Pivot and The Prof G Pod Co-host Scott Galloway Full Interview | Code 2021

[Music] [Music] hey everybody so i had to introduce scott galloway uh it's the most unlikely relationship i've ever had with a man um and uh he's not walt mossberg i would say who is a wonderful partner for two decades but scott and i have a really unique chemistry we think pivot is fantastic we actually have so much fun doing it um it's a pleasure to do it and what i really like about it is we disagree about a lot of things but we do it in a funny way a civil way an insightful way where we actually learn things about each other and about things uh that we didn't realize we knew about we love doing the show but of course as usual he's cheating on me again or attempting to um and he tried to go to bloomberg that didn't work um but he's going on cnn plus um and he's doing no mercy no malice it's gonna be a great show it's gonna be a real addition to the um to the repertoire there they're building something really interesting i think um and i'm very excited for him to do so um so please watch him uh on there um we will continue to pivot and our pivot con that we're coming up with in miami in february which should be a lot of fun we're going to focus on climate tech uh health care and sort of really fast fast forwarding psychedelics things like that um which we're going to talk about tomorrow actually in any case scott is a great guy he's a great presenter this is going to be a great presentation he's doing and so i want you to bring it on for scott i really really really love working with him and i'm excited for this presentation scott get out here [Music] [Applause] [Music] [Applause] [Music] first time on stage in 18 months i feel like i could throw up all right i've got my name is scott gallow i teach at nyu and i appreciate your time i've got 158 slides in 3 100 seconds so let's light this candle these are my investments just disclosure exciting slide uh some more disclosures i've said publicly i think investing in snapchat is like driving drunk i think it's something no responsible person should do you are handing your money over to a 27 year old with no rights in the stock three classes of stock so i added the slide because i see cnbc's outside i hauled my ass to wall street every wednesday for about five years and then one wednesday they just didn't call me and then the next wednesday they said we had a scheduling conflict no one called me no one said so immediately i went to okay why have i been canceled from cnbc and i immediately went to conspiracy theory and what i realized last night is actually i may just suck uh i predicted this is when i predicted uh snap was like driving drunk or investing and i was right for a little while and now it's gone to 90 bucks a share my most famous call is i said that tesla was going to get cut in half when it was at 70 a share and i was right for a hot minute now it's at 740. so in sum uh the real disclosures i get this wrong all the time okay decades and days there are decades where nothing happens and then there are weeks where decades happen uh originally attributed to vladimir lenin that's not true it was uh mp member george galloway but lennon's more gangster so i've been saying it's lenin so covet hit and we turn to god now we turn to google and it's interesting the searches my favorite is how to keep kids busy but we immediately started loading up on news social media became more and more addictive the biggest bet right now is whether the ccp is going to just wrap the knuckles of tick-tock or it's chinese kind of champions or if it's going to cut off their hands if it doesn't cut off their hands i believe tick-tock will be one of the three most valuable companies in the world within five years big tech has added the gdp of germany since covet broke out we all know it's great they've operated great they've done a great job uh this has been terrible for america if walmart stock had gone down 40 percent and amazon stock had gone down 60 instead of up 40 and up 60 uh we wouldn't be wearing mass right now this would be in our rear view mirror because when someone walked into walmart or a walmart without a mask we would tase them first and then ask questions later the dirty secret of this pandemic is the shareholder class is living its best life it means more time with netflix more time with family and your wealth has exploded so stop stop that hurts so good there hasn't been a full-throated capitalist response to this virus and the result is death disease and disability because we've decided that we need to bail out everything and now that this pandemic has largely been outsourced to people of color and seniors we've decided to use it as cloud cover to create stimulus that pours money into the market and explodes the wealth of the already wealthy you know it my brother that's why i'm here okay data crack it's best i could come up with silver lining by the way i'm going to tell la's stories in silver lining i grew up about three miles from here so i'm going to try and incorporate some silver linings and also not to be just totally debbie downer and also some la stories so there is some silver linings a lot of this has turned to innovation there's been incredibles there's some plants that are pyro pyrolytic that only germinate during a fire the architecture in londor london