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- [00:00]
Adobe Representative
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Tim Stenovec
Making sure your clients understand the file
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Bloomberg Businessweek Host
is the hard part.
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Tim Stenovec
But with PDF spaces in Adobe Acrobat, you can give your clients the full picture with custom intros, audio summaries and a helpful AI assistant to your docs. So if you want to stop the endless follow ups, do that with Acrobat. Need to make your docs crystal clear. Do that with Acrobat Want to make sure your clients get everything they need to hear? Do that with Acrobat learn more@adobe.com do
- [01:06]
Chase for Business Representative
that with Acrobat Small businesses are the pulse of every community. They bring people together, create opportunities and drive growth. Chase for Business helps business owners like you with personalized guidance and convenient digital tools all in one place. With that guidance and your determination, you can take your business farther and and help build a brighter future for your community. Learn more@chase.com business chase for business make more of what's Yours the Chase Mobile app is available for select mobile devices, message and data rates. May apply JPMorgan Chase Bank NA Member FDIC Copyright 2026 JPMorgan Chase Co. Bloomberg
- [01:47]
Bloomberg Businessweek Host
Audio Studios Podcasts Radio News this is Bloomberg Businessweek daily reporting from the magazine that helps global leaders stay ahead with insight on the people, companies and trends shaping today's complex economy. Plus global business, finance and tech news as it happens. The Bloomberg Business Week Daily Podcast with Carol Massar and Tim Stennebec on Bloomberg Radio hi everyone.
- [02:17]
Tim Stenovec
Welcome to the Bloomberg businessweek Weekend Podcast. Carol's out this week. Alex Semenova and Emily Griffeo tapping in for some of our conversations today. And it was a week with the economic environment really top of mind. Especially top of mind. Global markets reacting to a potential resolution in hostilities in the Middle East. Traders parsing mixed signals about prospects for a US Iran deal to end the war and revive energy flows through the Strait of Hormuz. All the important details, of course, can be found@Bloomberg.com and always on the Bloomberg Terminal. Meanwhile, lingering interest rate anxieties, persistent inflationary pressures, a deepening global energy shock, and more earnings made us wonder about the state of the consumer. Peter Atwater discusses how he went from a K shaped recovery to a full blown K shaped American experience. He'll explain in just a bit. With that in mind, a closer look at two items that are really squeezing American household budgets, healthcare and food. We catch up with the CEO of Resilient Health on the personal cost of staying healthy and then with Dr. Michael Swanson on what's keeping grocery prices stubbornly high. And speaking of the grocery aisle, the founder of Mr. Bing Foods on scaling a global street food into a profitable condiment brand. And yes, we had to taste the chili crisp. All that to come. We begin with a look into consumer health. The most recent US Consumer confidence report adding to evidence of growing anxiety among American consumers about the high cost of living. The recent spike in fuel prices is particularly challenging for lower income households, despite a largely stable labor market and few signs of broad layoffs. When we talk about sentiment, we talk to Peter Atwater. He's president of Financial Insights. He's also adjunct lecturer of economics at the College of William and Mary. He joins us on set in the Bloomberg businessweek studio. Peter, I think a lot of people know you as the K Shape guy and nowadays we hear about this from everyone, whether we're talking to executives or executives are talking about earnings calls or we're talking to analysts or investors here on our program. It's not getting any better. In fact, it's getting worse.
- [04:16]
Peter Atwater
Yeah. And in fact, it's no longer a straight line K that the arm of the K looks almost parabolic and the leg is turning almost straight down into despair. And so the divide between those at the top and bottom isn't just economic at this point. It's almost become two life experiences that bear nothing in common. And I worry that those at the top are doing all they can not to see those at the bottom. But in a world of social media, those at the bottom can't help but see this enormous overabundance that exists above them.
- [05:06]
Emily Griffeo
I want to get more into that. There was a great piece in the Atlantic this weekend. The Vibe session is over. The Perma session is here. It spoke about how households are feeling worse about their finances and the economy than they did back in 1970 during Great Inflation. So you talk also a lot about the confidence gap. How much does the pullback from lower end consumers have to do with the fact that they just don't see any upward mobility?
- [05:31]
Peter Atwater
It's not only that they don't see any upward mobility. The AI boom has now put a target on their back. They believe that It's a zero sum game, and they're looking at all of these gains being made in AI stocks and believing that ultimately it will come at their expense. A lot of this has to do with how both groups imagine the future. And the imagination of the future could not be more divided in terms of extraordinary optimism at the top and this dire level of despair at the bottom. And it's the despair that troubles me because I know that ultimately that is what sets people into the streets.
- [06:26]
Tim Stenovec
Are you seeing. I want to talk about those people and the repercussions of this or the ramifications of this in a minute. But before we do that, just the. We hear so much about the resilience of the American consumer, and I hear what you're saying about despair and that bottom rung of the kids, but are we seeing an uptick in people missing car payments? Are we seeing people spend a certain demographic, put a different type of payment on their credit card? We talked to the folks at the Buy Now, Pay later firm Affirm, and they have the, you know, their client is the average American, and they say the average American is doing so well right now.
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Dr. Michael Swanson
Yeah.
