Pivot - Facebook makes a Substack competitor, Netflix's carbon footprint and the future of McKinsey

Episode Date: March 19, 2021

Kara and Scott discuss scandals at Substack as Facebook builds a newsletter competitor. They also discuss a new tool that is measuring the carbon footprint of streaming on Netflix and what that means for the industry. In listener mail, we get a question about whether McKinsey is still the gold standard for early career success. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Not the Bill Maher thing. Amazon's expanding its telehealth program, Amazon Care, to all of its U.S. employees and other companies. We've both been talking about this, but talk about this. This was the idea that Amazon, as it's done with its logistics, and AWS is starting to do this. You mean in 2018, when I predicted a deal that Amazon would as it's done with its logistics, and AWS is starting to do this. You mean in 2018, when I predicted a deal that Amazon would be the biggest healthcare company in the world, and the CTO of Amazon then took to the stage and just called me

a comedian and then refused to answer any questions about Amazon's entry into healthcare. And then you're not heard about that, are you? Look, what was that movie with Brad Pitt and Tom Cruise where we got to see them kiss? Diary of a Vampire. I guess. The Analyze novel. Sure, yeah. Sure?

Yeah, okay, fine. Both hugely underrated actors because they're both so hot. Anyways, he can't survive on rats. And finally, he has to go after humans. And Amazon, if you look at the retail ecosystem. I can't believe you're making this metaphor, but keep going. It works. I'm sorry, handsome gay vampires.

When it works, it works. And then a bridge to Amazon and healthcare. Yes, all right. Let's block this metaphor, but go ahead. If you look at the retail ecosystem, Walmart's done okay. Lululemon's done okay. There's some well-publicized examples coming. And basically, everyone has been sucked dry. Amazon has added more market capitalization than I think all of European retail is worth since the pandemic.

And the bottom line is they need a new carcass. And there just is no carcass as fat and ready as healthcare. And they have been lining up their troops at the border. It's just so obvious that Halo, their food, their acquisition of PillPack, their investment in voice. And it's both a really exciting because this could provide a level of primary health care access to tens, if not hundreds of millions of Americans. But also, and this is why Amazon needs to be broken up, it is going to, you're going to see everyone from hims and hers, which we talked about this week, to Teladoc, to the health care insurance industry and hospital providers. You're going to see everyone

start to shed, start to leak market capitalization to Amazon. Yeah, on a lot of things. And this is interesting, they're using Amazon Care, which is their, you know, it's interesting because, you know, Slack, not Slack, Slack has, you know, started as a communication system within a game company and became Slack. And this is something Amazon was using its AWS system internally and then made it logistics. You can also see them doing logistics that they do at factories and white selling, whatever it's

called, white labeling them. A lot of the things it's doing, this is something it's doing with its own employees, which of which number in the million now. But the ultimate jujitsu move that we'll be writing case studies about for 20 years in business schools is that go line item by line item and take Amazon's biggest expenses. Their biggest expenses as an online or as an e-commerce player was fulfillment. They said, I know,

let's turn our biggest expense fulfillment into a profit center and start Amazon fulfillment. What is probably their third or fourth biggest expense? Healthcare for their workers. So they said, how can we innovate around our own healthcare, test it, and then we're going to turn it into a profit center. No company has been able to take their expense line and pivot every major expense

into an enormous business that drives shareholder value. It really is interesting. But let me just tell you, telehealth is a dicey proposition, of course. You know, delivering pharmacy pills is one thing, which is sort of in their wheelhouse. But, you know, they are dealing with their program. But moving in doctors and stuff like, let me read you. This was from Dr. Jeffrey Swisher about our discussion with him. I have to read it. He's going to keep just driving me crazy with the text, Scott. I Swisher about our discussion. I knew it was coming. I have to read it.

He's just driving me crazy with the text, Scott. I got to deal with it. Let me just read the text that I got and I ignored completely the other night. I was literally screaming at your guest on Pivot today. He was so far in over his head. He has no idea. This isn't medicine. It is millennial band-aid.

So many thoughts. First off, what self-respecting physician spends 15 minutes on video and gets compensated a fraction of some $20 to $30? What about misdiagnosis, malpractice, state's law, ethics, shilling, Viagra, and skincare is one thing, but diagnosing and treating UTIs, my head is exploding. What about actual sick people with diabetes, COPD, CAD? They don't exist in Teletubby medicine land. And then I sent him a winky face and he wrote, I'm telling you I'm screaming at him, he got super animated talking about his fucking SPAC but has no clue about medicine holy shit, this medical advisor was a chief doctor at Walgreens, that is the same company that is, that greenlit

Theranos so he just so here's the thing, what that tells me okay, doctors Dr. Swisher is pissed more than any insight into medicine it's entirely clear to me that neither of you was adopted, that you are in fact related by blood. Yes, yes, indeed. Whenever I hear that.

He's good. D-Swish, D-Swish coming in. J-Swish, J-Swish. D-Swish is the doctor, the lawyer you don't want to meet, but go ahead. Actually, I think I want to meet him. So look, but here's the thing. And I, you know, I love Dr. Swisher. Jeff is like kind of my new older brother who tells me when I'm wrong about three times a day.

Yeah, he yells at you a lot on the Twitter. I need that. I need that. Here's the thing. If you want to get a total gripe fest, total bitch fest, get a bunch of doctors, invite a bunch of doctors over for dinner. Yes. They're anchoring off the high point when doctors 30 years ago had the biggest house in the neighborhood, the nicest car and played golf on Wednesdays.

Yeah. And if you go into, I think of medicine as retail and the shittiest retail in America is gas stations. The second shittiest retail, I think Tesla is more a story of just getting out of gas stations and electrifying the world.

But anyway, the second worst retailell is a doctor's office. I went to my urologist for my monthly complaint around how much I'm paying. And by the way, his internship and residency in Grenada really paid off. He's like, well, dude, you're 56. That's his medical diagnosis every time I complain about how much I pay. You move from gay vampires to your prostate, but go ahead. Hello? We're going to get to your prostate, but go ahead. Hello? We're going to get to the big story in a minute.

