Responsible Innovation and Venture Capital

Hemant Taneja, a managing director at General Catalyst and the founder of the firm’s Silicon Valley operations, joins Scott to discuss the venture capital space, why he’s bullish on the healthcare sector, and why responsible innovation is more important than ever. Hemant also shares his thoughts on the energy space and why Tesla is a key player. Follow Hemant on Twitter, @htaneja. (16:44) Scott opens with his thoughts on LVMH buying 50 percent of Jay-Z’s champagne brand as well as his thoughts on the luxury brand market. This Week’s Office Hours: Australia vs. Facebook (49:18) and buying shares on the secondary market (56:40). Algebra of Happiness: Love & Empathy (60:51). Learn more about your ad choices. Visit podcastchoices.com/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Scott Galloway?

  Episode 50, the atomic number of 10. There are 50 states in the United States of America. When I turned 50, I started, no joke, lying about my age. I'd ask that you love me, don't judge me. Go, go, go!

• 0:21Scott Galloway?

  Welcome to the 50th episode of the Prob G Show. In today's episode, we speak with Hemant Taneja, Managing Director at General Catalyst and the founder of the firm Silicon Valley Operations. We discuss with Hemant the venture capital space, his thesis around economies of unscale, and the innovations he wants to see in the healthcare sector. All right, what's happening? What's happening? What's the dealio? Let's take a look at the luxury brand market and start off with the big news. Luxury brand giant LVMH, which stands for Moet Hennessy, Louis Vuitton, has purchased a 50% stake in Jay-Z's champagne brand, Armand de Brignat. I'm not sure if I'm saying that correctly. By the way, something about getting older, the part of my brain where I can have some sort of accent or pronounce

• 1:05Scott Galloway?

  something, it's just literally going away. Anyways, or better known as the ace of spades for an undisclosed amount. The Wall Street Journal reported that the investment is aimed at growing Jay-Z's champagne brand through LVMH's global distribution network. Per the Financial Times, ace of spades sold a half a million bottles in 2019 and are typically priced between $300 to $950. Whoa! Oh my gosh. Okay, okay. So why is this a good deal? It's both inclusive and maintains the exclusive and aspirational attributes of the brand. LVMH, the world's largest luxury goods company, has a third of a trillion dollar market cap, almost big tech-like. And although annual revenue dropped by a third in 2020 to just under $6 billion, shares

• 1:49Scott Galloway?

  have jumped roughly 20% since January 2020. The company also recently acquired Tiffany & Co. for $16 billion. Bernard Arnault, the wealthiest man in Europe, who has been leading the 75 brand conglomerate for the past 32 years, is a visionary CEO and is considered the Sun Tzu of luxury. Unless you want to annihilate your competition, you must give them an escape. I love that book. It's just so like, I don't know, it's just a fucking macho. Just like, okay, the art of war. So, so what are we gonna have here? Think about what's about to happen. Think about why LVMH is about to be a champagne and cocaine party. By the way, huge news this week. This professor for Columbia dropped that as a part of his lifestyle, a very responsible guy with

• 2:34Scott Galloway?

  what appears to be a very functioning family, he rolls out, crushes up some heroin and snorts a few rails of heroin on a regular basis to maintain work-life balance. Huh, huh. And on this show, I've talked about the fact that occasionally I partake in zacapa a lot. Love the Z, love the Z. Anyways, anyways, occasionally I like to think that I'm sophisticated and I get Diplomatico, which is initially a Venezuelan rum. I know a little too much about rum and I love the packaging. I love the bottle. It's a little sweet for me, but I still absolutely love it and I love the ceremony. Champagne for me, I love champagne, absolutely love champagne. Although Max is out at about 30 or 40 bucks a bottle, but the rest for me, I just don't have the palate to discern between.

• 3:19Scott Galloway?

  I can discern between a $5 bottle of champagne and a 30 bottle, but then that's it. Anything above that, it just all tastes pretty, pretty good for the dog, pretty good for the dog. Lap that shit up. And when I say shit, I mean champagne. Anyways, I'll go to 80 or 90 bucks and I'll buy Ruin Art for signaling. I want to signal to my friends and people that I am successful. I realize how insecure that sounds. By the way, that insecurity drives the majority of our consumer economy. But, but what's gonna happen? Why is LVMH probably still a buy? Why are they buying champagne? Oh my gosh, let's talk about the nitro. The nitro is the amount of money consumers have right now. We pumped a trillion dollars into the economy, into consumers' hands, 50 billion net destruction and compensation, meaning they've got about a trillion dollars more in their pockets than

• 4:04Scott Galloway?

  they had. And, and consumers have saved $500 billion in incremental cash because they're not going to the Olive Garden or to Disney. So we have a trillion and a half dollars waiting on the sideline. And, and if you're like me, and I know you are, and I know there's 355 million of you out there like me, minus the anger, the erectile dysfunction and the predisposition for zacapa and edibles. Anyways, anyways, you're gonna see. The fucking roaring twenties. It is gonna be crazy. From September of 2021 to the end of 2022, you are gonna see a consumer orgy, the likes of which we haven't seen since, since the roaring twenties. And I think Bernard Arnault, who is the Jeff Bezos of the consumer

• 4:47Scott Galloway?

  sector and his ability to see around corners, sees that it's just gonna be nuts. And when he can take a high-end champagne with awareness and then flush it out across his distribution and network, people are gonna need something to wash down that cocaine with, and it's gonna be Armand de Brignac. I think this is a great acquisition, and you're gonna see LVMH, in my opinion, is gonna continue to outperform. What happens after that? I don't know. I don't know. The roaring twenties didn't end well. And I get the sense that we're due for the mother of all corrections, but let's enjoy it. Let's enjoy it while we can. All right, all right. When we're talking about luxury brands, we typically refer to companies such

• 5:28Scott Galloway?

  as Apple or Tesla because of their ability to capture our attention and drive home a narrative. When it comes to Western luxury, they have historically been late to the game when it comes to innovation in the digital commerce space. However, however, they are making progress here and have plenty of opportunities to innovate. A report by McKinsey expects luxury e-commerce sales to reach around $90 billion in 2025, meaning one-fifth of luxury sales will be done online. Think about that. 20% of luxury sales will be online. And those who over-index, those who get to 30 or 40%, will trade at a higher multiple, which will give them access to cheap capital, which will give them the ability to build more robust innovation, wash, rinse, repeat. That's what I call the jump to light speed. A narrative backed up by performance resulting in cheaper capital, and you use the cheaper capital

• 6:13Scott Galloway?

  to build that narrative or further pull away. And Vogue Business pointed out an interesting intersection between luxury fashion brands and gaming, specifically with WeChat mini-games and its 500 million Chinese consumers. Think about that. A half a billion consumers on WeChat mini-games? Doesn't sound too many to me. Doesn't sound... They should call it WeChat monster fucking games. 500 million Chinese consumers. Oh my God. Vogue Business reported that transaction volume through WeChat mini-programmes for the apparel industry tripled in 2020 compared to 2019. And luxury fashion brands, including Burberry, Dior, and Fendi, have begun testing ways to integrate their products within the games.

