Disney’s current leadership made some magic happen last week, though not the kind usually linked to the company. At its annual shareholders meeting, Disney was able to ward off pushes to elect new board members from two activist investor groups—Nelson Peltz’s Trian Fund Management and Blackwells Capital—and maintain its existing slate of 12 board members.
The hedge funds each put forward slates of nominees who pledged to take Disney down a new path. Trian was looking for Disney to address recent declines in its earnings, while Blackwells was interested in breaking the mega-company into three smaller entities: sports, entertainment and experiences. And while these both represent valid paths forward for Disney, many observers predicted the rebuffing the activist investors received. After all, Disney’s share price rebounded more than 45% during the last six months following the reinstatement of CEO Bob Iger, delivering strong quarterly results and a cost-cutting plan. An optimistic analyst note from UBS last week also projected the company’s streaming services will break even this year and be a significant source of future revenue.
Although Disney won this round, activist investors and proxy wars aren’t going away. Trian had mounted a similar campaign against Disney’s leadership last year, with Peltz throwing in the towel after saying Disney had done what the firm wanted, and placing faith in Iger’s then-recent return to the CEO position. From Disney’s perspective, the company was fortunate this time because Iger’s business moves were beginning to bear fruit in the run-up to the shareholder meeting, as well as the opportune timing of the optimistic analyst’s note.
However, it can be argued that even though Trian didn’t win any spots on Disney’s board, the firm got what it wanted, which is the whole point of an activist investor campaign. In a statement issued after the meeting, Trian said they were disappointed with the election results, but “proud of the impact we have had in refocusing this Company on value creation and good governance. Since we re-engaged with the Company in late 2023, Disney has announced a host of new operating initiatives and capital improvement plans.”
Sprawling mega-companies like Disney represent one portion of the business landscape, but different businesses have vastly different models. Marketplace companies built on individual contractors renting their skills, homes or goods are also a powerful force today. TaskRabbit CEO Ania Smith, who previously held high-level jobs at marketplace giants Uber and Airbnb, talked to me about the evolution of that space. An excerpt from our interview is later in this newsletter.
HUMAN CAPITAL
Last week had both good and bad news for workers. The good news: The U.S. added more jobs than expected in March—a grand total of 303,000, according to a report from the U.S. Labor Department. This moved the unemployment rate to 3.8%, extending the longest streak of unemployment below 4% since the 1960s, and beat analysts’ predictions of the number of jobs added. Hourly earnings also rose 4.1% from March 2023 to last month, keeping ahead of inflation and matching analysts’ projections.
Even though so many jobs were added, March was the worst month for layoffs since January 2023. U.S. employers cut 90,309 jobs last month, according to a report from outplacement and career services firm Challenger, Gray and Christmas. More than a third were federal government job cuts in the U.S. Army and Veterans Affairs department. More than 250,000 total jobs were eliminated in the first quarter of 2024, with the tech sector seeing the deepest cuts, losing 42,442 jobs.
What does this mean? Although job cuts are increasing, job growth is also red hot—and outpacing the losses. In Challenger, Gray and Christmas’s analysis, the largest number of layoffs was attributed to cost-cutting. As many businesses and investors are optimistic about growth through eventual interest rate cuts and new initiatives made possible by technology and AI, perhaps the need to cut costs will slow down.
ARTIFICIAL INTELLIGENCE
Generative AI has the potential to add capabilities to a wide range of industries, but developments in medicine and health care were on full display last week. The FDA cleared two AI-powered tools for clinical use: An algorithm developed by the Mayo Clinic and digital stethoscope maker Eko Health that can detect the heart ineffectively pumping blood—an early sign of heart disease—and a software tool that can use data to detect sepsis developed by AI company Prenosis. Those who developed the Eko Health algorithm told Forbes’ Alex Knapp that these applications can significantly affect patient outcomes. “These tools are incredibly powerful — they help us screen for conditions for which we have treatments,” said Mayo Clinic Cardiovascular Chair Paul Friedman.
In general, many business AI applications involve intelligent chatbots, and a study published last week showed they can also be helpful in a healthcare setting. A Northwestern Medicine study in JAMA Network found ChatGPT was able to respond to questions about radiation oncology as well or better than trained professionals. The AI system was asked 115 common questions about radiation therapy or chemotherapy, and its answers were scored by three radiation oncologists and three radiation physicists. The only concern with the AI-generated responses flagged by the study was that some used complex medical jargon and may be difficult to understand. The study said this is an early indicator that AI could be a first line for patient information about cancer treatment—and help reduce workloads and burnout rates for physicians specializing in the disease.
NOTABLE NEWS
Progress toward gender equality in the C-suite has fallen for the first time in two decades, according to a report published last month by S&P Global Market Intelligence. The firm, which has tracked women’s representation in C-suite positions since 2005, found 11.8% of these jobs were held by women in 2023. This is down from 12.2% in 2022, and represents the first time there has been a decrease in this metric. One of the reasons may be less corporate emphasis on gender diversity. S&P looked at mentions of the issue in earnings calls, and found 2023 had the least mentions of the issue since 2012. Forbes contributor Soulaima Gourani writes this study should be a wake-up call for organizations to reassess their commitment to gender diversity, since diverse leadership teams are proven to bring greater creativity, resilience and financial performance.