A, B, C. All right. So land your plane here. Go ahead. My point is, there's a kernel of truth in everything that Dr. Swisher is saying. You know what? Doctors have stuck out their chin in the medical industrial complex. Think about how shitty visits to the

doctor's office are. They are. Yes, they are. If I went into Best Buy and asked to get information on a flat screen TV, they wouldn't hand me paperwork and say, fill this out for the 15th time and not even stand up, not even make eye contact. There is HIPAA. Well, that's a really interesting point because probably the biggest innovation here or the biggest catalyst for the explosion in telehealth is the pandemic bringing down a lot of regulations, which quite frankly were put up to entrench the incumbents. I think Dr. Swisher needs to get on board here. He needs to join Amazon Care. He could be the chief medical officer for something. Amazon Care.

Yeah. Then he would love it. He wanted to be in a tech company. All his friends went to Microsoft after. I think he's a little bit Jones. Maybe his sister could get him a job. Anyways. I'm an ambassador in this company called 98.6. And we find a third of the people who reach out to us for primary health care. What does that do? What does 98.6 do? I understand what it is. Primary care, remote primary care sold in through the enterprise. So if you're Walmart, who's a client, you spend 10 bucks per month, I think it is, per employee, and they can access primary healthcare

over their phone. It's a series of AI-driven questions that then get you to the right specialist. It's like Amazon Care is going to come and smack you around. Or acquire us and the dog finally gets a Gulfstream. Hello. Because you know what, Kara? What? I'm an interesting guy, but with a Gulfstream, I'd be fucking fascinating. I would love you if that were the case.

I would really like you about 100% more. I'd be fascinating at 0.9%. You'd move from 33% of my mind share to maybe 60%. There you go. At 0.9%, the dog is sexy. Yeah. Anyways, what were we talking about? Vampire.

The doctor's wish for being nice to the humans. But what we find is on 98.6 is that a third of the people that make inquiries about whatever it is, a rash or UTI or whatever it is, they're doing it while they're in a meeting. Think about what a pain in the neck is, like the emotional barriers to deciding, okay, I'm actually going to go to the doctor and being able to just flip open your phone and say, this is bothering me. Should I be worried?

And then they can literally, they can prescribe you something and it can be there within an hour or two hours. So let us say to doctors, I'm going to close this out with the gay vampires, et cetera, is some of this is going to be complex. You'd be a vampire. That'll solve it all.

Some of this is going to be complex with the other things, but a lot of stuff that you go to the doctor for is irritating, and there's a big business opportunity there. And eventually they will get it better than doctors do, because doctors, I'm sorry to say, are very difficult to use as a product. Jeff, you're a product that's difficult to use. Not you, because you dispense drugs

when people are in surgery. His doctors went up. Say more. Yes, he's an anesthesiologist. You can't do that telehealth. The complex stuff is complex and should be. No, that's about a third of expenditures. About two thirds of expenditures.

Are common. Yeah. Delivered remotely. Yeah. Okay. All right, Jeff, we will have you on at some Yeah. It can be delivered remotely. Yeah. Okay. All right, Jeff, we will have you on at some point. You can keep tweeting. I'm literally scared.

Keep texting. I'm scared to check my DMs after I get off this podcast. Oh, no. Does he DM you? I'll have to speak to him. All right. Really quickly. Only gay vampires will be more offended than Dr. Swisher from this.

Oh, God. He's going to don't DM Scott Jeff. Jeez. Anyway, let me just... Last thing in this banter part, by the way, and it's completely unrelated. Facebook will start sharing an annual report detailing the company's impact on

human rights as part of an effort to address criticism of the platform. What do you, shall we subscribe to that? Wait, what was this? Facebook will start sharing an annual report detailing the company's impact on human rights in part of an effort to address criticism on the platform. Well, that's going to be a page turner.

You know what I'd like to do? Can they have that? I'd like to get that on VHS so I can rent it, take it home and erase it. What do you think? I have no. OK, I thought I thought they were doing it. I just. OK, sure.

Whatever. Seems a little cow barn door. I don't know. Let me summarize it. Let me summarize it. We're really awful for the world, but we need to do better and we're proud of the progress we've made. Yeah. Summarize what it'll say right now. What it'll say right now. It's true. By the way, did you hear I'm engaged? Oh, no. You're being mean now. Sorry. I can't. You're being mean now. That is, that'm engaged oh no you're being mean now sorry i can't you're being mean now that's not appropriate um uh later i do want to talk about a movie i saw this weekend

promising young woman i love it it's fantastic what's it called i just promising young woman it got an academy award nomination it's fans have you seen it i can't no i obviously you haven't which means i'm a misogynist if I haven't seen it. No, no, no. It's great. Listen, watch it and we need to discuss it because there's a lot going on there. I want you to watch it.

Wasn't the director nominated for Best Director? Yes, she is. And she also played Camilla Barker Bowles in The Crown. She's amazing. And she was also the showrunner for Killing Eve. She's really quite something. Oh, I like it. Killing Eve is one of my favorites.

This movie will... I want to see Scott Galloway's reaction to this movie. That's really quite... Oh, I like it. Killing Eve is one of my favorites. This movie will... I want to see Scott Galloway's reaction to this movie. That's what I was thinking. It is a mind blower. Really? I have to say. Yes, it deserves the Academy Award. 100%.

100%. And I am a little edible and a little promising young woman. You're going to be freaked out, Scott Galloway. I'm just going to say... The dog lives his life. Up front. This is going to freak you out. I cannotalloway. I'm just going to say it up front. The dog lives his life, Scott Galloway.