• 6:52Scott Galloway?

  Wow, talk about gamification. That's gonna be crazy. We already know that China outpaces the US when it comes to adopting retail innovation. And Fast Company reported that the country is set to become the first country in history that will have more than half its retail sales take place online. Think about that. 50%. I think we're at somewhere like 28, and it depends if you exclude grocery or gasoline, but China, 50% online. On top of that, on top of that, a global personal luxury goods market report by Bain and Company anticipates that Chinese consumers will account for nearly half of all luxury purchases worldwide by 2025. So basically, in the world of luxury, there's China and the seven doors, the seven

• 7:33Scott Galloway?

  doors being the rest of the world. Okay, let's go to the root, though. Let's do a little bit. Let's go to school. What is luxury? We talk a lot about innovation as it relates to technology, but the real innovators, the gangster innovators here of the modern business era are artisans, specifically in luxury. Whether it was Louis Vuitton hiking tens of miles barefoot into the city because he understood that luggage should be flat topped, so it could be more easily stacked on the back of a horse and carriage, or that the rubber inside, the leather inside the bag should be treated with a special chemical such that it didn't mildew, or whether it was L'Oréal that collided chemistry with

• 8:17Scott Galloway?

  agriculture and figured out a way to take the poppies in the southern France region and capture that smell and then distribute it beyond southern France. These guys were always the original innovators. In addition to innovation, they collapsed it with artisanship. And that is a pure love of beautiful things, a willingness to take time and materials and bring art to something. Now, what is the core? At the end of the day, any big consumer brand, any company you want to grow to tens of billions of dollars at some point has to fit to a specific instinct.

• 8:55Scott Galloway?

  Google is God, right? What is prayer? You put a query into the universe, some sort of divine intervention spits back an answer you trust more than any advice you get from a rabbi, priest, mentor, boss, coach, et cetera. And as we become less reliant on a super being, Google fills that void. Google is God. Our brain, our instincts need to have questions to answer, that curiosity, right? Facebook is love, right? Choosing moms choose Jif. Most CPG programs play on your maternal instincts. Well, you're not a good mom if you don't use this detergent, right? That really hits to your relationships and your heart. Amazon, more for less, that's the gut. Survival. My God, I have two dogs. They are so food driven. Why? Because it makes sense, because a lot of wild dogs, millions of years, dogs were in

• 9:39Scott Galloway?

  real risk every day of dying if they didn't get enough food and becoming weak and getting eaten by some other animal predator or just starving. So dogs are very food driven. Survival, more for less, is always the gangster business strategy. It's the strategy of Dell. It's the strategy of Walmart. It's the strategy of China as an economy. More for less, the gut, survival, instinct. And then, and then where does luxury go? Luxury go? Luxury goes two places. It does go to God. We are used to, for hundreds of years, if not thousands, we're used to seeing the most beautiful things from artisans in places of worship, the frescoes in mosques, the beautiful music in churches, right? The incredible sounds and customary in temples.

• 10:22Scott Galloway?

  We were used to seeing the most beautiful things. And to a certain extent, religious organizations have manipulated us into believing this is probably where God hangs out. If you go into St. Peter's Cathedral, you think, wow, there's a good chance that God rolls in here every once in a while. It is just so beautiful and so breathtaking. So our desire to be closer to God has been captured by luxury institutions. And that is, we are trained to believe that the slope on the back of a 9/11 or the mesh on a Bottega Bonita bag makes us feel more holy, makes us feel closer to God. In addition, in addition, it goes after the second most powerful instinct, right behind survival. And what is it? It's propagation. A lot of people say propagation is number one. No, it's not.

• 11:05Scott Galloway?

  You can be ready to get down with Tom Brady, or whoever Tom Brady's hot equivalent is. And if you smell fire, you're pretty soon not interested. You're leaving that house or that hotel room. Doesn't matter how hot the person is with you. If your life is under threat, you are out of there. Survival is a distinct number one. But in a modern society, 99.99% of us get up every morning and we're not worried about our survival, which takes us to a modern day kind of number one, and that is propagation. And that is our need to spread our genes to the four corners of the earth. That's primarily what men think about. And then women have a much finer filter and want to attract the most inbound opportunities for genetics,

• 11:49Scott Galloway?

  such that they can use their much finer filter. And let's be honest, it's much finer than most men, to pick the smartest, strongest and fastest seed. If that sounds wildly sexist, it is. And generally speaking, generally speaking, the sexes are different when it comes to their approach towards procreation and their criteria. Women want men for three reasons typically, typically. One, they want resources. I know that sounds so bad, but the bottom line is if you partner with someone who has resources, your children are more likely to survive. Two, they want someone who's intelligent. Someone who's intelligent is if you partner with someone who's intelligent, you again are more likely to survive. And they want someone who is kind, someone who has resources and is intelligent. It really doesn't matter if they're an abusive, difficult person. So those three things, those three things. This chocolate and peanut butter combination

• 12:34Scott Galloway?

  around propagation and the way we demonstrate resources. One of the ways we signal artisanship and closer to God, the way we signal power is through material items. So when you buy that 9/11, okay, maybe you're into cars. Maybe you're into cars, but you're really just signaling. You're really just signaling. I would argue the next signal or the new signal, the new ultimate luxury brand is Tesla. It used to be Apple that said, I think different. I'm groovy. Have sex with me. Tesla basically says, I care about the planet, but I can also afford $120,000 car. Luxury taps into our need for a super being, our desire to be closer to God and our desire and I need to be more attractive to mates. Even if you're in a monogamous relationship,

• 13:16Scott Galloway?

  even if you have no desire to meet random strangers or to propagate, if you will, at this point in your life, those instincts don't die. You want to be closer to God. You want to be attractive to strangers. Luxury, God and sex.

• 13:35Scott Galloway?

  Stay with us. We'll be right back for our conversation with Hemant Taneja.

• 13:41Scott Galloway?

  Support for the show comes from Nutraful, the number one dermatologist recommended hair growth supplement brand used by over one and a half million people. With age comes knowledge, patience, and for some, hair loss. Didn't say it was all good things. And for those who want to do something about it, there's Nutraful. Nutraful has formulas built for men at different life stages. They have Nutraful Men for guys age 18 to 49, plus the new Nutraful Men 50 and older. That's the first product of its kind specifically for men over 50. You can now address the key root causes of thinning wherever you are in life. Grow visibly thicker, fuller hair in just three to six months. Start Nutraful today and make the hat optional. Visit nutraful.com and enter promo code PROP G for $10 off

• 14:23Scott Galloway?

  your first month's subscription and free shipping. Find out why Nutraful is the best-selling hair growth supplement brand at nutraful.com, spelled N-U-T-R-A-F-O-L dot com, promo code PROP G. That's nutraful.com promo code PROP G.

• 14:44Scott Galloway?

