In this episode of Retaili$tic, Deborah Weinswig and Todd Benson discuss the 2026 sector outlook, consumer spending trends, and the transformative impact of AI on retail. They explore the importance of second order thinking in investment strategies, the challenges of navigating tariffs and supply chains, and the role of sustainability in modern manufacturing. The conversation also touches on change management in businesses adapting to AI, and concludes with predictions for the market in 2026.
Video of this episode is here
Takeaways
The 2026 sector outlook provides insights into consumer spending trends.
Second order thinking is crucial for understanding market dynamics.
Walmart's strategic positioning highlights the importance of being a tech company.
Sustainability initiatives can lead to profitability in retail.
AI is reshaping consumer behavior and retail strategies.
Navigating tariffs requires strategic planning and adaptability.
Advanced manufacturing techniques are revolutionizing sustainability efforts.
Investment strategies must consider timing and market inflection points.
Change management is essential for businesses adopting AI technologies.
The future market outlook for 2026 suggests potential volatility but also growth opportunities.
Chapters
00:00 Connecting the Dots: Insights from Experience
03:58 The Evolution of Retail: AI and Market Strategies
07:54 Navigating Consumer Preferences: Lessons from Starbucks and Beyond
10:43 Resilience in Business: Learning from Failures
15:09 Cultural Insights: The Impact of Geography on Business
18:19 Innovations in Sustainability: The Future of Apparel
21:13 Investing in the Future: AI and Market Trends
24:52 Beverage Trends: The Shift in Consumer Habits
26:39 The Ritual of Chocolate and Consumer Behavior
29:52 AI's Impact on Investment and Business Models
32:57 Transforming Workflows with AI
36:34 Lightning Round: Insights and Reflections
41:56 AI's Role in Daily Life and Future Outlook
Philip Moore (00:00)
Welcome to Retaili$tic, the official podcast of Coresight Research for December 16th, 2025. This week, CEO Deborah Weinswig welcomes another legend of commerce, Todd Benson. Todd grew the Citigroup Private Equity Fund to $11 billion before leaving to start his own firm, Herington LLC. But before we chat with Todd about the impact of AI on our future, Isla is here from our London office with a preview of this week's research, publishing on Coresight.com.
Isla Meldon (00:30)
This week, we're rolling out our 2026 sector outlook data graphics, a full week of clear one page snapshots with forward looking insights across a wide range of US retail sectors. 10 quick visuals packed with what you need to know going into 2026. We'll also share our November US retail sales update, breaking down what the latest numbers tell us about consumer spending. And we'll wrap up our third quarter earnings season with a look at how US retailers performed and what it signals for the months ahead.
Focused insights, clear takeaways all coming this week.
Philip Moore (01:03)
Thanks, Isla. Now here's Deborah and Todd.
Deborah Weinswig (01:06)
Todd, thanks so much for joining us on Retaili$tic. We're so honored to have you with us. so I think, my gosh, we must have met over a decade ago. And I think we were originally talking real estate stuff and just having come off of two days of ICSC, it's a wonderful time to be able to reconnect. I always find that you are seeing things probably three to five years earlier than most.
Todd E. Benson (01:14)
Yeah.
Deborah Weinswig (01:31)
Maybe we can start there with what your process is or how do you put yourself physically in places where you're able to connect dots in a way that 99 % of people can't.
Todd E. Benson (01:33)
Okay.
Hmm.
Well, I don't know about that. Some of it's basically just like luck. And I truly believe that sometimes it's sort of kind of just like luck and being one who has no children. I love golf more than golf loves me. And so that I basically spend like you a lot of time just working and reading and consuming just any sort of information that I can sort of kind of find and try to fashion myself a little bit as a human marketplace for intellectual and financial capital. So things just kind of wash over me.
can learn a lot just by and I think actually when I'm with young people, I always sort of say like the skill that we all want to kind of learn and to continue to hone and to build what two things are, one of which is basically what I call a second order thinking. And so basically just when you see anything, so try to always kind of force yourself to ask the question, what does this mean? What, what sort
of
kind of happening next, and particularly at times of dislocation or change. So you see, for example, know, chat GPT coming out and being one of the fastest adopted kind of consumer products. And you sort of say to yourself, what does that mean? But you have to force yourself to ask the next question. Well, who wins or what's how's like who wins and who loses in that world? And of course, the answer for all of us and kind of shame on me for not buying more Nvidia
now two, three years ago, or you see interest rates rising very that shock and you don't say to yourself, gee, what's basically a long fixed income ETF? Oh, I know it's a bank and go out and you short signature and first Republic Bank. And so just things like that, always sort of kind of thinking about, you know, kind of second order impacts. And then the second thing is, you know, I always say basically it's just like trying to like figure out like how to ask better questions.
and to sort of just if you can think, if you can kind of constantly teach yourself what's the right question of the right person at the right time, the universe will sort back to you. sometimes too I also think you know, I was thinking this morning about, here's a crazy stat, which
29 % in terms of, so think about it this way, there's 340 million Americans, 170 million of them are men.
of the 170 million Americans that are 780 of them have what it takes to make the 26 man roster in Major League Baseball. So we whittled down that universe from there to all the way there. of those 780 men, the 100 best of those basically make 29 % of all salaries paid in Major League Baseball. And I'm sorry, that's the, I think that's the top, yeah, that's the top 50. 50 of them make 29 % of it and 100 of them, the top
100
of them out of 780 in a census of 170 million men make 48 or 49 percent of it. It's just some of the sort of you sort of kind of just say you kind of like everything has a Pareto distribution in terms of outcome and we're in such a world of like winner-take-all and so like I think that applies to sort of everything.
Deborah Weinswig (04:36)
it's so funny because I've never said, be a fast follower, right, being first tends to cost a lot more time, money, effort. But now, I mean, it's interesting where our team was just on the phone with a large retailer and we're like, hosting these AI playbook events, which are public for different retailers so that Wall Street, right,
We'll call it the media and even people internally understand what they're doing from an AI perspective because more and more share price is based on that. And it's amazing. go back to I think it was 2013. I'm sitting in the audience at the June shareholders meeting for Wal-Mart and Doug McMillan talks about we're going to be a tech company and all of us are kind of looking at each other, right? Like almost uncomfortable physically because that was just kind of like
Todd E. Benson (05:14)
Yeah.