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Peter Atwater
So if I look at credit card debt delinquencies, which this month look like they're going to come in at about 13%, what is so striking to me is if you. If you look at it mathematically, that level is historically high, but it comes at a time when, within the card portfolio, you have enormous convenience balances that are absolutely riskless for the card issuer and so on their own. I suspect that the. The quality that the card issuers are seeing among their lowest tier is distressful. And the challenge right now, Tim, is that we have this. This bifurcation where not only are businesses like the airlines dependent on the top, but I see so many derivatives of wealth, including our banking system, that require, at this point, those at the top to continue to do extraordinarily well. It's fascinating to me that a bank like JP Morgan, at the bottom of the financial crisis, there were about $3 worth of credit card balances to private banking balances. Today, the lines have crossed. They have more credit outstanding to private clients than they do to Main street credit card holders. So there's been an enormous wave of credit extended to those at the top with the belief that they will never default. I think that when you see so much of our economic system now dependent on those at the top, it begins to beg that question.
- [09:04]
Emily Griffeo
This bifurcation, Peter, has been a problem for years now and seems to only be getting worse, as you just mentioned. What can policymakers do to remedy this? And if they don't step in, what is the worst case scenario?
- [09:15]
Peter Atwater
I think policymakers need to be thinking about the needs at the bottom of the hierarchy. We know that food insecurity is an issue that leads people to protest and riot. We know that basic health care is financially debilitating to those at the bottom. And so I think we need to be thinking about the basic needs and ensuring that there is a safety net. And I think of it as a social safety net that prevents despair from setting in. And I think that we need to be cognizant of the fact that there is a growing population that feel hopeless and that hopelessness ultimately leads to action.
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Tim Stenovec
Well, what kind of action? I think a lot of people watching this, especially on primary day in Texas and as we do get into the midterms, would think that there are electoral consequences. And certainly that was a lot of the navel gazing that we saw post 2016 election. But. But what are ramifications of this?
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Peter Atwater
So the ramifications, if you go back to the fall, to me, it was no coincidence that in the midst of this affordability crisis that everybody was talking about, you saw a more populist mayor elected here in New York.
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Tim Stenovec
Okay.
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Peter Atwater
Who resonated both left and right. One of the things that is so telling about this latest consumer sentiment data is that for the first time, we have a meaningful drop in confidence among Republicans. And so the bottom is purple. It's not red or blue. And so that purple wants change. And candidly, neither party has done anything to suggest that they have action in place to. To serve those at the bottom.
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Tim Stenovec
So do.
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Brian Goldberg
Do the.
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Tim Stenovec
Do the people at the bottom have to be served through political action, or is there a way for this to be solved without Washington's help?
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Peter Atwater
I think you're seeing it on a local level first.
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Tim Stenovec
Okay.
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Peter Atwater
As I would expect. And ultimately, those changes on a local level lead to national.
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Tim Stenovec
So local like New York City and Zoran Mamdani, our newish mayor.
- [11:36]
Dr. Michael Swanson
Yeah.
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Tim Stenovec
Where else?
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Peter Atwater
So I think we're going to see examples of that this fall where you have incumbents on both the left and right who are voted out. And I think it's quite interesting in some of the political ads, incumbents aren't even talking about the fact that they're incumbents.
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Tim Stenovec
Like they know that it's governor of California, someone like Steve Hilton coming in, or mayor of Los Angeles, someone like Spencer Pratt coming in, for example. Is that what you're Talking about it'll
- [12:08]
Peter Atwater
start at a local level.
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Tim Stenovec
Okay, interesting.
- [12:11]
Peter Atwater
And part of that is every crisis is local. And politics are incredibly local when confidence is low. And so that's where people. It's tangible, it's immediate, it's proximate. And so those are where people demand change. First.
- [12:31]
Emily Griffeo
I'm really interested, Peter, in this idea that you mention of America becoming more of an ownership economy where more and more goes to the people who already own homes, who already own financial assets. Can you talk a little bit more about how this incredible run in AI companies is worsening that?
- [12:48]
Peter Atwater
Yeah. So you have beneficiaries of asset inflation and it's hard not to see it, and it driving everything from NICs tickets to airline seats. Owners of assets today have choices and opportunities that those below don't. And I think that for every owner, there is a renter, there is somebody with a car payment, somebody with a credit card payment. So. So you have those that are in essence, extending credit, extending opportunity, and those who are on the other side of it. And the gap to move from one to the other is it's too wide and it's too costly. You look at the average rate on a credit card, 20 some percent. Well, to pay that off first, to begin that upward migration is all but impossible.
- [13:57]
Tim Stenovec
We're speaking with Peter Atwater, president of Financial Insights. He's a lecturer of economics at William and Mary. He's also the author of the Confidence Map, Charting a path from chaos to Clarity. Peter, let's end with the investment thesis. In an environment, in a world where the K's are sort of going parabolic in the other directions. We're speaking to you on a day where The S&P 500 could finish again at a new record. Doesn't seem like this idea of a weakening bottom rung of the K is holding back investment in AI, as Alex mentioned, what's the. What are the investment ramifications of society like this?
