This is Matt Reustle and today we are breaking down Restoration Hardware. The average person would call RH a furniture company but RH is a company where the CEO feels as important as the business, and CEO Gary Friedman has aspirations well beyond selling furniture. To break down RH, I'm joined by Drew Cohen of Speedwell Research. You may remember Drew from our breakdown of Floor & Decor. We cover how Gary Friedman took Restoration Hardware from the brink of bankruptcy and has built it into a brand with luxury aspirations. We go deep on the business model, why has RH been leaning into this in person experience despite a massive e-commerce boom, the reality of interior designers, inventory management, and orchestrating a supply chain when you sell monstrous couches. There's a lot to talk about here. It's a fascinating business with a fascinating person sitting at the middle of it. Please enjoy this breakdown of RH.   For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.  ----- This episode is brought to you by Tegus, the modern research platform for leading investors. Stretch your research budget with flexible expert calls you can trust. At a fraction of the cost of traditional expert networks, Tegus customers pay only what an expert charges – with zero markups and no confusing call credits – netting an average 70% savings. Don’t want to conduct a full hour call? Tegus offers the ability to schedule 30-minutes, an offer you won’t find anywhere else. And they don’t stop there. With white-glove custom sourcing for every project and robust compliance measures, including a dedicated 50+ analyst team that vets every call transcript, Tegus ensures your privacy and protection. As the industry innovator for qualitative insights, Tegus helps you find the right experts you need at a quality and speed that can’t be matched. For a limited time, as a listener, you can trial Tegus for free by visiting tegus.co/patrick. ----- Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here. Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss | @ReustleMatt | @domcooke Show Notes (00:02:27) - (First question) - Restoration Hardware’s relevance in the market (00:04:37) - The origin story of Restoration Hardware (00:07:58) - Insight into Gary Friedman’s backstory and his entry into RH (00:09:52) - The current RH business model and how Gary has shaped that over time  (00:17:14) - Their unique marketing funnels  (00:19:47) - Their move into the luxury brand market (00:21:24) - Explaining how the product collections are made up (00:22:32) - Updated supplier relations model  (00:25:25) - Insight into the RH sales model (00:28:04) - Overview of the membership model and how it impacts the business (00:31:42) - Peers within the industry that are using similar business models (00:32:49) - Cyclical macro exposure sales growth over time (00:34:09) - Their operations and logistics model (00:39:03) - The impact of COVID-19 (00:40:15) - Expected working capital for RH and other furniture peers (00:42:36) - Peer group average margin growth (00:45:56) - Key decisions and investments that need to go right (00:48:41) - European housing sizes and issues with American furniture (00:49:52) - Capital allocation history within RH (00:51:15) - How RH stays in style as decor tastes change over time (00:54:02) - His overall insight towards Gary’s ideas and risky business experiments (00:55:37) - His capital structure perspective for the future  (00:58:09) - How RH is moving into the luxury market as other brands move out  (00:59:09) - Lessons learned from studying Restoration Hardware

This is Dom Cooke and today we’re breaking down Bayern Munich. Bayern is Germany’s most successful football club and one of the world’s biggest. Most importantly, it makes a great case for being the best-run club in football. It has an enterprise value close to €3 billion, no debt, has been profitable for 3 decades, and is majority owned by fans. Plus, it has a trophy cabinet to rival any club worldwide. Bayern has won a record 32 national Bundesliga titles, including the last ten in a row, and has won the prestigious Champions League, six times. To break down the business behind the club, I’m joined by Marie Schulte-Bockum, a football journalist and Munich resident. Please enjoy this Business Breakdown of FC Bayern Munich. For the full show notes, transcript, and links to the best content to learn more, check out the episode page here. ----- This episode is brought to you by Tegus. Tegus is the modern research platform for leading investors, and provider of Canalyst. Tired of calculating fully-diluted shares outstanding? Access every publicly-reported datapoint and industry-specific KPI through their database of over 4,000 driveable global models handbuilt by a team of sector-focused analysts, 25+ industry comp sheets, and Excel add-ins that let you use their industry-leading data in your own spreadsheets. Tegus’ models automatically update each quarter, including hard to calculate KPIs like stock-based compensation and organic growth rates, empowering investors to bypass the friction of sourcing, building and updating models. Make efficiency your competitive advantage and take back your time today. As a listener, you can trial Canalyst by Tegus for free by visiting tegus.co/patrick. ----- Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here. Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss | @ReustleMatt | @domcooke Show Notes (00:02:38) - (First question) - Overview of Bayern Munich (00:05:37) - How Bayern’s been able to maintain such consistent success writ large (00:12:39) - What the 50+1 rule is and its implications for German football clubs (00:17:24) - Major differences between the Bundesliga and other European leagues (00:22:30) - What it takes to run a high performance team like Bayern Munich (00:28:39) - Driving profits and the three major revenue buckets for Bayern Munich (00:35:48) - Germany’s influence being the biggest economy in the European Union (00:38:40) - How important European football is to every major club and broadcasting revenue (00:43:20) - Whether Bayern are buyers, builders, or borrowers in regards to their team  (00:51:15) - Overview of their expenses and the size of their wage bill  (00:53:43) - What financial fair play is and how it protects football clubs (00:57:27) - How they’ve managed to cultivate one of the biggest fanbases in the world (01:02:14) - Potential risks for Bayern Munich’s continued success (01:04:18) - League-level discussions around sharing revenue equitably  (01:05:34) - Lessons for builders and investors when studying Bayern Munich’s story