This is going to freak you out. I cannot speak to you about it until you see it. Really? Yeah. I'm only remembering because there's a scene where she's dressed up as a naughty nurse. But let us just... You're not going to like that scene. You're going to like it,

but then you're not going to like it. I've never been into cosplay. And I've tried everything, Kara. Just watch it. I've never been into cosplay. You're going to like it, but then you're not going to like it. I've never been into cosplay. And I've tried everything, Kira. Just watch it. I've tried everything. Are we talking about my prostate again? I wish I was watching it with you. I was watching it.

Yeah. So, damn again. We're going to move along to the big story. Let's go on a movie date. Let's go to Alamo Draft House. All right. Well, it's bankrupt. But it's still operating.

Yes, that's true. Okay. We will do that now, you know, once we're all vaccinated and ready to go. All right. Facebook is starting aat. This is a big story. Facebook is starting a substat competitor, speaking of human rights. The platform will include tools for journalists to build actual websites. In addition to newsletters, Facebook plans to start with a small group of writers and plans to pay them to help get it off the ground. Meanwhile, there's trouble in paradise at substat. Some writers are accusing the newsletter platform of allowing anti-trans writing to flourish with

their tools and using their Substack Pro Fund to fuel these writers. It's a little more complex than that because it's also, they're not being transparent of who they're paying. So it's not clear who's actually making money. So they're trying to sort of sell all the others on, you're going to make money here, but some of them, they're paying on top of it. So you don't know where. The economics seem confused. They are really an edit operation when, in fact, they were just saying they were platform.

Anyway, it's quite confusing. Are you talking about Facebook or Substack? Substack. But here's Facebook coming in with a competitor. Same thing with Twitter. And Facebook's going to possibly not charge anything, pulling a Microsoft, you know, Explorer move here on Netscape, essentially.

So what do we think about this? Will the writers use Facebook Substack like a tool? Is there just another Facebook attempt to mimic popular new platforms like TikTok? What do you think about this situation? Well, it's really interesting, whether it's Coursera and Google coming in with certificates,

whether it's Clubhouse and Twitter coming in with, is it called Spaces? Spaces on Twitter. Whether it's, or now it's Facebook coming after Substack. Look, anything with review, but go ahead. But anything I think that gives journalists more opportunities to own their audience and extract higher rents from the platforms that have starched most of the margin out of journalism, I think is a good thing. But there's just no getting around it. I've really benefited from my partnership with Facebook, said no one ever, said no one ever. So just proceed with caution because Facebook- Remember Zynga? Facebook will say, we're creating pages for brands so you can own your audience.

That was literally what they said. Oh, Nike, you need to have a bigger page. So if you pay to advertise, you can have a bigger page. And then just kidding, we own those people and you don't have access to them unless you advertise. So I would just say proceed with caution because, and it's an old saying, and I've said it a long time, caution because, and it's an old saying, and I've said it a long time, Facebook partners with journalists and vendors and media companies like a virus partners with a host. They'll keep you alive long enough such that they survive. Back to vampires. Back to vampires. Eventually it ends poorly for one of the parties and it's not Facebook.

Talk about this idea of why Facebook and Twitter and of course Substack, and we can talk about the issues. I think a lot of people arguing about this issue and by the way there are there is it is it would be nice Ann only knew it's wrote a good piece beyond just the issue of funding people who are anti-trans necessarily is it doesn't stay a neutral platform for one two it's not transparent of who they're funding right and it's not transparent of who they're funding, right? And it's not transparent of who's, I think it's the transparency around the business model is also really problematic in that you don't know who's making money. So why, what, what, how do you look at this shaking out, you know, the expansion of these newsletters and the future of media? Because I think it's, it's a lot more complex than yelling, you know, the people who are being attacked are like, free speech. And in fact, the CEO stupidly tweeted, defund the thought police.

He's trying to like yell free speech in a crowded Twitter theater where everybody can go crazy. But talk about this expansion of the newsletters and the future of media. Because I think that's really, and the business model behind it, I think that's what's really doing it. But they've managed to anger a lot of people and have sort of looking like they're abrogating their responsibility in addressing anti-trans concerns. So, look, it reflects, it's a collision of a lot of big trends around digitization, both good and bad. And the first is that the most talented people get to leapfrog the platforms. It's dispersion of value. And that is when I read Maureen Dowd, I think she has just such, I don't know, facility

or a plume with English language. Even if I don't agree with her views, I just love reading her writing. And the fact that she, if she chooses, can skip this platform, the brand, she's the brand. And the fact that she can own her own audience, which quite frankly is not only presents economic upside, but when you talk about cancel culture, essentially it's, you're not being canceled. It's the platform that comes under fire and decides to fire you. And so great advice to any creator is to establish direct links with your audience and audience. And then quite frankly, not only do you have greater upside, but you have greater downside. And so it's dispersion. The other thing it represents, and this is the scary part,

is that Maureen Dowd and Shira Ovadeh and Andrew Osorkin are probably realistically underpaid. And there's a lot of people at that platform that are overpaid. And what happens in digitization when capital, which is totally agnostic and doesn't care about equity or fairness, all crowds to the best in the tier two, quite frankly, get just swept off the planet. So Substack, there will be on Substack, the top 50 people on Substack will soak up 110% of the economics. And the other 50,000... Although they're accusing them of creating these sort of faux businesses for these people and then facilitating them by pushing them out. So it's not... They're not really successful, or maybe they are, or nobody knows. And how do they make those choices?

What they've done is they've dragged themselves into an editorial discussion when they were pretending to be a benign platform, right? Where anybody can succeed. Any land here, come here and you can grow. I'm sorry. I'm just saying. I think the transparency is the issue because I had an interview with him and he was like, anybody can win on this platform. And okay, but someone who gets $100,000 and a ton of promotion can win a little better, not just because they're good. But anyway, but go ahead. That's no different than any other media platform.