incredible renaissance after the great fires of london post world war ii we turned enemies into allies with a visionary investment a lot of wonderful things can come out of crisis and we're seeing a ton of innovation new business applications are soaring record levels of funding going into new businesses valuations subsequently have exploded in the private markets this is our graphic of a unicorn that's what my creative team did last night what did you do um but just to put this in perspective you can take every unicorn in the world uh that's a private company over a billion dollars take them all and they're still not as big or uh apple is almost as big and apple of course is worth more than 100 biggest companies in the uk so basically apple has become kind of its own g7 economy and people say that the markets climb a world of worry well they've been escalating and climbing very fast a world of worry that it seems as if things have gotten worse the markets keep going up if you had a crystal ball and you knew that more people were going to die in this tragedy then have died in every other war but that's all the crystal ball would tell you would you say i'm going to go buy stock it's just really the kind of land of unintended consequences what's happened here so we got very excited about all this new money pouring to the market stimulation a lot of people home with their phones a lot of time on their hands and a lot of incremental capital and human capital has gone into investing in mobile ads and this is at the same time when we lost more people in one month than we lost in all of the recent conflicts and wars and if you pull that out you could take every war that america has participated in and as of now we have lost more american souls now people will say it's not apples to apples because it was younger people that we lost in this war a greater percentage of the population but we've never hopefully this is the the kind of seminal event or tragedy of our lifetime so i'm fascinated with daniel kahneman's work around slow and fast thinking it's very difficult to process what's going on and so we go to our system one kind of fast thinking where friend or foe fight or flight and we make quick decisions and we either decide something is very good or very bad and there's not a lot of room or time for nuance and that's the subject of this presentation or the construct through which i'm trying to filter these views and that is i think we look at things as either being very good and we over hype them or very bad and we under hype them when i say under hype they don't get the attention they receive with evaluation they receive and over hype is they're capturing too much of our human capital and attention and are probably overvalued okay so the first thing is i think one of the biggest threats and something that's been overhyped is exceptionally purposely artificially constrained supply the results in exceptionally low admission rates at what has become the enforcer of the caste system and that's higher education me and my colleagues have become so drunk on self-aggrandizement and arrogance that we take pride in turning away 60 70 90 95 of applicants so we can feel more important about ourselves america is not about exceptionalism america is about acceptance and we have totally lost the script across higher ed that no longer see ourselves as public servants but as a hermes bag it is a very negative forward-looking indicator of where we are when the only two cohorts that get into the most transformative experience in the united states which is a college degree in terms of income opportunities health and we decide that the two cohorts that should have access to it are one the children of rich kids you're 77 times more likely to get into an elite university if you're top one percent income earning household child there are now 33 of the top hundred schools have more people from the top one percent income earning households in the bottom sixty percent or you're freakishly remarkable and i would argue and i can prove to you mathematically while we'd like to believe all our children are freakishly remarkable i can prove to you that 99 of our kids are not in the top 1 we have spring used to be a time of joy and nervousness it's morphed to a time of despair where good kids are now turning to their family and say i've been arbitraged down to a second-tier school because the top hundred are drunk on luxury but i have to pay a tier one price families are faced with terrible decisions do i go into debt to pay a mercedes price for a hyundai product it's not what we're supposed to be doing we used to be about acceptance opportunity in academics we've become about exceptionalism the enforcers of a caste system and prestige harvard if it were a country would be the wealthiest country in the world if you stacked princeton's endowments and hundred dollar bills you couldn't have commercial airline traffic because the stack would be higher than seven burj khalifas they say the admissions director says they could have filled their freshman class with six times the number of applicants or admission amid ease with no sacrifice and quality and the question is when you're sitting on the endowment of the gdp of costa rica well then why wouldn't your boss we sit up here and we have all these people talk about how they're