Deborah Weinswig (05:26)
lunacy and look at like where they've gone right in a very short period time and that's that's I think you know there's this speed component there's being first and then there's also I mean to get to where they are I mean it was expensive and difficult and so I think right now to doing like the hard things is what's gonna get you ahead
Todd E. Benson (05:30)
out.
Yeah, I agree with that. Walmart, think Walmart's incredibly well positioned right now. You know, mean, basically like the I mean, it's it's they're phenomenally well positioned.
Deborah Weinswig (05:54)
it's interesting, we did this somewhat macro-y presentation yesterday to NACDS and then somewhat on AI. So was like, talked about the macro, then the macro impact of AI, and then AI, just to kind of build a what is, as you start to kind of take a big step back,
And you look at, mean, Costco is about as quiet as you can get, and you look at like how much market share they have now, and right, they've just really put in like a more strategic insights team, like the last two years. So they've gotten here just doing good retail, right? Walmart, I think the story going kind of forward, right, this like ecosystem partner player and...
Alternative revenue sources that they're they're still very early in but the biggest thing is right that her thousand plus household income consumer Where they're winning and I don't know I mean I do I I do know when I go into Target or when I think about it or you're on the earnings calls like I know what's wrong but I don't I still personally don't believe the change that they've made are Going to get them where they they need to and you've also had Kroger. I mean, it's interesting,
Think about this, I was thinking about this as I was preparing for today. I'd love to hear your take. And maybe it doesn't really say anything at all, and maybe it does. Maybe there's more correlation. But look at Target, Kroger, and Starbucks, who I would say probably all go after a fairly similar consumer, struggling with a strategy, right? Basic strategy. And I mean, I know a bunch of people who work Starbucks. And it's like, we stopped writing people's names on the cups. I'm like, I guarantee you.
Todd E. Benson (07:16)
Yeah.
Deborah Weinswig (07:27)
that has nothing to do with like you saying, hello, Deborah, thank you for buying the coffee today. not it. But like I have a Starbucks at block and a half. I used to go all the time. I mean, honestly, I'm embarrassed to say I can't tell you the last time I've been.
Todd E. Benson (07:38)
No, think Starbucks is interesting because I think they got...
Did you ever, this guy, the guy Dean Phillips, was it Dean Phillips? The that ran for basically the Democratic presidential, ⁓ the Congress person who ran for that. And basically they made their money in Belvedere vodka and they made their money in Talente ice cream. And that's how the family made its money. And so basically Belvedere vodka was taking Grey Goose and Kettle One and basically just going a little bit more premium, a little bit in terms of the vodka and a little bit more premium in terms of the bottle. And Talente was that, is it related to Haagen-Dazs and Ben and
on ice cream. And that's why they made his money. And I think basically that's what's happened to Starbucks. They got kind of little bit stuck in the middle. They got picked apart by Blue Bottle and some of these people going basically, you know, kind of better, more premium. And they got picked apart from the bottom with people who had cheaper real estate strategies. Luckin and the Bank Street and those. And so they're at a tough kind of place.
Deborah Weinswig (08:32)
But but okay, so I right I I just got back from China two days ago So right I'm I've spent a lot of time there and I still spent a lot of time there and I mean I remember right Starbucks doing in Shanghai right the the tour of their roastery and like patting themselves on the back and stuff and I'm like You know there this is great all I can see is like how much it costs you to build this and how you're not going to be able to charge the same amount as like cost of coffee or luck in or whatnot and
Todd E. Benson (08:37)
Yeah.
Deborah Weinswig (09:00)
I don't think ultimately consumers are that different around the world, right? I always say one of the reasons I, until the department stores figured this out, I'd be in line behind somebody who had like the Macy's credit card and I'd have like a clipped coupon. That person was really saving 40 to 60 % more than I am, because I don't have a Macy's credit card. So I would call it like the chump factor, because now I feel like a chump, right? I'm here.
Todd E. Benson (09:12)
Yeah.
here.
Deborah Weinswig (09:21)
I've spent my time, but I'm to pay for basically the same good this much more. So if you think about Luckin Costa versus Starbucks, I go to Luckin, I feel like brilliant. I mean, I gotta tell you, like, have phone, we'll travel, right? And it's so funny because I'm there and everyone, like the first time there, you can see the people who've never been there before. They are like deer in headlights. How do I order? And I'm like, no, it's all on your phone. They're like.
But what do do on my phone? I'm like, well, you download the Luckit app and you order your coffee. That's what you do. And they're like, well, what about talking to a person? I'm like, no, no, that's how you order your coffee. But then what's so amazing, right? Because you're now connected. They know what coffee you get. Like, so say your coffee is $2 and 54 cents. You didn't get like a $2 coupon like instantly. So now you're like, oh, I'm so smart. Right? Like not only did I figure out how to like order coffee is pretty good. And now I have a $2. I mean, it's basically like a bounce back, but
Todd E. Benson (10:11)
Yeah.
Deborah Weinswig (10:12)
want to take a pause because this thread I think is super important is Like modern day right remember like green stamps or whatever like you know in a in Hong Kong at Circle K We had developed this thing called stamp Right, but they were digital stamps. I Think that I'm hearing more and more and more right people talking about that I was at this dinner last night and someone was like
Todd E. Benson (10:20)
Yeah.
Deborah Weinswig (10:34)
I didn't even know this like Macy's I guess way before my time used to do that and and they were like wouldn't that be cool if they did that I'm like yeah we need like a modern-day loyalty it's not like a loyalty card and you buy I'm not calling out anyone in particular but if you know you know like if you buy five bras you get your six free that is not like loyalty that is not gamification that's not interesting if you make it interesting for the customer and they care they will follow through and you will you will gain share and I think Walmart
Walmart Plus, I think was brilliant, going against the grain, right, of what they always believed. mean, I remember, I mean, I remember talking to Mike Duke and Lee Scott and whatnot about like loyalty programs and they're like, no, they're like, you know, Mr. Sam said we shouldn't do one. then like, you know, Doug is like, that was a different time. This is this time we need to do this. And it's been unbelievable.