Sure, but they pretend it's not. When MCC has the upfronts, they want Will from Will and Graves. So they want Ross and Rachel because those programs have so far the most success. So they pimp them, they promote them, and then they pull away. And Third Rock from the Sun is like,

we're funny too. You should give us more oxygen. So them promoting the folks that get early traction, I don't see how that's different than what... No, they went out and got them before. So it's just an interesting... I just wish they would be just transparent about what they're doing. And then people could say, who are they giving money to? Why? And then everyone can argue or decide whether they want to be on the platform. It's like, I don't like the ones they're funding. Like, I just think they kind of pulled a fast one

on a lot of their writers. Should Vox publish our agreement, our financial terms? No, but it acts like a media company. It says it's a media company, right? It's not necessarily the financial terms. I agree with you on that issue, but this was pretending it was not doing this and it was doing this that's that's all my issue is is it's it's

confusing i think to a lot of people and so they immediately run to you know well if you said you weren't a media company and you're acting like a media company just tell me what you're doing and i don't know if they need to, to, to do the economics. We're not a media company. We're a platform. Yeah, exactly. And so you're like, just say who you're paying and, and, and what you're doing, what, what they're getting at that I'm not getting. I don't know. I just feel like people thought this was a different thing. That's, that's what I think is one of the big issues behind it. I'm still thinking it out, but, but I,

but I do think behind it is are these, are there, are there going to be newsletter companies that are going to be left-wing and right-wing too? Jason Calacanis brought that up, but other people have brought it up. I don't necessarily think. I just feel like people have to plumb these things a little closer than they do. It's not quite what... And Facebook's a whole other thing, which is that they're going to somehow get the benefit here they have their own like agenda too yeah i look i i have almost no comment do you know jane lynch tweeted at me this weekend yes i know she said i'm a force carol i'm a force okay we're moving to anyway you do have a comment

like what happened who is going to win here i I want you to, you do have a thought. You always win. You have Facebook and Twitter and Substack. Which one of the three, if you had a bet on a horse here? I'm going to go out on a limb here and say that Big Tech wins. They get the gold, the silver, and the bronze medal over the short term here. Over the short term, they'll pretend to give a fuck and like they're helping small business and journalists and slowly but surely they'll starch all the margin and then they'll invite the journalists to their party on the beach and

they'll stroke their hair and tell them what great partners they are and then shoot them in the fucking face oh wow geez okay what about twitter no i'm a shareholder twitter they're They're much nicer. Twitter, look, Twitter, Twitter still has tons of upside because it just commands such incredible influence. And your interest graph is there. That's right there. I mean, it's, I don't, you, I think you and I are both like physically addicted or at least I am Twitter. Yes, you definitely are. And they haven't. I like it, It's a good product. Yeah, I think so too. And they just haven't monetized it as well as the other guys.

It's just not, the bottom line is Twitter's just not as well-run a company as Facebook or Google. Yeah. And you can see, like, could you see, this is my last question, a clubhouse buying a sub stack? Like, so that's, you know, you have your clubhouse thing and then you put out a newsletter

and people, you know, I don't know, they seem to belong together. For me, clubhouse thing. And then you put out a newsletter and people, you know, I don't know. They seem to belong together. For me, clubhouse is like CompuServe, Von Dutch Hats, and White Claw. And that is, I will be excited to say in five years, those were things I never tried. Those are things I never tried. And they went out of business.

You tried White Claw. Don't even lie to the group here. I do like the claw. You called me out and you're right. You ain't wrong. I do like the claw. Yeah. And then I watched Ted and I feel so Caucasian.

I watched Ted videos and I'm like, could I be any whiter? Ted, that is a really dirty movie. And then I listened to the podcast of Bruce Springsteen and Barack Obama and I'm like, oh my God, Caucasian Olympics. Oh, okay. All right. We're going to take a quick break. This is an interesting area.

I think beyond the screaming right now that's going on and I think some of it's quite justified is this is an interesting- What do you think of Clubhouse? I've never been on it. I don beyond the screaming right now that's going on, and I think some of it's quite justified, is this is an interesting... What do you think of Clubhouse? I've never been on it. I don't understand it. I think I'm going to interview the CEO soon. I don't know. I don't know. I like the idea of it. I just don't understand why I would also... Just to like the people on it?

I just don't. I think it could... I think it'll be a fad. I do, honestly. There was a great thread that I tweeted. I think you probably saw it. It was so, this guy was amazing. And I'm totally- I'm going to pay attention. Somebody said this is amazing.

Yeah, it was amazing. It was amazing about where it was going. And I thought it felt like exactly the story. It felt like that's the stories we've written. But I don't know. You never know. You never know what these things are. But brands are brands that have communities. A lot of it is the self-expressive benefit and you decide whether

you want to be part of that community and yeah um there's just certain it's like walking into a club and thinking it's not about the club it's not about the music it's about do i aspire to be part of this this this herd this tribe whatever and i And some of the early ugliness around Clubhouse, I'm like, I just would never want to go to that club. I just never want to be there. But to their credit, they are talking about pivoting to a subscription model, which I think is the right move. And also, I hear about it everywhere.

Yeah, but that's right. You heard a lot. There's a lot of stuff. I want to see the next chapter. I think that's why that whole tweet stream. And I wish I could name this guy. Unfortunately, I can't find it. It's gone. It's gone away in my Twitter stream. But you can go look on my Twitter stream. There's a thing. I think there's a lot of people liked it because it was like, oh, yeah, that's how it could go kind of thing. That's how this could go. But I still like the phenomena. I like the phenomena. I like people chit-chatting. You know how exciting. Think about, I mean, just let's dream for a moment. Let's dream that Brad Pitt is a gay vampire. Let's dream about that. And then let's dream about what happens when they announce they're breaking these guys up? Think about the flurry of activity,

of funding, of new businesses, of excitement. I just think the ecosystem, it would literally be like the ecosystem had a massive rain of nutrients and new oxygen and new sunlight. I think it would be so exciting what would happen. And by the way, a lot of people will say, well, but I love Amazon. You're still going to get all your shit in 24 minutes. It's not like Amazon would die. The majority of breakups, almost all breakups,

result in greater service to the end consumer. You want to talk about when we go to five times a week, when these companies, they decide these companies are being broken up, and we think about all the possibilities for new companies, new competitors, and new companies being funded. You would see venture capitalists raise entirely new funds focused on the new niches and ecosystems that would open up when these guys get broken up by Tim Wu and Lena Khan. Gangster and gangster, gangster.

