The Prof G Pod with Scott Galloway - Office Hours: Apple Stock and China. Should Young People Pursue a Career in Sales? And How to Bounce Back After Layoffs
Episode Date: November 23, 2022Scott takes a question about tensions between China and Taiwan and the potential impact on Apple stock. He then shares his thoughts on a career in sales and finishes with a pep talk to a listener who ...was recently laid off. Music: https://www.davidcuttermusic.com / @dcuttermusic Learn more about your ad choices. Visit podcastchoices.com/adchoices
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NMLS 1617539. Welcome to the PropG Pod's Office Hours.
This is the part of the show where we answer your questions about business, big tech, entrepreneurship, and whatever else is on your mind.
If you'd like to submit a question, please email a voice recording to officehoursatprofgmedia.com.
Again, that's officehoursatprofitmedia.com.
I have not heard or read these questions.
First question.
Scott, hi.
This is Brian from New York City.
I'm a long-term holder of Apple, as I believe you are.
Earlier in 2022, I took profits on all my tech holdings except Apple,
believing it is uniquely positioned to sail through these difficult economic times. I also took comfort in knowing that Apple is Berkshire Hathaway's
biggest holding. Since the Chinese Party Congress a few weeks ago, in which the party leader appeared
to adopt a more aggressive tone against Taiwan, I'm now wondering if holding on to Apple is such
a smart move. We're trying to invade Taiwan. Many pundits see the results for Apple as nothing
short of catastrophic. From a risk management perspective, how do you view the risk and
potential impact of a Chinese invasion of Taiwan on owning Apple stock? Well, that is a complicated
and thoughtful question, Brian, from New York City. So trying to assess geopolitical risk and
how it impacts stock prices, I don't know,
I feel like that's a question more for Ian Bremmer.
Look, Apple sees this risk and is trying to, my understanding, is divest a bit away from
China, although they're inextricably linked to China.
And by the way, I think that's a good thing.
I think that probably the two things that make an invasion of Taiwan less likely are
one, the bravery of the Ukrainian army that is pushing back against a much bigger, more
ferocious army, which is probably giving Chinese generals some pause in terms of what
they probably believe would be an easy victory over Taiwan. And two, we need China or Apple
needs China, but China needs Apple. There are more employees working for Apple in China than in the
US. And Xi Jinping still needs to bring tens or hundreds of millions of people out of
poverty into the middle class. Otherwise, the likelihood of revolution goes up. So I think
actually Apple in some ways being in China is sort of a good thing, not only for Apple,
not only for China, but just for geopolitical safety. Now, as it relates to the stock price,
Apple trades at kind of historically high PEs. I think it's at a P of 24, 25 now. It has
held up really well. But I think your approach is the wrong one. And that is, I think the dimension
or the analysis that should drive your investment decisions or the tail that should wag the dog
here isn't trying to assess geopolitical risk. It's to look at your portfolio. And if you've enjoyed the kind of run-up I enjoyed in Apple, I've owned Apple since I think 2010. I
think it's up, I don't know, 10 or 15 fold and I've sold along the way and it's still worth a lot more
than when I bought it. But look at your total portfolio. What percentage of your wealth or
your stock portfolio does Apple represent? If it's only 10 or 20% of your portfolio,
you like the company, okay, fine, hold on if you think the prospects are good. But If it's only 10 or 20% of your portfolio, you like the company,
okay, fine, hold on if you think the prospects are good. But if it's grown, which I bet it has,
to be a bigger and bigger part of your portfolio, then maybe think about taking some chips off the table and investing in some other stuff, maybe outside of US tech, because US tech has had such
an incredible run-up. I find there's always a regression to the mean. What do I mean by that?
Everyone gets their turn at the woodshed and in the sunshine. And it's been really sunny for Apple
for a long time. Most valuable company in the world. Typically, a company that's the most
valuable company in the world doesn't stay there for longer than 10 years. I don't care if it's GE
or Cisco or Exxon or Saudi Aramco or Apple, which is now the most valuable company in the world.
I love the company.
You don't have to sell all,
but look at your portfolio.
Spend more time trying to balance your portfolio
across different asset classes in different regions
because your Kevlar is diversification.
So the geopolitical risk, bottom line is,
I don't know.
Next question.
Robert here from Omaha, Nebraska.
My question is a macro one.
What do you think of the future of commissioned sales reps in the new economy?
In a world of near-perfect information between buyer and seller, do you believe that the commissioned salesperson represents an uneconomic tax on commerce. And will that career
be a viable career path for young people into the future? Would love to hear your thoughts.
