks are getting left behind.
When people think of the Jersey Shore, the MTV reality show might come to mind. Gym, tan, laundry; fist pumping, and nightclubs. But a small beachside city is drawing a more chic crowd to the beaches of New Jersey, and redefining what the shore looks like in the process.
Long Branch, New Jersey, which is an hour's drive from Trenton and a similar distance from Manhattan, has largely kept its small-town charm. But a transformation is afoot, and sisters Jennifer and Michele Maybaum have seen it up close.
"We've really seen the evolution of Long Branch going from a, you could say, lower- to middle-class city to what's being built today," Michele told Business Insider.
The pair run Max's Bar and Grill, a local landmark in Long Branch. The restaurant has been in their family since 1950 and in New Jersey since 1928. But new construction is changing the shoreline and the town itself.
"With the advent of all the condos that are being built, new restaurants and new things that have come into Long Branch, a new type of person is moving to Long Branch," she added.
New luxury developments, restaurants, and stores are luring wealthier visitors and residents away from other hot spots around the country, changing the fabric of the once old-school beach town.
The condo market in Long Branch is on the rise
Williams New York
The condo market in Long Branch has adjusted in recent years.
Data from Redfin shows the median sales price for condos and co-ops was $818,242 in April 2020. That same month in 2025, that number was $950,000 — a 16% increase.
The increase in price could be due to the increase in ritzy selections in the area, like The Atlantic Club, a luxury beachfront condo building scheduled to open in 2026. It's home to what is now the most expensive condo sale in the county: A penthouse that sold for $5.95 million in 2024. According to MLS data, condo sales over $1 million increased year over year in Long Branch by nearly 11%.
The 132-unit Atlantic Club features a pool deck, a fitness center, a business center, and a pet spa, among other amenities. It opened up sales in 2023 with prices ranging from $1.12 million to over $5.95 million.
Dennis Drazin, a 73-year-old attorney, bought a four-bedroom unit, which he plans to pay between $3.65 million and $4 million for, depending on what features he chooses to install.
"The unit that I chose has a big terrace on it where I walk out of the living quarters and I can sit and relax in the sun and watch the ocean," Drazin told BI. "That's what I like to do when I'm not working."
Drazin was born in Long Branch but has lived a 10-minute drive away in Fair Haven, New Jersey, since 1988. He and his wife are downsizing from their two-acre property and getting closer to the beach.
"I wanted to be on the ocean," he said. "I wanted to have the beach within a few steps of where I was. I wanted to have the boardwalk where I could walk long distances back and forth. I wanted to have restaurants in the area that I would be able to utilize."
Williams New York
Peter Rokkos, a 56-year-old professor at Rutgers University , was in the market for a second home and was looking far and wide for a new spot. He looked in New Jersey and even went as far as Florida, considering Fort Lauderdale and Naples.
He was close to settling on Naples, but sided with convenience and a tamer climate.
"In my mind, I've got sort of an over-under of 100 nights," Rokkos told BI. "If I'm going to get a hundred nights, how often am I going to want to fly down to 100 degrees in Florida?"
Rokkos' getaway home is about 15 miles from his home base in Holmdel, New Jersey. He paid about $1.9 million for a two-bedroom unit with a den, he said.
A bittersweet transformation
The essence of Long Branch is rooted in vacationing — mainly for New Jersey locals. The pier used to be complete with quintessential boardwalk necessities like arcades, waterslides, and mini golf. Now, while some of those classics still remain, fine dining restaurants, fashionable retail stores, and condos are in the mix, changing the ambiance.
andykazie/iStock
That change in ambience is a benefit for a lot of the people choosing Long Branch, like Rokkos.
"I'm not sure this would've been the purchase we would've made 15 years ago when my kids were a little bit younger — but now they're a bit older," Rokkos said. "They like the ability to pop down the block and get a cup of coffee, or go visit the yoga studio down the block."
"They started bringing more commerce to the area, bringing more people to the area, bringing more restaurants to the area, spreading the tendrils out from that little beach strip out to more and more gentrification, turning Long Branch from the sleepy, beach community that it was into more of a commerce destination."
Longtime business owners like the Maybaum sisters are happy to see business booming and patrons from all over the world — noting that people from France, Spain, and beyond have visited their restaurant.