Fair, fair. So we're going to have a whole flowering. It's a flowering. A thousand flowers are going to bloom and then they're going to be cut down by another big tech company. Anyway, let's go on a quick break. When we come back, we'll talk about Netflix's carbon footprint and take a listener mail question.

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you'll discover what differentiates their investment approach, what learnings have shifted their career trajectories, and how do they find their next great idea. Invest 30 minutes in an episode today. Subscribe wherever you get your podcasts. Published by Capital Client Group, Inc. Scott, we're back. Netflix has released information about how much binging is affecting the planet using the tool called DIMPAC. Netflix claims that one hour of streaming

on its platform in 2020 used less than 100 grams of carbon dioxide equivalent. This amounts to driving an average car a quarter of a mile. The metric is a big step for Netflix to catch up on minimizing carbon footprint. Last year, Microsoft promised to go carbon negative by 2030. Apple announced its own plans to become carbon neutral by the same date.

Facebook is committed to net zero emissions from all suppliers and users. And Google has promised to run exclusively on renewable energy. It's really interesting because there's lots and lots. And of course, there's a controversy about NFTs and cryptocurrency using too much emissions. This is really interesting.

I find it really interesting because this is why. Because as I predicted, the world's first trillionaire will be a climate change technologist, even though I made that up. The fact of the matter is there's all this opportunity here in all these promises of people to start moving into the space in a really innovative way. So what do you think about this? I think people do want to know what their impact is necessarily, especially young people. What do you think?

I think it's powerful. I think what gets measured gets done. And I tell young people to go get a really serious physical because at the end of the day, what you want is baselines around measurement because it's not having a high PSA or high cholesterol alone that's necessarily bad. It's the velocity and the change. And so the idea of having a set of standardized metrics around your carbon footprint such that companies, people, even countries can all commit to getting carbon neutral is really exciting. If we want to take climate change seriously, we have to have common standards

and we have to have measurements. And then ideally it becomes a criteria for funding, taxation, consumer choice. Consumer choice, yeah. It's interesting. It's like knowing what they put into their food and stuff like that. And I know people think it's virtuous,

but I don't actually. I think it's an interesting thing to want to know about. Like someone was saying, I was using Instacart the other day, like, oh, you're using delivery and this and that. I'm like, you know, I get I've gotten into a car

and driven it and parked in a parking lot with all these other cars. And this guy made 10 deliveries. I'm like, maybe we have to figure out how to pay these people better and give them more benefits. Absolutely.

Which is another issue. But I have people better and give them more benefits. Absolutely, which is another issue. But I have a feeling it might be more efficient. But I want to know. I don't know. I was like, I don't know. But I think it might be. And it's an efficient use of my time because I can make more money doing other things and employing other people. Anyway, it's just an interesting, this carbon footprint thing.

Bill Gates has talked about it quite a bit in his book. I think these companies have been making these promises. They're going to keep these promises. And to keep these promises, all kinds of innovation has to happen and products and ways to mitigate it. Because the NFT people have moved in really quickly and said, okay, we're going to move to this other, there's something called proof of work versus proof of something else. I can't POS. They're going to move to a more efficient system because the artists were upset. And someone was like, oh, it's a virtue signal. And I was like, no, it's not. It's actually people wanting to know

the provenance of what they do and the impact that they have. And more and more, my kids talk about it a lot. And I didn't particularly push the environmental stuff on them necessarily. talk about it a lot. And I didn't particularly push the environmental stuff on them necessarily. I didn't even, like I didn't at all. I should more so. But it'll be interesting to see who dominates in this area. There's an enormous business opportunity for being the brand. I built a business around this notion. L2 is essentially, we're going to try and establish ourselves as the premier neutral, most rigorous arbiter of digital IQ or digital competence across corporations. Whoever figures out a way, and it might be a government agency, it might be a for-profit company that figures out a way to come up with a ranking similar to the Net Promoter Score or to the Y&R Brand Asset Valuator that publishes or the Business Week ranking. Rankings are really powerful.

publishes or the business week ranking rankings are really powerful and a third party that comes in and says these are the criteria for measuring your carbon footprint and then applies it to the thousand biggest corporations in the world that's a big business a media company should probably do it but again it's it's really i think it's really powerful and exciting and it's exciting that this next generation uh is a lot more cognizant than my generation around climate change and holding in reverse engineering. I just never would have thought to connect the dots between Netflix and climate change. Yeah, 100%. It was interesting what they're going to do with this information because I think one of the things is we don't use that much, everybody, just so you know. And actually, they could use it as a brand initiative.

Like, well, you go to the movies and you use this and this and this and this, and here we are. So it's almost like putting sugar information on something. I do pay attention to that now when I didn't before. I think it's a brand additive that you may want to make your choices of how you move around the world, etc. I think more and more people will do that. Not everybody, for sure. People are going to continue to use plastic and crap all over this planet. But I think a lot of more people are not.

It's a static part of our zeitgeist now. There's a huge conversation around crypto and the carbon footprint of mining. So it's... I think it's really... I think it's exciting. It'd be something if that group really fixes that issue. And I think they certainly can. There's all kinds of discussions about how to do that.

But I do like that a brand like Netflix is doing this. You do hear when Microsoft made it, I noticed this a lot more than I did when Microsoft did it, but all corporations are going to have to have some sort of score in this area or make people aware of it. And then it has to be accurate, too, not just using it fakely like those oil commercials that they always show forests and stuff. You know, though. My favorite ad campaign ever, Brace for BP.