Robert from Omaha, Nebraska. So according to ZipRecruiter, the average salary of a commissioned
salesperson in the U.S. is currently around $50,000 per year. In New York, commissioned sales reps can easily
make up to six figures, easily. As a matter of fact, I would argue if you're not making six
figures in New York, you're not going to last very long. Here's the bottom line. Anyone in your
company that people think is not that talented but makes a lot more money than them, there's a
word for that, salesperson. On a risk-adjusted basis, people who can sell will make more money relative to their efforts than anyone else. The bottom line is, if you want to be an entrepreneur or you want to make a shit ton of money, you have to learn how to sell. pillars of my success. One, I'm ridiculously fucking lucky. I was born a white heterosexual male in 1964, California, which meant free education, processing power, coming of age in
the internet. Two, the irrational passion for my wellbeing of my mother. And three,
I was forced to sell at a young age. I not only had a paper route, I used to go sell the goddamn
subscription, not to the LA Times, but to the Herald Examiner. Try selling the number two
paper in the US. I used to sell chocolates. I used to sell magazines from a young age. I was knocking
on doors. Also as a young man, I was six foot, 130 pounds when I got my driver's license with bad
acne. And guess what? I wanted to go to the prom. So I learned how to approach women and endure rejection.
You know, that may sound kind of trivial or strange, but your ability to be successful in
life, whether it's money, whether it's mating, is a function of your ability not only to sell,
but your ability to sell is your ability to withstand rejection. And the majority of people, the majority, are not willing to endure rejection.
If you want to start a company, if you want to make more money than your peers relative to your
efforts, you better learn how to sell. Being a salesperson, if you can sell, you will always find
a great way to make a living. And if you want to be an entrepreneur, and if you want to be a CEO, and if you ever want to run for office, boss, you better learn how to do one
thing. Two things, sell and endure rejection. Thanks for the question. We have one quick
break before our final question. Stay with us. The Capital Ideas Podcast now features a series
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Hello, I'm Esther Perel, psychotherapist and host of the podcast, Where Should We Begin?,
which delves into the multiple layers of relationships, mostly romantic.
But in this special series, I focus on our relationships with our colleagues,
business partners, and managers. Listen in as I talk to co-workers facing their own challenges
with one another and get the real work done. Tune into How's Work, a special series from
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Welcome back.
Question number three.
Hi, Prof G.
My name is Nikki, and I'm a 28-year-old project manager from Las Vegas.
My question is about the path forward for young professionals who have been affected by the downturn in technology.
I work for a VC firm headquartered in Palo Alto and found out this week that I'm being laid off at the start of the new year. In line with your predictions over the last few months about the recession for information age workers, like I'm sure many others feel right now, it seems like I'm putting myself
back on the market at a time when morale is only getting dimmer. I love what I do and I want to
keep growing my career in the tech industry. What would you suggest is the best path forward for
someone like me
and so many others
who are being laid off
just as we are beginning
to hit our professional stride?
Thanks.
And I love listening to the Prof G pod
and pivot every week.
Nikki from Las Vegas.
Thanks so much for your authenticity.
Thanks for your honesty.
First off, Nikki,
if you're at a VC at the age of 28,
the VC industry
is actually a very small industry.
And people call me and say, I want to be a VC or I want to be in private equity. I'm like,
well, good luck with that. It's an industry that people think is much bigger than it is.
There's actually very few jobs in venture capital, even fewer in private equity. So,
if you were able to get a job in venture capital, it means one thing. You are an impressive young woman and you are the solution
to a lot of firms' problems. So yeah, getting laid off, it sucks. You deserve to mourn for a little
while and then you have to move on and again, stand in front of the mirror and go, I'm an
impressive young woman and I am the solution to a firm's problem. And what do you need to do? You
need to get out there and immediately
start interviewing, start calling people, start reaching out to friends, reaching out to firms
to find out if they have a corporate investing arm. Think about the things you enjoyed about VC.
Would you like to be in corporate development for an organization? Would you like to be
in investor relations? There are so many ways your skills could go. And what do you want to do?
You want to start just putting yourself out there, doing informational interviews, calling on friends, just getting out there.
Also, don't let perfect be the enemy of good.
No job is going to be the perfect job.
I'm not saying take the first thing.
Have a kitchen cabinet of people who advise you.
But what you don't want, quite frankly, is to still be looking in a year.
And also, also,
it is not dark yet. I mean, it's barely, it is, it is, there's some clouds, but it is still really
sunny out, Nick. Employment is still really strong. And there are a lot of companies, maybe not in the
growth economy as much, but there are a lot of companies that want people with your skills. You
are in the sweet spot. We always anchor
off the highs. Is the market not as good for someone like you a year ago? Yeah, but guess what?
At this moment, it's better than it has been for 90% of history. And the fact that you got as far
as you did as young as you are means that you're, in a word, awesome. This is a mild bump in the road. If you, when you
are older, when you are my age, you will look back on this, Nikki, I promise you, and you will not be
upset about being laid off. You'll be upset at how upset you were. Get back on the horse, assemble a
kitchen cabinet, get out there, start talking to people. And Nikki, if you got this far, it means you are really damn good.
That's all for this episode.
Again, if you'd like to submit a question,
please email a voice recording
to officehoursatpropgmedia.com.
Our producers are Caroline Shagrin and Drew Burrows. Sammy Resnick is our associate producer. Thank you. The answer to that question is probably more complicated than you want it to be.
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