Prof G Markets: Apple’s Headset Bet, Sequoia’s Big Breakup, and Hypocrisy at the PGA Tour

This week on Prof G Markets, Scott shares his thoughts on what product Apple should be focused on to create more shareholder value, rather than its Vision Pro headset. He also explains the real reason why Sequoia Capital is spinning off its China and India units. And finally, he discusses the PGA Tour’s decision to merge with Saudi Arabia’s LIV Golf. 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.

• 0:01Scott Galloway?

  Support for the show comes from Northwest Registered Agent. Your business identity is everything that makes your business legitimate and professional. With Northwest Registered Agent, you don't just form a business, you start a complete foundation built for privacy, credibility, and growth. That includes registered agent service, a business address, operating agreement, domain, 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.

• 0:48Speaker 01

  Your heart can tell you a lot about your health. Apple Watch Series 12 measures your heart rate every five seconds with the most accurate heart rate sensing in 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/aplewatchseries12.

• 1:18Scott Galloway?

  This week's number, $10. Salesforce is donating $10 to local charities for each day an employee shows up at work. I give at least 10% of my earnings to charity, another 5% to Destiny, and a few percent to other strippers.

• 1:43Scott Galloway?

  Welcome to Prop G Markets. Ed, you love that.

• 1:46Ed Elson?

  Yeah, that was good. That was actually pretty good.

• 1:49Scott Galloway?

  Today, we're discussing Apple's headset, Sequoia Capital's spin-off plans. That should be interesting. And the PGA Tour's merger with Live Golf. Here with the news is Prop G Media Analyst and stage name Ed Elson. Ed, step away from the pole. Tell us about the markets.

• 2:07Ed Elson?

  Before we do that, Scott, I just want to let you know that I would happily accompany you to the Champions League final this weekend.

• 2:14Scott Galloway?

  That's right.

• 2:15Ed Elson?

  Just gonna put that out there.

• 2:16Scott Galloway?

  I'm taking my 12-year-old son to see Man City versus Inter Milan. And I didn't, I said to him, I said, who should we support? And he was just disgusted that I would even ask and he's like, Man City is the enemy.

• 2:30Ed Elson?

  He's not a Man U fan, is he? Isn't he? He's Tottenham, right?

• 2:33Scott Galloway?

  Yeah, my oldest is Tottenham, my youngest is Chelsea, but they both were sort of Man U for this one versus Man City. I didn't realize how many people dislike Man City.

• 2:41Ed Elson?

  Well, they just bought their way to success. That's how it goes though.

• 2:45Scott Galloway?

  There you go. That's why this podcast is called markets. All right, get on with it.

• 2:49Ed Elson?

  Let's start with our weekly review of market vitals.

• 2:58Ed Elson?

  The S and P 500 was up and Bitcoin tumbled before paring back some of those losses. Shifting to the headlines, Instagram was found to be hosting and promoting accounts used to commission underage sex content. European Union Commissioner Thierry Breton demanded that parent company Meta take immediate action to combat child pornography on its platform. Meta stock fell 4% on the news. CNN ousted its chairman and CEO Chris Licht, sending Warner Brothers Discovery shares up 8%. His tumultuous 13 months on the job started with shutting down CNN Plus. GameStop also fired its CEO and promoted Ryan Cohen to executive chairman. That sent shares down more than 21% and it erased roughly half of the stock's gains for the year.

• 3:44Ed Elson?

  And finally, the Securities and Exchange Commission sued both Coinbase and Binance, accusing them of operating unregistered securities exchanges. The SEC is also accusing Binance of mishandling funds, lying to regulators, and alleges that its CEO Changpeng Zhao committed civil fraud. Scott, what are your thoughts?

• 4:04Scott Galloway?

  I don't think GameStop will be around in 10 years. I've never, it became a meme stock and brought a lot of attention to it and people keep hoping at some point tomorrow will be today regarding the future of GameStop. And a store-based video game retailer just absolutely makes no sense to me. I know they do more than that. But if you look at the four-wall unit economics of this company, even with its crash and its market capitalization, it is still wildly overvalued. CNN is interesting. The thing that struck me is they fire Chris Licht and the stock goes up 8%. So why does the market take this company up a billion dollars in value because they fire the head of CNN? And what I think it says is not that they're excited about a new person, but that the market thinks that there is no room in the middle.