  Support for the show comes from Vanta. As AI adoption grows, so does your company's security risks and requirements. New frameworks, audits, and vendors keep piling on, but your team isn't getting any bigger. Most compliance tools promise automation, but you're really stuck doing all the work by hand, chasing screenshots, validating controls, and playing catch-up when audit season comes around again. Vanta works differently. The Regentech Trust platform is built to scale with you, not slow you down. With over 1,400 automated tests across 400-plus integrations, Vanta collects evidence and monitors your controls year round, cutting your audit prep by 82%. Plus, you can access the Vanta agent everywhere you work, whether your team is in Vanta every day or living in tools including Claude

• 15:26Scott Galloway?

  or Cursor. Want proof? Over 16,000 fast-growing companies like Ramp, Ryder, and Harvey save time and resources while scaling fast with Vanta. Learn more at vanta.com/profg and get $1,000 off. That's spelled V-A-N-T-A dot com slash PROP G for $1,000 off.

• 16:01Scott Galloway?

  Welcome back. Here's our conversation with Hemant Taneja, a managing director at General Catalyst and author of Unhealthcare: A Manifesto for Health Assurance and Unscaled: How AI and a New Generation of Upstarts Are Creating the Economy of the Future. Hemant, where does this podcast find you?

• 16:20Speaker 02

  I'm sitting at my home in Las Altos Hills.

• 16:22Scott Galloway?

  Nice. So let's, ground zero venture capital. Let's talk about, give us the state of play in the venture capital ecosystem, valuations, trends. What is your Cliff Notes on the industry, if you will?

• 16:36Speaker 02

  Yeah, this is incredibly active time. It feels like this is the golden age of venture capital right now. And I say that because lots of companies are getting started. We're busier than ever. And when you think about the kinds of businesses that have been built over the last decade, they're all scaling to be much bigger than we ever thought. So, you know, this kind of, this idea that you can actually have 50, $100 billion companies and so many of them all at the same time. I mean, it's unprecedented. You know, markets are rewarding that and more capital is flowing into space. It's, it's, it's exploding everywhere I look.

• 17:14Scott Galloway?

  Yeah, I think of in the late 90s, I started a company called Red Envelope that was backed by, amongst others, Weston Presidio, Sequoia, I mean, just a ton of, Ron Conwath, Andrew Fund. I remember a guy was on my board, Mike Moritz, and I remember everyone congratulating him because they had sold PayPal for like $900 million. And we were just all blown away that a private company could grow to be worth a billion dollars. That just seemed staggering to us. And that was such an enormous kind of watershed moment. And now I'm an investor in a company called Public. They just raised money at a billion dollar valuation. I mean, it just seems as if the numbers, the scale of the numbers has gone.

• 18:00Scott Galloway?

  Parabolic and I don't know, it strikes me that we've, well, let me put it this way. I feel as if I've been here before and every time I'm here, I think I'll be smarter this time and diversify and recognize this can't go on forever. Where do you think we are in the cycle? I mean, no one knows, but it just feels, it does feel kind of frothy right now. What are your thoughts?

• 18:19Speaker 02

  Look, it's, it's frothy and the ideas are bigger. I think both of these things are true. Like when, when I got into venture business 20 years ago, the math was you had a three, $400 million fund and if you got lucky and sold something for a billion bucks and you returned the fund, you were a legend, right? Now you can invest at a billion dollars and have a thesis of why something can be $10 billion or $100 billion kind of a company. I mean, like, you know, that, there, there's so many data points in, in that zone that you can actually have venture return in terms of the performance, even at that price. Why is that? It's because the sheer size of the market is much bigger. When you're, when you're building a healthcare delivery system, you're not selling software to healthcare.

• 19:02Speaker 02

  You're building a new, you know, neo-bank, you're not selling financial software to these companies. So like the paradigm has changed. And so that is flowing capital into this industry in unprecedented ways. The whole, if you think about all the major firms, they're all changing to adapt to this, this market dynamic. Our, our job is different, right? I mean, our job is not to go sell at a billion dollars. As you said, our job is to say, can you go create a, help create a company that's going to endure and be worth a hundred billion bucks and actually invest along the way because, you know, you have the most insight into those businesses.

• 19:41Scott Galloway?

  Yeah, it strikes me whenever you speak to quote unquote tier one venture capital firm, one of their criteria is how much capital they can put to work because they've been able to raise such extraordinary funds in terms of size. So one of their criteria is how much capital they can put to work over the course of the lifetime of the company. If you think about the life cycle of a company and you think about the different investment stages, you have seed, seed slash angel, then venture, then growth, then pre-IPO, then public markets, then mature company, then distressed. And every point of the value chain seeds and accretes power.

• 20:22Scott Galloway?

  I'll put forward a thesis and you respond to it. My sense is seed is difficult right now because there's a lot of companies that get started. That it's just very, it's just a very risky part of the ecosystem. The infant mortality rate is really high still with startups. And then venture is amazing. Growth a little bit is being replaced by SPACs, which seem to be reaching into growth's turf and saying, no, you're, you can skip your series D and E and just go public. It's great to be a public growth company. It's awful to be a mature public company. And distressed always offers, in my opinion, opportunities because people, people don't like the, just as if people, you know, the same reason that we discriminate against old people. People have a tendency to avoid troubled companies.

• 21:07Scott Galloway?

  And I always thought that that's an under-invested asset class. Tell me where you think in the, the life cycle and the investment cycle, there's been advantage seeded and accreted.

• 21:17Speaker 02

  Yeah, so I actually think our view is if you think about each of those stages, you can have a high multiple investment opportunity in a plethora of companies. And so the change that's happening in the industry is our job is to catch these companies as early as possible, preferably as to seed. In some cases, we actually incubate, like we did, you know, 20 years ago with Kayak or six years ago with Levango, and continue to invest across those inflection points. Because, I mean, look at some of the companies that have gone public in the last few years. They've got a 10, 20x return even from public market, leave aside from seed.

• 22:01Speaker 02

  So our, you know, our perspective is we need to learn to invest across all these stages with great regard for finding teams, market dynamics, and business models that actually can keep inflecting. So you've got this interesting dynamic where folks like us are saying, hey, let's bring our builder's mindset to differentiate and be part of these enduring companies. And then you've got the public market investors that are coming and saying, hey, let's commoditize early and early investing, essentially flood the market with the capital. And the ones that catch on will continue to concentrate in the public markets.

• 22:39Scott Galloway?

  And where do you see, when we talk, I've always thought the market dynamics or sector dynamics will trump individual performance, that it's better to be good in a growing great sector than great in a sector that doesn't, you know, I'd rather be good in AI right now than great in wearables is an example. What sectors do you, do you as an investor want to put the most wood behind right now?

