The Prof G Pod with Scott Galloway - Elon Musk’s Pay Package, Scott’s Early Career Advice, and How Do I Find a Mentor?

Episode Date: June 26, 2024

Scott speaks about Tesla, specifically Elon’s compensation package. He then gives advice to a recent college graduate who is moving to a new city for work. He wraps up with his thoughts on finding mentorship. Music: https://www.davidcuttermusic.com / @dcuttermusic Subscribe to No Mercy / No Malice Buy "The Algebra of Wealth," out now. Follow the podcast across socials @profgpod: Instagram Threads X Reddit Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Welcome to the Profit Pod's office hours. This is the part of the show where we answer questions about business, big tech, entrepreneurship, and whatever else is on your mind. Hey, Prof G. Hey, Scott and team. Hey, Scott. Hi, Prof G. Hey, Prof G. Hey, Prof G. Hi, Professor G.

In last week's Office Hours, I answered your questions surrounding OpenAI's recent content deals, why I tell crude jokes, and what the dog's morning routine looks like. It's about me pissing on anything I want. Now, what I was worried about is that I would say, to me, the business news for this morning, and the voice of Reuters with a pinch of, I don't know, Anderson Cooper, and with some humor from Dave Chappelle, and I would never need to go to CNN, and I would never need to go to Reuters,

and you'd even have more oxygen sucked out of the room of media companies because they could start mimicking their voice and not pay them any royalties. I mean, there's a reason why people aren't crude in media, because is it worth the risk of offending people? If the kind of the core or the white meat of what you do is excellence or insight or being funny generally about stuff, then why do you need to, you know, go NC-17? My morning routine is I get up, I have coffee, I read a bunch of news, I hang out with the dogs again. If I'm really motivated, I'll do some exercise. Sometimes I put it off. I try to work out about four times a week. I've worked out four times a week for about, I don't know, about 40 years. It is my antidepressant. Today, we'll talk about Tesla, early career advice, and discuss how to find a mentor. So with that, first question.

Hey, Prof G. I'm Chris from Vancouver, a long-time listener, first-time caller. I've been sitting here watching the Tesla shareholder meeting where Elon is trying to convince folks to pay him $40 billion to not become distracted by other things. And it made me wonder, if they've let him go and made you CEO, what would you do next for Tesla? Love your work. Peace. Thanks for the question.

And it sounds like we're both a little bit cynical about Elon. So some context here. Tesla shareholders approved CEO Elon Musk's $56 billion pay package, a move that allows the company to move its incorporation from Delaware to Texas. According to a Delaware judge, it's the largest pay package on record for the public markets. It's 33 times larger than Musk's prior compensation plan. Who voted in favor of the compensation package? 77% of shareholders, Tesla's largest institutional investors, BlackRock and Vanguard, both voted in favor of the pay package. According to diligent data, BlackRock and Vanguard have

historically supported at least 90% of pay packages at U.S. companies every year. I think the most difficult thing about, I've served on a bunch of boards, the most difficult thing, hands down, is compensation. And I find in this instance that the board did not do its job because what you want is a compensation package that is market and keeps the CEO focused. First off, the CEO is not focused. He's actually here in Cannes trying to convince advertisers that Twitter is not ground central for Nazi porn. Actually, they have a beat shirt. It's called Plage de Nazi Porn. Not true. I can't even imagine. Literally, the easiest way to get fired as a brand marketer or a media planner would be to advertise on Twitter right now.

Anyways, they basically said, all right, I think the argument goes something like this. When he was awarded that pay package, it was options, and they were worth a lot less than $56 billion. I think it's actually now worth closer to $40 billion, that it was options and they were worth single digits of billions. And the guy, you got to give it to the guy, the guy has a certain level of vision and has built singular companies. SpaceX is singular. By the way, my favorite product of 2024, SpaceX or Starlink. I've been on a plane where the Starlink network comes up and I select it. And then two minutes later, my son calls me on FaceTime and it is perfect. Also on that same flight, the pilots

had looked out to the left and a SpaceX rocket had launched And I thought, okay, don't like the guy, but I got to give it to him. He has a unique vision and the ability to, you know, action that sort of vision. And I think that shareholders have said, look, the guy's been really good for us as shareholders. Sure, as the stock come down from highs. But anyone who's been in this stock longer than, I don't know, 18 months has probably not only made money, but made a lot of money. So I think they want to keep him interested. Now, my personal experience rubs against this, or this rubs me against the wrong way, because when I had L2, I was investing options. I had a large stake as, or founder shares. And I said, I want options and equity to continue to work here.