• 4:49Scott Galloway?

  And that trying to be a centrist organization doesn't work in this media environment. And they should go back to throwing red meat at the far left and just embrace who they are, just be themselves.

• 5:00Ed Elson?

  Such a shame, I think.

• 5:01Scott Galloway?

  I think it's a shame too, but it's, I think the market has kind of spoken that, you know, go, go centrist, go broke. And if you think about the shit he got in a lot of trouble for, the Trump, the Trump Town Hall, the firing of Don Lemon, the firing of Brian Stelter, I would argue that these things are, you know, quite frankly, just upset the left. And so the reason he's out of there, they say he quote unquote, "lost the room", that the journalists and the people in the newsroom just lost faith in him. Actually, the real reason is he spoke to me and offered me a show, no joke, about three and a half weeks ago, true story, which gets anyone fired. Literally, I'm the Typhoid Mary of television. But what he was doing kind of made sense. He wasn't a bad guy.

• 5:45Scott Galloway?

  I don't know him well, but I know him. Some of the execution was very ham handed. He did not acquit himself well. But for the market to go up a billion dollars based on the head of one division stepping down means the market sees something deeper. And the only thing I can figure out is the market said, "Go back to being the far left and go back to commentary and entertainment as opposed to news." Because that is what rings the register. The most disturbing news here of all this is Instagram, that a lot of accounts were used to commission underage sex content. And I want to be clear, I would imagine a lot of people at Meta, most people at Meta are horrified by this. I bet Mark Zuckerberg's horrified by this.

• 6:29Scott Galloway?

  But what plagues American corporations is not immorality, but amorality. And that is if there's enough distance and enough money in between me and the people this is impacting, my technology. I sort of ignore it. I come up with reasons not to feel like I'm making immoral decisions. They weaponize government. They've gotten away with so much. Their optimization for profitability over any sort of moderation or fact checking of content. They know what's going on, but they ignore it. Meta continues to be the mendacious fuckery of mendacious fucks. And the saddest part about all of this is that when a company or an individual does one or two really bad

• 7:11Scott Galloway?

  things, it horrifies people and they risk real retribution. But if you keep doing terrible things, people become numb to it. They begin to expect it. And that's what's happened with Meta. It's just you can't even name the number of times you thought that the government should move in. And I've said this a bunch of times before, and the letter of the law should be followed here, but until somebody does a perp walk, I don't think any of this changes. I'd actually like you to go first on Binance and Coinbase.

• 7:44Ed Elson?

  Well, the interesting part, I think, Scott, is what they're accusing both the companies of. So if you look at the complaint, they're saying that each company is operating as a securities exchange, a broker, and a clearing agency. And the SEC says that if you want to be any of those things, you have to register with the SEC. Neither of them have done that. So what's implicit in that complaint is that both of these exchanges are trading securities. And the US definition of a security is anything that involves a person investing in a common enterprise with the expectation of profits based on the effort of others. That's the definition. And the SEC has decided these are securities. Now, here's my question. If

• 8:28Ed Elson?

  the SEC believes that these are securities and that these companies are securities exchanges, why did they approve Coinbase to list itself as a publicly traded company, which they did back in 2021? So I was trying to figure out the answer to that question. I found something really interesting in the SEC complaint. So the SEC said this, quote, "Declaring effective a Form S1 registration statement does not constitute an SEC or staff opinion on or an endorsement of the legality of an issuer's underlying business."

• 9:03Ed Elson?

  Now, this struck me because I have always thought that that is exactly what the SEC's job is, that before a company goes public, the SEC has to determine, is this thing legal? And if that's not the case, the thing that I find most disingenuous is the fact that only now is the SEC deciding that they care about the legality of this business. Only now, once the damage has been done, the bag's been dumped, after countless frauds and Ponzi schemes that have collapsed, millions of retail investors have lost literally billions of dollars, only now do they care about what's legal and what isn't. Honestly, the only explanation I can come to is that back in 2021, the SEC, like the rest of us, just

• 9:47Ed Elson?

  didn't fully understand crypto. I feel that the SEC should be real with themselves and recognize, maybe publicly recognize, we made a mistake and we should never have let this thing list on a public exchange.