• 23:01Speaker 02

  You know, I'm focusing a lot on healthcare. Obviously it's going to a major transformation. And I know you've spoken and written about that a bunch as well. I think fintech still has a lot on a global basis. That's going to continue to happen. That thing's quite interesting. You know, one sector where I know you talk a lot about it, which is education. I haven't quite figured out how to capture, you know, large amounts of value in there in terms of the transformation, but theoretically there should be. And I gotta tell you, like the intersection of software and biology is very interesting to me. It transforms the pharmaceutical industry in massive ways, which then changes how we think about healthcare and healthcare

• 23:43Speaker 02

  services. And I also think some of the cryptocurrency stuff with this premise around decentralization is really quite interesting. And I think the quality of founders that are getting into that space now, you know, seems to be very promising. So we're, I mean, as I said in the beginning, we're busier than ever because these are all massive transformations. And as a multi-stage, multi-sector firm, we obviously can't afford to miss these. And so, you know, we're all working very hard to get our arms around so much change all at the same time.

• 24:18Scott Galloway?

  So talk about why you're excited about fintech. We use the term decentralization, but what is it about decentralization of finance or printing money or central banks? What is it that makes fintech such an interesting space right now?

• 24:32Speaker 02

  Well, fintech in general is an interesting space because the

• 24:37Speaker 02

  Consumer experience around banking and access to capital across

• 24:44Speaker 02

  the different segments and then also, you know, small business and enterprise experience has a lot that's going to change. I think there are two separate elements. One is just how does the stack get modernized? You know, you're seeing that with, you know, whether it's in banking or lending, a lot of industry companies scaling. My decentralization comment is about then how how do we get money to move on the internet, just like packets do? And, you know, transform the the business models in that regard. I mean, every country, there are interesting, you know, banks emerging. We're we're sort of tracking that on a global basis. You know, if you look at companies like Stripe, which were, you know, investors from about a decade ago.

• 25:27Speaker 02

  You know, what they're trying to do in sort of rethinking the entire commerce stack, treasury solutions, payments, lending, you know, Shopify, Square, and that's those are massive trends. And these companies have a long headroom ahead of that, of that transformation.

• 25:43Scott Galloway?

  You talk a lot about or the term used as economies of un-scale. What do you mean?

• 25:49Speaker 02

  Yeah, so, look, in the in the 20th century, scale was the word we were obsessed with, you know, we scaled, we scaled health systems, we scaled schools, we scaled banks, we scaled corporation. And all those systems started collapsing under their own weight, right? If you think about the last 20 years, banks failed, you know, school system, we know is it's quite broken. You know, health system, we just saw what a colossal failure we just dealt with. It was on its way to bankrupting us and we just saw what happened with the pandemic. So all these systems started

• 26:24Speaker 02

  collapsing. And and I think it's because it was all about mass production to provide these core services in society that were good enough. And as we have gone to this platformization of the vertically integrated stack, distribution, manufacturing, customer access, computing, and you can start renting all these core services, the ability to build businesses that would have been subscale by servicing sort of small niches of customers, mass personalization just wasn't there before. Now it is. And so any idea, you can actually rent all aspects of scale and service, you know, that segment of consumers, doesn't matter how big or small. So it just, it just transforms.

• 27:08Speaker 02

  And, and I think economies of one scale is that power of mass personalization that is taking share from the inertia of mass production of the 20th century.

• 27:20Scott Galloway?

  So apply that. You said you weren't entirely sure how you capture value in the, you know, the coming disruption in education, but it sounds like you're more, or you have more visibility into the, how to capture value in healthcare. Try and break down for us, and I know, you know, 72% of the US economy, a big industry. But what are your major themes around investing in healthcare? And why do you think it presents such an opportunity?

• 27:44Speaker 02

  Yeah, so look, the, the biggest thing that's happening in healthcare is we're reorienting from a geographic health system to the internet. Just like we organized content, community commerce on the internet over the last 20 years, we're now doing that with care. And, and the core premise is we're trying to reorient care in the context of consumer personas. So over the last seven years, we built this company called the Vongo, which basically focused on the 32 million consumers with chronic conditions like diabetes and said, how do we give them a phenomenal consumer experience? And that is focused first and foremost on keeping them healthy,

• 28:26Speaker 02

  on getting them to disengage from their diseases as opposed to engaging, which is just a design principle. And sort of doing that in a way that actually bends the cost curve. I, I, I think healthcare is one of those areas, as we said, is 17% of GDP. We want to reduce that so that there's more resources available for better living. And then in order to accomplish that vision, which I think will take us the next, in the better part of the next decade, we need a whole new software stack. We need distribution models that bring these services to market. And then finally, we also need to figure out how to align the various stakeholders. You know, one of the biggest issues there, as you know, is who pays? Who decides? Who benefits?

• 29:11Speaker 02

  Different stakeholders. How do we actually bring rational economic behavior? The last thing I would say is the workforce needs to be heavily transformed in this space. We have too many people in these hospitals that are working on billing codes so they can get paid and not enough people taking care of people that have mental health issues in the field. There are some places where software should go play a role, a much deeper role. It's actually going to create a dislocation in workforce. But then there's other places the workforce needs to be created, like mental health or elderly care and so on.

• 29:43Scott Galloway?

  Mm hmm. You founded or co-founded the Advanced Energy Economy, an organization focused on transforming energy policy in America. Why does our energy policy need transformation?

• 29:56Speaker 02

  So if you and I were staring at the very first internal combustion engine 150 years ago, and somebody said that this is going to transform society, but it's also going to climb, going to create climate change. How would we have used that technology differently? Just ponder that for a second. We did not do that and we ended up creating a whole inertia in our energy and power systems over the last hundred years. Didn't know this unintended consequence was going to happen. And then before you know it, you've got this deep amount of inertia in sort of energy and power consumption sources that are powering society.

• 30:38Speaker 02

  What we're trying to do now is figure out a way to unwind all that and move towards what we call, advanced to us is clean, affordable, secure power. And and how do we actually create an interesting market opportunity to move the industry towards, again, advanced energy? And, you know, it's a complicated task because, you know, nobody wants to pay more for power.

• 31:08Scott Galloway?

  Mm hmm.

• 31:09Speaker 02

  We need new sources of demand. Ironically, I would say, you know, Elon and Tesla have had the most impact in chipping away at this problem because they've actually made the transportation system, or at least demonstrated that in the auto, in the cars part of it, an application on the power system. Because we had two different energy systems in the country, transportation and power. By making one an app on the other, on the grid, we created all this demand that now we can service with these advanced sources of energy. And innovation is the only answer here. We gotta get us onto these modern sources of energy that are, you know, low carbon, affordable and secure.

• 31:50Scott Galloway?

  Yeah, so you talk about Tesla. What else do you think is, I mean, I have a difficult time, I have a difficult time wrapping my head around Bitcoin. I also have a difficult time wrapping my head around the valuation of Tesla. And a lot of bulls will say it's an energy company. How, explain, explain to our listeners and the host here, how is Tesla an energy company and not an automobile company?

• 32:13Speaker 02

  Yeah, look, I have a, I have a hard time wrapping my head around the valuation as well, because at the end of the day, you've got a certain amount of manufacturing capacity and you can only sell so many cars and, you know, Tesla today is valued at multiple of all the auto industry combined. But the thing they have done, and this is an important point, that is perhaps across sector, is they have transformed the experience that the consumers have expected to embrace. People love that car. And so what that has done is it has forced every other automaker.