It used to be Petroleum, now it's Beyond Petroleum. Yes, we're moving beyond petroleum, although 99.9% of our profits and our capex is around digging new wells in the North Atlantic or whatever. Anyway. Yeah. Anyway, it's a great, interesting story. Pay attention, people. Pay attention. And we think this is important.

I do. I think it is. Absolutely. Anyway, moving on, let's take a listener mail question. You've got, you've got. I can't believe I'm going to be a mailman. You've got mail. Hi, Kara.

Hi, Scott. This is an anonymous question from London. Scott's spoken about Goldman a few times. So I wanted to ask about a company that's often mentioned in tandem, McKinsey. Both are known for their outsized influence as sources of exceptional talent and for their public scandals. But what do you think? Does McKinsey still offer unrivaled services and is it still a training ground for the next generation of CEOs? Or is it writing out a diminishing brand and weakening proposition? And if you were to advise

the newly elected managing director of Bob Sternfels, what would you say? So, Scott, where are the next generation of leaders going to come from as to this question? Well, look, I think McKinsey and Goldman have what is one of the key attributes of any successful, a really successful organization, and that is they've developed a reputation for being an accelerant in young people's careers. Accelerant. Well, if you're,

if you're a talented young woman who has a double E from Dartmouth or you just have all the right skills and grew up playing sports or, or you were the editor of your paper and you just kind of have it going on. I mean, we, we all meet those people, right? I have several of them were in my, my company and they're these women who could be the junior senator from Pennsylvania by the time they're 37.

To attract those people, and I think that's the secret sauce in any high growth company, is show me a sample of the half dozen people under the age of 30 and I'll tell you how the company's doing. And your ability to attract the best human capital is a function of your

reputation as an accelerant. And what I mean by that is the good stuff that we always talk about is some 25-year-old gets double promoted, makes more money than their parents were making at 45, gets tremendous responsibility, this whole notion of meritocracy. What these companies are really good at and no one wants to talk about is the only way you can do that is by moving people out. And that is some 45-year-old who's making half a million or a million dollars a year because they're 45 and they've been around a long time, but who's no longer pulling their weight gets moved out. And what McKinsey is famous for is firing people really elegantly. And that is they say, okay, you're great. You're not going to make partner, but we're going to find you a job. And we're they say, okay, you're great. You're not going to make partner,

but we're going to find you a job. And we're going to, they've created this unbelievable alumni network and they continue to, they continue to attract the best and brightest human capital. I think this is a scandal is somewhat overrated. I would argue that McKinsey needs a better operating group. I'll give you an example. Goldman's biggest threat to their brand. And I know the guys at Goldman well, and I like them a lot. If they take Robinhood public and they advise Robinhood, there will be a scandal around Goldman and Robinhood because Robinhood is a mendacious group of fucks. And if Goldman continues to associate with mendacious fucks, they will damage their brand. By the way, Mendacious Fucks was the name of my band in high school, but go ahead. McKinsey advises... By the way, Mendacious Fox is the name of my band in high school, but go ahead. But when McKinsey decides to advise Gaddafi, I mean, they're just going to get in trouble. So,

I don't even think it's... Or opiates or whatever. Yeah, whatever. Various and sundry things consulting companies do. Yeah. When they just say, okay, wear whores with Hermes ties and graduate degrees. Okay. But you're still cavorting with dangerous organizations that are going to lead to bad places. Whereas the same thing is true of Goldman. Goldman's operating committee that okayed them to take Robinhood public is putting the brand at risk. And my sense is that McKinsey, it's not that they're bad people. They're generally a very impressive group of people. It's that they're senior management that clears and okays certain engagements and certain clients has been making, trading off long-term brand equity and, quite frankly, health for the world by taking on, by talking themselves into believing, well, we can make the world a better place if we advise

these people that are not good people and not good organizations and a corrupt government. So, but the bottom line is the long-winded way of saying McKinsey will continue to attract the best and brightest because they continue to be outstanding at taking young human capital, training it well, and accelerating it. It's an outstanding organization. Even through the scandal, it's going to be fine. So what is going to, I think it's an interesting question of what each of them does and what it helps. Talk a little bit though about how it helps a young person. So my nephew, I forget which one he went to, went to one of them, one of them, McKinsey or BCG. He was working somewhere, didn't like it. I advised him to go to one of these companies. And then he, you know, and he's liked it. He's liked the ability. He has an engineering degree,

a chemical engineering degree. And I think it's interesting. I think it's an interesting way to sort of excel, not accelerate, just improve yourself for a short time where you're going somewhere else. That's exactly right. I started my first company. Better than a graduate school, rather than paying for, you get paid for going to graduate school. Exactly right. I started my first company. Better than a graduate school. You get paid for going to graduate school, essentially. That's exactly right. My first company out of business school is Profit Brand Strategy, a consulting firm. And consulting is essentially a second graduate degree. It's outstanding in the sense that there's, I'll break down the upsides and the downsides. The upside is it's a fantastic way to get into amazing shape from a multidimensional perspective. You have to be good at presenting. You have to be good at analytics.