• 10:00Scott Galloway?

  I think that's really powerful, Ed, and I would bet that the volume of trading and the financialization of everything has vastly outpaced the resources that the SEC has allocated by a Congress that doesn't want enforcement, because the people who usually violate these laws and the reason the SEC is there are rich people. But I would bet that the SEC, one of their defenses would be say, folks, we're dealing with so many different, everything from SPACs to crypto to an unbelievably robust IPO market through 20 and 21, you know, we're just, we're barely keeping up. Having said that, the SEC is

• 10:40Scott Galloway?

  supposed to, they will tell you they're supposed to protect investors. In this instance, they didn't. I mean, a lot of investors, a lot of retail, I've always said the SEC doesn't protect investors, it protects management. It's there to create a series of terms and there to essentially ensure that management has access to the public markets. But I've always thought the SEC erred on the side of companies versus investors, that they weren't true to their mission. But I think your point is a really valid one, that it's like when the sheriff shows up after the bank has been robbed and everybody's dead, it's like, well, okay, it's good you're here. I agree with you. I think that these agencies have some

• 11:20Scott Galloway?

  splaining to do. And there was such a movement that made you feel lame and old if you questioned the brilliance of these companies and their promoters, even as it was just pretty clear there was. I remember this conversation where I asked you when FTX went down, what's the difference between FTX and Binance? And you basically said, I don't think there is any.

• 11:41Ed Elson?

  Binance is next because the thesis here is very simple. If your business is predicated on existing outside of the law, and generally that means existing outside of the US, which has probably the strongest regulatory environment in the world. If that's the first pillar of your business and second, your sector is in structural decline, there's just no way that you can win this game.

• 12:01Scott Galloway?

  I just want these things to go away. I think that there's Bitcoin does have some utilities to store value, helps people get out of volatile currencies. Other than that, I'm just looking forward to not speaking about this shit again because it's a fairly unimportant market. It's worth, what, a trillion dollars? Apple's worth $3 trillion. Can we just all, can we all just move on?

• 12:22Ed Elson?

  We'll be right back after the break to discuss our reactions to Apple's headset.

• 12:32Scott Galloway?

  Support for the show comes from Nutriful, 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 Nutriful. Nutriful has formulas built for men at different life stages. They have Nutriful Men for guys age 18 to 49, plus the new Nutriful 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 Nutriful today and make the hat optional. Visit nutriful.com and enter promo code PROP G for $10 off your first month's subscription and free shipping.

• 13:17Scott Galloway?

  Find out why Nutriful is the best selling hair growth supplement brand at nutriful.com, spelled N-U-T-R-A-F-O-L dot com, promo code PROP G. That's nutriful.com promo code PROP G.

• 13:35Scott Galloway?

  Support for the show comes from Upwork. Trying to scale your business? At some point, you're probably going to hit a point where you need some help. Sometimes, the best way to break through that is bringing in the right talent at the right time. Upwork can help. Upwork is a one-stop platform where you can find, hire, and pay expert freelancers across more than 125 categories. Whether you need specialized skills for a single project or extra support to keep up with demand, it's easy to connect with experienced professionals, review their work, and find the right fit. You can move faster without taking on the commitment of full-time hires. And for businesses that need the very best talent, Upwork Business Plus provides access to the top 1% of freelancers on the platform. AI-powered matching connects you with qualified candidates in under six hours, cutting down the time spent searching.

• 14:18Scott Galloway?

  Upwork also takes care of contracts, payments, and other administrative tasks, so you can spend less time managing logistics and more time focused on what's next. Visit upwork.com/profg right now and post your job for free. That's upwork.com/profg to connect with top talent ready to help your business grow. That's U.P.W.O.R.K. com/profg. Upwork.com/profg.

• 14:52Ed Elson?