• 32:50Speaker 02

  Off their ass to essentially acknowledge that they need to move in this industry.

• 32:55Scott Galloway?

  Yeah.

• 32:56Speaker 02

  Well, what a policy was going to do that the consumer demand and the consumer expectation is doing that. So the fact that the whole industry is moving towards transportation and application on the grid reduces the task at hand of transforming the overall energy mix. It's not, it's not like if you're burning coal on the other side and doing electric cars, that's maybe not necessarily as good for the environment as marketed. But what it does is it does create this new demand and it change the energy mix. So that's why I find Tesla very interesting. It's like all the, you know, hype in the stock price, that to me is, I guess it's tremendously overvalued in my opinion, but you know, everybody who's been proven, proven wrong, don't short it.

• 33:38Scott Galloway?

  Yeah, I know. I said that when it was at 50 bucks a share. By the way, be careful when you say that Tesla is undervalued. I've, I've got my eyebrows and my face blown off or ripped off there. So let's, let's, I want to shift to the venture capital community, the gestalt, if you will, the complexion or the character, the community and, and region. And I'm about to make some stereotypes here, so forgive me. I find that the tech community and specifically the tech community in the Bay Area is infected with what I would call a third base virus. And that is they conflate luck with talent. And that there is a general expectancy and a general viewpoint amongst people in tech.

• 34:22Scott Galloway?

  And I think I'm somewhat infected by this too, that we're the innovators. We should play by a different set of rules. We should pay lower taxes. We're doing God's work and tend to forget just how fortunate they are. And that there is a, I don't know, an ugliness to the, the viewpoint in Silicon Valley. Feel free to push back on that. Well, how do, what is your response to that?

• 34:47Speaker 02

  Yeah, look.

• 34:50Speaker 02

  First thing is, there are bad apples in venture, just like there are bad apples in every other. Uh, I mean, that's just, so, you know, humanity specific comment. So there's definitely some of that. And, and you see that in the companies that blow up, that were just, you know, fundamentally fraudulent. I have a view that what happens to, uh, these companies, where you go from being lucky and humble to invincible. You know, these folks weren't bad people. Then you get attrite in this like business model and scale and success. And you see your, your, your decisioning, uh, starts to be compromised. I mean, if you remember, you know, uh, in the case of Facebook, exactly want to go public.

• 35:31Speaker 02

  And, and now you're on the advertising juice and, you know, you're going to monetize everything. And so I, I think this, this happens along the way. And the reason this happens is we don't have a framework for building these companies with regard for unintended consequences. And once we're faced with those unintended consequences, then profitability, there's, these companies find themselves at odds between, you know, are we building for profitability and, and return or societal good? And one of our core focuses, as we think about the digital transformation of society over the next decade, is figure out a way for the company building process, both from the investor perspective and the entrepreneur perspective,

• 36:15Speaker 02

  so that there's a clear alignment between, uh, having financial return and societal return. I, I'm not going to disagree with your, your blanket statement. I'm just trying to, trying to understand why we get there and how we actually have a, a better set of company building processes to avoid those, those scenarios.

• 36:35Scott Galloway?

  Do you think that some of it is that government isn't doing its job? That we haven't elected people who will, uh, hold tech companies and innovators to the same standards they hold other industries? And our tax policy, whether it's 1202 or capital gains, that everything has just been sort of tilted. I don't want to say rigged, but tilted towards the innovation class that, that the innovators in Facebook, whether it's section 230, whether it's tax policy, just get to play by a different set of standards. And any industry that's allowed to play by better rules or, or more favorable rules would take advantage of that, that it's really a failure. When you talk, when I hear you talk about externalities, isn't, you know, i- isn't, isn't that government's role?

• 37:16Speaker 02

  Yeah, so there's a massive lack of impedance match between government and policy and technology today. Right. When Microsoft got hit by its antitrust, they sent regulators on campus to actually watch what business practices were being done. Today, if you, you know, if you think about doing that to Facebook or Google, um, what are you going to do? You're going to send people to share these servers where this stuff is actually algorithmically being done. The idea of regulating uh business practices, it should also be a software enabled idea. So like I, I think there's a major overall, the Commerce Department that needs to happen where you start to create these software watchdogs.

• 38:00Speaker 02

  That actually understanding what is happening, you know, they can be measuring for the unintended consequences that are emerging out of these things as well. Policy used to get created in a retrospective way and it was, it was okay. Cause these businesses weren't scaling that fast and you had the benefit of years and sort of problems emerging and you got to solve them along the way with policy. Now that's not what happens. We organized all of society online in like a decade. And next thing you know, you're getting blowing up democracy because you're never have a chance to understand what was going to go wrong, let alone intervene and mitigate it. So how do you, how does the government become more um software adept? In understanding how these companies, these digital businesses operate, how they use machine learning and data, how their decisions are being made.

• 38:44Speaker 02

  The answer is yes, Scott, like in terms of the government needs to play a better role, but boy, they are so far away uh from uh being able to play that role.

• 38:54Scott Galloway?

  Isn't a lot of it too, though, that the feels of Washington has been overrun and then until there's a perp walk. You know, people are angry that uh we keep setting up uh systemic financial risk as there was never a perp walk. No one was sent to jail for the financial crisis. I mean, at some point, when these tech companies, just their fines are just kind of a function of doing business. And the numbers, as you referenced, are just so enormous. I mean, don't at some point, at some point, don't these investigations or these penalties have to be criminal? Or this, this regulation lobbyist, it just becomes a, a price of doing business?

• 39:36Speaker 02

  Yeah, look, first of all, this idea that they're tech companies doesn't make any sense. And they're banks and they're healthcare institutions and they're schools. You know, I mean, I, I really think getting um this next crop of entrepreneurs to take this responsibility very seriously needs to be done. I don't think that necessarily has to be just, you know, laws and, you know, sticks. It's also carrots. It's also like, how do we rethink governance? Uh, is how are we uh asking the right kinds of questions in diligence and in board meetings? And sort of pushing for uh this level of intentionality uh in terms of is this business that is doing really well in the short term also fundamentally aligned with long-term interests of society?

• 40:21Speaker 02

  That question gets asked. It's always, well, if you get big enough and something is broken, that's a good position to be in, right? That's the traditional mindset that we take in terms of company building. I, I, so, so I think all stakeholders have to think differently if we're gonna uh continue to uh work on this digital transformation successfully and, and not have these unintended consequences like we just had in media. Like, can you imagine what that could be in healthcare? If we make the wrong side of decisions and how we bring these services and therapies to populations this fast with Moore's Law behind it? Right? I mean, like, so much could go wrong. And so in every one of these sectors, we just have to be careful in how we approach the act of company building.

• 41:05Scott Galloway?