But when new buildings are constructed, they take over old ones.
Jennifer highlighted Seashore Day Camp, a camp that both the Maybaums and their children attended that, as of 2025, has turned into condos starting at $1.9 million. The camp would have celebrated its 100th anniversary in 2026.
"Seeing that gone is sad because you grew up seeing that, and it was part of your history, part of your memories and your experiences," Jennifer said. "There have been some businesses that the local community had a connection with that are no longer there."
"I do think what's happening is amazing," Jennifer added. "It's almost bittersweet."
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Sunday, 8 June 2025
Elon Musk's feud with Trump likely won't blow up Tesla's robotaxi push, analysts say
Andrew Harnik/Getty Images
- Elon Musk's relationship with President Donald Trump imploded in a series of social media posts.
- Tesla's stock took a 14% dip on Thursday before it recovered some of the losses.
- Analysts said the feud won't have lasting impacts on Tesla's business, including robotaxis.
Elon Musk's public sparring with President Donald Trump last week may have briefly put a dent in Tesla's value, but analysts say they can't see any reason the feud would have a long-term impact on the company's business, including its robotaxi ambitions.
The feud between Musk and Trump began with the Tesla CEO's criticism of the GOP's spending bill, which slashes EV tax credits and is estimated to add more than $2.4 trillion to the national deficit. The clash then escalated with threats coming from both sides: Trump threatened to cancel government contracts with Musk's companies, and the CEO fired back by saying he'd shut down SpaceX's Dragon spacecraft before reneging.
During Musk's fight with Trump on Thursday, Tesla's stock dipped 14%, wiping out $138 billion from the company's market cap. The company recovered some of the losses the following day. Yet the CEO saw one of his biggest single-day hits to his net worth with an estimated $34 billion loss.
Still, some analysts say this storm will pass.
"Musk's and Trump's relationship has an impact on the stock and maybe investor sentiment, but as far as the actual business impact for Tesla, I never thought Trump getting elected was positive or that negative for Tesla," Seth Goldstein, Morningstar analyst, told Business Insider. "So with the feud that started between Trump and Musk, I never really viewed that as that positive or negative for Tesla either."
While it may not be helpful to no longer be in Trump's good graces, Goldstein said the president has already made clear that he would cut EV subsidies, which the analyst viewed as having the most negative impact not just on Tesla but on all EV makers.
Gene Munster, Tesla investor and managing partner at Deepwater Asset Management, estimated in a Friday report that the elimination of the tax credits could reduce 2025 deliveries by 15%.
Trump wishes Tesla well
As far as Tesla's June robotaxi launch in Austin goes, which Musk says will unlock trillions of dollars of market value for his company, analysts say there's little reason to believe the administration would want to hinder progress there.
"In my view, the White House has little to gain in standing in front of autonomy, given autonomy is central to physical AI, and for the US to be a leader globally in AI, it also needs to be a leader in physical AI," Munster said in his Friday report. "The bottom line, I expect cooler heads to prevail and the Federal Government will continue to support the growth of these services."
Goldstein told BI that he doesn't see many avenues the administration could take to hinder Tesla's robotaxi progress. He said the Department of Transportation is reviewing federal standards for autonomous vehicle safety.
"In theory, if Trump wanted to see Musk face retaliation and target Tesla, they could, say, require autonomous vehicles to have lidar in order to be approved by the federal government for operation, but I don't think they're going to get that detailed," Goldstein said. "I think that Trump could more easily just target SpaceX by just cutting their contracts if he really wanted to hurt Elon, versus making some really weird, nuanced policy."
Spokespeople for the DOT and the White House did not respond to a request for comment.
In a note on Friday, Morgan Stanley analyst Adam Jonas wrote that Musk's feud with Trump doesn't impact the "longer-term vectors that drive the stock's value."
"AI leadership, autonomy/robotics, manufacturing, supply chain re-architecture, renewable power, critical infrastructure... Tesla still holds so many valuable cards that are largely apolitical, in our opinion," Jonas wrote.
By late Friday afternoon, the online jabs had slowed down, but the Trump-Musk alliance remained on ice. The president told NBC News on Saturday that he doesn't expect to mend his relationship with Musk and warned the CEO against supporting Democratic candidates.