  We're back with Prof G Markets. Apple unveiled its most ambitious hardware product since the iPhone, the Apple Vision Pro, a mixed-reality headset controlled by your hands, eyes, and voice. The headset has a variety of uses, from watching movies, to browsing the web, to FaceTime. And unlike other headsets, it has a feature called Eyesight that makes the user's eyes visible from outside the device. However, it's very expensive. The Vision Pro will cost $3,499, even more than analysts had expected, and nearly 12 times the price of Meta's Quest 2 headset. Apple shares briefly hit an all-time high the morning of the announcement, but soon dipped and closed the day down 0.8%.

• 15:34Ed Elson?

  Scott, last week, you predicted this headset would be one of the biggest tech failures, and that it would be the final nail in the coffin for the AR/VR headset category as a whole. Now you've seen the products, where do you start?

• 15:47Scott Galloway?

  It's impossible not to think that any product that Apple launches on that day doesn't have a real shot at success. First of all, every product they've launched in this millennium has gone on to be just a seminal consumer product globally. Whether it's AirPods, the iPod, I mean, everything they do kind of is gold. A lot of people would argue, well, that means this will work. I would argue it means that this is likely to fail because I think reversion to the mean is is one of the most powerful forces in the universe. In addition, I'm sticking to my guns here. I think this thing doesn't work. And just as like, can we all admit that crypto outside of a couple of things with mostly a levered Ponzi scheme? Can at some point, we just admit that people don't want to put shit on their head?

• 16:31Scott Galloway?

  And I think it's just a violation of basic anthropology. And that is the only things we will put on our face are devices that make it less likely we will be eaten. Because we can see and or make money because we can read that is glasses. Or they make us more likely to have a random sexual encounter because they increase the elevation of our cheekbones, which makes us more attractive to mates. And also, I just want to be, I have a bias here and I I'm really freaked out. That people of your generation are slowly but surely being sequestered from each other.

• 17:07Scott Galloway?

  And life in general, through these reasonable facsimiles of the real world on Coinbase, on YouPorn, on Twitter, on Netflix, on Tinder. That essentially creates lower risk, lower calorie life. And that people have less and less reason to not only leave their home, whether it's Zoom or whether it's a dating app. And less reason to engage with people, endure the rejection such that ultimately they can understand the victory of real friendship, of real mentorship. Real romantic partnerships and develop the skills that they need for the rest of their lives. And also, I think it just makes people more depressed. And whether you're

• 17:49Scott Galloway?

  an orca, whether you're a dog, the worst thing you can do to a mammal is to sequester it. Leave your dog alone. See how he or she reacts. Put an orca in a tank alone. We are not meant to be alone. We're not meant to have anything getting in the way of our ability to look each other in the eyes. So I just, I find all of this trend, whether it's shooting people to Mars or into a metaverse and these devices and these platforms, really disappointing. I also think it's a no man's land in terms of a price. At 3,500 bucks with sales tax, you're up towards four grand. And I would imagine the technology here is so cutting edge that it gets perishable pretty fast. So the way I look at stuff is the useful life of a product. A computer costs a thousand bucks now, lasts four years, five years, you're

• 18:34Scott Galloway?

  losing 200 to 300 bucks a year. A pair of sunglasses costs you 200 bucks, hopefully hold on to them for five years, that's 40 bucks a year. This thing, I can't imagine this thing isn't going to be outdated within 12 months. So let's give them benefit of the doubt, let's say 24 months. So it's 2,000 bucks a year to have a headset? Yeah, I think once you get above, once you get to this weight class in terms of price, it needs to be more enduring technology. I mean, you're getting to the point now, at 2,000 bucks a year, that's the cost of a lease on a Toyota or a Hyundai. So what do you want? Do you want a Hyundai or do you want a mixed reality headset from Apple?

• 19:16Ed Elson?

  What if it weren't a headset? What if it looked like the Google Glass? You just wear the thing, you're free, you've got your peripheral vision, and it has all of the same features and you use your hands and your eyes to select things. And it basically just works as a phone, that is, an interface that you just see in front of you.

• 19:35Scott Galloway?