  So in every podcast, I like to take pause when I hear something that strikes me as exceptionally or important or really insightful. And, and the comment you just made really struck me, and that is, what if, what if we let the same things happen that we've allowed to happen in media with algorithms of amplification that divide us and enrage, enrage us? What if those same negative outcomes or externalities infiltrated our healthcare system? I mean, that is, I have never thought about that before, and simply put, that is fucking terrifying. That to think that we might foster a new generation of entrepreneurs that some people would say blitz scale, or I would argue that it's sociopaths and it's what

• 41:50Scott Galloway?

  happens when you replace civics courses with computer science. But what if some of the the negative attributes that become nitro meets glycerin with processing power were to permeate or infiltrate our healthcare system? I think that is terrifying. I'd never really, never really thought of it that way. Do you think we can prevent that just with, I always feel as if we're imposing or hoping that the next generation is going to be more noble, that they're, we're going to instill in them a set of qualities or a code that is better than previous generations. And granted, this is cynical, but it doesn't mean I'm wrong. I've always thought that in a capitalist society, when it's raining money, your vision gets blurred. And there's a core group of people that will always

• 42:32Scott Galloway?

  be principled, but for the most part, people make incremental decisions to get wealthier that might lead them down the path to hell. But people at Altria were good people, the people running Exxon are good people. You know, what, let's talk about that. Is there, does there need to be an oversight body? Does there need to be more regulatory scrutiny? How do we get to the starting gate and ensure that healthcare, that we don't have the Mark Zuckerberg of healthcare where we're, that can't be removed from office, dual class shareholder, creates hundreds of billions of dollars, has a PR department that's bigger than the newsroom at the Washington Post, and basically overruns Washington and continues

• 43:14Scott Galloway?

  to kind of, and I apologize, I'm being very aggressive here, levy damage. What can we do at the outset around the flood of venture that is going to healthcare?

• 43:24Speaker 02

  Yeah. So, look, first of all, every stakeholder has to treat this sector with a sense of responsibility. The capital providers, the entrepreneurs, the policymakers, the FDA, everybody. Because it is scary as to what we could be creating on the other side. You know, I can tell you a way to formulate the

• 43:45Speaker 02

  Nirvana, in terms of what should come out on the other side of this, you know, I always use this example, whether it was a diabetes coach at Livongo or a primary care physician that Teladoc Ramwell had, or a specialist at Mayo in person, they should have all the data and the intelligence required to serve that consumer in the safest, most cost-effective way. Now, think about that and the business practices required to actually enable that kind of a world as opposed to what happens and what happened in health tech 1.0. Silo data with the HRs and, you know, it's our property and you're not going to understand

• 44:27Speaker 02

  this particular thing about this consumer, even though that might have saved their life, right? I mean, that's the way this industry was structured and we have to somehow get this next generation of entrepreneurs to understand that the responsibility of keeping people healthy on the other side requires a set of collaboration and business partnership mindset and orientations that are, it wouldn't be natural to you if you were trying to be just purely capitalist and sort of create your own mode. And so, you know, as, as an ecosystem builder in this industry ourselves, what we're trying to do is we're trying to get our founders together to try to realize that vision, try to make sure that they can

• 45:08Speaker 02

  reinforce their understanding of the consumers across each other and, and service them better, service them more cost effectively, reduce the GDP of healthcare, as I said, and keep people healthy versus spending money on sick care. So, so I do, I do think there's a huge amount of focus that has to go into rethinking the design principles of doing business in this sector to set this up in the right way.

• 45:33Scott Galloway?

  Hemant Nenjia is a managing director at General Catalyst and the founder of the firm Silicon Valley Operations. He's also the author of Unhealthcare: A Manifesto for Health Assurance and Unscaled: How AI and a New Generation of Upstarts Are Creating the Economy of the Future. He joins us from his home in Los Altos. Hemant, stay well.

• 45:57Scott Galloway?

  We'll be right back.

• 46:02Scott Galloway?

  Support for the show comes from Vanta. As AI adoption grows, so does your company's security risks and requirements. New frameworks, audits, and vendors keep piling on, but your team isn't getting any bigger. Most compliance tools promise automation, but you're really stuck doing all the work by hand, chasing screenshots, validating controls, and playing catch-up when audit season comes around again. Vanta works differently. The Regent Trust platform is built to scale with you, not slow you down. With over 1,400 automated tests across 400-plus integrations, Vanta collects evidence and monitors your controls year-round, cutting your audit prep by 82%. Plus, you can access the Vanta agent everywhere you work, whether your team is in Vanta every day or living in tools including Claude or Cursor. Want proof?

• 46:47Scott Galloway?

  Over 16,000 fast-growing companies like Ramp, Ryder, and Harvey save time and resources while scaling fast with Vanta. Learn more at vanta.com/profg and get $1,000 off. That's spelled V-A-N-T-A dot com slash prof G for $1,000 off.

• 47:09Scott Galloway?

  Support for the show comes from Northwest Registered Agent. Your business identity is everything that makes your business legitimate and professional, from public records and compliance to your website, email, and phone number. With Northwest Registered Agent, you don't just form a business, you start a complete foundation built for privacy, credibility, and growth. Northwest Registered Agent has been helping small business owners and entrepreneurs launch and grow businesses for nearly 30 years. They are the largest registered agent and LLC service in the US, posting over 1,500 corporate guides, all of whom are real people who know your local laws and can help you and your business every step of the way. When you form your business with Northwest, you get a complete business identity, not a stack of vendors to deal with. That includes registered agent service, a business address, operating agreement, domain,

• 47:53Scott Galloway?

  website, professional email, phone number, and built-in privacy. In other words, your home address, personal email, and phone number stay private. Don't pay hundreds or thousands of dollars for what you can get from Northwest for free. Visit northwestregisteredagent.com/profgfree and start using free resources to build something amazing. Get more with Northwest Registered Agent at northwestregisteredagent.com/profgfree.

• 48:31Scott Galloway?

  Okay, it's time for Office Hours, my favorite part of the show, based on the show Frasier, which I used to watch with my mother, and one of my favorite shows, the part of the show where we answer your questions about the business world, big tech, higher education, and whatever else is on your mind. If you'd like to submit a question, please email a voice recording to [email protected]. Question number one.

• 48:51Speaker 03

  Hi Scott, Troy from Melbourne, Australia. As I'm sure you're aware, Facebook just blocked all news media from appearing on its platform in Australia without any warning as a response to the new media bargaining code that's coming into effect soon. There's a bunch of background as to how this came to be in the Murdoch empire's squirrel group on the Australian political landscape. But at the end of the day, it forces Google and Facebook to pay up for news media appearing on their platforms. Google's responded with a new, what they call the news showcase, which is paying publishers for their content in that feature. And Facebook just really threw the toys out of the pram. Question for you is, do you see this as a watershed moment for other governments around the world to get

• 49:34Speaker 03

  their revenge and wrestle back some control from Facebook? Will the removal of news from Facebook spread globally? And if so, will it be appropriately relegated back to just cute baby videos and motivational quotes, therefore dramatically reducing its engagement liquidity for advertising? And will that, in a parallel with Apple's punch to the throat to their advertising model, start to actually spell the end for Facebook long term? I'd love to hear your thoughts and love the show. Thanks.