Still, during a press gaggle on Air Force One on Friday, Trump said he hadn't thought about Musk but wished him and his company well.
"I mean, I hope he does well with Tesla," Trump said.
A spokesperson for Tesla did not respond to a request for comment.
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Saturday, 7 June 2025
Here are the winners and losers in today's job market
Photographer, Basak Gurbuz Derman/Getty Images
- May's jobs data came in stronger than economists expected, but the labor market is still a mixed bag.
- Workers already in white-collar roles, or those seeking jobs in healthcare, are in a good position.
- But middle managers, white-collar job seekers, and new grads aren't faring as well.
The winners and losers of the workforce are coming into sharper focus.
If you're looking for roles in healthcare or service work, you may have a very different experience than the white-collar workforce or new grads.
Overall, the latest jobs data shows that the labor market isn't looking too shabby; the number of payrolls added in the Bureau of Labor Statistics' May report exceeded economists' expectations, and the unemployment rate held steady.
But that doesn't mean all workers are navigating the labor market with ease. Instead, some are faring better than others. Cory Stahle, an economist at the Indeed Hiring Lab, said the new jobs report reflects that divide.
"The headline number says the train keeps chugging along," Stahle said, "but at the same time, not everybody is experiencing that same thing."
Here's who's winning in the job market right now
A few industries stood out in the most recent jobs report.
Employment in the private education and health services sector and the leisure and hospitality sector swelled. They alone accounted for over 100,000 new payrolls in May, and over the last three months have added around 374,000 jobs. In short, if you're trying to find a job in food service or home healthcare, the job market is in your favor.
Other sectors that added roles in May include construction and retail trade, although not at the same clip.
Daniel Zhao, lead economist at Glassdoor, said those service sectors have powered job growth, but "all of them have slowed in the first half of 2025 compared to the back half of 2024."
There were also some winners in the white-collar world. Job-stayers — whether they still want to be there or not — are at least reaping some financial rewards. Average hourly earnings for workers in the information sector, which includes many aspects of tech, shot up from a year ago, as well as pay for those in professional and business services.
For the white-collar workers who are waiting out the Big Stay, that's a win. Indeed, job stayers have a bit of a financial edge right now: Their raises are now slightly outpacing those of job switchers, per the Atlanta Federal Reserve, a big change from the days of the Great Resignation.
Who's losing in the job market right now
White-collar workers who are actively seeking a new role probably aren't feeling too hot; neither are new grads.
Employment growth in the information sector has been nonexistent since February, while employment fell by 19,000 in professional and business services during that time. The job switching pay premium has evaporated, and companies are taking longer to fill available roles.
One subsection of white-collar workers has reason to be especially nervous: Middle managers are getting flattened out of corporate structures in the name of efficiency.
Then, of course, there's the bottom rung of the labor market: New graduates trying to land a full-time role. The share of recent college graduates with jobs that don't require a degree ticked up in March, according to the New York Federal Reserve's analysis. Similarly, that data shows recent college graduates ages 22 to 27 had higher unemployment rates compared to the larger 16- to 65-year-old workforce, a reversal from longer-term historical trends.
"There's fewer people coming in, fewer people heading out," Guy Berger, the director of economic research at The Burning Glass Institute, said. "That mix tends to favor established workers who tend to be older and tends to hurt younger people trying to get their foot in the door."
Stahle said college and high school graduates are entering a frozen labor market where the quits rate is low, people are staying put, and employers aren't really looking for new folks.
"We're seeing unemployment rates rise most notably for those younger workers, college graduate-age workers — which is very different than what we've seen in the past, where those workers tend to do pretty well," Stahle said.
Are you a job seeker, middle manager, or new grad with a story to share? Contact these reporters at jkaplan@businessinsider.com and mhoff@businessinsider.com.
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Americans are questioning the value of a college degree. Trump is joining the debate.
Huntstock/Getty Images
- Trump floated redirecting federal funding intended for Harvard to trade schools.
- His administration has highlighted the need to invest more in alternatives to a four-year college degree.
- With high student debt and a tough labor market, more people are questioning the value of a college degree.
President Donald Trump wants to tweak a traditional feature of the American dream: a college degree.
Trump has continued to escalate his battle with Harvard University, threatening to cut off the Ivy League school from federal funding if it does not meet the administration's demands, which include eliminating diversity, equity, and inclusion initiatives and cracking down on campus activism.