scaling their companies at 30 or 40 percent a year we know there's tremendous negative externalities but we can't figure out a way to scale the university of north carolina chapel hill or uc riverside at four percent we just can't figure it out this is my first la story i went to school just a few miles up here it's obvious i know what you're thinking i haven't changed a bit seriously what the happened when i applied 74 people got in out of 100. the acceptance rate of ucla was 74 i had to apply twice true story i was installing shelving at 18 bucks an hour which seemed like a lot of money at the time and hanging out and getting high with my co-workers and on the way home from ontario i'm like i don't know this is what i want to do the rest of my life so i appealed and i got in changed my life today 12 people get in is this good for america we just don't have the option to reach into the homes of people of unremarkable kids raised by single immigrant mothers and give them the kind of opportunities that my generation got i do think there's some silver linings here and the first is that i think you're going to see the brand equity of public institutions soar mostly because the rankings are changing and for the first time we had a public university my alma mater for graduate school was ranked number one because forbes has decided to include access in their ranking and whereas pell grants used to cover 80 percent of tuition they only cover 30 now but they've decided that access is an important feature and the university of california berkeley will graduate more kids from low-income households this year than the entire ivy league combined some silver linings yeah go bears right uh coursera and google i'm seeing as a critic of big tech i think what google is doing in terms of certificates is wonderful and i want to acknowledge college isn't for everyone we need to create more on-ramps to great middle-class lives and i think tech is doing that the most interesting thing in higher education didn't happen higher ed it happened at apple and tesla and other firms that have decided they're going to create on-ramps and ways to evaluate people on their skills as opposed to their certification and are allocating a certain percentage of their entry-level jobs and non-college grads that's probably the most important thing that's happened in higher ed i think there's an emerging crisis we talk a lot about income inequality i think there's an emerging crisis in mating inequality and if you look at the genie coefficient there's actually greater mating inequality now in the u.s i was on cnn on saturday and i got a lot of email and a range of emotions around this but effectively tinder and online dating will now be the primary means through which people pair off or not pair off it used to be school and work it's turning into online dating and you have basically exceptional young women going to college there's probably going to be this year or next year two female graduates for every male largely because they have their act together more at a younger age and they deserve to get in and we're seeing an explosion in the disparity now why is that bad when there's 100 people on tinder and 50 men and 50 women 46 women show all their attention to four men leaving 46 men to fight over four women and in some women at least on tinder appear to be interested in men that not only have resources but signal their ability to garner resources in the future in sum women aren't interested in pairing off with men who don't have college degrees or women with college degrees i thought this was one of the scariest stats i've seen this year in 2008 just 13 years ago the number of men that had not had sex before the age of 30 was eight percent and people hear the word sex and all sorts of neurons begin firing but think of it as a key step to establishing a relationship uh it was eight percent uh as of 2019 it's now 28 it's probably 33 now if we maintain this trajectory in five to seven years when you walk down the avenue that is america there'll be twice as many young women with college degrees and one in two men will have never established an intimate relationship by the time they're 30. and you think well why is that a problem if women deserve that why is that a problem and loneliness just isn't a problem for men it's a problem for women just as digitization creates college consolidation and e-commerce and social media i think it's creating consolidation or a winner take all dynamic and mating and the result is that about 10 of the men are having 80 percent of the sex which means they are not incented to establish long-term relationships and have children and the bottom 50 percent of men in terms of attractiveness don't have access to mating at all i think this is dangerous for society the most unstable societies suffer what i call porsche polygamy and that is wealthy men get too much access or too much attention and there's an entire cohort of the most dangerous person in the world which is a young broke and alone male and we're producing too many of them and so the what's the answer should we have fewer people of color or fewer women admitted into universities no we should have more and we should have a lot more men and we need to again start scaling our great public universities at a fraction of the rate we come to celebrate the