• 50:06Scott Galloway?

  A really thoughtful question, Troy from Melbourne. I think Sydney is the most beautiful city in the world, but I think that Melbourne is the most soulful city in the world. I think if I moved to Australia, and I've actually thought about it, and I'm considering, I'm considering. I'm just so glad we get to talk about me. I'm thinking about, I don't like, I live in Florida and I don't like the idea of raising my sons as teenagers in Florida. I just think there's something in the water here that creates a certain element of batshit crazy. When you read about some guy who, you know, killed his entire family and his neighbors and then took his dog for a long walk, it's usually, you usually go, okay, that guy's from Florida. And there's something about teenage boys in Florida that kind of scares me.

• 50:50Scott Galloway?

  So I am contemplating, I said, if the world is our oyster and time's going fast, and I think a lot about how fast time is going and the fact that I'm going to be sitting on my deathbed before I know it, or lying on my deathbed. Well, that's cheery, isn't it? Anyways, it's motivating for me and one of the things I want to do is I want to move. And I'm kind of, it's kind of come down to London for me or Australia. And I think if we did move to Australia, I'd want to live in Melbourne. Anyways, we soon may be neighbors, but that's not why you called in. Okay, the whole Facebook, Australia. First off, first off, first lesson, don't fuck with Australia. Don't fuck with Australia. Australia is America with backbone when it comes to big tech. And think about it, Australia gets all the weaponization of their elections, gets all

• 51:35Scott Galloway?

  the tax avoidance, gets all the monopoly abuse, gets all the division, gets all the rage, but gets a fraction of the upside. We, you could argue that in the US, or I think you would argue the word net gainers from big tech. The problem is where the word net, and that is we get a lot of prosperity, we get a lot of stock market value, we get a lot of hiring. Amazon is the largest recruiter out of my class at NYU. I would argue that Facebook is actually, among all of them, the only net negative. I think the world would probably be a better place if the earth opened up and swallowed Facebook. By the way, I wouldn't want anyone to be heard in the tremor-like earth opening, end of days kind of activity I'm envisioning here. I would just want the company and the corporation to disappear. So what happens?

• 52:20Scott Galloway?

  I actually believe that the internet should be open and you should be able to circulate links to a media property and then it's up to the media property if they want to put a gate on it. I think that Facebook's concerns have real legitimacy here. And also, let's be clear, the individual... The wizard behind the curtain here, and the curtain being this legislative action, is Rupert Murdoch, who is Uncle Satan to Zuckerberg Satan. So if there's a war between Mr. Zuckerberg and Mr. Murdoch, which this is, I'm rooting for the bullets. And so let's be clear, this is not a clean issue. Having said that, having said that, when you're Facebook,

• 53:01Scott Galloway?

  and you continue to lie, and you continue to do damage, when you show up, it's like when Jeffrey Dahmer shows up to a picnic with egg salad. And who doesn't love egg salad? Maybe he just wants to bring, maybe he just wants to make the picnic a brighter place with that, that buttery yet sublime picnic treat known as egg salad. But no one wants Jeffrey Dahmer at their fucking picnic because they don't trust the guy. Because guess what? His activities and his history speak louder than any intentions or any argument. So I would argue Facebook has a very strong argument here, but it just doesn't matter. Everyone is fed up. It indicates something larger too, Troy. And that is the immunities are starting to kick in against Facebook. I predicted two years ago that Facebook would be banned

• 53:44Scott Galloway?

  by a Northern European or Latin American country. And I got it wrong. I think it's going to happen in Australia. And this is sort of the first incremental step towards banning Facebook. Supposedly, they've come to some sort of agreement, and Facebook's VP of Communications, Campbell Brown, who I think is a interesting, thoughtful, and competent person, you know, everyone gets, everyone should be allowed an opportunity to sell out and go make bank on her as an effort for that. But I'm disappointed because I thought she was a great journalist. But she said that, she put out this bullshit quote, that we support journalism in Australia as we always have for journalists globally. Oh, my God. Yeah, right. Anyway, I like what's going on here. I like the pushback,

• 54:25Scott Galloway?

  even if the pushback, quite frankly, is sponsored by the original Satan, Rupert Murdoch. I think it indicates that the world is fed up with Facebook. I think this is slowly but surely going to result in a country effectively banning Facebook. So I think this is going to be interesting. I think there's some larger trends at play here. Another feature to be thought about here, another thing that we can think about or learn from is what Google's done. Google's backed off and said, Now, we're going to solve this problem. We're going to reach into our pockets and we're going to solve it with cash. Why? Why? Google's trying to pull an apple. They're trying to disarticulate from Facebook. As we often do, it's easier to stereotype companies or group people and companies into one general assumption. And we, I do it all the time. We call them big tech.

• 55:09Scott Galloway?

  The bottom line is, Apple is not Facebook. Google is not Facebook. And I think Google saw an opportunity. A, they wanted to solve the problem. It's going to cost them a couple hundred million dollars. Fine. They, they can't start their hat wide here, but they can make it a lot less black, if you will. However, however, what they really want to do is they want to separate from Facebook. I think Facebook did not handle this well, did not handle this well. I think that they have a legitimate argument. They want to be indignant. They want to play power. You know, they want to, they want to pull a power move, take their advertising ball and go home. And then what do you know, a bunch of public service information and health information goes dark. Oh, I wonder if that was an accident. It felt a lot like Chris Christie deciding for political reasons to increase traffic in residential neighborhoods in New Jersey. How'd that work out?

• 55:54Scott Galloway?

  Former Governor Christie, who's on the road pitching opportunity zones, I think. Anyway, anyway, I don't think Facebook's handled this well. And Google saw an opportunity to pull an apple and disarticulate away from, from the nephew Satan to Murdoch Satan, and that is Mark Zuckerberg and Facebook. Next question.

• 56:13Speaker 04

  Hey Scott, Michael here from Phoenix. One company I haven't heard you talk too much about is Stripe. And I wanted to get your thoughts and reaction on reports this week that Stripe was raising their next round at $100 billion valuation. And that shares were being sold on the secondary market for 115 billion. Most recent reports from 2019 suggests that Stripe was processing transactions in the area of 250 to 350 billion. Do you feel like the company's overvalued? And what tips and tricks would you have for a person like me interested in buying shares of privately held companies on the secondary market? Look forward to your insight and thoughts. Thanks very much.

• 56:54Scott Galloway?

  Thanks for the thoughtful question. Michael from Phoenix. My dad lived in Paradise Valley in Phoenix. When my mom and dad split up when I was eight, he moved to Ohio with his third wife to take a job with a promotion with OM Scott, the fertilizer divi- my dad literally sold shit. Literally sold shit. Metaphorically and actually physically. I remember people coming over to our house in Laguna Niguel and bringing like a crock pot or bringing like, I don't know, cutlery or pans and barter. And my dad would give them bags of fertilizer. Anyway, moved to Columbus, Ohio, Worthington, Ohio. Essentially abandoned me, but that's an entirely different issue to go to work for OM Scott.