Todd E. Benson (11:06)
Thank you.
Yeah, no, it's just all the data, the retail media, just like everything sort of compounds.
know, it's interesting you we just mentioned Luckin coffee I've tried with them It has been one that I haven't followed the stock sense But I just remember like they had the fraud or you know, whatever they had now I was thinking like how many companies have actually had like massive fraud where they almost went out of business and have come back to be this strong They may be that I don't know of anybody other than the like Luckin that's been able to do it's like I'll call the Lazarus How many Lazaruses are there there Lazaruses in terms of? You know, maybe chilies in terms of the restaurant
Deborah Weinswig (11:44)
So it's very.
Todd E. Benson (11:58)
world in terms of just like killing it. But they weren't, it wasn't a fraud. That was basically just, they lost their way and they were able to kind of turn it around. But you know, well, right. mean, there's more examples of like Lacoste, right? Lacoste basically, they took the shirts out of the store. was too cheap and they turned it around and now Lacoste came back as a premium good, but not in terms of fraud. Basically, whatever it was.
Deborah Weinswig (12:07)
Not many.
Well,
at T-Mobile, right? They had major, major cyber issues before others did. I can think that was, they were lucky, I guess, in an odd way that it happened first to them. So they completely like three years ago, I this is recent, right? This is like post-COVID, they went in and they completely like to get onto one of their calls, you have to type in like eight letters, right? It is like what I'm telling you.
Todd E. Benson (12:41)
Mm-hmm.
Deborah Weinswig (12:43)
and everything is like locked down, right? I'm on an airplane, somebody works there and it's like their whole laptop is like locked down. And so they, think, first of all, it's like, yes, we had a problem, we're not gonna run away from it. And as a result, we can now help you understand what you should do to protect yourselves. And so if you look at it, right, I won't name them, their competitors have had some major issues, right, in terms of data breaches and et cetera.
And T-Mobile has been this kind of like stalwart. So if you can, we've known each other a long time, Todd, right? I'm one of those people, right? If I miss an opportunity, if I make a mistake, right, I own it. But I also really like constructive feedback because I just wanna get better at what I'm doing. It's really important to me. And it's not about necessarily being the best. I just want to continuously improve because I...
I don't, first of all, whatever the best is that that target keeps moving. I feel like you're similarly minded.
Todd E. Benson (13:43)
Yeah, of course it also kind of illustrates one of my things in life that basically the happiness that in order to be happy in life that you got to break the 2x mentality and I call it the 2x mentalities basically if I had twice as much status, money, success, whatever kind of whatever thing that is basically and so like you just you know you constantly like the bar constantly moves and so like if you truly want to be happy in life you got to break that. You got to just say like you know what you know like you know like the concept of enough.
The concept of it.
Deborah Weinswig (14:11)
It's
it's funny you say that so my brother was changing jobs and as the you know, Big sister right like always and so I said to him like, you know, we were just talking salary and all that and So, you know, he just he's a CFO. So of course he just puts it in dollar-and-cents He's like, you know, he's like unless I'm literally making 10x as much it just isn't gonna change my life right and it was such an like very pragmatic right don't don't like nickel-and-dime because it's just
doesn't really matter unless like my salary is 10x. He's like, this is not gonna change my day to day life. And so I think sometimes too, the 2x versus 10x, right? I I think that to be happy when we were talking about before the call, right? Like a really good night's sleep can make you, right? It's sometimes like the really small things. It's never like the really big things.
Todd E. Benson (14:56)
no.
Deborah Weinswig (14:57)
Yeah, it's interesting. actually, it's funny. So I was just going back to I just got back from China two days ago. I met somebody who started working there like 15 years ago. And he is from the US from the Midwest. And he said, I'm one of the first he works in medtech. He said, one of the first days his boss said, there's no such thing as two weeks. And this guy's name is Mike. He's like looking he's like, he's like, didn't even know what that meant. He's like, there's only two days. He's like,
You never tell me you're getting me something in two weeks because here we can do it in two days. And I thought that was such a great way to describe China's speed. And if that's what's expected. And you think about leaning into that. Right. I think sometimes going back to happiness, isn't this who I bring it up, is that it's wherever The bar is and.
Todd E. Benson (15:25)
Thank you much.
Deborah Weinswig (15:41)
how you feel like you want to be at the bar, under the bar, over the bar, or striving kind of. And I think it goes back to kind of what expectations are. So sometimes happiness, I think, can be geographically based as well.
Todd E. Benson (15:52)
Yeah, yeah, no, it's I mean, it's, you know, like, mean, I think there's the expression, we all become the arithmetic average of the five people we spend the most time with in whatever it is, ambition, happiness, whatever it is, so basically choose your friends, aspirationally. yeah, like, that definitely holds. It definitely holds. Let me ask you this, since you just got back from China, it's remarkable to me, basically, just how all the tariff, you know, volatility,
Deborah Weinswig (16:10)
It's a team work.
Todd E. Benson (16:14)
is seemingly not been as bad as I would have thought. I would have thought that, and maybe I'm just missing it, or maybe it hasn't come through the numbers as people were kind of running through inventory, but it seems to me that the world has navigated tariffs better than I would have thought it would have been, you know, colossally bad, and maybe it's only just bad, I don't know.
Deborah Weinswig (16:19)
and
It's really only been in footwear. So if you think about footwear there's a lot equipment. You're talking about molds and, so for anyone who's been through a factory, I'm sure you can go look up on YouTube and see what that's like. But in an apparel factory, you literally have a sewing machine, put it your suitcase, we'll try, have sewing machine, we'll travel.
Todd E. Benson (16:43)
⁓ Right.
Yeah.
Deborah Weinswig (16:57)
So I think that what we've seen is that our friends in footwear have been hit much harder and it's been much more difficult because you can't also easily move production. So they've just figured out kind of how to, stay put, which I actually think has been, we got a lot of our clients, not our advice, right, moved out of China, then realized what they gave up, moved back to China.
some cases that moved a little bit of production out of China. So there's been a lot of this, but if you just stayed and focused and built a strategy, you would have been much better off. so, well, look at what's happening. I Li Ming, Anta, right? They're acquiring, you know, brands outside of China in the athletic footwear space.
Todd E. Benson (17:29)
Yeah.