way we're scaling other companies and other organizations healthcare i think this is the most disruptible industry and will create more shareholder value than any industry in history over the next 10 years u.s healthcare 17 of our gdp three and a half trillion dollars four out of five people aren't satisfied with it and there's a lot of exciting things pre-pandemic less than one percent were virtual visits to the doctor's office now it's a third it's estimated that two-thirds of all health care spending could be digitized you can't get an appendectomy on your iphone but you can get the consultation you can get the drugs prescribed you can get the physical therapy the idea the opportunity to push healthcare out onto our phones represents an enormous opportunity to take healthcare from a defensive state on our heels to an offensive health driven industry on our toes funding is following we're seeing tremendous amount of deals done i think this is going to be an amazing unlock a mom who manages her child's diabetes and let's be honest it's almost always the mom spends five months of her year managing that child's health care and most of it is in time that's wasted transportation waiting dealing with insurance companies so this might be an incredible unlock that pushes preventive care and primary care out to 100 million americans who really don't have access to it i think that probably the biggest opportunity is in femtech or basically health care for women if you think about it they again like so many consumer categories spend a lot more and influence the majority of spending in health care yet the industry as it has done for a long time kind of ignores them right now two percent of healthcare funding goes to kind of distinctly or focused femtech companies why is that i think it's a proximity or a familiarity bias where 40 of the venture capitalists are men from either stanford or harvard 80 are men and it's probably 90 to 95 percent of venture capital that is allocated is allocated by men this is kind of the perfect analogy for what's going on in health care in general the most famous online health tech company was called hems and the first products were a hair loss treatment and an ed treatment and then they decided in 2018 to switch it to him's and hers this is basically a summary of medical research for the last 100 years in america i want to bring attention to a company called hey jane a startup that's focused on family planning through a remote device that gets around certain geographic constraints offers anonymity i think this is a huge opportunity and when you have a lack of capital and a bigger market i think that all adds up to higher returns fintech so i think over hyped as online trading platforms so the number of options as a percentage of market has exploded because people see pictures of other people making money and some online trading platforms have done a great job of convincing you that all you need to do is trade more because that's how they make money by selling order flow to get rich but the reality is day trading somewhere between 80 and 95 percent of day traders lose money and their average loss is 36 percent of their capital that year they're also inexperienced you could look at this as half full that this is about bringing a new cohort into investing there's some very good things here for the first time this same proportion of people of color who own stocks has caught up with whites so there's a there's some very good things about this the question is are we setting up an entire generation of inexperienced investors who've never known anything but a bull market to get hurt very badly and lose all confidence in the market when i look at robinhood uh 40 of their revenues this quarter came from cryptocurrency and 60 of that was from dogecoin so you have a company that's as valuable as barclays more valuable than one of the biggest pranks in uh uh spain bigger the deutsche bank and it's got 25 percent of its revenues this quarter from doji coin trading dojo coin i think that firm is very vulnerable what's under hyped is online banking i think that's going to be a much bigger industry much more sustainable if you think about operating systems every company is trying to establish the operating system for media for search for your dating for your media life the operating system for our financial lives have large loosely speaking been branches and atms and people want new types of operating systems and a lot of the traditional banks are focused on their legacy assets and are shutting down these legacy assets like crazy 25 of america is still unbanked because they're seen as an unprofitable segment so the innovators see huge opportunity and are coming in and trying to capture the 1.7 billion people in the world who are unbanked huge opportunity in latin america where the majority of people are unbanked and a wallah affirm i'm tracking closely in argentina one in four people under the age of 25 are now banking with walla on their phones they've just launched in mexico and are getting adoption there they now have populations or customers that rival some of the biggest banks and they're seeing valuations that dwarf traditional players transportation over-hyped space tourism the morning network spent more time covering the launch of jeff bezos rocket than they did on climate