A group of allies in Donald Trump’s inner circle are trying to capitalize on his re-election and a resurgent mega-movement in America, a network of companies with ‘anti-weak’ and ‘values-based’ sentiments. has standing to appeal.
This week, companies in the so-called parallel economy — a new ecosystem that targets consumers with conservative or Christian values — celebrated Trump’s victory as a major boon for their businesses, which to date have has struggled to make any meaningful profits.
Backers include Wall Streeter and mega-campaign donor Umid Malik, former Republican senator Kelly Loeffler and Trump’s son Donald Trump Jr., who has funded Public Square, an e-commerce platform similar to Amazon or eBay. is for consumers who value “life, family and freedom”, and who have an important role. The source of income comes from financing gun sales.
Meanwhile, libertarian investor Peter Thiel and Trump’s own vice president, JD Vance, were early investors in Rumble, a right-leaning challenger to YouTube. Vivek Ramaswamy, along with Elon Musk, will lead Trump’s government efficiency efforts while also running his asset management firm, Strive Asset Management, which is committed to environmental, social and governance (ESG) principles.
For publicly traded companies, the hope is that a Trump win will help them do something they haven’t in the Joe Biden years: turn a profit. After years of declining sales and heavy losses, the companies, which position themselves as the “woke” alternative to corporate America, are banking on a reversal of fortunes, possibly from their maga-linked investors. are providing damages.
“I was vindicated that there were a lot of people who felt the way we were talking from a political and cultural perspective,” said Malik, chair of Public Square and founder of 1789 Capital, his e-commerce platform. SG is an anti-investment firm. “It’s an open question whether they feel that way economically and whether the political movement will translate into trade, but I believe it will.”
On an earnings call Tuesday, Rumble Chief Executive Chris Pawlowski said he’s “never been more optimistic about our opportunity,” adding: “The relegation culture is over. Free speech is now mainstream. Included and Rumble is in the driver’s seat.
The Rumble went public in 2022 through a billion-cheque deal with a company backed by Cantor Fitzgerald, the Wall Street group run by billionaire Howard Litnick. Lutnick, Trump’s transition co-chairman, is jockeying for Treasury secretary in the incoming administration.
Michael Seifert, chief executive of PublicSquare, said: “We’re looking at the economic manifestation of last week’s election victory, and we’ve already seen our business pick up over the past seven days.”
Advocates argue that the parallel economy still has billions of dollars in untapped potential markets, and support sectors believed to be undercapitalized by ESG principles – such as guns and ammunition. . They also say Trump won more votes this year than he did in his first election, increasing the number of potential customers these companies can appeal to.
“With Trump in office, many of these platforms will become more institutionalized,” said Sam Woolley, associate professor of communications at the University of Pittsburgh. “They will become part of the system rather than the periphery of the system.”
But, he added: “A lot of platforms are seen as too political or too unbridled and thus face the problems that come with that.”
Carolyn Schmidt, an academic who tracks several dozen parallel economy groups, said “this kind of values-based shopping on the left has been going on for a long time”. On the right, however, the parallel economy has grown as a response to a perceived “outdated culture”, and has been closely linked to electoral politics.
It emerged this week that Donald Trump Jr. has chosen to join the nation’s 1789 capitol rather than be part of his father’s team at the White House. Founded in 2022, the firm has a listed investment on private markets database PitchBook: Tucker Carlson Network, a streaming platform founded by the right-wing pundit.
“We see this synergy between these businesses and people connected to Donald Trump and elected officials,” Schmidt said.
However, companies in the space have struggled to create sustainable business models. They depend on niche user bases and don’t have the deep pockets of Silicon Valley, which is already taking its toll.
In 2022, the “anti-weak” bank GloryFi, backed by Thiel, closed after only three months of operation. Parliament Technologies, the parent of Twitter’s alternative Parlor, backed by Republican megadonor Rebecca Mercer, sold the app in 2023 before filing for bankruptcy earlier this year.
Experts say that the monetization mechanism of the major groups that have survived to this day is fragmented.
Public Square, for example, gets the bulk of its revenue as a Klarna-like fintech for guns, which some have dubbed “shoot now, pay later.” The firm last year acquired anti-abortion nappy brand EveryLife, founded by Republican strategist Nick Ayers.
The company’s namesake online marketplace offers everything from American-made home goods and health supplements to joggers with hidden pockets to models of concealed weapons and Confederate flag-waving Civil War soldiers. It brought in about $800,000 in revenue for the company in the third quarter, or less than 15 percent of its total sales.
Strive’s first investment offering, an energy ETF with ticker DRLL, advanced its “post-ESG” mandate by investing in US fossil fuel companies. Including fees, the fund has underperformed its benchmark over the past 12 months and since inception, according to the firm’s fact sheet.
Rumble runs ads, offers cloud services and has launched its own brands, including Be Naked, a men’s wellness brand that offers supplements that promise “core strength,” and 5G-free, Which it says offers “electromagnetic field (EMF) well-being”.
Despite their bullish outlook and the belief that Trump’s recent victory vindicates their business model, shares of Public Square and Rumble have fallen about 20 percent and 15 percent, respectively, this week after their quarterly results that There are heavy losses involved.
PublicSquare said its sales rose to about $16 million in the first nine months of this year, up from just under $3 million a year ago. But to generate that growth, the company spent $14mn on marketing and $33mn on salaries and other administrative costs. Overall, the company lost $37mn in the first nine months of the year, or about $2.30 for every dollar it generated in sales.
Rumble, which is popular among Trump’s base but has been shunned by major advertisers because of its hand-off for moderation, posted third-quarter revenue of $25mn, up from $18mn year-on-year. was higher, but fell short of Wall Street expectations. increased to $29 million. At $31.5mn, losses were also higher than the $25.2mn expected.
Old Glory Bank, an Oklahoma-based “pro-American” online lender founded four years ago by former Trump administration official Ben Carson, country music star John Rich and others, said the account in the week after There was a rush to open. Election
“We won at the ballot box,” said Mike Ring, chief executive of Old Glory Bank and a Trump supporter. “These same consumers are now saying we’re going to vote for a freedom economy with our dollars.”
Silicon Valley big tech executives have more broadly embraced Trump in this election after facing regulatory probes and antitrust threats during the Biden administration.
George Farmer, Parlor’s former chief executive, said the shift to the America First movement to “buy into our values” is getting stronger, but he noted that “if [mainstream] Companies feel comfortable with Trump, which undermines the essential argument for the parallel economy.