The latest threat against Harvard, however, floated shifting funding to trade schools, an alternative path to a four-year college degree.
"I am considering taking Three Billion Dollars of Grant Money away from a very antisemitic Harvard, and giving it to TRADE SCHOOLS all across our land," Trump wrote in a May 26 post on Truth Social. "What a great investment that would be for the USA, and so badly needed!!!"
The White House's press secretary, Karoline Leavitt, added onto the president's comments in an interview with Fox News: "Apprenticeships, electricians, plumbers, we need more of those in our country, and less LGBTQ graduate majors from Harvard University. And that's what this administration's position is."
Over the past few years, a growing number of Americans have started to question the value of a college degree due to high costs and a tough labor market, making trade schools and apprenticeships a favorable alternative. It marks a shift in the standard American dream, in which a four-year college degree had been viewed as a step to middle-class success.
However, Jon Fansmith, assistant vice president of government relations at the American Council on Education, told Business Insider that taking funding away from Harvard and other research institutions isn't the answer to boosting investment in trade schools.
"The money that he is talking about withholding from Harvard is money that Congress provided to research agencies to perform advanced scientific and biomedical research," Fansmith said, adding that Harvard earned grant money because "they had the best researchers, the best laboratory facilities, the best understanding of how to advance that science," he continued. "You can't simply take that money and use it for another purpose."
Madi Biedermann, deputy assistant secretary for communications at the Department of Education, told BI that "American universities that are committed to their academic mission, protect students on campus, and follow all federal laws will have no problem accessing generous taxpayer support for their programs."
'Two very separate stories'
Higher education doesn't have the same draw that it once did. Some Gen Zers previously told BI that despite being taught that college was the primary path to success, they felt they could make a living by directly entering the workforce or going to trade school.
That's why Trump's push to invest more in trade schools is important, Fansmith said — they help Americans get a stable career to support themselves and their families, and the federal government can help support those schools by asking Congress to approve more funding, not redirecting the funding unilaterally.
"There are two stories here. One is this administration's attack on Harvard, and the other is, what is the role of trade schools, and is there a need for more support for trade schools? And as much as the president's trying to conflate the two, those are two very separate stories," Fansmith said.
While Trump's big spending bill proposes some provisions to expand Pell grant eligibility to short-term programs, it does not detail a significant funding increase for trade schools.
The Trump administration's rhetorical focus on trade schools isn't new. Before he won the 2024 election, Linda McMahon, now Trump's education secretary, wrote an opinion piece in The Hill advocating for the expansion of Pell Grant eligibility to workforce training programs.
"Our educational system must offer clear and viable pathways to the American Dream aside from four-year degrees," she wrote.
Trump also signed an executive order on April 23 to strengthen and expand workforce development and apprenticeships programs, which McMahon called a "significant step in ensuring every American can live their American Dream."
Congress' role in rethinking education
For years, Democratic lawmakers have been pushing for greater access to postsecondary education options, like free community college, and there has been bipartisan agreement on the need to boost apprenticeships and workforce programs without redirecting funding from higher education institutions.
Amid the heightened focus on alternatives to a four-year college degree, the New York Federal Reserve said in a recent report that college still pays off; the median worker with a college degree earns about $80,000 a year, compared to $47,000 for a worker with just a high school diploma.
Trump hasn't yet implemented his idea to redirect Harvard's federal funding to trade schools, and it's unclear how, or if, he will attempt to follow through. While he has already withheld billions of dollars from Harvard and other schools across the country for failing to meet his administration's political demands, the moves have been met with lawsuits, and Fansmith said it's likely more legal action would ensue should Trump attempt to move around funding without congressional approval.
"We're talking about spending money that Congress said would go to support really critically needed research into things like cancer and Alzheimer's and diabetes, and other things that impact everyday Americans' lives, and give it to trade schools," Fansmith said. "Trade schools are great schools. They have lots of benefits. They deserve a lot of federal support, but not just to make a political point at the expense of Harvard."
Jason Altmire, president and CEO of Career Education Colleges and Universities — a group that represents for-profit colleges — said in a statement that Trump's focus on trade schools "is an investment in America's workforce."