- [14:33]
Peter Atwater
The investment ramifications are that there is an over investment in this abstract technology that we crave. When confidence is extremely high. We imagine this unlimited opportunity in futuristic technology at every peak in confidence, then there comes the backlash. In this case, I expect the backlash to AI to only grow. I think those at the top, particularly the proponents of AI, fail to appreciate the zero sum that is seen by those at the bottom. And the higher the market goes, the more those at the bottom feel that ultimately they will pay the price. Because to sustain that earnings growth, it has to come somewhere. And the most obvious target is labor
- [15:36]
Tim Stenovec
Peter Atwater Always a thoughtful conversation when you join us here on Bloomberg businessweek Daily. Peter's president of Financial Insights. He's an adjunct lecturer of economics at the College of William and Mary. He's also the author of the book the Confidence Map, Charting a path from chaos to clarity.
- [15:55]
Adobe Representative
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- [16:28]
Dr. Michael Swanson
the thing about AI for business? It may not automatically fit the way your business works. At IBM, we've seen this firsthand. But by embedding AI across hr, IT and procurement processes, we've reduced costs by millions, slashed repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by
- [16:50]
Tim Stenovec
putting AI where it actually pays off, deep in the work that moves the business.
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Dr. Michael Swanson
Let's create smarter Business.
- [16:57]
Public Investing Representative
IBM Support for the show comes from Public. Public is an investing platform that offers access to stocks, options, bonds and crypto, and they've also integrated AI with tools that can assist investors in building customized portfolios. One of these tools is called Generated Assets. It allows you to turn your ideas into investable indexes. So let's say you're interested in something specific like biotech companies with high R and D spend small cap stocks with improving operating margins or the S&P 500 minus high debt companies. Chances are there isn't an ETF that fits your exact criteria, but on Public you just type in a prompt and their AI screens thousands of stocks and builds a one of a kind index. You can even backtest it against the S&P 500. Then you can invest in a few clicks, go to public.com market and earn an uncapped 1% bonus when you transfer your portfolio. That's public.com market and paid for by
- [17:52]
Peter Atwater
Public Holdings Brokerage Services by Public Investing member finra SIPC Advisory Services by Public Advisors SEC Registered Advisor crypto service by ZeroHash sample prompts are for illustrative purposes only, not investment advice. All investing involves risk of loss. See complete disclosures@public.com disclosures.
- [18:10]
Bloomberg Businessweek Host
You're listening to the Bloomberg Business Week Daily podcast. Catch us live weekday afternoons from 2 to 5 Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg business app or watch us live on YouTube.
- [18:24]
Tim Stenovec
The surging cost of corporate health care has employer sponsored premiums jumping nearly 8%. It's the sharpest annual increase in over a decade and it's driven heavily by GLP1, weight loss, drugs and outpatient care. That's according to the 2026 Milliman Medical Index. That increase in cost now has some companies moving past basic cost shifting and partnering directly with provider networks. It's something that Dr. Danish Nagda knows all too well. He's the CEO and co founder of Resilient Health. It offers direct primary and specialty care for employers and their employees. Good to have you on the program this afternoon, Doctor. I want you to explain how people access Resilient Health because you essentially serve two different markets, right? You need to get the employer to sign on and you need to get the company to start using the benefit and then their employees can start using the benefit. How does it work?
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Dr. Danish Nagda
One of the biggest things that we've seen recently is that employers are really struggling with their employees getting access. I mean, that's why you're seeing the rise of these other tools, because people are just opting out of the healthcare system. And the problem with that is that if you keep opting out of the healthcare system, when you actually get sick, you don't know where to go, you don't have an existing relationship. So what the employers are doing is they're offering these really high quality benefits for their employees. And what the data shows, and it's very well established, but even our own internal data shows that when you spend a dollar on primary care, you can save three to five dollars in the same year.
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Tim Stenovec
Wow. What is the obstacle to the access to health care?
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Chase for Business Representative
Is it, is it financial?
- [19:58]
Tim Stenovec
Is it a convenience thing, a difficulty?
- [20:01]
Dr. Danish Nagda
I mean, we all have tried to get a primary care appointment. It takes three to six months. So there's no availability.
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Tim Stenovec
You literally have to know somebody.
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Dr. Danish Nagda
You have to know somebody and to have to phone a friend just to get access to a primary care doctor.
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Tim Stenovec
Yeah, okay, I thought that was just
- [20:12]
Chase for Business Representative
a New York City problem, but I'm guessing, I guess it's not.
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Dr. Danish Nagda
But isn't that worse in other parts?
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Tim Stenovec
But that's a problem.
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Dr. Danish Nagda
It takes six months.
- [20:20]
Tim Stenovec
But isn't that a problem with primary care? Because primary care doesn't really do procedures and therefore they're not paid the way that other doctors are paid. So there's a problem attracting primary care doctors or in the case of like so Many doctors who I've had, even, even our pediatrician, they're going concierge. So literally tens of thousands of dollars to actually go and see a doctor because it is so much more lucrative. And there is that opportunity there. How do you attract primary care doctors when the system, I think many people would argue, is so broken?
- [20:51]
Dr. Danish Nagda
Well, the dirty little secret in healthcare is that everybody's focused on the boomers, the aging population, Medicare Advantage. And what's happened is when you think about Nana having seven different diseases, the primary care doctors have to spend an hour, two hours with her, but they can't worry about your mental health, they can't worry about your other issues. And so they end up spending five minutes with you. And so that delay is coming from the fact that we have a mismatch. We have a primary care doctor that's coming in and is completely focused. The first visit was somebody with cancer. The second visit was somebody with maybe what seems like nothing, back pain. But that back pain can lead to a 40, $50,000 surgery. So this mismatch of supply and demand is a big issue. And that's where AI is actually playing a great role.