Uh-huh.
Deborah Weinswig (17:40)
Right.
And so I think if you are there, I think you've you figured out how to navigate. And I think this is, you know, a lot of companies kind of pulling their teams into Vietnam or Cambodia or Indonesia or whatever. I think that they ended up hurting themselves because they didn't work collectively together to figure out how to do things better, faster, cheaper. They just physically moved. And so I think they.
To be honest, I think they did themselves a disservice. And I do know that many of our clients who had moved out are moving back. Because if you think about cargo, fabric, talent, proximity, it's all there. And actually, and I don't know you saw my LinkedIn post. Oh my gosh, it was should go together or I'll take a better video next time. So I went a wedding and of course I stayed and worked.
Todd E. Benson (18:18)
Sure.
Ha!
Deborah Weinswig (18:31)
always wanted to, so I've been very involved in something called like Science Park and Hong Kong Rita. And this is a lot of the research, right, that is done in Hong Kong. And so they've built, and like the last year, this whole advanced manufacturing center. they have one of the areas devoted to the apparel world. So they're growing hydroponic like a warehouse.
Todd E. Benson (18:55)
Hmm.
Hmm.
Deborah Weinswig (18:56)
And
they can do two a year, right? Because it's got about a six month. And then what they're also doing is, this is the thing that was so unbelievable. So when people say their garments are recyclable, but they're like poly cotton, are not recyclable because you can't break down poly and cotton in the same garment. So yes, So however, they're not recyclable how I would define recycling.
Todd E. Benson (19:00)
Yeah.
Deborah Weinswig (19:17)
So they've literally been able to throw, so you had to have, right, like advanced AI. They can now physically look at a garment and see the fibers and figure out, it, let's call it three poly, two elastane, whatever. And they can break those fibers down back into the original fiber. And the cotton ends up being like almost like a,
like sand, chalky. And then the polyester goes into like strips. And so you can like basically reconstitute. put water in the sand, it becomes cotton again. I mean, it is truly unbelievable. And what I learned, which I always had kind of thought, I was never a big believer, more just gut than anything that you couldn't turn plastic bottles into tennis shoes, not calling on any particular brand or anything. But we'll leave brands out of this.
Todd E. Benson (19:44)
Yeah.
Deborah Weinswig (20:07)
⁓ But if you then recycle again, it is unusable. So as they said, plastic bottles should only be plastic bottles. So that was interesting. Secondly, the fact that you can now do this, right? And you're actually saving money. And I always believed, actually Richard Galanti, former CFO of Costco, he's like, sustainability rhymes with profitability. Well, it doesn't exactly rhyme, but right, if you get the point, you have to do things for the right reasons.
Todd E. Benson (20:15)
Great.
Deborah Weinswig (20:32)
Ultimately, if you're a publicly traded company, need to, right, your shareholder has to be, you know, top of of what you So this is actually saving money, time, driving ROI and ROI-C. And it's, it is, it's one of those things and you can do it in your warehouse. You're also talking about like a much more stable cotton crop, right? And you're, you're starting to like really, Todd, a year ago, this couldn't be done. This is, this is like, and the thing is like so easy going back to like,
You can feel it. It's like in the physical world to me, I feel like where we're seeing leaps and jumps with AI as a result of AI, I'm much more impressed with that than the fact that I can now edit something I write with a core site GPT that we built, right? Like that's sure. you know, that's interesting. I had a person who did that before. Now we have this like GPT and the person gets to do kind of different work.
But when we're solving like real world problems, just, I don't know, that to me is where and so, so.
Todd E. Benson (21:25)
Yeah, that's fascinating. Don't have to worry
about traceability and the Uyghurs being involved in any of sorts of things either.
Deborah Weinswig (21:32)
I mean,
it's a totally different approach. So if we think about that, right, like this idea that from a tech perspective, there's what you can see, but most of it right now you can't. How do you think about where to invest, how to invest, how do you look at results? Because so much of it is, it's like AI magic.
Todd E. Benson (21:49)
Yeah, I think the honest answer is it's very hard. I in the venture world, people kind of think about three things, one of which is basically insight. So basically, where's the white space or what's big idea? The second thing is basically inflection points. So like, why now? Because it turns out that most companies or most ideas are not bad ideas. They're just kind of bad timing.
Webvan was a bad idea in 2000, but when it was reconstituted, you know, was DoorDash or Instacart or any these others, it became a great idea because just time, it sort of kind caught
Deborah Weinswig (22:18)
You know,
were the bankers on Webvan. I knew Webvan. I can't believe you brought that up. I probably I could give the tour. Truly, I was like able to give the tour of their kind of DC. And like this was like the thing. I was like, I always you know, it was like you'd ask these questions as an analyst and like they would kind of I'm like, for your model to work, you have to do six deliveries in an hour. And you remember you had to unpack the totes, right? They had plastic totes.
Todd E. Benson (22:23)
Hahaha!
Yeah.
Deborah Weinswig (22:44)
and they literally would have dog bones in their pocket to give and they would have lollipops. I'm like, you cannot do one-to-one customer service in 10 minutes unless it's all in the same apartment building, which is not how San Francisco is built, which is the first market. So it's so funny that you brought that up. And yeah, reconstituted as door to door.
Todd E. Benson (22:56)
Yeah.
Yeah, right,
right. Or Cosmo, right? Cosmo where you'd like order of just one snickers, please. Then it becomes GoPuff and GoPuff works. Anyway, so like, you know, so that's inside inflection point and then basically why this team, right? So that's those sorts of things. And they think basically in terms of AI, things that are going to work in AI are going to be basically, you know, they say you can get proprietary data sets or proprietary data.
Deborah Weinswig (23:04)
I love Cosmo! my god, these are like my favorites!
you
Todd E. Benson (23:20)
Then it's workflows. So basically just kind of people, know, kind of just getting accustomed to it and that's, you know, kind of gets into the routine. And then the last thing are basically distribution advantages. And so like those are the ways that at least the frameworks that kind of lot of people kind of look through, you know, kind of for AI, but in terms of thinking about...
you know, just like where, and I do think to your point around kind of first movers, mean, some of these things that have been first movers and things which you would otherwise thought is relatively commoditized, what was this Harvey I just read, Dutch Finance, which is like the AI legal one, one of the leaders in doing that, and I think it was, I don't know, was a five, six, seven billion dollar valuation, but these things are getting to be, you know, kind of relatively sizable because somebody has a little bit of a first mover advantage, and at least for now, you know, that's given them opportunities to compound that advantage.