"The best way to support trade schools is to reduce the regulatory burden facing private career schools while increasing funding that allows students interested in the trades to choose the highest quality school," Altmire said.
Have you decided to skip college for a different path, like trade school? Share your story with this reporter at asheffey@businessinsider.com.
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Friday, 6 June 2025
Meet the 'reclusive' tech billionaire making an audacious bid to buy TikTok
AppLovin
- AppLovin is in the mix to buy TikTok and save the vertical video app from a US ban.
- Adam Foroughi, AppLovin's founder, is an uncharacteristically low-key tech billionaire.
- Foroughi's getting used to the spotlight as the $100 billion-plus company makes its biggest bet yet.
Adam Foroughi tends to eschew the typical trappings of a billionaire.
He has one car, and would rather it were self-driving. He rarely appears on TV or conference stages. In his downtime, you're more likely to find him at home with his five children than schmoozing on the slopes of Davos. People who know him point to his mild manner and lack of ego.
His advertising technology company, AppLovin, is similarly unflashy. With an ad network that reaches around a billion daily users and a market cap more than twice that of Snap, Pinterest, and Reddit combined, it was the technology behemoth you'd never heard of.
"We're a $100 billion-plus company, not many people know of us, so that's probably a flaw on me," Foroughi told Business Insider in an interview.
Then came April.
Ahead of a June 19 deadline, AppLovin and Foroughi, 45, made a last-minute bid to acquire the international assets of TikTok as the Chinese-owned company faces a potential ban in the US.
It's an audacious move for any company, let alone one with a founder who usually goes out of his way to avoid the spotlight.
It faces an uphill battle. Competition is fierce. President Donald Trump has said he's been negotiating with multiple potential buyers. Investors like Kevin O'Leary of "Shark Tank" fame and former Dodgers owner Frank McCourt have signaled interest, and other tech companies are in the mix.
At AppLovin, Foroughi is known for running a ruthlessly efficient ship that drives hard for profit. It's not unusual for the company to reduce head count even when it's doing well. Foroughi executes with a hands-on management style that has, at times, seen him struggle to delegate to execs who don't fit the mold. And the company's recent financial success has also caught the attention of short sellers who have raised questions about its data practices.
With TikTok, Foroughi would be taking on an organization with a much bigger spotlight — and the heat that comes from running a user-generated content business popular among teens and often lambasted by parents.
Most of the former AppLovin employees, competitors, and business associates who spoke with BI believe he's up to the task. They say Foroughi's smarts, as well as his tendency to forgo the marketing jazz hands and let the product do the talking, position him well to crank up the dial for TikTok's ad business.
"We've been competing for over a decade, and I've never seen anyone like him — he's all around amazing, it hurts me to say it," said an executive at one of AppLovin's competitors. "He's the most talented CEO I have ever seen."
Foroughi acknowledged that the TikTok bid is uncharted territory for him, but "I don't really care about 'uncomfortable,'" he said. "I do what I think is right for my business."
An Iranian export
Foroughi and his family fled Iran when he was four years old, in the fallout of the Iranian Revolution.
They settled in Laguna Beach, California. His father, once one of Iran's leading real estate developers, left nearly all his wealth behind, and the family had to adjust to a more frugal lifestyle, a new culture, and a different language.
"My parents had to give up a lot to get us over here," Foroughi said. "Knowing that, you always have this motivation inside you to perform."
After graduating with a degree in finance from the University of California, Berkeley, Foroughi took a job as a derivatives trader. He found it a lonely existence. He wanted to build something of his own, and he wanted to work with people.
He worked at a marketing agency for small businesses, which later morphed into a social media marketing company. Eventually, as the app stores of Apple and Google became dominant, he looked to apps.
With a small team of engineers in Palo Alto, Foroughi created a fashion app, then a dating app.
"They stunk," Foroughi said. "We got rid of them."
In 2012, they launched their third attempt — an app that allowed friends to connect and send recommendations for other apps to download. This one stuck. If you were playing "Words with Friends," the app could send a push notification to your contacts, asking them to join. AppLovin was born.
Like many tech companies, AppLovin — which Foroughi insists wasn't inspired by McLovin, the nerdy character in the stoner film "Superbad" — decided to pivot to advertising. It expanded from a ground-floor garage to offices on three continents, and more than 1,500 employees as of December 2024, and a market capitalization of $140 billion at the time of publication.
