Sent Items #190: Sunday, June 1, 2025

Happy birthday month to me and all other Geminis! I’ll be in Vegas later this week for my annual birthday trip with my younger brother - we were born on the same day, June 7, but 5 years apart. My Venmo is below if you wish to send a few birthday pesos to place on the roulette table (or a Yankees futures bet to win the World Series).

A few quick PSAs before we get started:

When you get 18 minutes today, check out the Happy Customer Channel podcast I was on yesterday where I discuss Tariffs, Trade and DTC. Watch it here (link) or listen here (link).

But if you only have 30 seconds, check out my latest unboxing (…in a new location!):

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Two weeks ago we announced Third Person's inaugural 𝗟𝗼𝗴𝗶𝘀𝘁𝗶𝗰𝘀 𝗮𝗻𝗱 𝗟𝗲𝗮𝗱𝗲𝗿𝘀𝗵𝗶𝗽 𝗥𝗲𝘁𝗿𝗲𝗮𝘁 and the response from applications has been incredible!

We are only accepting 𝟱𝟬 𝗽𝗲𝗼𝗽𝗹𝗲 𝘁𝗼𝘁𝗮𝗹 - founders and executives across Brands, 3PLs, and Logistics Tech companies. I𝘁'𝘀 𝟭𝟬𝟬% 𝗳𝗿𝗲𝗲 𝗳𝗼𝗿 𝗕𝗿𝗮𝗻𝗱𝘀 𝘁𝗼 𝗮𝘁𝘁𝗲𝗻𝗱 (𝗶𝗻𝗰𝗹𝘂𝗱𝗶𝗻𝗴 𝗮 𝟮-𝗻𝗶𝗴𝗵𝘁 𝘀𝘁𝗮𝘆).

Remember, this is a VIP event, a curated cohort focused on creating meaningful relationships and we are capping attendance at only 50 guests to encourage real connections and an intimate retreat experience.

We are currently reviewing applications so if you’ve been meaning to apply, this is your nudge! You can find more information about the event here (link) and the sign up link is towards the bottom (or here).

Now onto some news…

“The court does not read IEEPA to confer such unbounded authority and sets aside the challenged tariffs imposed thereunder.” - U.S. Court of International Trade

These were the happiest words in many months that e-commerce brands read this past week.

But the following day, the US Appeals Court reinstated Trump’s reciprocal tariffs. The US Appeals Court's decision can likely be appealed to the US Supreme Court. Either side can petition for review, but the Court must agree to hear it, which isn't guaranteed.

As my friend Ben Spivack from Folden Lane commented, “The fallout [from these changes] is even deeper uncertainty and more widespread disruption.

Suppliers, small businesses & importers, freight forwarders, logistics firms, and retailers should brace for an economic environment shaped by volatile costs, policy reversals, opaque duties, and shifting lead times.

The downstream effects on inflation and Fed policy are just as unpredictable.

A ruling that should bring clarity instead highlights just how fragile the foundation of global trade has become.

Small peace of mind wrapped up in an expression I heard last week referring to Trump’s tariff policy: TACO - Trump Always Chickens Out, referring to Trump's pattern of making big tariff threats only to back down in some fashion.

We seem far from knowing where things will settle, what the go-forward reality looks like. Until then, talk to customs broker to understand your options, and get your unit economics dialed in.

Air cargo capacity from Asia falls on loss of US de minimis exemption (link). The May 2 elimination of the US’ duty-free exemption for low-value shipments from China under so-called “de minimis” rules has led to a drop in air cargo demand and capacity on the trans-Pacific and a shift to other major markets.

The first signs of that decline is visible in data from air cargo analyst Rotate, which shows air freighter capacity deployed on the eastbound trans-Pacific from May 12–18 fell 8% year over year to 82,000 tons while increasing 19% year over year to 74,000 tons on Asia-Europe.

Chinese exporters are offering sweet deals to U.S. businesses. They often come wrapped in fraud (link).

Chinese exporters are understating the value of goods or mislabeling them to draw lesser duties. This tactic is not new but it has gained greater momentum, as businesses scramble to sidestep Trump’s new tariffs. U.S. businesses are underestimating civil and criminal risks by partnering with such exporters, experts warned.

A Goldman Sachs report released in January estimated that the tariffs Trump imposed on China during his first term saw evasions worth $110 billion to $130 billion in 2023, with understating value and mislabeling each contributing $40 billion and rerouting accounting for $30 billion to $50 billion. In comparison, the total duty, taxes and fees collected by CBP in fiscal 2023 was $92.3 billion, according to government data.

The agency said that between May 5 and May 9, the agency secured over $630 million in additional revenue as a result of “targeted reviews of more than 2,000 shipments” detected for duty evasion such as undervaluation, misclassification, transshipment, antidumping and countervailing duties.

Meet the Takeover King Who Leans on Yoga and Team Bonding to Make Billions (link). Brad Jacobs has struck more than 500 M&A deals while exuding feel-good vibes. I’ve mentioned Brad in several prior issues of Sent Items.

Jacobs’s career includes founding United Waste, United Rentals, XPO Logistics, GXO and RXO and now QXO, targeting building products. He jokes that the “X”s and “O”s he puts in the names of his companies stand for hugs and kisses.

A nice read of one of the most successful modern-day entrepreneurs, and among the most successful logistics entrepreneurs ever.

Finally, a couple really exciting financial headlines:

1. Portless announced an $18 Million Series A (link). Portless is a really unique fulfillment model, essentially a drop-ship model for brands who manufacture in China and Vietnam. Their team is awesome, and their CEO, Izzy Rosenzweig is a friend and a great LinkedIn follow.

2. elf Beauty is acquiring Rhode for $1 Billion! $1B for a 3 year old DTC skincare brand. Rhode skin launched with just three SKUs and did eight figures in DTC sales within 11 days. By year three, they hit $212M, all without any physical retail.

   This wasn’t ad-spend driven. It was organic virality at scale. A masterclass in building sustained momentum, deep community, and real brand equity.

Have a great week ahead!

- Matt

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