But, you know, the one company that I, well, one of the things that I've, the other thing too is like in this world.
too, like sometimes you just sort of say, like, I'm going to invest in something totally different. So this year, I've invested in just things that have been a little bit more off the run versus more of the kind of the B2B software things I've invested in, like Grata, which we sold to a data site about a year ago. It's been things like, Slate, which is a protein shake.
Deborah Weinswig (24:33)
Good night.
Todd E. Benson (24:34)
All right, and
so protein is having a moment and you've got slates, you know, kind of businesses, you know, more than doubled this year in terms of revenue, just because, you know, kind of protein shakes are very hot. Put money into the franchisee, one of the franchisees for Seven Brew Coffee. We were talking about coffee earlier, but, you know, kind of just, you know, drive through coffee. If you think about just sort of the efficiency of the model, we just have like a kiosk and people going through from some sugary, and highly caffeinated sort of kind of drinks.
What else? Gosh.
Deborah Weinswig (25:00)
What think about being a whole,
like, I remember meeting Peter Pham and him telling me about Liquid Death. And I was like, because, you he was like, I'm like, so I'm going to go to a stadium and I'm going to get a can of water, right, with a skull on it. I'm going to be cool. I'm like, great. I'm like, you know, like, and it was fun. was just with their CMO, who's like phenomenal. And like, I think they still pinch themselves at like what, you know, what they've done for the water category in particular. But
Todd E. Benson (25:13)
Yeah.
Deborah Weinswig (25:27)
B, just kind of like the growth that they've had, but like that alternative, I if you think about it, right, some of the greatest changes are, right, we're seeing a significant decline in people drinking, right? And so, where, certainly some of that's going into like the Celsiuses and whatnot of the world, but like, do you see kind of like the alternative beverage market how far do you take that?
Todd E. Benson (25:36)
Yeah.
I don't know, but it's basically by like, if you can think of a beverage, a good friend of mine was recently retired as the CEO of a major grocer. And he basically said, Todd, let's think of a beverage because a pretty good way to get is the time of like when Elani New got sold for like a billion six or something out of like nowhere. Or think about vitamin water.
ollypop and just, know, beverage.
Deborah Weinswig (26:11)
the, the, the, the, the, the, the,
the, the, the, the,
Todd E. Benson (26:16)
But it does come down to something somebody observed to me is when you meet, particularly a lot of these Latin American and European seventh year on G7 for some of these families that have been wealthy over seven generations, that's relatively infrequent because basically from generation to generation, you either have even Sears and General Motors which were dominant when I was a young child. One's hobbled and the other one doesn't exist.
thing that can sustain over seven generations besides real estate where you've got locational advantage, it doesn't matter if your grandfather was a drunk and your father wasn't that smart basically, that value will sort of endure because of the building indoors. But the one industry and company that could be would be beer. And beer is something if you think about particularly Latin American, European beer have sort of kind of persisted generation over generation. find some of these things that are just 150 year old brands, which is sort of interesting what your comment about.
kind of beverages and drinks and it goes to things around kind of habit. mean, things that are
Deborah Weinswig (27:15)
If chocolate, like I was just thinking about, you know, other
Todd E. Benson (27:18)
Do you have
C1Cs with Buffett, right? Lindt. I'm originally from Kansas City and so Russell Stover sold for a billion six, probably a decade ago. So Choclo is another big one that has, anything that has a ritual to it. There's something about the kind of the
Deborah Weinswig (27:21)
Yeah, I-
That's an interesting... Yeah.
The Dubai chocolate right now is insane.
Todd E. Benson (27:41)
The bullish guys always talk about basically the remarkability factor. That's another thing because we're all kind of social animals. That your willingness to basically tell others about a product or service because we all kind of crave either the person that tells somebody about a new exciting brand or product or service or this product or service is so good. So and why that's so important is because otherwise you don't, your customer acquisition costs are dramatically decreased if there's word of
something to people versus you having to go out and spend a ton of money on meta and Google to get customers for yourself or an B2B Salesforce. that's another thing, just like people's, they found it, cool, discovering kind of products. So I guess back to your question about AI. So some of it is basically just like,
maybe doing things that are kind of impacted by AI and other kind of other things. So that's the protein shakes and, you know, whatever the seven brews and had a chance to participate in the buyout of insomnia cookies out of Krispy Kreme donuts. So put a little money into that. But so there those sorts of things. And then like the things within kind of like call like the B2B software world.
Deborah Weinswig (28:42)
no way. That's-
Todd E. Benson (28:51)
One of the I invested in is a regulatory software.
where native or kind of by history, it's called Finalus. And so Finalus will end this year with nearly, I think around about a thousand investment bankers on its platform. So it's like LPL Financial is for the RIA world. It enables an investment banker to become an investment bank. So it's all the backend, it's all the SEC, the FINRA compliance and all those sorts of things. And so what that does is a business and a business model,
as it gives, from an AI standpoint, it gives basically the purest and the cleanest data set because they have a regulatory mandate to basically know what goes in and out of any investment bankers mailbox. So if you think about where are you going to get proprietary data that's not going to be susceptible to commoditization, that's going to be an area like that. So that's why Finale is super interesting. If you can think about what data is truly going to be powerful. And then I do think there's just a lot of things that are going
to be like the niche here or the better where you can really use AI to build something that is incredibly niche where you know that the workflows within that industry, particularly if that industry is regulated, think that's a regulation and complexity basically or code for how do I create margin and defensibility. I think a lot of these things are going to have profit puddles, not profit pools.
where just the niche here, the better. I guess there obviously will be some of these huge opportunities, but I think those are going to be largely the domain of the giant LLMs and some of the others. What else do I think about AI?
I think it's actually personally, think it's not so much from a, who knows, I jury is out what it's gonna mean in terms of an investment, particularly investment returns because there's just so much capital. It sort of reminds me 25 years ago when,
Deborah Weinswig (30:21)
What is it?
