Speaker · 53:58
US based tech firm hiring increasing numbers of New Zealand software developers to work remotely and offering to pay more than double the going rate in New Zealand. That's obviously great news for these developers, but it could be really bad for the New Zealand startup tech scene because it just doesn't have access to the deep pockets of US venture capital, which means it can't afford to pay Silicon Valley rights. Thank you very much.
Scott Galloway · 54:24
Ah, that guy's likable. Talk about likable.
Kara Swisher · 54:26
Him. I love the New Zealand accents. Chris Liddell, who ended up working for Trump, but I I I like a lot, worked for Microsoft, had the same kind of He started podcast. Charmed, charming accent in New Zealand. Wow. There's a lot there. Let me just go from the back very quickly. I interviewed Brian Chesky and Steve Case last night for Steve's event Rise of the Rest. One of the things they were talking about was hiring increasing numbers of software developers at different places and whether that was gonna hurt the startup scene in individual spots. I thought that was that was an interesting point. I think that's what they're gonna do because Brian was talking about, you know, how much he's sort of a more radical remote worker now even though they had a beautiful headquarter and they're really pushing remote if people wanna do it and letting the employees lead the way on that. So I think that is absolutely going to happen that a lot of these areas that are trying to create their own ecosystems locally are going to get sucked up by the Googles and Airbnbs and Facebooks of the world. That is, I think absolutely true. Scott, do think about the other stuff?
Scott Galloway · 55:25
Well, on the extremist side, so the stat that came out that was really frightening was that somewhere around two thirds of people who joined an extremist group on Facebook, that extremist group was suggested to them by the Facebook algorithm. So the notion that what these the defense these platforms put forward is that there's a certain number of people who are just drawn to these groups and we can't be responsible. It's like, well, yeah, you're actually promoting extremist groups. So he asked if he thought The US joining meant anything and if whether these companies had changed their activity. When I believe when the Christchurch massacre happened that primarily Facebook said, well okay, how do we minimize this? They went into damage control mode. What I do think it does though is that it highlights... And what's interesting is stuff like that happens in The US. Mass shootings happen all the time. But when it happens in New Zealand, we get freaked out because it typically doesn't happen in countries that have a saner approach to gun laws. And I do think it has an impact because it was so horrific and tech played such a of a weird role in it that the public becomes less sympathetic to tech and wants to see more action against tech. So I think it does impact it, but it's not... We 've gotta get out of this notion of waiting for the better angels of these companies to show up. They don't... When the Christchurch... My guess is, and Kara, tell me if you think that my thesis is that when Christchurch happened, Facebook didn't sit down and said, wow. What was our role in this? How do we rethink our approach to business? I think their first emergency meeting was how do we minimize the fallout here? How do we delay and obfuscate? How do we wallpaper over this? It wasn't how do we change our product and our platform?
Kara Swisher · 57:04
Yeah, I agree. I think that it was really... That it doesn't matter, but it does... Even if it's just signaling being in this, not being in this is a problem. Being in it is not a problem. The US can really turbocharge this stuff by entering climate accords, these kind of things. I think the prime minister of New Zealand, Jacinda Ardern, has been amazing about this and I think it's okay that they're part of this. It puts pressure on companies like Facebook, especially when The US is in these things. And so I think they'll continue again, Lena Khan is the answer. These are all the, you know, these kind of people putting her as chairman said a lot to me about the Biden administration. Putting Tim Wu in there, know, putting Anne Neuberger in there. It says a lot about what their intent is, is to push back this series of legislative moves by David Cicillini and Ken Buck for example, and Amy Klobuchar, and even Grassley and and others in the senate is is is... It is all signaling, but it's also movement forward. So I think it is meaningful to do these kind of things. Facebook will respond to pressure. That's how they're gonna... That's that's... They don't do it because they wanna do it for the good of the world or they they... Some of them do. That's not fair. I think they will do it because they get pressure and they will do it badly because it's hard by the way. Like, you know, the just information about vaccines, where it comes from, the Wuhan lab, where they right, wrong, they have to make these decisions that are very difficult for them and at the same time they do it claudishly. So it's it's it's super complex, but I love seeing this happen that we do this and I think it's important for for that. And and one of the things that I love to know, you know, answered what Brian Chesky was saying that they're hiring more people and Steve was thinking that maybe they're, you know that would cause them to maybe not have as many cities growing because his goal is to get as many cities as possible to be tech forward essentially and great places to work and with people moving they can work from anywhere and it looks like tech companies are gonna let them work from anywhere for at least the near term future. So what do you... One of the things that another thing they talked about was immigration laws bringing people into this country more people in, but do you do you think people care if a job location isn't an issue going forward? You have this belief that young people should be close to HQ. There may not be an HQ. Brian was talking about you are you you don't do this hybrid thing which is three days a week and two days off because you don't really get time off. You do you come in for three weeks at a time and do intense work together and then you all go away from each other and work remotely. What do you think?