  Game changer. Game changer. I think that works. I think if I can put on a pair of- Effectively Ray-Bans or Purse-Salves and it has this sort of technology built into it? Boom. But supposedly the technology just isn't there. That it's, we're about a decade away.

• 19:51Ed Elson?

  Finally, last year, we wrote this post where we tried to picture what Apple would need to do if it hit a trillion dollars in revenue, which no company has ever done. We suggested a lot of different categories. We said banking, search, health, fitness, home products, also cars. Apple trades at 30 times earnings. If you compare that to Tesla, Tesla trades at 66 times earnings. We did not mention headsets or spatial computing or VR. But if you were Tim Cook, what would you be focusing on?

• 20:22Scott Galloway?

  Three things, a car, a car and a car. Tesla's taken a low margin manufacturing based business to a high margin software based business and that all spells Apple. And the ultimate self-expressive product is probably, other than where you went to college, is probably your car. It says a lot about you. And then maybe number three is your watch. And the car is so self-expressive in terms of what it says about you for so many people, not as much for people of your generation, but people of my generation. And I think the most valuable waiting list ever assembled would be the day that Tim Cook announces a car and opens the waiting list. I think there are a ton of automobile manufacturers with excess capacity that would partner with

• 21:03Scott Galloway?

  Tim Cook and, you know, co-pilot on the design, an electric vehicle that had some autonomous technology. I just, I'd buy one. I think anyone who makes over a certain amount of money would get on that waiting list. I think it'd be the mother of all waiting lists. And the auto industry, there are just very few industries that move the needle for Apple. And the automobile industry is one of the biggest in the world. And I think Tesla is ripe for disruption. The disruptor should be disrupted. Its design, to me, has gotten stale. I don't think their products look especially appealing. I think it was a truly differentiated design six, seven years ago. There's a sameness now around Tesla. And I think Apple has, and specifically Tim Cook, because brands get personified, has such a better brand.

• 21:48Scott Galloway?

  I think right now the Elon Musk and Tesla. So I would have just loved to have seen Apple and they still might. They still might.

• 21:54Ed Elson?

  Completely agree. I mean, you look at the sales of this headset projected to do 150,000 units in its first year. If you assume those projections are correct, that means that the headset is going to bring in $525 million. That's 0.1% of Apple's annual revenue. Apple makes $395 billion a year. So, I mean, it better be the greatest long-term play of all time because based on its first year, this is going to do absolutely nothing to the company.

• 22:33Ed Elson?

  Venture capital firm Sequoia is spinning its China and India units into two new entities distinct from its US and Europe operations. The firm said sharing the Sequoia brand across borders has created market confusion and portfolio conflicts. This, of course, comes amid an increasingly tense US-China relationship. Biden has been working to restrict investments in China and TikTok is under intense scrutiny with Montana taking steps to ban it. Meanwhile, one of TikTok's biggest investors is Sequoia China. It has a 10% stake in the parent company ByteDance. In other words, running a global investment business has become, to quote Sequoia, increasingly complex. The split will take effect by next March. The China unit will

• 23:15Ed Elson?

  be renamed Hongshan, the India unit to peak 15 partners, and the US-Europe unit will remain Sequoia Capital. Scott, what's your reaction to this?

• 23:25Scott Galloway?

  So that sentence in there, "The firm said sharing the Sequoia brand across borders has created market confusion and portfolio conflicts." That's a bald-faced lie. That has nothing to do with this decision. This decision is that they are worried that they're going to get caught in the crossfire of a US-Cino conflict where American investors might not be able to invest or register a gain from ByteDance if ByteDance doesn't comply with US regulations. And what they're sitting on top of is potentially $100 billion in gains. And the partners at Sequoia want to make sure they have access to that. So they'll create a Chinese unit that's subject to Chinese laws or international laws, of which there are very few, not subject to the long arm.

• 24:07Scott Galloway?

  Of Uncle Sam or regulations, or they can do whatever they want and they won't come under fire for it. Full stop. It has nothing to do, oh my God, that's hilarious. It's increasingly complex to run a decentralized global investment business. So we're going to simplify by splitting into three different entities? Yeah, that'll, that'll simplify things.

• 24:26Ed Elson?