- [21:32]
Tim Stenovec
So you, you trained, you, you went to med school at the University of Pennsylvania. You did your residency in otolaryngology at the at WashU in St. Louis. What made you want to sort of leave traditional medicine and start companies?
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Dr. Danish Nagda
It's actually one of the greatest. There's recently lots of data that came out in the last week or so. A lot of doctors are leaving medicine, making the problem worse. Now, I might be part of the problem, but I want to be part of the solution as well, which is it is incredibly challenging right now for a provider or a doctor to deliver care. The reimbursement models are completely breaking. The patients are not getting enough time. There's moral injury associated with it. And so what we want to do is use technology to restore that doctor patient relationship. And that's really what I built this company around. I mean, I'd already built a company before that was acquired and went public. And so this was, for me, the opportunity to kind of go back and build this. And most importantly, I was a caregiver for my dad. And this is the. The again, unspoken truth in healthcare in America. Because we're so focused on people with chronic diseases, you, your family members and others are walking around with undetected diseases that will become those chronic diseases. And if we could get early enough into the cycle of it, we could prevent what happened to my dad and my co founder's mom, where they literally just missed the diagnosis for decades from happening. And my dad would still be here playing with my grand, you know, playing with my kids. And so I think that that's the reality of healthcare in America.
- [23:00]
Tim Stenovec
How does AI find those, is it AI?
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Chase for Business Representative
How do we find those undetected symptoms?
- [23:06]
Dr. Danish Nagda
AI is already finding them today. 40 million daily queries on ChatGPT for healthcare. 40 million daily. That's way more than the healthcare system today because people are just saying, we're done, we're opting out, we're going to go this other route because we trust them more than we trust doctors. And it's just the way it is. As a doctor, I feel very comfortable saying that the problem is one, those systems are not built with the clinical guardrails that are required. Two, when you do need something, they don't know where to send you. And so I think the answer is AI healthcare together solving the problem. So you could go into, for example, resilience, AI native. So you can go in and ask us questions just like you would with ChatGPT, but we can escalate it to a provider that can see you same day. So it's just the opportunity to be able to get as much information, as much time, and most importantly, as much knowledge that is needed for you to take care of yourself, but not get lost in the rigmarole of the current healthcare system, which is just an absolute mess.
- [24:06]
Tim Stenovec
Yeah, I actually threw some labs into Claude a little earlier today, and I know my doctor will look at him and get back to me, but now I know what he's going to say. So I guess if Claude is correct, that's the question. Hey, making sure that the AI is actually trained. Because we did cite a study earlier this week that said a good portion of what you get back on ChatGPT when it comes to medicine is not actually that accurate. What's the right way? What's the right way to have the guardrails up that. That actually makes sure you deliver the right information. Just 30 seconds left.
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Dr. Danish Nagda
Yeah. So from our perspective, the most important thing is to know when the confidence of that model is high or low. So if you just think about the way Claude responds to you, it's as if it knows all the answers and that everything it's saying is correct. For us, we actually look at confidence scores of the responses and use that to escalate care in a, what we call a har of guardrails to make sure that no patient gets the wrong care at the wrong time.
- [25:00]
Tim Stenovec
Dr. Dhanish Nagda. Gotta come back soon. Appreciate you taking the time and joining us. He's the CEO and the co founder of Resilient Health. He joins us this afternoon. From paying up for health care to paying up for groceries, here's an interesting story that you could have missed. We know farmers worldwide have been under pressure due to the Iran war. It's disrupted supplies of conventional nitrogen fertilizer. It's forcing these farmers to improvise ahead of this crucial fall planting seasons. One of the ways they're improvising is actually using human urine as a fertilizer. 2B Organics is a French startup. This was in Bloomberg News last week. It converts human urine collected from schools and festivals into a bacteria feed that helps plants grow. The Bloomberg News piece also said that since late February, sales have jumped about a quarter for the product. There is no end in sight to rival US And Iranian blockades. And Hormuz fertilizer disruptions are expected to persist. A prolonged conflict could mean weaker harvests and higher grocery prices. This is what Dr. Michael Swanson looks at. This is his specialty. He's chief agricultural economist at the Wells Fargo Agri Food Institute. He joins us from Maryland. Dr. Swanson, good to have you on the program. The disruptions that we've seen as a result of the, of the, on fertilizer, as a result of the, the war in Iran, the Strait of Hormuz closure. We spoke at the top of our program about what an open Strait of Hormuz could look like and when that could happen. Hint, we're still no closer than we were three days ago is what our Bloomberg News team says. Chris Kennedy over at Bloomberg Economics, if the strait were to open, how quickly, soon, how quickly would we then see fertilizer prices drop and that actually hit worldwide agriculture?
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Dr. Michael Swanson
You know, it's interesting. The prices would drop quickly even though the supply itself would be delayed behind it. But these are markets that are always looking forward. So the same thing that drove them up quicker than the product disruption would take the prices down faster than the product actually arriving to the markets.
- [27:00]
Emily Griffeo
Dr. Swanson, one of the themes that we've been talking about a lot is this idea that consumers are trading down on certain items. They're trading down on staples, but splurging, for example, on certain categories. Where are you seeing this when it comes to food trends?