You have to have good EQ. You have to be able to sell business. You have to be analytical. It's a fantastic place for what I'll call not only athletes, but aimless athletes. Because the reason you go to business school is because you're credentialed and smart and ambitious and have absolutely no fucking idea what you want to do with your life. And you're like, while I'm figuring it out, I'll get a credential that'll make me worth $150,000 instead of a confused person making $70,000. The same is true of consulting. Very few people end up lifelong in consulting because you know what? It's a young woman's job because you're on planes and you're kissing other people's ass. And when the CMO of Audi calls you and says, hey, we have a meeting

tomorrow. Can you be here? I say yes when when I'm running a consulting firm, and I fly to fucking Ingolstadt. It's really difficult on relationships, really difficult on relationships, hard to attach to a spouse or kids or friends when you're roaming the earth as a consultant. This is going to sound strange, but basically, the way I built profit into a brand strategy firm was by establishing a series of father-son relationships with powerful men such that they would hire my firm for half a million or million dollar engagements. I was good at what I did, but it's a very relationship-driven business, which quite frankly is exhausting. It's exhausting playing golf and being nice to people. I never could have done that. I got worse at it as I got older. people. And I got worse as I got older, but it's a fantastic way to get exposed to pontoon into different industries, develop fantastic schools, get another credential. You just don't, if you go to McKinsey or Bain or BCG for three years, you don't look back and think, well, I really fucked up doing that for two or three years. It's like, you're exactly-

Except if you have a huge entrepreneurial bent that you really want to make something, right? But it just means you can raise more money. It's like having a second or a third MBA. It's a fantastic thing for a young person. Yeah, it is interesting. What's interesting at McKinsey, you know, just last month, the partners voted out consulting firms' top executive, Kevin, I think it's Sneeter, on the blowback over the opiate crisis. So 600 senior partners.

He got voted out because of his name. Doesn't he sound like a man? It's Kevin Sneeter. Well, just so you know, McKinsey agreed to pay 49 states a historic settlement with almost $600 million because of sales advice the company gave to drug makers. So it's really, you do have to protect,

you're right, you do have to protect them just like anything else. Last question, is schools stopping luxury brands, as you've discussed it endlessly? How will young people differentiate themselves in the job market? Is this the kind of way you do it or what's the, you know, that it's not, you know, you don't get the job because you're Harvard, Princeton, Yale, whatever? We love the shorthand of brands. We want, we used to, Europeans were famous for doing it based on your last name. Americans did it based on where you did go to college.

Instinctively, we do it based on the height of your cheekbones or the length of your legs or the size of your biceps. And that sounds sexist, it is, but we're sexist as a species. So we love the shorthand. And in America, the brands or credentials are incredibly powerful. And we will always, whether it's schools becoming less important in terms of credentialing, I actually think they're becoming more important. The applications to the top 50 schools have skyrocketed this year.

We will always fill that void or that need for shorthand with brands and certification. And it'll be, someone will step into that void and say, okay, I'll provide you with the certification or the screening. McKinsey is a fantastic certification. Being a varsity athlete is a fantastic certification. Having been a journalist at the New York Times is an incredible certification. So that's not going anywhere. They may shift, but I actually think that the elite university branding is only getting stronger. I predicted that they would massively increase their enrollments partnering with big tech. I was wrong.

They decided to double down on exclusivity. Yeah, I just heard from someone telling me like, oh, our numbers were up more than ever, and that means we're not going to let as many people in. I was like, is that a good thing? I've become Scott. I've become Scott. I was like, that's wrong.

What business says that? We decided to deny 98% of the people ice cream. What? Oh, my God. What? This is... And guess what? You know what that means?

I went like that. I went, what? It means your daughter's not getting in. Yeah. Brag about it. No, my daughter will get into everything. There you go. We just got into a preschool that was very competitive.

Well, how white of you. Well, how white of you, Kara. No, it was a lesbian thing. What preschool is going to turn you No, it was a lesbian thing. What preschool is going to turn you down? It was a lesbian thing. The only way you can be better is if you showed up in a wheelchair. Seriously. Stop. By the way, that's

a horrible thing to say, but it's an episode of Modern Family, which means it's okay. Yes, that's true. It was an episode. Let me just say, we do get this. What a shocker they got into. I'm sure they're not scared of you. Yeah. I don't know.

A very strong lesbian woman who happens to work at the New York Times. Yeah, let's piss her off. Let's piss her off. No, I'm just saying. I just, anyway. Schools should be letting lots more people. And that's my favorite. I'm not talking about nursery schools.

I'm talking about big colleges. They should. I've moved to the Scott way. I've moved to the Scott way. I've moved to the Scott way. Look at the data. When I applied to UCLA, the admittance rate was 60%. And I didn't get in. That's a good rate. I didn't get in. I had to apply again. That's a good rate. That's a fair rate. You know what it's going to be this year? What? It's going to be 9%. Oh, God. It's going to be 9%. That's ridiculous. It's 50. I say 50-50. Don't you think?

Don't you think 50-50? Yeah, no one has a birthright to get into a good school, but here's the bottom line. I wouldn't be here with you making jokes about Brad Pitt and my prostate and getting paid for it if we had decided that schools were the new enforcers of the caste system. And there's so many things that need to change here. enforcers of the caste system. And there's so many things that need to change here. I think I would like to see people, when they make donations to schools, say, I need you to expand the number of seats. We need to fall back in love with the unremarkable, Kara. Unremarkable, like Scott Galloway. Well, 99% of us are not in the top 1%. The test of a society. According to Quitter, you're not unremarkable at this point, apparently.

I know she does. I'm a force. One more quick break. We'll be back. I need to be remarkable about predictions. We'll be back in a second. America is not about turning the 1% into billionaires. America is about taking the bottom 90% and putting them in the top 10%. We're being less

and less American because of the universe. We are less and less American. All right, Scott. one more quick break. We'll be back for predictions. Support for this show comes from Constant Contact. You know what's not easy? Marketing. And when you're starting your small business, while you're so focused on the day-to-day, the personnel, and the finances, marketing is the last thing on your mind. But if customers don't know about you, the rest of it doesn't really matter. Luckily, there's Constant Contact. Constant Contact's award-winning marketing platform can help your businesses stand out, stay top of mind, and see big results. Sell more, raise more, and build more genuine

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Constant Contact.ca. Do you feel like your leads never lead anywhere and you're making content that no one sees and it takes forever to build a campaign? Well, that's why we built HubSpot. It's an AI-powered customer platform that builds campaigns for you, tells you which leads are worth knowing, and makes writing blogs, creating videos, and posting on social a breeze. So now, it's easier than ever to be a marketer. Get started at HubSpot.com slash marketers. Okay, Scott, prediction time. Give me a prediction. You're very good. Amazon one was good. What's your next one? What's your next prediction? We're finally going to demonstrate some leadership.