  Do you think that there's an argument to be made that this is sort of a good thing from a national security perspective? And that is Sequoia is arguably the most iconic influential VC firm in the world. The fact that they're doing this will probably set a tone that going forward, US VC firms shouldn't invest in Chinese companies and vice versa. There'll probably just be less cross-border investing at this point.

• 24:50Scott Galloway?

  I don't know. I, I think that VCs will go where the money is. And I think there's a benefit to this, and that is there are people who will, and organizations that will just pursue a return on invested capital. And moral clarity for them isn't high up on their list. That's not to say there aren't a lot of great citizens out there who run companies and try and do the right thing every day. But if there is opportunity in tainted baby milk and it's not regulated, there will be a VC who will fund it. And I'm not saying it's Sequoia Capital because they're so rich that they probably, you know, can be a little bit more selective and not get involved in stuff like that. But, I mean, Christ, look at the people.

• 25:35Scott Galloway?

  Look at the people, these investment banks. They're, they're good people. I know them. Look at the shit they took public. They knew, they knew retail investors were going to lose a ton of money. They knew it. They knew this stuff was shit. And they still underwrote it. I mean, look at the people in crypto. Not bad people. They really think that, you know, Cum Rocket is a place to, to store value. You know, you want to be a good citizen. You want to have some fidelity to the Commonwealth. You want to be a good employer. But for-profit entities are primarily there for profit and to create economic security for them and their shareholders.

• 26:09Ed Elson?

  We'll be right back after the break to discuss the PGA Tours merger with Liv Golf.

• 26:24Scott 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. Their Agentic 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?

• 27:09Scott 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.

• 27:32Speaker 03

  This episode is brought to you by Michelob Ultra. Good times mean competitions between you and your friends, like seeing who can throw some pigskin the farthest or rush the field the fastest. Winner gets an Ultra. Because it's not just a superior-like beer, it's also giving fans superior access to their favorite sporting events. Superior is worth playing for. Visit michelobultra.com/superioraccess to enter. Enjoy responsibly. Copyright 2026 Anheuser-Busch InBev Michelob Ultra Beer, St. Louis, Missouri.

• 28:10Ed Elson?

  We're back with Prof G Markets. The latest conquest in Saudi Arabia's sports washing campaign is golf. The PGA Tour merged with its Saudi-backed rival Liv Golf after a long and very public dispute. Ever since Liv Golf emerged last year, it's gone head-to-head with the PGA, issuing lawsuits and counter lawsuits, and poaching PGA-registered golf players. Liv offered Phil Mickelson a $200 million contract, which he accepted, and they offered Tiger Woods an $800 million contract. He rejected that one. Many PGA players and leaders have expressed their concern over Saudi Arabia's influence on this league. Rory McIlroy said he, quote, "hates Liv and hopes it goes away." And the head of the PGA Tour, Jay Monahan, said that anyone who ignored the Saudis'

• 28:53Ed Elson?

  history of human rights abuses was, quote, "living under a rock." But the two parties are now setting all that aside. The PGA Tour will send its revenue to a new collectively owned, for-profit entity, uniting it with the European circuit known as the DP World Tour and Liv Golf. The PGA Tour will still exist, but primarily as a governance body. So, Scott, we've been covering Saudi Arabia's sports interests for a while now. You've made your position quite clear. You think the pay-to-play model will work. It's worked so far, buying sports teams like Newcastle United, recruiting sports stars like Cristiano Ronaldo, but this is the first time they've purchased an entire sport. What does this say about the future of sports and the Gulf States' role in it?

• 29:37Scott Galloway?