- [27:15]
Dr. Michael Swanson
You know, it's interesting. You can see it clearly in the protein space. I mean, when you look at the value of chicken and pork relative to beef, right now, clearly, it's really bidding up that demand in a big way. But on the flip side, when you look in the beverage categories, some of the probiotic soft drink replacements, they are super premium pricing, but they're not finding any problems looking for good demand. They have plenty of product demand even at that super premium pricing.
- [27:39]
Tim Stenovec
You know what I noticed over the weekend, I was buying some chicken and it said 20 grams of protein per serving on it. And I'm thinking to myself, is this, is this a result of the protein craze coming from GLP1s that, you know, even. Even foods that have had the same protein content in them for generations, like forever, are now advertising that protein, because that's what at least American consumers want to see.
- [28:02]
Dr. Michael Swanson
That's exactly what you're seeing. So we're seeing across every single category. If you have a protein component, you're going to highlight that first on your packaging. And it's interesting how packaging really responds to that question that's on the consumer's mind. But you're exactly right. This is something that's going to continue and it's going to be very prominent. I think you're going to see it clearly in every single category.
- [28:21]
Tim Stenovec
Is this protein craze, Is it like other food crazes in the past where we've seen people, you know, consumers are fickle and Americans are fickle when it comes to sort of what we follow, or is this protein craze here to stay?
- [28:34]
Dr. Michael Swanson
You know, it's a great question, and it's here to stay. I mean, you, you and I can all name diets that have come and go. Paleo, Atkins, things like that. But when you're talking about medicine that's going to be prescribed, it's going to be the new statin. When you think about it, there's like 90 million prescriptions for statins out there right now. This is going to be the new statistics. And since Americans are pretty good at taking their pills, this is going to be one that's going to stick around. This is not a fad that's going to walk away. It's going to be here for a long time.
- [29:03]
Emily Griffeo
Consumers are very much feeling the sticker shock of prices when they go to the grocery store. Even as some agricultural commodity prices have actually come down. At what point do consumers feel some of that relief in the stores?
- [29:16]
Dr. Michael Swanson
You know, it depends on the category. Take eggs, for example. Last year's avian, highly pathogenic avian influenza was just an enormous shock, but we're actually below the price starting that cycle right now. But we're not seeing consumers really take away a lot more eggs even at these really low prices. So it takes an awful lot to shake an American out of this particular diet that they really like. But we will see some relief as we, for example, the dairy industry right now, they're chasing more cows to produce more beef, which means more milk. So we're seeing good dairy pricing as well. So the consumer does have some opportunities if they're willing to look for them.
- [29:53]
Emily Griffeo
As we head into the summer months, are there any categories in food that might see inflation pick up? Any that you're expecting for it to be worse than others?
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Dr. Michael Swanson
You know, right now what we're seeing is a little bit in the vegetable and fruit category. We started out the year with a tough spot with the freeze in Florida, which really put up the price tomatoes. And we're going to have to wait to see what happens with the labor, with the transportation cost, because diesel is a major cost for moving it around the country and bringing it into the country. So probably fruits and vegetables will probably be the most pressure thanks to the recent events we've seen.
- [30:27]
Tim Stenovec
So my same question to you about fertilizer has to do with diesel prices. If the strait does open and diesel prices come down, will we stop seeing those price increases in fruits and vegetables?
- [30:39]
Dr. Michael Swanson
You know, probably not, because the bigger driver is going to be that long term availability of wages and wage inflation is probably still running at a 3,4% range right now. So diesel would be a nice relief factor, don't get me wrong on that. But the wages are going to be a bigger piece of it for the longer term. Once they go up, they almost never come down.
- [31:01]
Emily Griffeo
What about our farmers, Michael? There is a disconnect between how much farmers are earning and how much consumers are paying our American farmers. Farmers getting squeezed right now as grocery bills remain elevated.
- [31:13]
Dr. Michael Swanson
You know, it's a great question. It really is farmer by farmer. You know, when we look at the microdata that we have, last year we saw some amazingly good returns in the same year as very bad returns. And I think what really driving a lot of it is the technology. What we're hearing from the farmers is technological change is so rapid and so difficult, they're having a hard time implementing it if they're not on top of it. So yeah, we're seeing some squeeze. It'd be nice for them to get some price relief from the higher crop prices, which would be inflationary, or lower input prices, which would be great. But what's not going away is the vice of technological change, which is just really putting them in a tough spot.
- [31:51]
Tim Stenovec
You mentioned the rising prices of protein. The story in the Washington Post over the weekend got my attention about how the Texas barbecue industry is struggling due to rising meat prices. The country cost of brisket increasing 28% over the past year. Imports coming from outside the United States. I mean that, that is what an import is. Is that going to put a dent in in rising beef prices?
- [32:14]
Dr. Michael Swanson
You know, not really for that type of a category. So grind that goes into hamburger? Absolutely. This industry has discovered that Brazil is a gold mine of hamburger and they're going to mine it for the foreseeable future. But when it comes to identifiable cuts, stakes and brisket, things like that, no, we don't really have another source because we want a certain quality. So this industry is pretty bullish right now about their ability to keep prices high. And it usually is a sign that things will change when they think nothing will change.
