Could a Chipotle-Starbucks Merger Actually Work? & Hollywood Turns on Big Tech

Olivia Lake (0:01)

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Good Morning Brew Daily show. I'm Olivia Lake.

Toby Howell (0:29)

And I'm Toby Howell.

Olivia Lake (0:30)

Today, what to make of a potential Chipotle Starbucks merger.

Toby Howell (0:34)

Then The Social Reckoning arrives today, 16 years after The Social Network, with plenty of new material to cover. It's Friday, October 9th.

SPEAKER_3 (0:43)

Let's ride.

Toby Howell (0:49)

Happy Friday, everyone. If you struggle with your sleep, consider inviting your dog into your bed. In a study that sounds like it was written by your pet, researchers tracked the nighttime activity of 25 human volunteers and found that despite self-reporting worse sleep with their pooches in the room, sleep tracking devices showed their dogs were not affecting their slumber. And if anything, the opposite was occurring. Humans were moving first and disturbing their dogs, not the other way around. According to the co-author of the study, the findings show we feel safer sleeping with our pets, hinting at a deeper evolutionary history between humans and dogs. Liv, you're a dog owner. Does Homer ever sleep in the bed with you?

Olivia Lake (1:31)

Homer does sleep in the bed with me, and I have to disagree with this article. I mean, I love my dog, but I have an aura ring, and it will actually, when he sleeps in the bed with me, be like, did you share a bed last night with a human or an animal? Because your sleep was disrupted. And maybe that's just a comment on Homer and how much of a menace he is, because he is nine pounds but takes up the entire bed.

But mentally, I like sleeping in bed with him because it's so cuddly and cute. So I understand the whole safety coziness of it. But my aura ring would beg to differ.

Toby Howell (2:06)

Homer is so tiny too, which is so funny that he is waking you up. The study does go on to say that the caveat is, if it's a big dog and it's taking up a lot of room, then you're probably not sleeping that well. But nine pounds, I guess his personality is just too big. And now a word from our sponsor Intuit. If your finance team spends more time finding data than using it, if there's one entity here and one here and one here and one here, if scaling your business feels like starting over, you need Intuit ERP. Intuit Enterprise Suite is the AI native ERP solution that's powerful, painless and proven.

Olivia Lake (2:41)

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There may be some truth to the rumors. Chipotle and Starbucks might be hooking up. On Wednesday's show, we mentioned murmurs of a potential merger between the two fast food giants. Now, the Financial Times have reported that Starbucks has worked with advisors on a takeover proposal for the burrito chain. It would be one of the biggest restaurant deals ever, according to Bloomberg, eclipsing Burger King's $11.4 billion purchase of Tim Hortons in 2014

And it would create a combined company with almost $50 billion in sales. The connection runs deep. Starbucks CEO Brian Nichols spent more than six years running Chipotle. Nichols has already hired two former Chipotle executives to run marketing and coffee shop development at Starbucks. And he still lives in Newport Beach, California, home to Chipotle's headquarters and where Starbucks recently built a satellite executive office. The timing is what's odd. Starbucks is only in the early stages of its own back to Starbucks turnaround, which includes adding baristas, heating up service, renovating cafes. It's starting to show results, but it's far from finished. Chipotle, meanwhile, has struggled since Nichols left in August 2024, with its stock nearly halved in value, which makes you wonder if he thinks he can fix it again. Toby, they say never go back to your ex, but Nichols seems to think this one is worth a second look.

Toby Howell (4:05)

All right, let's just get the jokes out of the way.

Toilets are not ready for a Starbucks Chipotle tie up. I said it. It's out of my system. I don't need to say it again. But the real intrigue here is not just that Michael is Chipotle's old CEO. It's that he actually spent a decade at Yum Brands before he came over to Chipotle. Yum Brands is the parent company of Taco Bell, KFC, Pizza Hut, among other brands. So he has firsthand experience with this multi-brand restaurant model. So the idea wouldn't actually be to merge Starbucks and Chipotle. It wouldn't be to have Starbucks suddenly start slinging burritos. It would look probably more like Yum Brands where they operate multiple chains, but separately the combination would come in things like the back office functions, other areas where you can have scale and use synergies. You create cost saving measures. That's what like the corporate speak is or something like this. But Nickel understands this world because of his years at Yum. Andy understands Chipotle because of his years at Chipotle.