  Simply put, it's what Logan Roy said in episode three of season two, "money wins." And this is, I think, the biggest business story of the week, that essentially, the Kingdom has executed a creeping takeover of a sport. And they didn't just buy a team. I mean, it's one thing when they buy Newcastle, they have bought a sport. And I don't have a problem with the Kingdom of Saudi Arabia and the US becoming closer. I think we should. I think it's very difficult to have moral clarity around geopolitics. And the Kingdom, regardless of what you think of their LGBTQ abuses and Khashoggi and all of that, warrants

• 30:20Scott Galloway?

  scrutiny and caution, but I think we need to engage them on every level. The Kingdom has one of the largest military budgets in the world, and in a world that's increasingly shaping up as Europe and the US versus China and Russia, the swing votes become India and the Kingdom. They sit on a reservoir of tens, if not hundreds, of trillions of dollars in capital, known as oil, and whoever has the best relationship with them is going to get a disproportionate amount of that economic benefit. And I think that should be us. But as much as a capitalist I am, I've said at this show, at the end of the day, it's mostly about shareholder value. There has to be some rule of fair play. There has

• 31:03Scott Galloway?

  to be some semblance of character here. There is no individual more hypocritical in business right now than Jay Monahan, and that's the head of the PGA. Because as he is putting pressure on players not to accept huge offers to play for Liv, these athletes whose money-making years are finite, they maybe have, really have five or 10 years to make enough money to support them and their families for the rest of their lives. They bought into, a lot of them bought into the argument and said, Jay, we're with you and we believe you're right. I don't want to be associated with the kingdom. I have a problem with their, you know, the way they acquit themselves. And they turned away these

• 31:46Scott Galloway?

  tens of millions of dollars. And while he's making these morally indignant arguments, he's negotiating with them and agrees to a merger or a takeover? I just find that if you're going to weaponize geopolitical, if you're going to weaponize 9/11, if you're going to be emotionally manipulative of young golfers and trying to urge them to do this for moral reasons, then boss, you got to die on that sword.

• 32:13Ed Elson?

  Yeah. And just to clarify the arguments that he's made. So you mentioned the 9/11 thing. He basically suggested that Liv golfers were betraying the victims of 9/11, of the 9/11 attacks. And he also said, according to Senator Chris Murphy, he said that PGA officials were in his office talking about how the Saudi's human rights record should disqualify them from having a stake in a major American sport. He also canceled a sponsorship deal with Raytheon because, quote, "The company sells missiles to Saudi Arabia." Those are the arguments that Scott, you're referring to. But he's also made the business case. And it's difficult here because he has a both apparently a moral incentive,

• 32:56Ed Elson?

  but mainly a financial incentive from the beginning to protect the PGA Tour. And last year, he said, quote, "We welcome good, healthy competition, but the live Saudi Golf League is not that. It's an irrational threat that's not concerned with a return on investment or true growth of the game," which to me basically aligns with your view that Liv doesn't have any of these financial constraints because its backers don't care about a financial return. All they care about is soft power, brand influence, national awareness.

• 33:26Scott Galloway?

  Well, Liv Golf essentially did what Netflix and Amazon have done. And that is they came to the party with cheaper capital and overwhelmed the competition with capital. And you can't compete against the kingdom. They just have more money and they are looking for non-economic return. PGA is looking to invest a billion dollars and get a billion 200 million a year. The Kingdom is looking to invest a billion dollars a year, maybe get half a billion back and have people feel better about the Kingdom and diversify into sports. They can't compete with that. Now, there might be an antitrust argument. There might be a CFIUS argument. And by the way, I think Jay, what he should have done was made those arguments, held out and then sold out for a big number. The business end selling out to the Kingdom, negotiating,

• 34:09Scott Galloway?

  fighting them hard on antitrust, crying foul that they're competing on non-economic terms. That's business. That's full-body-contact capitalism. This is a bridge too far. The whole 9/11 and the moral argument. I don't think he laughs. They say Chris Licht, the final straw for him was that he lost the room. I love that term. He lost the room. And that is the journalists and the people in the newsroom no longer supported him. I would be shocked if Jay hasn't lost the locker room. If I'm some golfer that turned down 20 million bucks.

• 34:44Scott Galloway?

  You know, I would refuse to be in the same room as this guy. I don't mind Darwinism. I don't mind capitalism, but for God's sakes, just be a little bit more honest about it.

• 34:53Ed Elson?

  Finally, the other big news in sports is that Lionel Messi turns down an offer from Saudi Arabia.

• 34:58Scott Galloway?

  Come on, go Messi. Greatest player in history in my book now.

• 35:03Ed Elson?