- [32:47]
Tim Stenovec
Michael, gonna have to leave it there, but this was a great chat. You got to come back soon. We appreciate you taking the time. Michael Swanson, chief agriculture economist at the Wells Fargo Agri Food Institute, joining us from Minneapolis this afternoon.
- [33:03]
Adobe Representative
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Brian Goldberg
Yep.
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Peter Atwater
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Chase for Business Representative
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- [35:50]
Bloomberg Businessweek Host
You're listening to the Bloomberg Business Week Daily Podcast. Catch us live weekday afternoons from 2 to 5 Eastern. Listen on Apple CarPlay and Android Auto with the Bloomberg Business app or watch us live on YouTube.
- [36:04]
Tim Stenovec
Sometimes we get the stuff ahead of time to try it and just like see or just like check out the product. Scarlet Fu yeah, she gave me, she gave me some of the the chili crisp.
- [36:12]
Adobe Representative
I didn't get any. It was on his desk.
- [36:14]
Tim Stenovec
It was on my desk and it, it said you don't need to refrigerate it, you can just open it and and then so every day I just take a little bit and put it on my eggs.
- [36:20]
Dr. Danish Nagda
Poof.
- [36:21]
Tim Stenovec
Yeah. And then suddenly I ate both of them. But fortunately, Brian Gold Goldberg brought more. He's founder and chief Chief Growth officer over at Mr. Bing Foods. He joins us here in the Bloomberg Interactive Broker Studio. I'm glad you brought, I'm very relieved you brought more because I was really worried that I had, you know, really messed this up. You have a really interesting story. You had this food truck. You spent some time living abroad where you had this love of street food. You wanted to bring this back to the U.S. how did you end up with a project line that looked like this?
- [36:50]
Brian Goldberg
So it started back in the late 90s in China, study abroad with my co founder in Beijing. Ate these amazing street foods in particular Jianbing. It's like a savory Chinese crepe that we would have for breakfast every day before school. And then one day we decided to bring that to Hong Kong and then to the US and the sauces in there is what our platform is now. So we had a whole restaurant, kiosk, food truck life in Hong Kong and then in New York for almost 10 years where the brand really built itself up as a street food forward Pan Asian street food brand. The sauces, basically we were doing pop ups inside a lot of the corporate office cafeterias in New York. Pre pandemic, partnering with Compass, Aramark and Sodexo. And the chefs noticed that we had this chili crisp that we had created. Chili crisp has existed for a long time. Right. Lao Gama in China. Basically we wanted to make a version a little more accessible for the American market on our own. The right particulate size to spread in the food. A mild version of it. A little bit of a different flavor profile, a little more versatile with Mexican, Korean, Chinese flavors to make chili crisp more adaptable to so many other cuisines. The chefs at those places, like at Goldman Sachs and at Morgan Stanley and at Google LinkedIn where we were doing all these bing pop ups, loved it and asked us to put it in a big size that they could use in other foods.
- [38:13]
Tim Stenovec
So I'm holding a. There's a big size here. This is, I don't think they have the actual, oh, 64 ounce version of this.
- [38:20]
Adobe Representative
That is a big size, which a
- [38:21]
Tim Stenovec
typical is 7 ounce. So yeah, that's a big.
- [38:24]
Adobe Representative
So for their use in their kitchens.
- [38:26]
Brian Goldberg
Yes, they wanted to use it like to mix with ranch, to mix with mayo, to make what they call plus ones or sauce hacks where you, I mean you can use it straight up like on eggs, rice, pizza, pasta, burgers. It was a big trend. I mean it trended a lot during the pandemic. Right. It's become much more mainstream now when it was much more niche before.
- [38:43]
Tim Stenovec
Well, it's interesting because I see it everywhere now, just chili crisp. A lot of different companies make it and it was first on my radar. Like I guess maybe two years ago. My wife bought it at the store, brought it home and now it's like now it. Chili crisp is a condiment that we always have.
- [38:57]
Adobe Representative
Interesting.
- [38:58]
Tim Stenovec
And we have bought. There are a lot of different versions of it. I mean Momofuku does a version. There's like some classic versions as well from, from other companies. It's a really crowded space at this point.
- [39:09]
Brian Goldberg
Well, chili crisp definitely saw like a massive growth during the pandemic. It's grown over 700% on menus nationwide. In terms of the mention of Chili Crisp.
- [39:20]
Adobe Representative
Right.
- [39:20]
Brian Goldberg
Which is sort of our real strong forte is on the food service side as well. We're basically the leading brand in the country and food service. Chili Crisp, if you go to a restaurant, hotel, college stadium, airline, if they're using Chili Crisp, they're using your stuff.
- [39:32]
Tim Stenovec
So interesting.
- [39:33]
Brian Goldberg
Most likely it's ours. Not necessarily.
- [39:35]
Tim Stenovec
Is that like 7?
- [39:36]
Adobe Representative
Is that like 70 or 80% of your business or what's Chili Crisp?
- [39:39]
Brian Goldberg
Chili Crisp itself is about 85%, but within our overall business, almost 50% of our of our revenues is food service.
- [39:47]
Adobe Representative
Okay, right.
- [39:48]
Brian Goldberg
So our products are very chef driven. I mean, like, it was kind of created by the rest, by the kiosks.
- [39:54]
Dr. Danish Nagda
Right, right.