Todd E. Benson (30:34)
If you may remember when competitive telecom in the late 90s was so highly valued, and if he added up all the value of the Selex, it was greater than all the value of the incumbents, or least, certainly the incumbents. It's just one of those sorts of things when you said, G, just if you play this forward, it can't work. The math can't That they're all going to be that successful. so I think that is it relates the investment.
opportunity associated I think AI may end up being a little bit like China. China was for long periods of time in general has been super high growth for the last 20 whatever number of years since China joined the WTO. But from an investment standpoint, it has not been all that great. So basically the growth and all those sorts of things and how transformative and the impact on the world economy and all those sort of things have been terrific.
But basically the people that were kind of long China is an investment, obviously in certain cases, Alibaba, cetera, et cetera. People have done quite well. But I think in general that maybe won't translate in terms of investment returns, but it's definitely going to translate in terms of just its impact on society. Because I just see some of these companies, some of the things that are AI related that I'm invested in, they just blow you away in terms of what they can do.
Deborah Weinswig (31:47)
Oh, there's
one we introduced them to a large retailer they have a way to basically
make painful memories less painful. And so they ended up using it with their store associates because a lot of them have had, especially post COVID or even, right, like, you know, the associates have not been always particularly nicely treated by the consumers. And so they have like some PTSD. And so it's literally making these unpleasant memories more pleasant or, and it's all AI driven. So you start to think
If you can do that, what else can you do? And you can start going back to see it all goes back to happiness, Todd. you can, right? I mean, think about it. This is why, I'm going back to, I spoke on this panel yesterday at ICSC. was like AI 101. It was really like 202, but anyways. And I said, think about what you hate doing the is that? And then figure out a way, whether you're using N8N, whatever you're doing for your workflow, your protocol.
Todd E. Benson (32:27)
Yeah.
Deborah Weinswig (32:46)
and just spend the time, right? Like have AI teach you how to do And build in those workflows so you don't have to do that work then you get to spend more time doing what you love. I think it'll take down your stress levels, you will be happier. keep like little, Microsoft to do, like what do I really not like to do? And then like on the weekends, let me figure out if there's things that I can spend some time on to figure a different way.
to do it right through AI.
Todd E. Benson (33:08)
Yeah.
I always did a VC annual meeting and they had an investment in a company that I think did like a healthcare receivable recovery or something like that, right? And talk about it like a job, which basically would be like the worst, one of the worst jobs is like calling people up and asking them to pay their medical bills. I mean, just like a horrible, mean, just like the stories and how the difference, just everything about it just seems miserable, but then turn it over to the AI to do it with a voice agent.
I can do that. And like, it's crazy. And like, in the AI can do it, you know, like, you know, just, I mean, it's fascinating just all the sorts of jobs and the things that the, have you ever seen basically AI interviews conducted?
Deborah Weinswig (33:39)
It's-
we interviewed somebody who wasn't like a real person turned out. I mean, we figured it out pretty quickly because we were like, like our team is, it was like a group interview and I'm like, something seems like really off. And so right, like our, our head of infrastructure was like, can you just like put your hand in front of your face? And like, it was this, like we were like interviewing an avatar. And so it's, and we, so I'll tell you, it's interesting. We've started to like at, at CoreSight, right?
we're documenting how we do things, right? That's like at a level we hadn't before. We are when we're hiring people, right? We're doing like checks, like more checks just to make sure that, you they are who they say they are. And right, these are things that a year ago you I think about how run our business, what we do and like how important we know the HR function for one of the like,
most important. And we have because who manages the agents, right? We have, we've built a bunch of agents, of course, right, they need a review just everybody and so these are some of the things you start to think about. And I'm like, I can't like, well, I feel in some ways like, gosh, it's going a lot slower. I thought I could be able to do this, that and the other now. I'm but when you actually look back, you're like as a company, we've changed so much.
Todd E. Benson (34:45)
Yeah.
Deborah Weinswig (35:03)
And I can't even imagine what 26 is going to look
Todd E. Benson (35:06)
I love that, who manages the agents? And how do you give the agent servers you?
Deborah Weinswig (35:08)
Thanks
I know it's we've started to do that. You know, and this and that way to write everybody has a performance review and then you can start to also think about other going back to other work that people and I just said internally, right? Like we maybe are not hiring at the same same speed we were before because we don't need to write because we're able to do a lot of kind of workflows, especially right like when you're publishing research, I mean, you know.
There's just a lot of moving things back and forth. There's different workflows. And now everything is in one workflow. And so we're saving a lot of time. think our research, I I've always thought it was good, but I think it's even better. And I don't even know, we've got now a fairly large data team because we started to think about where we're, now we can take a lot of this other stuff off our plate, I'm like, our biggest cost is data.
Todd E. Benson (35:43)
Yeah.
Deborah Weinswig (35:59)
And so we've now started to build most of this internally. I had the, when I spoke to person in front me, he was using all government data. And I was like, our data is actually better than a lot of this data that she was using for her talk track. And so I sat down with her afterwards and she was like, this is amazing. And I'm like, you know, and I was explaining to her kind of like how we were building it and whatnot. It's, and had some folks who are purchasing our data now. They're like, you're about six to eight weeks ahead of the federal government.
And so it's fascinating, but we did it because we just wanted to take down our data costs. That was like the purpose. And so I think going back to if companies think they don't like to do, what they do like to do, and how they can do more of that to drive, we'll call it the happiness quotient or whatever, you know, we'll come up with our own thing, Todd, right? That I think is a really interesting way to think about how you spend your time and to also really easily explain it to your
Todd E. Benson (36:28)
You
Deborah Weinswig (36:48)
Once again, shareholders, customers, and employees, because I do think right now one of the greatest challenges is change management. because you've done something the same way for 20 years to tell me I'm gonna save two hours a week, so what, I don't really wanna learn this whole new workflow. it starts to change how you think about things. All right, so we have five minutes left, so I always like.
Todd E. Benson (36:57)
Yeah.
Okay, good.
Deborah Weinswig (37:10)
to end with a lightning round. So you didn't know this was coming your way, which I think is probably better. so, OK, so start. So best decision you ever made.
Todd E. Benson (37:12)
Okay, good.