Scott Galloway · 59:39
I don't know, I'm big boomer on this. I think there's certain industries where you're gonna want people together on a regular basis. And I don't
Kara Swisher · 59:47
know if
Scott Galloway · 59:47
that's two days a week, three days a week or one week a month. But there is a certain entropy, I think especially in services industries where you need to be able to just kinda yell over the desk to somebody or pull people into a conference And I do think young people wanna be, or most young people I think wanna be bumping off of other people. And so look, I tell young people get into the office. And it's what I call a Walmart store effect. Pankaj Shemawat, a colleague at NYU, did this great research where he found that the further a retail store gets from headquarters, the lower the ROI of that store. Most profitable Walmarts are in the Southeast, and then as you get away from the Southeast, they become less profitable.
Kara Swisher · 1:00:28
That's fair. That's a
Scott Galloway · 1:00:29
fair question. And I think the same is true of headquarters.
Kara Swisher · 1:00:32
Right? It's not gonna be campuses. Just think about it. Airbnb built a pretty pretty series of buildings. They're now down from one building. They had three in San Francisco. Microsoft used to be you'd have to be on the campus, all the time.
Scott Galloway · 1:00:44
Yeah. But I would I would venture that if you take the 50 people who get the most traction at Airbnb over the next five or ten years, who get promoted the fastest, who make the most money, they'll... 90% of them will have one thing in common. They're at HQ a lot physically. It's just that there's just no getting around it. In corporate America and big companies, your career progress is a function of your talent, your grit, and more than anything, the relationships you're able to establish within that company. And relationships are correlated to proximity. There's no free lunch here. If you wanna be live in, you know, Visalia and overlook the great hills of the California Foothills or whatever it is, you trade... There's a trade off here. And there's no free lunch in terms of remote work. And I would advise every young person to get to HQ while they can because when you start collecting dogs and kids, it gets harder and harder to live near work because work... You know, the the campuses are usually are increasingly in urban areas because they know that's very young people wanna be.
Kara Swisher · 1:01:44
I think we're not gonna see these big campuses like the Microsoft Gold Campus going forward.
Scott Galloway · 1:01:47
Mastercard and Purchase New York and these big corporate campuses.
Kara Swisher · 1:01:50
Not gonna happen. Not gonna happen. Alright. We're gonna get back. I... This was a really great question. Thank you so much. William from New Zealand. One more quick break. We'll be back for predictions.
[Ad break]
— Predictions segment begins —
Kara Swisher · 1:02:59
Okay, Scott. Prediction. Make it quick. We've been chitchatting away today.
Scott Galloway · 1:03:03
So something happened. So I own some rental property. And when anyone... When a family leaves, as long as the family's there, we don't raise the rent. If they're good tenants, we like having good tenants. But when they leave, we get a broker to say, alright, what's the market for this? And most recently, last year when someone left, said, you know, it's maybe the market's up a few percent or whatever. This year we had some people move out and the broker came back and said, you could charge 30% more. And it strikes me that inflation is on the way and this narrative, there's always a narrative to support why the market should go higher and everyone's supposed to sign up to the narrative whether it's The Economist, CNBC, everyone says, alright, let's buy into the narrative. And the narrative goes something like this. Inflation will subside because the supply chain will get worked out and there'll be more supply again and things will normalize and people will come back to work as remote schooling, people go back to school. I think the level of inflation here across everything I see is so extraordinary that the narrative is just BS. And I think we're headed into an era of higher interest rates in the last half of the year and we should track this. I think the economy is gonna boom. GDP is gonna go way up. A lot of companies have got in fighting shape. The consumer has money, and we're gonna see the markets absolutely throw up. This is gonna be me like in my fraternity pledge pen and carry
Kara Swisher · 1:04:20
Throw up because of inflation.