AppLovin
The business model is fairly simple: It helps app developers make money and find users using in-app ads. But under the surface is a highly optimized AI-powered algorithm designed to entice businesses with the promise that chucking $1 into the machine will net $2, $5, or $10 in profit.
It's a snug fit for TikTok, where ads for figure-hugging jeans, grip socks for soccer, and campaigns for major brands like Coca-Cola and Apple are slotted between consumable vertical videos. While TikTok has soared in popularity, particularly among Gen Z, its ad revenue lags behind Google, Meta, and Amazon. AppLovin thinks its adtech can help close the gap.
AppLovin has also widened its aperture beyond its core gaming roots in recent months. After it opened up its ad platform to e-commerce advertisers, some said that they were excited for an alternative to Meta, which had become increasingly expensive in their hunt for new customers. Mike True, CEO of the e-commerce marketing platform Prescient AI, said AppLovin is the fourth most invested-in channel among its advertiser clients, behind Meta, Google, and Amazon Ads.
"The fact that advertisers continue to invest in AppLovin, even amid a cautious market, suggests growing confidence in its long-term role within the performance stack," True said.
Last year, the company posted net income of $1.58 billion at 34% margins — a margin profile almost on a par with Meta, and ahead of its closest adtech rival, The Trade Desk, which had a profit margin of 16% in 2024. AppLovin's annual revenue rose 43% to $4.7 billion.
But some observers said that while AppLovin helped e-commerce advertisers extract more sales from current customers, it was less effective in driving sales from new ones. Jones Road Beauty was one of AppLovin's early e-commerce clients, but its CEO, Cody Plofker, told BI it's no longer using AppLovin.
"We found it not to be very incremental with new customers," Plofker said.
Foroughi said that the e-commerce product is still in its infancy and doesn't yet work for everyone.
"But it will as we build it out," he added.
AppLovin' it
One Silicon Valley tech veteran who interacted with AppLovin in the early years said taking meetings with Foroughi was a "breath of fresh air." He cut to the chase, no two-martini lunches necessary.
"We got on calls and he'd be very to the point, versus the mindset where relationships precede business — a very Valley kind of guy," the person said.
Simon Spaull was AppLovin's first hire in Europe in 2014. He reluctantly entertained the idea at first.
"No one had heard of it and it was a rubbish name," Spaull said.
He was soon convinced. Spaull stayed at the company for almost seven years, as it continuously posted record annual revenue, mostly growing traction through word of mouth in the gaming community.
Foroughi has remained deeply enmeshed with day-to-day operations, including customer service. Up until around a year ago, he ran product and human resources alongside his CEO role. (He said he wanted to "get more involved in making sure our culture is aligned with the principles we had when we started the business.") When he's not traveling, he sits among the engineers.
"You don't know what's going on in your business if you don't work with your employees," Foroughi said.
Foroughi has said some of the biggest mistakes he made as CEO involved taking outside advice, including briefly hiring a chief operating officer in 2012.
"I thought, what's the point of me at this company, I'm hands-on, I'm not going to defer to this hire," Foroughi said at a recent conference held by the investment bank Jefferies.
He had a similar reaction after following advice to bring on a chief revenue officer and a brand ad sales team, with staffers who were paid more than the company's best engineer, the person making the actual product.
AppLovin
"It bugged the crap out of me," Foroughi said. He scrapped the entire team.
The company's strategy has been defined in part by unrelenting efficiency. Foroughi, who said he considers Elon Musk as an inspiration, counts EBITDA — or profit — per employee as one of his most important success metrics.
The company recently sold off its entire mobile gaming studio business — developers of hit games like "Mobile Strike" and "Project Makeover" — deeming it surplus after the apps had been sucked for data to use for its advertising algorithms.
Foroughi also showed a cut-throat streak in 2022, when the gaming software development company Unity announced its intention to acquire AppLovin's app advertising rival, IronSource. Seeking to derail the merger, AppLovin put in an unsolicited $20 billion bid to merge with Unity, but only on the provision that Unity drop the IronSource deal. Rather than make his offer to Unity's management team and the board, Foroughi went public to appeal directly to Unity's main shareholders: the investment firms Sequoia and Silver Lake.
Unity's management team wasn't happy, and they rejected the hostile takeover bid.
