In today’s big story, we’re looking at some of the recent big changes at McDonald’s, including the launch of a new restaurant concept.

• Markets: Forget everything you thought you knew about the importance of a balanced portfolio.
• Tech: The walls are starting to cave in on Elon Musk.
• Business: Get a first look at Adam Neumann’s latest bid to revolutionize the world.

McDonald’s is rolling out a new restaurant concept focused on cold, customizable beverages that’s looking to compete with Starbucks.

CosMc’s — a homage to an obscure McDonaldland character from the late 80s — opened its inaugural location in a Chicago suburb, Business Insider’s Nancy Luna reports.

The Bolingbrook, Illinois, restaurant is the first of 10 scheduled to open by the end of 2024, with the rest coming to Texas.

The strategy for CosMc’s, which is considered a pilot program, is to address the so-called “3 pm slump” fast-food chains face between lunch and dinner. It’s a time slot that’s been a sweet spot for beverage-focused chains like Starbucks, Nancy reports, thanks partly to their customizable, cold drinks.

Cold foam and oat milk are big business, as drink modifiers add up to roughly $1 billion in revenue for Starbucks.

And that’s not the only change to the McDonald’s “universe” — their term, not mine. The Golden Arches is supersizing its burgers and bringing back its once-beloved chicken wraps after competitors pushed into the snack-wrap space earlier this year.

Inflation has hit the industry hard, making the once-affordable food option a lot more pricey. McDonald’s dollar menu isn’t even a thing anymore. Things have gotten so bad you’re better off cooking at home again.

And then there’s the “Ozempic effect.” The buzzy weight-loss drug has some worried that customers’ appetite for fast food might dry up — even if those fears are unfounded.

Which is why launching a beverage-focused chain is such an interesting play. Call it “beverage math,” but when it comes to drinks, I don’t tend to scrutinize their price the same way I would a full meal. And fast-food beverages are typically a high-margin item for chains, Nancy told me.

CosMc’s could also be a bid for McDonald’s to boost its app and loyalty program. McDonald’s app has grown over the years, with over 57 million active members, but it still leaves much to be desired. (Nancy reviewed all the top chain apps.)

Starbucks, meanwhile, is the industry’s gold standard. The app accounts for over a quarter of the US company store transactions.

And it’s not just driving business. Starbucks’ app essentially functions as the world’s largest unregulated bank. It has billions of dollars deposited on gift cards that amount to an interest-free loan for the company. (Jamie Dimon could never.)

To be sure, 10 CosMc’s is not even a drop in the bucket of McDonald’s 40,000-plus restaurant empire. But it’s not hard to see how CosMc’s could quickly become a key part of the ubiquitous chain.

• Penn president Elizabeth Magill resigns after a week of intense backlash
• We now have more info on what Sam Altman did that was so bad he got fired from OpenAI
• Today’s parents have to pay $3.4 million to fund the American Dream for themselves and their kids

🔔 Before the opening bell: US stock futures trade mixed early Monday, after jumping Friday as a Goldilocks jobs report took pressure off of interest rates.

2. The market just got a huge green light for 2024. Carson Group chief market strategist Ryan Detrick pointed out that 60% of all components of the S&P 500 hit a new 20-day high last week. That indicator has a 100% accuracy rate of predicting big gains for the market over the following year.

3. So much for the benefits of a balanced portfolio. The long-touted 60/40 strategy of splitting investments between stocks and bonds is under fire. A new study suggests a stock-only portfolio offers better returns over the long run.

2. OpenAI’s Ilya Sutskever doesn’t seem to be having fun at work these days. The startup’s cofounder and chief scientist played a key role in CEO Sam Altman’s ouster. Now his position has yet to be addressed, and he hasn’t been seen at OpenAI’s San Francisco office. More on the uncertain future of Sutskever.

3. Elon Musk’s big bet isn’t paying off. After an incredible run that saw him named Time’s 2021 Person of the Year, Musk is facing some serious turmoil. From figuring out the future of debt-laden X to Tesla’s shrinking profits, things are not going well for the richest person in the world.

2.  Gen Z is anxious, and it’s remote work’s fault. The workforce’s youngest generation is particularly stressed. And the fact many have never set foot in an office since they started working isn’t helping matters.

3. If you’re worried about layoffs, here’s what you should look out for. An employment law attorney detailed the early signs that job cuts are coming. Keep an eye out for clues from your supervisor and HR and be on the lookout for cutbacks.

• $27 billion up in smoke – that’s how much cash the 3,200 startups that failed this year had raised, says PitchBook
• ‘I feel conned into keeping this baby’
• ‘The 2021 era glorified the role a lot’: How venture capital has changed since the pandemic gold rush 
• These are the 10 US billionaires who saw their wealth grow the most this year as stocks surged
• Republican congressman says his former aide threatened to expose his daughter’s OnlyFans account and mocked him over her videos: report
• More than a third of consumers are so sick of inflation they’re willing to risk a recession to get lower prices

• Donald Trump takes the stand. The former US president is expected to testify today for the defense in the civil fraud trial against the Trump Organization.
• Golden Globe nominations are in. Nominees for the 81st edition of the television and movie awards will be revealed ahead of the winners’ presentation on January 7.
• Hollywood’s list of the best that never was. The Black List, a collection of the best unproduced screenplays as voted on by studio executives, is released today. Alums of the list include “Argo,” “Slumdog Millionaire,” and “Whiplash.”

Dan DeFrancesco, deputy editor and anchor, in New York City. Diamond Naga Siu, senior reporter, in San Diego. Hallam Bullock, editor, in London. Lisa Ryan, executive editor, in New York.

Get in touch

insidertoday@insider.com

To read unlimited articles, subscribe to Business Insider.