• 57:39Scott Galloway?

  And then began a slow wind down of his career as he was part of what I'll call the reengineering generation. Remember reengineering, which was basically Latin for fire everybody back in the eighties? And slowly but surely worked his way down the corporate ladder and ended up in Arizona in Paradise Valley. But I used to, the thing I remember about it is how beautiful the sunsets were. And that's where my dad got me into running. One of the wonderful things my dad got me into at a very young age was physical fitness. Anyway, that's not what you asked. That's not what you asked. Okay, so Stripe. The payment space and Bitcoin is just, or more, or loosely speaking, the payment space is one of the mini spaces. I just can't wrap my head around. I will say, I think Stripe is a juggernaut.

• 58:22Scott Galloway?

  Whether it's undervalued or overvalued, I don't know. What I will tell you, what I would tell you is about investing through the secondary markets, things like Forge, Second Market. I think there's another one called Micro Ventures. Anyways, there's a few of them. A couple of things. One, they are typically fee laden. You have to spend between four and 10% on fees. And I would argue if you were going to do that, I mean, a couple of things. I think the algorithm or the algebra of wealth is find sectors that you think are growth sectors. Payments qualifies, right? Bring discipline and focus, and that is focus on making more money than you spend. Stoicism, live below your means.

• 59:06Scott Galloway?

  Live below your means such that you can start putting money into investments. It sounds like you've done both those things. Then it's time. Don't buy stocks you don't want to hold for years. And then it's diversification. Make sure you're not more than 30 or 40% if you can help it, or 50% if you're younger in any one sector, and try not to be more than 10 or 15% in any one stock or more than 5% when you get to my age. So anyways, payments, you sound like a responsible guy. It sounds like you're doing all of this. What I would suggest is if you're going to do this, do your homework, find out where shares are available, and try and see where you can get the lowest fees, if you will. Fees will eat up returns. And two, diversify. If you're going to do this, if you're going to buy shares in the secondary market as

• 59:49Scott Galloway?

  a retail investor, know you're playing at a disadvantage versus the institutional guys. You have to pay higher fees. And to create a basket, don't just do Stripe, do others, whether it's, I know SpaceX has an active secondary market. If you like payments, try and find a few others. Again, the key, the key, the algebra of wealth, algebra of wealth. Focus, focus on something that you're great at such that you can make money. Stoicism, always spend less than you make, live below your means, times diversification, times time in the market. Thanks for the question. Good luck. Okay, algebra of happiness.

• 1:00:34Scott Galloway?

  The biggest story, the biggest story of the year so far is that reportedly data out of Israel shows, shows that your transmissibility post-vaccine is reduced by 89%.

• 1:00:49Scott Galloway?

  This is enormous. This is so exciting, so exciting, because there were, there was real doubt around, okay, I get a vaccine and I'm protected, but I can still transmit it, or that was the fear, right? So, so there's less of a reason to get a vaccine. If you're 30 years old and healthy, and of a certain demographic, specifically you're thin and white and have OT type blood, your odds of having, your odds of mortality from this thing are, you know, probably no greater than pneumonia or flu. So, that led to a narrative I kept hearing among a cohort that I know, that I'm gonna wait. And that is, I'm not

• 1:01:33Scott Galloway?

  in a high-risk group, I'm in a low-risk group, and I'm gonna wait. And my view was, well, okay, boss, it's not about you. It's about not being a node of transmission. It's not, it's about not being a web, a fiber in the web of death that's snaring people across our nation. We can't figure out the exact attribution of who's a node of transmission. There's a, by some estimates, somewhere between a third and two-thirds of people who have this thing and transmitted, may not have even known they had it when they transmitted it. Anyway, we now know, we now know that, that it appears, it appears your transmissibility goes way down. So, the question, the question we need to ask ourselves when it comes to

• 1:02:13Scott Galloway?

  the vaccine, is not, are you afraid of getting COVID? It's, are you afraid of someone you love getting COVID? And let's talk about that. Do you love other Americans? Do you love seniors? Right? We all, we all want to love our brothers and sisters across the nation. So, this is a way to express empathy. This isn't just about you. This isn't about you. This is about others. And now, there's proof that you don't need to be a fiber in this web of death. We need more empathy. And I say this a lot, and I'm trying to practice it, and it's important to say it out loud, but Twitter, Facebook, treat you to be more terse and more of an asshole. They treat you to dunk on other people. Dispersion,

• 1:02:58Scott Galloway?

  regressing, or reverting, or retreating to our homes and distancing.

• 1:03:03Scott Galloway?

  Less interaction, less empathy. We don't see the homeless vet. We don't see the single mother. We don't see people of different income groups at the mall, or at the restaurant, or at the movie theater. We have to practice empathy. We have to, we have to say out loud, how do I love other Americans? How do I express that sort of, you know, what is love? No, I don't think anyone really knows love until they have kids. And I define love as something you care more about their wellbeing than your own. I never felt that in the remotest sense in the world until I had kids. And then thought, Jesus Christ, it's no longer about me. And it's just funny, when I sit with

• 1:03:44Scott Galloway?

  my kids, I sit with my boys, and I eat with them, and we talk about their homework. And you know, you have those moments as a father and as a parent where your heart just wells up. I was thinking the other day that my 13 year old, he's two thirds gone. I got him for another third. His first 13 years have gone so fast. I got another third, I got another six years with him, and time keeps going faster. And he's gone. He's out. And I was so, my heart was so heavy. And, and I remember thinking, you know, I wanted to express to him, you know, you know how much we're gonna miss you when, when, when you leave for college and it's going so fast. And, you know, I just sort of gave up. There's no way anyone can understand it. There's no way anyone can understand

• 1:04:26Scott Galloway?

  it until you love something for the first time. And for me, that was when I had kids. And as I've gotten older, I've realized, okay, love is not just something that happens naturally. Love is something you need to practice. And it just strikes me that to say out loud, to think out loud, I'm going to love other Americans. I am going to make sacrifice. I'm going to insert a function into this equation, into this algebra of concern for other people, regardless of the inconvenience, or regardless of the calculus I've done around my life. Get vaccinated. Express love to our brothers and sisters across the nation.

• 1:05:06Scott Galloway?

  Our producers are Caroline Shager and Drew Burrows. If you like what you heard, please follow, download, and subscribe. Thank you for listening. We'll catch you next week with another episode of The Prop G Show from Section 4 and the Westwood One Podcast Network.

• 1:05:26Speaker 05

  Your heart can tell you a lot about your health. Apple Watch Series 12 measures your heart rate every 5 seconds with the most accurate heart rate sensing and wearable. So your vitals app, now with heart rate variability, can tell you when something is off. And your readiness score can let you know when to rest and when to push. Hear the story in every heartbeat with Apple Watch Series 12. The features described are for wellness purposes only and not for medical use. iPhone 11 or later required. Based on Apple conducted study of heart rate accuracy, August 2026. Visit apple.com slash apple watch series 12.