Weather prediction betting is hot. This L.A. ice cream shop is cashing in
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- 28 Wishes Ice Cream Shop in downtown Los Angeles uses Kalshi to bet on weather prediction markets.
- The business, which sells less ice cream in rainy weather and during extreme heat waves, hedges against temperature swings to recover losses.
- The practice is growing across the country, chiefly with sports bars.
Online betting is increasing in politics and sports. Polymarket, for example, held at midnight on election day odds of 77.5% that the Democrats would retake the Senate. Which happened. If it hadn’t, whoever bet against those odds would have cashed out big. In this anything-goes betting culture, are there untapped gambles to be made in other realms? How about with food businesses? Specifically, how about an ice cream shop that usually suffers a dip in sales when it’s raining?
Plus, yes, microplastics are everywhere. And like you, perhaps, I’m also buying more glass containers, adding to a lucrative future for glass houseware makers. This is L.A. Omnivore, a newsletter about food and everything else.
Betting against the rain
On Oct. 21, rain was forecast in Los Angeles. Just after midnight, Jason Jiang, co-owner of 28 Wishes Ice Cream Shop in downtown L.A., fired up his Kalshi account and bet that yes, rain would indeed fall, a no-brainer. He also threw some money at the chance that the temperature in L.A. would reach two separate ranges: 73 to 74 degrees, and 71 to 72 degrees.
As a result of this hedge, Jiang earned about a 40% profit on the amount he bet. Why did he do this? Simple math. The ice cream shop faces dips in daily revenue when the temperature drops.
“In L.A. even if it drops to 70 degrees or below, our sales take a 20, 30% hit,” Jiang said. “That’s when we started hedging against the weather on Kalshi. It’s a balancing game.”
Jason, 37, and his brother James Jiang, 32, opened 28 Wishes Ice Cream Shop on Spring Street in early 2020, right before the COVID-19 pandemic. They specialize in a mixed gelato- and American-style ice cream, including popular flavors like Matcha Oreo and something they call the Cookie Monster, using blue spirulina for an organic tint.
In recent months, they learned that sports bars in other cities were now using online betting platforms to hedge against potential losses if their local pro teams didn’t advance in postseason play, such as the recent run-up to the World Series. The trend has a bitter taste since it entails betting against the home squad, but it’s working quite well for some sports bar owners in other parts of the country, according to the Athletic.
Here in L.A., Fortune reported that a large restaurant and bar group traded $60,000 against the Dodgers not advancing to the World Series — which the team didn’t — to recover all that cash flow the unnamed group could’ve earned from an extended run toward a third consecutive championship.
The 28 Wishes story has garnered media attention for its owners being open about the practice, and being at the forefront of a new intersection between the frenzy of the betting space and the restaurant industry.
Jiang, who started his career in banking, said at first their weather bets were against the brutal heat waves of this summer. Apparently people in L.A. tend to also shun sticky, heavy ice cream when the temperature gets too hot.
The brothers began studying the weather more precisely, noticing patterns in forecasts and how the weather actually plays out around us. Then they developed a system. If it’s expected to rain or get very cold, or if a frightening heat dome happens, they’ll place bets on weather-prediction markets targeting certain temperatures. He throws down $20 or $30 here or there, maybe a $100 if he’s feeling bullish, “like roulette,” Jiang said.
If they predict correctly, they cash out, in effect recovering losses from that day’s lower foot traffic. If they don’t, the $30 or so played is absorbable.
“It’s like trading the stock market. It could be like 2% in the morning, then suddenly be like negative 3%. We’re making sure we’re covering multiple ranges,” Jiang said. “You have to hit it on the mark, before anyone gets to it.”
I asked a some folks in the food space, a loose and small-sample survey, and no one I spoke with had heard of the practice. Is it at all weird to do this? I asked the 28 Wishes brothers on a recent day outside their store.
“It is, it is weird,” Jason Jiang said. But “for a small business like us … it helps us stay balanced.”
Lien Ta is an unofficial mentor to many in the L.A. restaurant industry, as co-founder of nonprofit group Regarding Her and former proprietor of beloved L.A. restaurants All Day Baby and Here’s Looking At You. She’s well aware of the hardships that restaurants face on a daily basis, and the existential crisis that seems to be gripping an industry that can’t catch a break.
She’d not heard of weather hedging as an insurance practice for restaurants, but she knows the scenario from which it springs. Angelenos tend to seek any excuse to stay in for the night, she said. Cold is a reliable one. “When the cold weather comes, I get this pit in my stomach,” Ta said.
In other cities like New York or Paris, “they still go out” even in frigid weather. “That unfortunately is not the general attitude of most Angelenos,” she added. “So if these guys can do that and they have that kind of energy and acumen, I think it’s lovely, and maybe it can spread to other people.”
Jiang said the 28 Wishes customers do not generally know the shop hedges against weather, and they likely don’t care. “I think they care more about what’s the flavor of the week,” he laughed.
Are you buying less plastic? I am, or trying to
It’s been a long time since well-meaning Mr. McGuire told Benjamin Braddock (Dustin Hoffman) in the 1967 classic “The Graduate” his best advice for a fresh alumnus: “Just want to say one word to you. One word. Are you listening? … Plastics.”
“The Graduate” was released in 1967, right when mass consumerism of synthetic plastic was booming. Less than a decade later, industry executives were beginning to worry about the potential risks posed by tiny plastic particles that could permeate organs in the body.
In 1974, according to a recent report by Times staff writer Susanne Rust, a renowned toxicologist gathered industry and health leaders in New York to discuss new findings that suggested that polyvinyl chloride or PVC plastics might be sickening workers.
The detailed report, based on decades of records, notes that the findings discussed in that meeting did not enter mainstream debates earlier because much of it was written originally in German. The term “microplastics” wasn’t coined until 2004, by marine biologist Richard Thompson.
Ever since, plastics have become another red alert to add to our list of threats that are largely out of our control yet impossible to stop worrying about.
I’ve shared in the dread that comes with realizing that my most worn cutting boards and reliable food containers have probably filtered unimaginable amounts of microscopic plastic pieces into my body. Then one morning, it hit me that my Target-bought coffee machine was not stainless steel or glass only. I vowed to replace it. Yet still haven’t. More and more people in my orbits seem to be taking steps to de-plastic their lives — good luck with that, right? — usually starting with tossing out their black plastic kitchen utensils.
The glassware industry is loving these jitters. The compound annual growth rate for home and consumer glassware is expected to climb by 5% through 2035, according to one private-sector report.
Count me in. I’ve been releasing my sturdiest plastic containers and gradually buying glass replacements. I already use a lot of wooden utensils for everyday cooking. My goal is to entirely de-plastic my kitchen by the end of the year. How about you?