- [39:55]
Brian Goldberg
And then the chefs that started buying it in big size wanted it a certain way.
- [39:58]
Dr. Michael Swanson
Way.
- [39:58]
Brian Goldberg
And we really had that dialogue with a lot of chefs about creating it, how to create it. And then that's what led to the barbecue sauces, a more squeezable sort of format of a Chili Crisp. Right. So we've been very involved with the chef community around the country. We've been very fortunate to have that opportunity. And that's. There's a flywheel effect between being on restaurant menus and then how your sales are, like, in the stores and also the E commerce piece. Like, all three of these things, you know, impact each other.
- [40:29]
Adobe Representative
Where's the growth? I get the under. I get it. Like you're in a restaurant, you do it, and then you, like, you want it for home. Where's the growth in terms of your businesses? Is it to the restaurants or the business side of it? The corporate side, if you will, or is it in retail outlets? Like, where's the. Where's the growth?
- [40:45]
Brian Goldberg
It's all really across the board, all of it. You know, I think we've been very fortunate to have the opportunity, the relationships and the distribution. Frankly, getting distribution is. Is really hard. You really need, like, anchor customers, anchor clients, anchor restaurant chains, anchor retail. Once you have that, then you can really go out and sell to everyone else. But the growth right now is in our squeezables. Like, Chili Crisp is awesome. Don't get me wrong. People love it, but you got to stir it up, spoon it out, scoop it out.
- [41:11]
Peter Atwater
It's a little bit.
- [41:12]
Brian Goldberg
You take that extra step, you get a little oil on the counter, which is fine. It's just the nature of it. Right. Because of the texture and how the particulates are. But a lot of people just like to reach for Something and squeeze it and squirt and put it back. Right. And that's what these are. This takes chili crisp. There are about 10% chili crisp bits in them. So it's a line of Asian barbecue sauces. Chili crisp barbecue sauces. They're the first ones on the market that are a chili crisp based barbecue sauce. Right. And that was developed because chefs wanted to squeeze the chili crisp. They wanted to be able to apply it to pizza or to wings more easily. You needed something sticky like a binder. Right. And that, like toppers Pizza in Wisconsin was the first one that really did that with us. And that led to the OG Sweet and spicy. And then that worked so well in a large format that we decided to go a little more Pan Asian. And that led to the Thai. The Thai hot honey, which has more like lemongrass and could fear lime leaf in it. We have a Korean gochujang forward one that has more yuzu and ginger. And we have a mild. So don't forget, like, our mild chili crisp is actually more than half our sales of chili crisp because almost half of Americans don't like spicy food.
- [42:22]
Adobe Representative
I'm a mild kind of gal. The rest of my family is.
- [42:24]
Tim Stenovec
Okay, so I'll take the spicy one. You take the mild. The things you just held up, those small dishes, what are those?
- [42:31]
Brian Goldberg
These are samples. These are just. We call them hockey pucks. Basically, these little baby guys.
- [42:36]
Tim Stenovec
TSA compliant.
- [42:37]
Brian Goldberg
They are TSA compliant. They are. And I'm sort of infamous for always having them in my.
- [42:41]
Tim Stenovec
So now I know what he's going
- [42:42]
Adobe Representative
to be traveling with.
- [42:44]
Brian Goldberg
Yes, exactly. So basically, I mean, food service is so relationship driven. And chili Chris, to your point, like, a lot of people don't know what it is. You have to taste it to kind of understand what it really is. If you've never had it, I've never had it.
- [42:58]
Tim Stenovec
Oh, okay. So this is going to be. Sorry to share it with you, though.
- [43:01]
Adobe Representative
You're at. You're absolutely not sorry.
- [43:04]
Tim Stenovec
But honestly, I have a real question about the serving sizes.
- [43:07]
Dr. Michael Swanson
Yeah.
- [43:07]
Tim Stenovec
Because these. These little jars have 40. Are supposed to have 40 servings. That is, like, not typical for me in terms of serving. And. But also. But it's a table. It's a teaspoon of this as a serving size. That seems like a small amount to include on it.
- [43:22]
Brian Goldberg
How much do you take, Tim? How much?
- [43:23]
Tim Stenovec
A few teaspoons each time. Yeah. Quite a bit, though.
- [43:26]
Peter Atwater
But.
- [43:26]
Tim Stenovec
But I mean, I think that it's kind of regardless. I don't know, it just seems like, there's no. I'm sorry, it just seems like a small serving size. I don't know. Do you find that chefs, you know,
- [43:35]
Adobe Representative
you have a big appetite.
- [43:36]
Tim Stenovec
I do, but. But do you find that chefs are actually adhering to, like, what is, like, that actual suggested serving? I know that's just the nutrition information side of it, but is that meant to be, like, to flavor an entire piece of pizza or flavor, like, three eggs?
- [43:49]
Brian Goldberg
It's a good question. So, like, in food service and according to, like, food labeling rules, there is a standard serving size for different types of things. Barbecue sauce is a particular standard serving size.
- [43:59]
Tim Stenovec
I guess that makes sense if you want to compare labels across the board.
- [44:02]
Brian Goldberg
Yes, exactly. And chili oil, because it's pretty potent or can be pretty potent, you know, ours is not. It kind of builds up. It doesn't overpower you. It's more about the texture, the flavor. But there is a standard serving size that you put on there for chili oil. Now, chefs will use as much as they want.