Scott Galloway · 1:04:21
The market, it's really interesting. Right now, of course, everyone assumes that if the underlying economy is strong, the markets will be strong. But here's a wonderful thing about the markets is the markets have an uncanny ability to look around the corner, and they're constantly asking itself what's next. And so I think in the last half of the year, the underlying economy will be really strong. But I I was gonna say that now, Joe, was gonna use my fraternity pledge pending where I drank drank about two or three bottles of pink champagne and it was so much fun. And then, wow, did I start throwing up. I think in the last half of this year, the market is gonna move into the latter stage of this. And it's like, we've had a lot of fun. The market's accelerated last year despite the despite the
Kara Swisher · 1:05:00
So money in the mattress. Money in the mattress.
Scott Galloway · 1:05:02
Yeah. Well, hard part is what... It's hard to time the market, and I would argue in an era like this, if you become bullish, you just... Or if you become bearish, you just lower your leverage and your exposure. But I think we're headed for... So anyways, my prediction is that the markets end up lower by the end of the year and we're gonna have extreme volatility in q three and q four with some, kind of four figure drops, in the Dow. Everybody thinks that the underlying economy is gonna power the Dow. I think that this inflation, and higher interest rates is is not... You know, we'd like to believe that it's just episodic. I don't know. The the price increases I'm seeing out there and one in $3 one in $3 was printed since January 2020. I mean, there's so much there's so much cash chasing fewer products
— Predictions segment ends —
Kara Swisher · 1:05:46
right Republicans will try to push the inflation situation for for for... That's Biden's weakness there in terms of that. But we'll see. Anyways We'll see where it goes.
Speaker · 1:05:55
Volatility market is throwing up.
Kara Swisher · 1:05:56
People are out and about. People are wanting to buy.
Scott Galloway · 1:05:58
They're Yep.
Kara Swisher · 1:05:59
I mean, just watch... Everywhere I've been, Washington, New York, all the cities, they're back and rocking kind of thing. But we'll see. That's a very good prediction, Scott Galloway.
Scott Galloway · 1:06:08
Vegas is on fire. Vegas
Kara Swisher · 1:06:09
is is sold off fire There's national parks. Everybody's all over the place. Me This just
Scott Galloway · 1:06:13
is the national parks. You never hear that in the same sense.
Kara Swisher · 1:06:15
I'm just saying. Was... There was a story in New York Times, national parks are like, people are waiting in line to get to see to see things.
Scott Galloway · 1:06:20
To see big data erupt?
Kara Swisher · 1:06:22
Yep. Yes. I guess so. Whatever. I'm just gonna go and sit in a sit on a lawn somewhere.
Scott Galloway · 1:06:27
I'm going to Vegas.
Kara Swisher · 1:06:28
You're going... We're gonna... You and I are going Vegas.
Speaker · 1:06:30
You know, promise me
Scott Galloway · 1:06:32
all the time.
Kara Swisher · 1:06:33
Going to Vegas.
Scott Galloway · 1:06:33
I'm done. I'm done. I don't even get my hopes up anymore.
Kara Swisher · 1:06:36
I do it in the VCs, and we're going to Vegas. That's what we're gonna do. And we're not gonna invite
Scott Galloway · 1:06:41
clubhouse to talk about the optimistic future.
Kara Swisher · 1:06:46
Alright. Don't forget that we're done, Scott, today. This is a long and exciting show, I think.
Scott Galloway · 1:06:50
Don't forget. It one of those.
Kara Swisher · 1:06:52
Thank you for being... No. It is. People will like it. We have a lot... We made a lot of content and the people at Injuries and Horowitz are taking notes, which they will listen to. They will do none of them because they have to be optimistic. Anyway, don't... And we are both optimistic and pessimist because that's what a journalist is in case they're interested. Don't forget if there's a story in the news you're curious about, wanna hear your opinion on, go to nymag.com/pivot and submit question for the show. Scott, read us out.
Scott Galloway · 1:07:17
Today's show is produced by Rebecca Sinanis and Caroline Shagran. Ernie Andretide engineered this episode. Thanks also to Drew Burrows. Make sure you subscribe to the show on Apple Podcasts. Or if you're an Android user, check us out on Spotify or, frankly, wherever you listen to podcasts. If you liked our show, please recommend it to a friend. Thanks for listening to Pivot from Vox Media. We'll be back next week for another breakdown of all things tech and business. What's worse than being at a
Speaker · 1:07:38
water park? Moving. What you need is a big burly Bane like character with a badass tattoo. Got one of those, bring in the giant, and boom. Moved in an hour. Moved in an hour.
[Ad break]
Scott Galloway · 1:08:57
See store
[Ad break]