crisis in all of 2020. this virgin galactic in my opinion is in a word ridiculous it is both supply and demand constrained and the company is being valued at 11 million dollars per people on the waiting list this was an incredible branding event the whole world saw this and they built a staggering waiting list of 600 people a good starbucks could serve 600 people in three hours aston martin gets two million dollars valuation for every car it sells i think space exploration is the equivalent of space execution i don't think sending people to mars is anything but a death sentence and also space travel is is dangerous we don't like to talk about it because it's scary or seeing as having bad juju or bad optimism but the reality is it's more dangerous than almost any other activity you can think of i want to acknowledge there hasn't been a launch-based fatality in over a decade but this industry could be over in a flash going to mars makes no sense here's the weather here here's the weather on mars today i will say this though the view on mars will literally take your breath away literally as you can't breathe there under hyped space hauling actually putting stuff into space we're going to go from 3 000 satellites to over 50 in just 10 years and the companies that can haul that stuff into space are going to do really well i thought the for all mankind ridiculous trip 86 kilometers we sent three people to a rock circling our planet 50 years ago not knowing it and then got them home safely at a period when third third of american homes didn't have indoor plumbing and yet for all mankind when we send a rocket up for a few minutes to basically double the height of a citation 10 or such an adele's plane flying home last night and we think it's for all mankind ridiculous i will say this i think spacex is blowing all the others out of the water in terms of the number of satellites and also the cost of lifting every kilogram into space i think underrated is supersonic travel i think people are more interested i think the market is gigantic for people who can get to london in three and a half hours i think they'll pay 2500 2500 10 000 even 20 000 i think that market is gigantic i think that's going to be much bigger than a 600 person waiting list the wealthiest people in the world have all one thing in common and that is they built time machines i always say to a company that thinks they can get to a trillion i'm like what's your time machine prime saves you money netflix you save 11 days of your kids time because they don't wash commercials per year uber's a time machine and i think boom has an opportunity to be a big company we're also need to save more time or i think one of the most underhigh parts of the world of elon is actually the least talked about and as the boring company a lot of our time is spent on very short commutes new york to laguardia is only nine miles but it takes anywhere from an hour to two hours during the weekday and i think this opportunity to save time or save time bringing stuff to you is exceptionally under hyped right now if you look amount of time it takes in major metros death of cities has been hugely over exaggerated two thirds of economic growth is still going to happen in cities they're already recovering but our ability to save time in cities getting out getting in and getting our stuff in is going to be huge something that's over hyped i love talking about overhype technology on this stage i said 3d printing wearables vr were all over hyped i think the new big overhyped one is self-driving i don't think according to elon musk three years ago or two and a half years ago within a year there were going to be a million self-driving teslas on the road business insider said there would be 10 million and so far there's 1400 funding is already starting to decline and the hype is fading the mentions are going down we have software now courtesy of mendacious companies that will arbitrage people out of minimum wage making human capital and drivers very cheap and a lot of people just like to drive so covet brought the world to us vr and wearables i think are hugely overhyped i think venture uh virtual reality continues to be massively over hyped and according to mark zuckerberg legs are over hyped i know i don't get this if you look at the sales three and a half million sets crocs sold 69 million pairs last year this is the number of units google glass and snap spectacles but for perspective that yellow strip is all of google and uh snap wearables versus airpods if airpods were its own company it'd be a fortune 50 company uh back to attracting a mate i think you do this with air pods and signaling wealth and that you get it and you're a storyteller i think you do it with a rolex we like to pretend resources don't matter they hugely matter ray-bans want to look cool want to be like kara swisher now what if you don't want to have kids and you want to scare away mates you can accomplish this let me know i have a lot of experience here let me help you pay for dinner with a discover card show up in a mazda talk about how into magic you are and show one of these no kids no kids thought that'd be funnier the bloom is off the space rose we have a regression to mean canaries in the coal mine some of these facts are ridiculous some will endure esg branding is totally overhyped the majority