Acquired Episode 39: Whole Foods Market

**Ben Gilbert** (0:00)
Yep, yep, completely agreed. Podcasting is the new groceries.

**David Rosenthal** (0:07)
Yeah, well, good thing we're here on the scene.

**Ben Gilbert** (0:20)
Welcome back to episode 39 of Acquired, the podcast about technology, acquisitions and IPOs. I'm Ben Gilbert.

**David Rosenthal** (0:28)
I'm David Rosenthal.

**Ben Gilbert** (0:30)
And we are your hosts. Today, we are coming in hot with the just announced Amazon acquisition of Whole Foods for $13.7 billion, all in cash.

**David Rosenthal** (0:40)
Oof, are we ever.

**Ben Gilbert** (0:42)
We are not planning on doing an episode today, but David and I woke up, saw the news, and absolutely could not resist.

**David Rosenthal** (0:47)
We live for this.

**Ben Gilbert** (0:48)
So here we are, we do. It's 4 p.m. PST on Friday, June 16th.

**David Rosenthal** (0:53)
The day the acquisition was announced this morning.

**Ben Gilbert** (0:56)
And hot takes flying all over the internet. David and I do not purport to have any of the answers, but we do have hot takes of our own. So in true acquired fashion, we will probably be wildly speculative. We have no idea what they're going to do with this acquisition, and we certainly cannot give it a grade that we feel very confident about, but it's going to be real fun to talk about.

**David Rosenthal** (1:18)
Before we dive in, though, important announcement. So Ben's birthday is coming up this week, and if you want to get him a present, like me, you should leave Acquired a review on Apple Podcast. See what we did there. No, seriously.

**Ben Gilbert** (1:37)
David gets some of my birthday present, too, apparently.

**David Rosenthal** (1:40)
I'll rate you a review, Ben. But no, seriously, Acquired is growing a lot, and we have some amazing guests coming on this summer, and that's possible because of the growth, and the way to keep the growth going is through Apple Podcast reviews. So if you have a minute, please leave one. We really, really appreciate it, and thanks for being a listener.

**Ben Gilbert** (2:01)
We do, and now I get to skip my section where I normally ask for Apple Podcast reviews.

**David Rosenthal** (2:06)
My present to you is giving you a break from this.

**Ben Gilbert** (2:09)
Perfect, perfect. Well, listeners do know that we have a Slack. We're 750 strong now, and it was blowing up today. So if you're a new listener to the show and you want to talk about any awesome news that is dropping on the day that it drops in technology, join us, acquired.fm, you can join the Slack and be part of the discussion. This is a great time to tell you about one of our very favorite companies, Crusoe.

**David Rosenthal** (2:32)
So Crusoe, as listeners know by now, is a clean compute cloud provider specifically built for AI workloads. NVIDIA is one of their major partners and literally Crusoe's data centers are nothing but racks and racks of A100s and H100s. And because Crusoe's cloud is purpose built for AI and run on wasted, stranded or clean energy, they can provide significantly better performance per dollar than traditional cloud providers.

**Ben Gilbert** (2:58)
Yes, we talked about that on our ACQ2 episode with Crusoe CEO, Chase Lockmiller.

**David Rosenthal** (3:03)
The other element that makes Crusoe special is the environmental angle. Crusoe, of course, locates their data centers at stranded energy sites. So think oil flares, wind farms that can't use all the energy they generate, etc. And uses that power that would otherwise be wasted to run your AI workloads instead.

**Ben Gilbert** (3:21)
Yep. Obviously, it's a huge benefit for the environment and for customers on costs since Crusoe doesn't rely on the energy grid. Energy is the second largest cost of running AI after, of course, the price you pay NVIDIA for the chips. And these lower energy costs get passed on to customers.

**David Rosenthal** (3:37)
It's super cool that they can put their data centers out there in these remote locations where quote-unquote energy happens, as opposed to the other hyperscalers such as AWS and Google and Azure who need to build their data centers close to major traffic hubs where the internet happens because they are doing everything in their clouds.

**Ben Gilbert** (3:54)
Yep. If you, your company or your portfolio companies would like to use the lower cost and more performant infrastructure for your AI workloads, go to crusocloud.com/acquired, that's crusoecloud.com/acquired, or click the link in the show notes. Now, David.

**David Rosenthal** (4:13)
Let's do this.
For the show today, we are of course going to do history and facts as always, but it's going to be a little different than usual. One, because we didn't have the time to do the in-depth research that we usually do into Whole Foods. It'll be a somewhat truncated history and facts on Whole Foods, but we'll still tell some fun stories. But we don't think that we can actually give the full analysis and treatment of this deal and what it means without looking at a couple other companies too. We're also going to talk about Webvan, Kiva Systems, and of course Instacart, which will be a big topic of conversation today, and already is in the media given what happened and Whole Foods being an investor in Instacart. But so to start off, Whole Foods was started in 1978 in Austin, Texas by a young man named John Mackey and his then-girlfriend, Renee Lawson Hardy, and it was originally not called Whole Foods. It was a natural foods store, mostly for hippies, which they were in the late 70s in Austin, and they called it Safer Way, which was an intentional dig at Safeway.