And they said, Scott, you're fully staked. You're motivated. I think I owned 40 or 45% of the company. They're like, we don't feel a need to give you more of a thing. And I'm not Elon Musk. Now, also, what is interesting, and I don't know how this is going to play out, is that the Delaware chancellor or the head of the chancellery court there does not seem impressed by Elon and has basically said that the board did not do its job and that this was totally out of line with their responsibilities as fiduciaries to just do what is market and or keeps him motivated. And she rejected the pay package. I think the outcome here is that one, I think one way or another, he is going to get that money. It's unclear now whether the Delaware court that blocked the deal back in January will accept the revote and allow Tesla to reinstate Elon's pay. Some legal experts believe this could stretch out for months. Meanwhile, Tesla has been struggling with weak sales, increased competition in China, and layoffs. The stock is down 26% year-to-date. I think over the long haul, Tesla will trade like an automobile company. I think the stock gets cut by 70% or 80% and still looks

expensive. And whenever I try to have a rational conversation around valuation, people will claim that it's an energy company or it's a around valuation, people will claim that it's an energy company or it's a software company because if they acknowledge it's an automobile company, automobile companies trade within a certain range and really well-managed ones, including Toyota. If you apply their multiple, again, see above the stock decline, 70, 80, 90%.

And he's been able to defy gravity. It is an exceptional car. I owned a Tesla for a while before he started calling me names on Twitter. And then I sold it. car. I owned a Tesla for a while before he started calling me names on Twitter, and then I sold it. First, I took a big greasy dump in the passenger seat. Is that wrong? Is that wrong? Anyway, thanks for the question. I don't have a lot of insight here other than to say, what's the point of being successful if you're not going to be kind? When you're clawing your way to the, I don't want to say clawing your way to the top,

but when you're an entrepreneur, you can't overpay people because businesses don't go out of business because they're bad ideas. They go out of business because they ran out of money. So you got to throw nickels around like they're manhole covers. You got to be pretty Darwinian. Entrepreneurship is full body contact. But once you achieve a certain level of success, and I'm not saying don't be kind along the way, but that's your opportunity to have a lot of fun and be really kind. Anyways, enough of the virtue signaling. Thanks for the question. Question number two. Hey, Drop G. Got three quick questions from a fresh college grad here. For context, I am from and just graduated college in Indiana, and I'm moving to LA in a month. I couldn't be more excited as I've always wanted to live in a big city like LA,

and I love what I'm going to be doing. I'll be working sales and business development at a Series B retail tech startup with around 70 employees and for a super experienced leadership team that I really believe in. With two huge new life changes occurring simultaneously, I'd love to hear your advice as you've been in both of these positions before.

First, how can I maximize my value for the company I'm working for as an entry-level hire? What are some actionable steps that I can take to really stand out and be successful? With an IPO on the horizon in a couple of years, I want to pour all I can as I have stock options on the table. Also, how can I maximize my life outside of work in a cultural hub like LA? Looking at continuing to build my own personal brand, but also want to make sure that I'm joining all that LA has to offer. Thank you so much for your time. And I want to say how much I really love your content as it's

refreshing to have someone give real takes on business relationships and life derived from their actual experiences. There's so much posturing today. I appreciate you, Prof G. So first off, anonymous, can you not be anonymous? And specifically, can I be you? My God, you're just graduated from Indiana and you're moving to LA with a good job. Boss, you are in the sweet spot. So, okay, what to do? First off, figure out when everyone gets to work and try and show up a few minutes before them and a few minutes later. When I started at Morgan Stanley, I wasn't as talented as the other kids, not because UCLA wasn't an amazing education, but because I didn't work very hard at UCLA and I just didn't have the same skill set they did. So I decided to lean into my strengths. My strengths were my youth and my fitness and the