TOMORROW’S TRENDS
Ania Smith built her career in diverse businesses. She’s held senior positions at companies with traditional employees, including Expedia and Walmart, and nine years ago made a switch to marketplace businesses, where the service employees are gig workers. She worked with Airbnb and Uber before becoming TaskRabbit’s CEO in August 2020. I talked to her about her work with marketplace companies and how today’s economy has impacted the business. This conversation has been edited for length, clarity and continuity.
Why have you wanted to keep working with marketplace companies?
Smith: I didn’t wake up one day and go, ‘Oh, I want to go work in the gig economy space.’ What I did think about is I love travel as an industry, and so when I got a call from Airbnb, I thought, oh yes, I want to go back to travel because it’s an amazing space to be in. Fairly quickly I realized…what made Airbnb so much different is the gig economy piece of it, meaning all of our hosts who were just everyday people looking to rent out their space. My role was to help to work with our hosts, and that became extremely motivating, because I started thinking not only about why they come and what motivates them to come to our site.
Whether it’s for Airbnb, or couriers at Uber Eats, or taskers here at TaskRabbit, what I started thinking a lot about is how incredible it is that we live in an era where this is normal. Where 60 to 70 million people are doing some sort of side gig, and how I wish that these types of platforms would have existed two or three decades ago because I immigrated here from Poland, and my parents had to work a lot to make ends meet in traditional roles. You have to then deal with schedules, and you never could get enough hours. …It was just very hard, especially while they were raising two young kids. It would have been great to have any of these platforms available then, so they could use that opportunity to make that extra, meaningful income in a way that allowed them to do that with flexibility and with autonomy and with allowing them to figure out what their pricing is.
I meet taskers all day, every day, and it’s really motivating to understand the impact that we’re having on their lives. We just met with some taskers last week. This tasker’s a firefighter, but has really decided to lean in on TV mounting and some other skills, and she is really happy with the ability to make that extra income while she has her other job.
You’ve been at the helm of TaskRabbit through the Covid-19 pandemic, the great resignation and high inflation. Through all of that, how have things changed?
All this is happening quite fast, and more and more people are searching for that flexibility and autonomy, which means our tasker population has continued to grow at really high rates. For the first time, we have to start thinking about [whether there] are perhaps too many taskers in a metro area. …We’ve been focused on trying to manage both sides of the marketplace so that as we have more taskers coming on board who want to help, we also want to have as many new customers come on board who need that help. Because at the end of the day, that’s the crux of managing the marketplace.
It is very quantitative and very analytical, and there are many things that we can do as a company that helps to optimize both the demand and the supply side of the business. We do that by thinking a lot about locations: Do we have enough taskers in certain zip codes? Or maybe we do have enough taskers, but they all know how to do cleaning or yard work, and not enough of them know how to assemble furniture. So maybe perhaps we need to go out and tell our story more and make sure that we get more taskers who can assemble furniture. Or maybe in another location. …There’s also pricing and timing and so on.
We do that every day, and use a lot of machine learning and a lot of smart technologies to help us to think about how to optimize the marketplace so that it’s the best experience for both our taskers and our clients. Because at the end of the day, what we don’t want is our clients coming to our app and looking for someone to help them with yard work, and seeing that there is no one there who can do it. Or maybe there are people who can do it, but not for another two weeks. At the same time, we don’t want taskers signing up and just waiting for jobs and not getting any. They count on us to make that income.
How has public perception and use of marketplace companies changed in the nine years you’ve been involved with them?
When these companies were launching, it was so new and took a lot of money and a lot of financing from venture funds to build the market, because it didn’t quite exist. And then we went through this whole phase of Uber for everything. I think over time, the acceptance has grown as customers have realized the ease and the convenience of using some of these services. On the supply side, hosts and drivers and couriers and taskers have really learned to lean in and use these platforms to help them…to feel a lot more independent.
Then the pandemic hit, and I think that just turbo-charged the entire business. It was explosive growth for all of these main platforms for a variety of reasons. How we really evolved our thinking on travel and what we wanted to do, how we evolved thinking about delivery, and how we evolved thinking about having more flexibility. How we think about our time today is very different. It’s become more precious and people, I think, are more open to outsourcing some tasks that allow them to have more time to spend with their families, or spend on their hobbies. I think this area is only going to continue to grow.
FACTS + COMMENTS
Tesla is scrapping plans to build low-cost electric vehicles, Reuters reported Friday, and instead plans to put more resources into creating robotaxis. CEO Elon Musk did not immediately respond to a Forbes request for comment, but announced after markets closed the robotaxi would be unveiled Aug. 8.
$25,000: Cost estimate of the “entry-level” Tesla option, which Musk had said would be available in late 2025
6.4%: Drop in Tesla’s stock price last week during normal trading hours.
‘Reuters is lying (again)’: Musk’s response to the report, posted late Friday morning on his social platform X
VIDEO
STRATEGIES + ADVICE
Does your company need to shake up the way it does things? A consultant who is a non-linear thinker may provide the perspective change you’re looking for.
AI will probably redistribute some jobs and tasks in the immediate future, but is likely to have a larger impact on the future of work as a whole.
QUIZ
Tomorrow, parts of the U.S. will see a total solar eclipse, but many other celestial events and space-related experiments are also expected. Which one of these will not happen tomorrow?
A. The horned “devil comet” may be visible
B. The European Council for Nuclear Research will try to simulate the Big Bang
C. Blue Origin will launch the 25th mission of its New Shepard spacecraft
D. NASA will launch three rockets into the moon’s shadow to understand what happens in the atmosphere
See if you got the answer right here.