Foroughi has no regrets.
"The only way to disrupt that deal" was for AppLovin to make its takeover offer public, Foroughi said. "Yes, it was a little uncomfortable, obviously."
Nasdaq
Those within Foroughi's orbit say the billionaire has a generous side.
A banker who worked on AppLovin's 2021 initial public offering recalled receiving an updated draft of the registration statement and noticing that Foroughi had recently sold off around $10 million of stock, at a low price, pre-IPO. He asked Foroughi why.
"He's like, 'Uh, I'm surprised you found that. Yes, I sold some stock back to the company to distribute it to the team that was under-equitized," the person said.
A busted China tie-up and the attack of the short sellers
The TikTok suitor is no stranger to US-China tensions. In 2016, Foroughi signed a deal with a Chinese private-equity firm that valued AppLovin at $1.4 billion, and would provide a $1 billion cash injection. The deal was blocked by the Committee on Foreign Investment in the United States on national security grounds.
"CFIUS saved my ass," Foroughi said at the Jefferies Private Growth Conference earlier this year, referring to AppLovin's financial performance since.
The company's methods have been called into question in recent months with four short-seller reports, published in quick succession.
Muddy Waters Research
The most high-profile, from Carson Block's Muddy Waters Research, said AppLovin was "impermissibly extracting" data from top apps like Meta, Google, and TikTok, and targeting ads at "high value users" without their consent. The report also said AppLovin was using underhanded techniques to claim credit for sales it didn't generate.
In an email to BI, Block said that Muddy Waters believed Foroughi "lied" in a March blog post, when he pushed back on the idea that the company "uses persistent user identifiers without their consent." Persistent identifiers follow users across different websites and devices, and it can be difficult for users to delete them or even know they exist. Muddy Waters said AppLovin's use of these IDs violates various platforms' terms of service and privacy laws in some jurisdictions.
Block also said that Foroughi's background pre-AppLovin "supports our opinion that he should not be trusted." He was referring to Foroughi's tenure at a company called Claria, which owned a controversial eWallet software called Gator, that was said at the time to have distributed "adware" that collected users' browsing habits, and bombarded them with pop-up ads. One of Foroughi's early ad networks, SocialHour, was removed from Facebook in 2009 for violating its platform policies.
Foroughi has previously said in blog posts that the short-seller reports were "littered with inaccuracies and false assertions" and were aimed at driving down AppLovin's share price for their own financial gain. He told BI that he worked at Claria for a few months as a 25-year-old. In response to questions about SocialHour, he said all companies that monetized Facebook's inventory were removed when Facebook brought monetization in-house.
Some industry insiders saw the reports as confirmation of their bafflement at AppLovin's success, particularly in light of its reliance on mobile games, which are not always highly valued by big brands and agencies.
In the running for TikTok
AppLovin has proposed merging its company with all of TikTok's international business — not just TikTok US. Foroughi describes this as an "enhancement" to Oracle, which is TikTok's cloud provider in the US. Under AppLovin's proposal, Oracle would still provide data storage and security. Oracle didn't respond to requests for comment.
AppLovin has also pitched itself as a salve for TikTok's woes.
Chip Somodevilla via Getty Images
"There are really big national security and data issues, and I think we could solve them," Foroughi told BI.
AppLovin says it has expertise in both handling user data and controlling complex algorithms, which it believes could help it remove biases from TikTok's content recommendation system.
"I see what folks in the administration are doing now, what someone like Elon has sacrificed to give back to the country, and I think we could play a small part here," Foroughi said in an interview that took place before Musk and Trump's spectacular falling out this week.
TikTok didn't respond to a request for comment.
Ari Paparo, a former Googler and adtech exec who now runs the marketing media company Marketecture, said AppLovin has some big advantages in its TikTok bid: Its monster market capitalization makes the financial side feasible, it has proven monetization capabilities that could make ads on TikTok better, and it isn't "Big Tech," which has drawn antitrust scrutiny.
On the other hand, he said, "The company is a bit of an unknown in DC."
That may soon change. In April, Foroughi was spotted at the launch party of Donald Trump Jr.'s private members club.
"I'm reclusive by design, so part of the challenge has been that I have to get out there, and get to be known, and I just wasn't before this," Foroughi said.
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