- [44:17]
Tim Stenovec
Okay.
- [44:18]
Dr. Michael Swanson
Right.
- [44:18]
Brian Goldberg
I mean, the Tyson chef was covering an entire turkey. It was a chili crisp turkey as a new concept.
- [44:24]
Adobe Representative
That's cool, right? That's really cool.
- [44:26]
Brian Goldberg
And so that totally blew away the portion size. Right.
- [44:29]
Adobe Representative
So, Tim, did you hear Brian said standard size?
- [44:32]
Tim Stenovec
Yeah, standard. Yeah. That's okay.
- [44:33]
Adobe Representative
Just kind of put out there. I'm just looking at. So you guys are in 10,000 retail doors nationwide?
- [44:40]
Brian Goldberg
Yes. Over 10,000. Chili crisp. Over 2,500 on the barbecue sauces.
- [44:45]
Adobe Representative
Yeah.
- [44:45]
Brian Goldberg
And I don't know how many thousands of restaurants, hotels, colleges, stadiums.
- [44:50]
Adobe Representative
Does it sell in terms of the retail across the country equally, or do you find there's certain metro areas where you really. That's where a lot of the demand is.
- [44:58]
Brian Goldberg
It. I mean, it does tend. It used to be very strong in the more international coastal cities.
- [45:03]
Adobe Representative
Right.
- [45:04]
Brian Goldberg
But it's really spread just because, you know, TikTok and social media, people see these things all over the place right away. It doesn't really matter. But, yes, we have had a stronger, a little bit higher numbers, I guess. You know, east coast and West Coast, Pacific Northwest, where we manufacture it. California, obviously, large, Asia.
- [45:19]
Adobe Representative
It's all manufactured in the United States, or it is.
- [45:21]
Brian Goldberg
We make everything in the United States, which has been really great, especially to avoid. You know, we haven't had the really tariff issue come up. It makes it a lot easier for us to work with our manufacturers to adjust things in terms of supply chain. But, yeah, it is. We put made in USA and pretty. Pretty big letters on there.
- [45:39]
Adobe Representative
Yeah.
- [45:40]
Brian Goldberg
So Asian inspired, but made in the USA.
- [45:42]
Tim Stenovec
You know, McCormick bought Cholula hot sauce for $800 million back in, in 2020. Things have changed a lot in those in the last six years. You're an independent company now. What's the plan for acquisition or the future?
- [45:57]
Brian Goldberg
So we, we're very focused on our current products, growing them, getting them more into more chefs, more stores. We do work with some other big brands. We've been very fortunate through the food service industry in particular.
- [46:10]
Adobe Representative
Right.
- [46:11]
Brian Goldberg
With Kikkoman, for example, we do a chili crisp poison sauce together, which is awesome. A little bit of ponzu, little sriracha in there. And we sell that in food service together with Hormel. We work with them with their proteins, like really complimentary companies where they'll use it to ideate with big. The biggest restaurant chains in the, in the country. Right. On how to integrate our sauces with their products. And, you know, we'll see where things go. But right now, right, it's really focusing on growing the products, getting the new products.
- [46:39]
Adobe Representative
So there's more expansion that can come off of this.
- [46:42]
Brian Goldberg
Absolutely, Yeah, A lot. A lot more.
- [46:43]
Tim Stenovec
Like what?
- [46:45]
Brian Goldberg
Well, there's, you know, when you talk about numbers in retail, there's roughly 30,000 supermarkets in the country that you kind of judge in terms of your percentage of penetration in retail. Yeah, we're just over 10,000.
- [46:55]
Public Investing Representative
Right.
- [46:56]
Brian Goldberg
So we have definitely a ways to go and in food service as well, and especially with the, with the new products. So, you know, we're at about a 12 million run rate right now. We're profitable and there's a lot more growth to go.
- [47:08]
Bloomberg Businessweek Host
So.
- [47:08]
Adobe Representative
So, Brian, how much should Tim eat of this regularly?
- [47:12]
Tim Stenovec
I think that's personal.
- [47:12]
Adobe Representative
Like, one teaspoon is a normal.
- [47:14]
Chase for Business Representative
A normal person.
- [47:15]
Tim Stenovec
Big chili crisp guy.
- [47:17]
Adobe Representative
One teaspoon.
- [47:18]
Tim Stenovec
That's a suggestion.
- [47:19]
Adobe Representative
And should he share with his colleagues?
- [47:21]
Brian Goldberg
Maybe he should. Come on, Tim.
- [47:23]
Tim Stenovec
Yeah, I will share.
- [47:26]
Adobe Representative
It's on the Record, everybody.
- [47:27]
Tim Stenovec
Brian. Brian Goldberg, founder and Chief Growth officer over at Mr. Bing Foods, joining us here in the Bloomberg International Interactive Broker Studio.
- [47:35]
Bloomberg Businessweek Host
This is the Bloomberg Business Week daily podcast, available on Apple, Spotify, and anywhere else you get your podcasts. Listen live weekday afternoons from 2 to 5pm Eastern on Bloomberg.com, the iHeartRadio app, TuneIn, and the Bloomberg Business app. You can also watch us live Every weekday on YouTube and always on the Bloomberg Terminal.
- [48:06]
Public Investing Representative
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Tim Stenovec
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