The most, I love what I think are sort of underreported business stories that are going to have second order effects. So Walmart has announced that they are going to have a kind of a digital wallet around access to your healthcare records. But what's really important in that announcement is they said they're going to basically create a vaccine passport that says on your phone, you'll be able to pull up confirmation you've been vaccinated. And we're going to decide to demonstrate some leadership here and say, okay, you need to prove before you get on a plane and have access to our transportation infrastructure, you need to prove that you do not have a gun on your person. When you go to certain countries, we do. We get mad about

things and not about other things, but go ahead. And we are going to show some leadership here and decide, companies, and I think ultimately the government, we're about to run. The problem so far has been we haven't had enough vaccine. We're about to run into a new problem. We're going to run out of arms. And that is 24% of people. Or inefficient systems to get to the arms. But go ahead. But that's getting better.

Yeah. I think in the next few weeks, we're literally going to pivot to a demand-side problem instead of a supply-side problem. And 24% of Americans say they're either not going to get it or won't get it unless their company demands it. And they tend to cluster around three groups. Young people who feel immune. People of color who have, quite frankly, been, for legitimate reasons, don't trust vaccines. And then third, deeply conservative Republicans, specifically evangelicals. We're making a lot of progress

around groups one and two. And I think we're going to show some leadership here. And I think we're going to say, listen, you are, as an asymptomatic carrier of this virus, really dangerous. And if you want to access the trillions of dollars and the freedoms we have decided in this country, we can conflated liberty with selfishness. Yeah. Oh, I've decided it's my right. I'm going to exercise my liberty by being incredibly selfish. Our community and sacrifice is what makes America great. I have no problem with it. I agree with you. I think it's really irresponsible. I think it's really irresponsible. I think it's, you know, it's interesting.

Trump came out, he was on, whatever, what's her name's show. I don't mean to say her name. I think she's a terrible journalist. But he was, he talked, he said, every week, all my people should take it. Like, you know, he of course ran. All the Trumps ran and got it

after all their nonsense over the past six months on this issue. They all ran as fast as possible to get it. And all of their people did. There's a really good story about how they all just rushed the door to get the vaccine. It's a huge opportunity for him. But he did say it. I have to say he did say it.

But the fact that we had to beg him to do it was kind of ridiculous on some level. He should have been saying it loud and clear for a long time. He's the most important person around this right now. If he were to be really loud about it, it's really, I mean, good brand thing for him. Oh gosh,

it could, it could, it could have enormously positive impact, which would repair about 3% of the damage he's done. But if he's thinking about his legacy, the absolute gangster move. I agree with you. You know what? Because the thing he talked about was how it was his vaccine.

I got the vaccine. I was like, he invented it. I was like, I think it's this couple in Germany who invented this idea. He literally took all the credit as usual, but whatever. And Dr. Swisher will weigh in on this? Yes, he will. There really is. I'm literally scared right now. There look there is a race yeah there is a race between the viruses are so impressive

every time someone gets this thing the virus learns and the virus has got a heads up that the vaccines are here and you know it is working overtime unless and the other thing i can't see what's happening in europe and the delays and everything but it'll be closed down again one of them one of them but this whole i'm gonna wait or i'm not gonna take it i call that the narcissist playbook that's bullshit people yeah we don't like it we're not gonna let you come on this way unless you have a vaccine passport. The call has gone out. Two million Americans could still die from this thing. The call has gone out to get two million American brothers and sisters off the beach. Get them off the beach. Get a vaccine. It's not about fucking

you. Get a vaccine. Anyways, the prediction is I think we're going to have vaccine passports. And I think slowly but surely, corporations and states and governments are going to say, look- You can't come back to work unless. You want to work at Salesforce or you want to work at Lemonade. No, we want to work. You can't come in to work. Or whatever it might be. Yeah.

You can't come into an office. You can't get on a plane, an FAA-sanked plane. They're not going to do that. I think they should. I think there's a decent chance they will. We'll see. Anyway. We'll see. That's a really good one.

I like that one. I like that. It's interesting. You want to send that kid to a public school we force him to get vaccinated now why wouldn't we force him to improve from gay vampire make making out handsome very hard to do that very hard to do that that's a nice pivot as they say very hard to do that all right scott that's a really good prediction and that's the show do you have any predictions i don't i don't predict things i don You do. This is why I live in the glory, in the reflective glory.

Oh, yeah. I'll make a little prediction. I think the stock market's really going to go crazy. Going to go up? Up. Like crazy and up. Because of the stimulus? Just everything. It feels like savings. Everyone's like, let's open

the checkbooks, the ones that have money. And I think you're going to see enormous stock market. Everything. It's going to be like, it's like, let's open the checkbooks, the ones that have money. And I think you're going to see enormous stock market, everything. It's going to be like, it's going to be roaring 20s happening. Yeah, I think you're right. All right. That's the, I don't think that's, that's not the most smart,

but it's the obvious one. Anyway, that's the show. We'll be back on Tuesday. Go to nymag.com slash pivot to submit your question for the podcast. The link is also in our show notes Scott read us out today's show was produced by Rebecca Sinanis and Camila Salazar

Ernie Indretot engineered this episode thanks also to Hannah Rosen and Drew Burrows make sure you subscribe to the show on Apple Podcasts if you're an Android user check us out on Spotify if you like the show please recommend it to a friend thanks for listening to Pivot from New York Magazine and Vox Media we'll be back next week for a breakdown of all things tech and business.

Jane Lynch thinks I'm a force. I'm a force. I'm having her text you. How about that? Thanks. Do you feel like your leads never lead anywhere? And you're making content that no one sees. And it takes forever to build a campaign? Well well that's why we built HubSpot it's an AI powered customer platform

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