  They would have paid him $400 million a year. Instead, he's going to Miami, where he'll play for David Beckham's MLS football club, Inter Miami. Does that news change your perspective on this sports washing campaign?

• 35:16Scott Galloway?

  This was the best business news I got all week. You know, I saw Messi play. I saw the best kind of older player square off against the best younger player, Mbappe, at what is the greatest football match in history, the finals of the World Cup. And I was with my sons and it was just one of those moments I'll remember the rest of my life. And I just think the world of Messi seems like a good person. You know, I don't know how much of it is PR and bullshit, but he seems to spend a lot of time with his kids. What he was offered, though, I wouldn't be surprised. I doubt he got 400 million. But he was offered an opportunity to buy a stake in the team. So he gets kind of a call option on Inter Miami, or whatever they're calling it, that if he brings the kind of value they think he can, he then gets an option to buy a percentage of it.

• 36:01Scott Galloway?

  And then it's an Apple and an Adidas contract. And also, you know what won here? You know, the Soho Beach House and the Fiina. I mean, for God's sakes, where would you want to live, Ed? Riyadh or South Beach? The lifestyle in Miami is outstanding. It is hands down, Ed, the coolest city in Latin America, and it happens to be in America. And the quality of life is just outstanding. And for a guy raised in Argentina, who's played in Europe, you know, he is gonna, he and his family, I'm not entirely sure here, but I'm gonna go out on a limb and say that Lionel Messi didn't pick Miami. Mrs. Messi picked Miami. Miami, baby. Oh, my God, that shit's real.

• 36:47Scott Galloway?

  When you got a limited number of years, like me and Lionel, you wanna be, you wanna be in Miami. Can you imagine the sale weekend, what they call the pitch weekend? Beckham taking Messi out for the weekend in South Beach? That must have been a pretty good roll, right? That must have been a pretty good weekend. I gotta think when Ronaldo comes and visits Messi in South Beach, he's gonna go, "Okay, who's the one who fucked up here?"

• 37:16Ed Elson?

  Yeah, exactly.

• 37:22Ed Elson?

  All right, let's take a look at the week ahead. We've got earnings from Oracle and Adobe. We'll also see the consumer price and producer price indices for May, and we'll watch for the Fed's rate hike decision. Scott, what's your prediction this week?

• 37:37Scott Galloway?

  Well, my prediction is Jay Monahan decides that he's gonna spend more time with his family. That he's, you know, they'll try and, they'll try and rub Vaseline over the lens of this or put lipstick on this pig here, but I would imagine in the next 90 days, he's gonna announce that he's moving on, that he's accomplished. He's seen the PGA through a difficult time and ended up with a deal that was good for golf and good for golf fans and good for America. He's gonna declare victory and leave. He's gonna get fired. Okay, this episode was produced by Claire Miller and engineered by Benjamin Spencer. Our executive producers are Jason Stavros and Catherine Dillon. Mia Silverio is our research lead, and Drew Bros is our technical director. Thank you for listening to Prop G Markets from the Vox Media Podcast Network.

• 38:21Scott Galloway?

  Join us on Wednesday for office hours, and we'll be back with a fresh take on markets every Monday.

• 39:09Scott Galloway?

  You're welcome. You're welcome, Claire. Claire still hung them over from San Jose.

• 39:16Speaker 04

  We just moved into our new house and I didn't realize just how close we were to the neighbors. That's when my friend told me about Blinds.com.

• 39:24Speaker 05

  Blinds.com isn't a medication, but it can improve how you feel about your home. Customers who shop at Blinds.com experience excellent customer service, from consultation to installation. Side effects include increased privacy and better sleep. Talk to your partner today and see if Blinds.com is right for you. Visit Blinds.com to order your free samples.

• 39:46Speaker 06

  When you shop pickup at Kroger, you can expect the savings you love and fresh groceries selected just for you. Our associates are committed to getting every detail right, carefully handpicking your items, checking for quality and freshness, and packing your order with care. Because bringing you fresh, quality groceries is what we do best. And right now, enjoy $20 off your first online order of $75 or more. Restrictions apply, see site for details. Kroger, fresh for everyone.