No.
Gosh, best decision I ever made. actually to, I had grown up in Kansas City and to move to New York.
And that just sort of unlocks somebody's opportunities, whether professionally, personally, both in my personal and professional life. So think that would probably be the answer there. And just kind of coming to your right. I think basically, advice to young people is basically get to a major city, get to an opportunity where there's just going to be the most opportunities for basically interaction, people, energy, ideas, et cetera, et cetera.
Deborah Weinswig (37:49)
Worst decision you ever made.
Todd E. Benson (37:50)
my god, there's so many. Pass.
Deborah Weinswig (37:52)
Yes, okay, you absolutely do that. Favorite candy bar?
Todd E. Benson (37:54)
⁓
by far Snickers. Yeah.
Deborah Weinswig (37:57)
Ooh, I like Snickers. ⁓
Favorite beverage?
Todd E. Benson (38:00)
Favorite beverage? Well, I would say Cabernet Sauvignon, so red wine, but that's probably not the answer. I would say Diet Coke. Charlie Munger basically said Diet Coke was keeping him alive, so I'm stick with Charlie Munger's love for Diet Coke.
Deborah Weinswig (38:17)
I love it. What was the biggest takeaway from your time in banking?
Todd E. Benson (38:20)
Biggest takeaway from my time in banking. Actually, it's basically, I think it's an insight that...
that no matter what the company is basically, as a public company, like the capital is an atheist and that basically what capital wants is a low volatility growth annuity. And so it doesn't matter what your company does as a company, basically what the signal that the market is looking for is what's the predictability of the stream of cash flows, meaning earnings or whatever it might be. then from the annuity standpoint, what's the slope of the line? So how fast is it growing? And just wanted to kind of think about that lens.
and then also to think about other sorts of lenses in and around like what makes for a good business.
Deborah Weinswig (38:59)
favorite pet?
Todd E. Benson (39:00)
That's
I've had a lot of pets in life. As a child, had a beagle and a cocker spaniel. And think I like the cocker spaniel a little bit better. Nobody has a cocker spaniel anymore. Talk about basically a breed that like, you know, was, you know, it was like winning in 1980. And like, you know, 40 years later is basically like, you know, know, the cocker spaniel just went away. It also goes to basically another thing that I've sort of said about in terms of animals is basically is that we all need to become labradoodles. And by labradoodles, I mean basically you've got to cross
Deborah Weinswig (39:10)
No.
Todd E. Benson (39:29)
yourself with something else. as a Labrador is a better dog because it's been crossed with a poodle, it's hypoanalogenic, it's all those sorts of things. I think just in terms of just all of us from our growth is like you just got to take yourself and basically cross it with whatever it might be, whether it may be something, you know, an interest, a geography, a skill, something that just like you know that not everybody else sort of kind of has because if you're just, you know, that's that I think that's the way to growth success differentiation because we're all kind of a product or service and so
or understanding what that is, I'd say this, we all become Labradools. I never had a Labradool, I had a Cacospanul, and I had a, a child, we had a Beagle named Star, are hounds, hounds bark and howl.
Deborah Weinswig (40:09)
⁓ jeez. I didn't know. What do you do for relaxation or downtime? Either how do you spend your time or what helps you kind of have downtime? Because when you love to work as much as you do, I'm sure it's hard.
Todd E. Benson (40:10)
We love that dog.
that's, you know, exercise. So basically I'm a big believer in exercise. I have you sit like you got to, you got to exercise and whether that's even just kind of go into the gym, as simple as going for, actually one things I've started to do is to ride a city bike to work. So I can take a city bike kind of through the park and, ⁓ my gosh, and take a city bike to work. And I think that's just, that's one of the great things to do.
Deborah Weinswig (40:41)
It's 14 hours.
I, we had our, when we spun out of Liam Fong, our CFO at the time got doored. And I guess like somebody opened their door as he was driving down and he went like, and that always scared me away from even, I've like literally never even been on one because I was so frightened after that. but I do know. No, it's smart.
Todd E. Benson (40:53)
Yeah.
Well, I wear a helmet.
Despite kind of growing up in the era where my childhood heroes included Evil Can Evil, I wear a helmet.
Deborah Weinswig (41:08)
I love it. Favorite book?
Todd E. Benson (41:10)
Favorite book. This is like one if you're political candidate, you always say like the Bible, but no. You know, actually what book that I thought, I thought just a series of books have been, well, I should say basically, you know, my dear friend Scott Galloway's Notes on Being a Man, which is the one that I'm reading right now. But I've also enjoyed a lot. actually starting 1929 by Andrew Ross Sorkin.
Deborah Weinswig (41:33)
Nice.
Todd E. Benson (41:33)
And which I think is just kind of interesting. And then I do think like ⁓ Morgan House's Psychology of Money, as Ever and The Art of Spending are three kind of very interesting books. And I do think like, you know, as an investor, the concept of not what's going to change, but what's not going to change is a really interesting one. And it's a lens to sort of kind of look through. it's one of the reasons why, you know, of personally in my public stock portfolio, I own things like Sherwin Williams
paint, has the highest return on invested capital. It's the leader in paint, you know, of specialty coatings, you know, as you know, whatever, 5,000 retail points of distribution. I mean, just, if you just sort of kind of think about like, I can, I can think 10 years forward about what's good, how the world with AI and all those sorts of things. have, I'm absolutely like, you know, agnostic about like, or, you know, just like, I can't predict that long, but I can, but I can definitely see 10 years forward and seeing basically people are going to get their paint by going
to the local Sherwin-Williams and that's going to persist.
Deborah Weinswig (42:32)
I love that. How is AI changing your life?
Todd E. Benson (42:35)
How is Aliyah changing my life? Well, goodness.
I think basically in so many ways that are invisible to us, sense so basically just like so many things that are going on beyond the scene are basically being done by AI, or choices are being made for you by AI, or all these sorts of things sort of kind of passively. So I think the way that AI is mostly impacting my life are in things that I don't really know or appreciate or observe that it's kind of changing my life, and kind of actively how it's changing my life.
You know, use Google Gemini and Chat GPT and all those sorts of things almost every day now. I mean, just from terms of habit or looking things up and then cross-checking them to make sure that it's not hallucinating and telling me the story and those sorts of things. So I guess, you know.
guess that's probably how it's changing my life.