of usg funds really don't comply with the paris accords europe actually implemented regulations around what it meant to say your esg and the funding went down that hasn't happened in the u.s there's ridiculous backs this is my latest target aspiration they've decided that they are as a service sustainability as a service it's basically a cred debit card with a bad fund sustainability fund that invests in southwest airlines i don't see how that's sustainable less than two percent is truly esg so this is basically bad bad money management debit card trying to sell itself at 29 21 times revenues and spends 150 percent of its revenues on marketing so they've come up with a new metric called ebitdam where they calculate profitability minus marketing they don't include marketing in this calculation remember remember community-based weave ebitda well this is the new one ebitda i think the china crackdown story is really interesting i've got to go fast i'm almost out of time the mother of all macro bets is shaping up and that is a xi jinping doing the following to its internet champions is he doing this or is he doing this [Music] oh god [Music] trust me it's the best almost done i promise you the more you watch this it's it morphs from disturbing to disturbingly rewarding it's a source of joy now i promise you the next time you see this video you will like it there's a crackdown in china on things from private education to tutoring to social media to gaming to breaking up monopolies and i think we should learn from what they've learned watching us i think the algebra of deterrence is hugely under hyped this is a la story if anybody calls you and offers your son an opportunity to get into stanford by making donations to the sailing team you're going to hang up there's no algebra of deterrence in big tech the algebra of deterrence is the likelihood of getting caught times the penalty relative to the upside the upside is trillions of dollars they get caught but the penalty is almost meaningless the algebra deterrence does not work in um in big tech and it needs to be restored what if michael milken with his all birds born 30 years later patagonia vest had started a fintech company and was accused of insider trading today would he be sentenced to prison for 10 years the question i get the most often at every one of these presentations i've presented now to 88 000 people since covid has started about six thousand more students at the following brands i put these up there for credibility because i'm rapidly insecure but they always have one question what is the profound opportunity coming out of covid and i think this is the profound opportunity and this is the same slide i give at the end of every presentation i have and i ask people to ask themselves three questions one is this an opportunity to pivot to being a caregiver for someone in your life two do you have the relationship with your siblings you want if you were forced to say goodbye to one of them over face time is your relationship where you want it to be and three have you made the requisite investments in friendships or have you let competitiveness or perceived slights or other get in the way and what is the key component across every study on happiness and that is the depth and number of meaningful relationships in your life we give medals to young people who demonstrate grace and forgiveness and crises this is a crisis do you have the emotional financial and mental fitness and physical fitness to demonstrate that kind of grace and generosity if you do you can't accomplish in months would otherwise might take years and again that is the repair and cementing of key relationships so i'm going to wrap up low admissions rates democratizing investing space tourism space exploration self-driving cars vr and wearables spax esg branding and fines i believe have not received or are over hyped or gotten too much attention under hyped public university brands mating inequality the disruption of health care democratizing banking space hauling super sonic travel the boring company china crackdown and algebra deterrents are either undervalued or not receiving the attention they deserve okay [Music] shannon river [Music] life is old [Music] do something [Applause] and how should they do it [Applause] i told you you would like it more the second time we need a pallet cleanser to finish up here more than any content i put out the content that gets the most response is when i talk about my dog i bought um or i went got a great day and puppy as a reward to myself my first job here was walking when i was 13 years old along wilson boulevard 170-pound great dane called thor this is my visual image of me walking in at the age of 13 and i decided i wanted a great day so this is how it started and this is how it's going now i want you to scan your emotions right now everything i said before you like a little bit more or you hate a little bit less take this times a billion and this is what big tech has done to all of us their personal stories their likability there are more people here spinning and manicuring their than there are journalists covering them hold them accountable my name is scott galloway teaching the nyu i appreciate your time you

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Length: 36min 34sec (2194 seconds)

Published: Mon Oct 04 2021