fact that I did not have dogs, kids, or girlfriends waiting for me at home. I was living at home with my mother. I had literally no relationships, nothing going on. So I said, here's an idea. I'm going to go into work Tuesday morning and I'm going to work till Wednesday night at five every week. And I developed a reputation for this crazy kid who worked 36 hours straight, but crazy in a good way because investment banking had this sort of weird, fucked up, abusive culture in the 80s, 90s. And I'm not suggesting you go to that extreme, but try and be kind of first in, last out. Show that you come to play. Josh Brown from CNBC and from Ritzhold Wealth Management had a really good idea that I thought was very simple. I never thought about it. Find the shittiest part of your boss's job and take it off their plate and slowly but surely try and do stuff and volunteer for stuff and do your best to

try and take the worst part of other people's jobs off their plate such that you become indispensable to them. Because if you make their life easier, you're going to be indispensable. Try and praise, always praise people behind their backs. Be known as the guy that praises people behind their backs. Listen when you're in meetings. Try and really understand what's going on. Be very social.

Ask people out to coffees. Ask them a bunch of questions. You don't need to be explicit about finding mentors. I've never said to anyone, will you be my mentor? But I am blessed with a ton of mentors because I would ask them out for coffee. I'd ask them a lot of questions. When you're older and you've got some experience under your belt, you like it when people ask you questions. It's the reason I have this damn podcast is I like giving advice. If you feel like you have value to add, you want to share it with young men and young women. So don't be

afraid to ask people out for coffee and ask for their advice, ask for their feedback. And generally speaking, I think success is in the last 10%. What do I mean by that? We used to write RFPs in my first job at Morgan Stanley. And Morgan Stanley had this kind of cultural zeitgeist where if there were any errors, you could be fired. And we used to read things not only forwards to prove them, but then backwards to make sure that everything was perfect. And it was very stressful, but it was an outstanding training. So what I would try and bring is a massive attention to detail. Success is in the last 10% and be known also as the guy that anything that leaves your desk is near perfect or perfect. In terms of LA, oh my God, oh my God, is El Coyote still around?

Is the Hollywood Bowl still around? Maybe the Greek Theater? Maybe Zuma Beach? I don't know. What not to do? Jesus Christ, what not to do? The Uber drivers in L.A. are hot. Everything about L.A. is wonderful. Maybe go to the counter at Beverly Hills Hotel and tell them that Scott Galloway sent you. I don't know. Maybe go to the Polo Lounge on a date, order a drink, order a drink or two. Maybe go to the, I don't know, Jesus Christ, there are so many amazing things to do in LA. I love the influence that Mexican culture has had on LA. I love the fabulousness of the entertainment industry. I don't know, take a run on the beach.

Maybe go down to Shutters, have a little drink down there on the Playa de Los Angeles. Boss, you're going to get into so much trouble there. It is such a wonderful place to live. You are in the sweet spot of your life. Be kind. Work your ass off. Also, also get someone with really good taste to buy you kind of five good work outfits.

I don't know if it's a suit or whatever. So you have a uniform. You don't need to think about it, but you look competent. Take pride in your appearance. Try and find time for exercise. Jesus Christ, I've got 25 hours planned of every day. Let me finish where I started.

It is really good to be you, Indiana. We have one quick break before our final question. Stay with us. Welcome back. Question number three. Hey, Scott. My name is Joseph. I'm a 31-year-old male, and I'm struggling. To keep things short, when I was in my 20s, I got into drugs and partying. I cleaned myself up. I've been clean for seven years, and I found my passion in photography and videography. It doesn't pay all the bills, so I'm working two other jobs and it's just getting really tough. And I want to keep on leveling up. I want to be successful

in life. I want to wake up and stop worrying about money. And I feel like I've hit this part of my life where I've worked so hard on myself and I'm ready to ask for help. And my question to you is how can I find a mentor? I feel like I'm at this ask for help. And my question to you is, how can I find a mentor? I feel like I'm at this position in my life where my parents, they're beautiful people. They raised me with kindness, loyalty, respect. But I don't feel like they could help me get to this level of success that I'm looking for. Like you said, they're not superheroes. So how would you go about finding a mentor?

