🌎 The ESG reset

…and Roomba gets a new brain [Disclosures](   Green, washed (Mike Kemp/Getty Images)   Yesterday’s Market Moves   Dow Jones 32,813 (-0.54%) S&P 500 4,101 (-0.75%) Nasdaq 11,994 (-0.72%) Bitcoin $29,570 (-6.97%) Dow Jones 32,813 (-0.54%) S&P 500 4,101 (-0.75%) Nasdaq 11,994 (-0.72%) Bitcoin $29,570 (-6.97%) Hey Snackers, Vegas chapels are [all shook up]( after Authentic Brands, the licensing company that controls Elvis’ name and likeness, [ordered]( them to stop using Elvis impersonators in ceremonies — a major hit to Sin City’s $2B/year wedding biz. Less “Burning Love,” more “Crying in the Chapel.” Stocks ticked down to kick off the month, as investors keep rate-driven recession fears top of mind. US job openings [dropped]( by 455K in April, but there’s still a massive gap between open positions and available workers (nearly 5.5M more jobs). Red Deutsche Bank’s under investigation over greenwashing allegations as the ESG investing boom implodes Green-washed up… More trouble at Germany’s biggest bank: for the second time in a month, authorities [raided]( scandal-[plagued]( [Deutsche Bank’s]( Frankfurt HQ. This time it was to investigate allegations that DWS, an asset-management subsidiary of DB, has been “greenwashing” (aka: misleading investors about its environmental, social, and corporate governance — or ESG). In the fall-out, the CEO of DWS [said]( he’d step down. - ESG, meet SEC: The Securities and Exchange Commission began investigating DWS last year after an ex-employee said it fudged ESG info to woo investors (last week the SEC fined [BNY Mellon]( $1.5M for misleading ESG claims). Sustainable investment, unsustainable pace... ESG investing has exploded as investors demand socially responsible investment options. But ESG claims are unregulated and have been [criticized]( as arbitrary. One example: the S&P’s ESG index includes oil giant [Exxon]( but not EV pioneer [Tesla](. Some have [dismissed]( ESG investing as a “virtue bubble.” Now it may be bursting: - Going (less) green: [BlackRock]( an ESG pioneer (and the world’s biggest money manager), backtracked and [said]( it would support fewer “constraining” climate proposals. - The rise of “anti-ESG”: Billionaires Peter Thiel and Bill Ackman recently backed Strive, an asset management firm that specifically avoids politics. THE TAKEAWAY This could be a Great Green Reset… the ESG strategy seems to be falling out of favor: after outperforming the S&P 500 in last year’s bull market, ESG funds are underperforming the S&P in this year’s downturn. But sustainable investment as a concept isn’t going anywhere: investors have already parked $41T in ESG funds. Instead, future ESG investors might seek more realistic forecasts — and play by stricter rules. Meanwhile, the SEC plans to keep cracking down on misleading ESG claims, though it still hasn’t standardized ESG criteria. Room-bot iRobot updates the Roomba’s “brain,” betting its OS can be a differentiator in the crowded smart-home space Sounds like a sci-fi thriller... actually a vacuum company. [iRobot]( is the publicly traded consumer robot biz famous for Roomba (aka: the popular self-driving vacuum). Its sales soared for a while during the pandemic as homebound and hygiene-conscious adults ordered smart vacuums to clean up after their kids. But iRobot's US revenue growth has been slowing. Now: - New brain: iRobot just [revamped]( its robo-vacuum operating system to lay the foundation for a more sophisticated understanding of your home life. iRobot Genius, its AI platform for smart vacuums and mops, is now iRobot OS. - Features include the ability to identify and dodge phone chargers, stray T-shirts, and dog poop. With computer vision iRobot’s newest vac can also understand specific commands like "clean under kitchen table." Also: preferences like extra sweeps during pet-shedding season and fewer sweeps for the guest room. Competing for Fluffy's approval... Roomba isn't the only one: last year [Amazon]( [rolled out]( a $1K Alexa-powered robot named Astro (aka: a 10-inch tablet on wheels). Smart-device adoption has [surged]( thanks to speakers from Amazon and [Google]( along with thermostats, security cams, and light dimmers. iRobot's vacuums work with Alexa, Google Assistant, and Siri voice commands — but it may not be enough to win in the increasingly crowded market. THE TAKEAWAY Intelligence is useless without context… at least in the smart-home space. iRobot’s CEO told The Verge that the primary differentiator of a home robot is intelligence (aka: software brain vs. hardware body). Key to that is context — a deep understanding of your home and habits. Think: air purifiers understanding when a room is empty before going into noisy turbo mode (iRobot’s working on it). In the future, we’re picturing showers that turn on at your preferred temp when you wake. What else we're Snackin' - [Out]( [Meta]( COO Sheryl Sandberg, Zuck’s #2 and one of the most powerful people in tech, is leaving the company after 14 years. Sandberg helped turn Facebook into a multibillion-dollar biz. - [Booked]( [Delta]( said sales have snapped back to pre-pandemic levels, which is helping to offset soaring fuel costs. The airline canceled 700 flights last weekend, previewing a turbulent summer for the flying public. - [Hip]( [GM’s]( Buick unveiled a sleek "Wildcat" EV concept as it plans to go electric-only by 2030. Legacy automakers are trying to shake their old-school image with flashy electrified models for younger buyers. - [$17]( Seattle will be the first US city to set a minimum wage for app-based delivery drivers. The new "Pay Up Bill" is meant to stabilize income for gig workers with unpredictable schedules. - [WFW]( Elon Musk fired off an email to [Tesla]( employees, demanding they either get back to the office or leave the company. Elon’s been letting some staff work remotely, but says the option is “no longer acceptable.” 🍪 Thanks for Snacking with us! Want to share the Snacks? Invite your friends to sign up [here](. Snack Fact Of the Day A third of Americans who earn $250K+/year live paycheck to paycheck — and many are millennials [Read more]( Thursday - OPEC meeting. Weekly jobless claims. Platinum Jubilee weekend starts in the UK. - Earnings expected from: CrowdStrike, Hormel, Okta, Asana, The Duckhorn Portfolio, Samsara, Zumiez, Duluth Trading Co., and Lands’ End Authors of this Snacks own shares of Exxon, GM, Google, Tesla, Delta, Amazon, and Apple ID: 2227541 Robinhood Snacks newsletters reflect the opinions of only the authors who are associated persons of Robinhood Financial LLC (Member [SIPC]( and do not reflect the views of Robinhood Markets, Inc. or any of its subsidiaries or affiliates. They are for informational purposes only, and are not a recommendation of an investment strategy or to buy or sell any security, digital asset (cryptocurrency, etc) in any account. They are also not research reports and are not intended to serve as the basis for any investment decision. Any third-party information provided therein does not reflect the views of Robinhood Markets, Inc., Robinhood Financial LLC, or any of their subsidiaries or affiliates. 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