Deborah Weinswig (43:26)
It's funny, I've always enjoyed fixing things. I would call myself a professional tinker. But sometimes, I just like to jump in. And so now I find I actually look up how it could be elucidating or not, but at least I've got a starting point. And so I can fix things faster and better. But I did have a really interesting experience the other day. I was using,
Todd E. Benson (43:31)
Thank
Deborah Weinswig (43:50)
5.2, right? Like all these things. And I'm like, literally keep uploading screenshots. I'm like, that does not like exist, right? That is not an option under the message menu. so it like, mean, Gemini was just fine and that worked out really, really well, but it was interesting, right? Like how, how.
And then I started to get frustrated, is exactly what I say, AI is supposed to remove frustration. But it was interesting. And I think that all need to take a pause when we get the information and think about, this seem right or not, as opposed to just jumping right in. that I think is...
Todd E. Benson (44:21)
Yeah, no, it's,
you you have to like check, double check and then try to like find, mean, think basically citations around like basically like, know, like what's your source is like gonna be, I think gonna be something that's gonna be super valuable versus just like, know, cause all the rest of it's basically, they're always hallucinating cause that's their model is to hallucinate is sort of to guess.
Deborah Weinswig (44:42)
Yeah,
well, it's like it goes back to it's a it's it's a large language model. It's just guessing the next best word. So exactly. All right. So and number 10, if you can believe we already got there, what is your outlook for 2026?
Todd E. Benson (44:53)
My outlook for 2026. My goodness. I'm optimistic about 2026 in terms of in what? In what area? guess I would say just in general or what? Okay, in terms of the markets. All So in terms of the markets, I think the markets are...
Deborah Weinswig (45:01)
I think the markets.
Todd E. Benson (45:07)
interesting for 20 going to be interesting for 2026. think you're going to have at some point we're going to have some sort of kind of volatility or drawdown of 10 20 percent because it almost we almost sort of need to and have to but you know look you've got a consumer which I think is going to start getting checks right or there's going to be stimulus.
Deborah Weinswig (45:24)
I got
a check. actually thought it was baloney. was like, like, you know, I'm seeing stuff like, I go to like Google and they're like, oh, you get these inflation rebate checks. And I'm like, you know, it's like some average. I got a $400 check. I was like, this is like the coolest thing. I'm like, and it was funny, I mentioned it to an investor who lives down in Miami. And they're like, yeah, a bunch of people in New York mentioned this. And I'm like, you
It was just, first of all, there's no messaging. I was like, not even sure if it was like a hoax or not. someone else in my household is like, if I don't, they're like, we probably would have not even opened it, would have just like recycled it. Right? I opened everything. And so I was like, I'm like that, that it's, it's been so interesting, right? Like no messaging, check shows up, right? You don't like going back to it, you know, it real cause I cashed it, but yeah, I mean, it was.
Todd E. Benson (45:50)
Yeah.
Yeah.
Deborah Weinswig (46:09)
It was interesting. Do I think different about anything? Maybe am I buying stuff for the holidays that Sure, probably. was like, yeah, maybe I think a little bit differently about where to spend that money because it is found money.
Todd E. Benson (46:23)
Yeah, no, think it's, I I think like all this like no tax on tips and all the no tax on overtime and some of the rebates and withholding, I think just a lot of Americans, that's gonna be somewhat stimulative. That'll help the economy, particularly like the, know, more challenged economically, know, of demographic segments. think that'll be good. I think that...
will be, you know, you know, kind of, you know, who knows what the volatility that's going to be introduced there and who knows what, you know, policies are going to come out of Washington.
pretty hard to sort of understand. So I think those are all gonna be like the ups and downs of the volatility associated with the year, but I think in general, even some of this AI stuff is gonna continue to be very strong and that's gonna be an economic tailwind. So I think we're,
You mentioned the question is, think earnings and profits in the economy will grow. The question is basically, does that grow faster than the multiple contracts? Because multiples are relatively high here. And you mentioned, I don't know if it was here or the preamble to this, basically what a great company Costco is. But Costco has been something whose multiple has doubled from 25 to 50 in the last number of years and has come down a little bit because Costco
has had a of a sideways year as a stock. you know, like Costco still is at a very elevated P. I mean, Costco's P is, don't know, you wouldn't know better than I, because you're closest than I am, but it's like 40 or 45, somewhere in there. And that's a big number, you know, for a company that basically grows 8%. You know.
Deborah Weinswig (47:56)
At the
end of the day, it's a subscription company. They make the bulk of their money on their membership. So it is a subscription-based business. So I wouldn't put it under SaaS, but that I think is what's interesting when you still really think about the business they're in.
Todd E. Benson (48:01)
Yeah.
Now that's exactly the business, and that's why the market re-rated it just as Apple. Apple's in basically that kind of business too. That's why Apple's, the return on invested capital is so high, and it's got such a great business model. That's why Apple got re-rated by the market. Why its top line has not grown that fast in number of years, but its multiples increased so much because it's moved more to
And so that's why it's done so well.
Deborah Weinswig (48:35)
No, no, it's been fascinating. Well, Todd, I can talk to you for hours, which is what makes you so special. And I always learn so much. Yeah, I appreciate that. I really, I think we'll have to have you on again because I still don't feel like I really unwrapped and I apologize to the audience.
Todd E. Benson (48:43)
I got you.
Deborah Weinswig (48:53)
what it is that you do that puts you in a position either physically or otherwise to really cut through all the noise because it really is such a, it's really such a gift that you have. And I know you're, and you're also so willing to kind of share whether it's mentorship or insights with others. And so I think we have to have ⁓ that conversation to kind of get inside Todd's head. And we really appreciate it. Happy holidays and thank you so much.
Todd E. Benson (49:15)
Yeah.
Thanks so much too.
Deborah Weinswig (49:20)
Thank you.
Philip Moore (49:19)
Thanks, Deborah. And thank you for joining us this week. CoreSite Research serves our members with leadership communities, data resources, events, strategy sprints, proprietary research, and more. Visit us at coresite.com to learn how joining our community can accelerate your success. Have a wonderful day, and we'll see you next week.