What do you think of mentors? Love your podcast. And thank you so much for everything you do and say. So first off, Joseph from Undisclosed, you're 31, which means you're still incredibly young. It means you're probably going to live another 70 or 80 years. The fact that you're smart enough to realize you were abusing substances and partying a lot—by the way, the 20s are a great decade. You probably also enjoyed that a certain amount, or at least I hope you did. And the fact that you've cleaned up and you're self-aware enough to know that you've cleaned up, the fact

that you found something you're good at and you're working three jobs, boss, you're like, you know, you're trying, right? And what I would say to you is, first off, you need to forgive yourself. And that is, if you're in need to forgive yourself. And that is, if you're in any way down on yourself, I mean, be stressed, be like, shit, this is hard, fine, but don't be down on yourself. You've recognized what needed to change in your life, you made that change. It scares me that you have three jobs. And what I would say is that photography is one of those passion fields. What do I mean by that? I think it's very difficult in a passion field to make a decent living unless you're in the top 1%, and not only in the top 1% from a skill standpoint, but in the top 1% in terms

of just pure luck. And what I would ask you is, what are the other two things you're doing, and do you see money there, and are you excelling? Because what I found, I mean, I wanted to be an athlete, then I wanted to be a pediatrician. I don't know if that's a romance industry. I wanted to be investment banking, which was a high prestige job. And I ended up finding analytics. And so the idea of having three side gigs or two side hustles to try and make photography work, I think that's difficult now. This is all very situational. So this is what I want you to do. I want you to assemble a kitchen cabinet and you call the mentors. I never explicitly asked

anyone to be my mentor. What I did was I would call people or I would say, can I take you out to coffee? I'd love your advice on some stuff. Even if it's friends you meet through photography, and if it's smart people you met out socially, friends of your parents who have their shit together professionally. I find that generally speaking, people are very open to giving advice, that people are really good at running other people's lives. And so I wouldn't be afraid, I wouldn't say, will you be my mentor? Because that sounds like you got to commit to a certain amount of time, but I wouldn't be afraid to reach out to people and kind of assemble a kitchen cabinet. And I don't make, this is, you're so

much smarter than I was at your age. I thought leadership and having your shit together and being a man was saying, I know what's right. And I would hide everything that was wrong in my life and pretend that I had my act together and not take advice and assess the situation and try and convince everybody that what I would decide and what I was doing was the right thing, that that was leadership. The fact that you are even open to trying to find mentors and that you recognize your 20s and that you are struggling and that things are hard means you're way ahead of where I was and where most people are. And also, to be clear, as we talk about your story here and listen to you, I can tell you there are millions of people in their 30s and 40s who are struggling to keep up in this economy, who think, Jesus Christ, I didn't realize it would be this fucking hard. I mean, I had some really dark moments.

So the first is, okay, forgive yourself. Try and find, ask a group of people for advice. I don't like the idea of having three jobs. What I would say is you need to narrow in on two, ideally one that will provide some economic security for you, or there's a clearer path to economic security. In order to assess that more accurately, I can't do that remote. I would need to ask you a bunch more questions. So don't be afraid to ask people for advice and then keep asking them for questions and get a sense for their skills. And if you think they're giving you good advice and triangulate off of other people's advice. And if you really get down

and you really are struggling with your mental health. And when I say struggling for mental health, I found some times in my life I was just sort of stuck and I had trouble motivating and the things that I usually got joy from were no longer giving me joy. And it wasn't sad. And depression registers differently in everybody. For me, I feel hollow and I feel nothing. I get emotional and I cry a lot. And that's usually a symbol I've recognized for me when I'm in a good place mentally. I'm.edu and reference this podcast. I'd be happy to help you financially around seeking that type of help if you feel it would be helpful for you. But let me just recap here. So many people listening to what you said are right there with you. And the fact that you're working this hard and thinking thoughtfully means that you're likely going to be fine. I appreciate the call, and I really do wish you the best. That's all for this episode.

If you'd like to submit a question, please email a voice recording to officehoursofpropertymedia.com. Again, that's officehoursofpropertymedia.com.