Scott Galloway Tells All - $100M Net Worth, $4 Trillion Business Opp & Career Advice

0:00I look at this category and how much money is in this category and it's gonna happen. It's just, there's never been a business, there's never been a carcass so tempting, so bloated, swimming so slowly. I feel like I can rule the world. I know I could be what I want to. I put my all in it like no days off. On the road, let's travel never the last night. All right, we just asked Scott Galloway, if he was 25 years old again, what businesses would he start? Because this guy started, I think, nine businesses, sold one for over$100 million. And we said, if you were 25, what would you do? What are the ideas, the opportunities, the trends that you would take advantage of?

0:36And he gave us two answers. He said, if you had no degree, no college degree, no fancy education, he would do this. And he said, if I had a fancy degree, instead, I would do this other thing. Very cool to hear kind of where his head's at, the small opportunities and the big one, what he called the multi-trillion dollar carcass that he can't believe nobody has disrupted yet. And on top of that, we asked him about his finances. We talked about when he sold his companies and made his first few million bucks and then tens of millions of dollars, all the way up to how he got over$100 million, how he lost it along the way, and what were the key moments that allowed him to reach those heights with his own finances.

1:15I've seen probably 100 interviews with Scott Galloway, and I'd never heard him reveal these numbers or talk about this so openly. In fact, at one point, he goes, I'm naked here. I'm naked here, guys. You got to tell me something. And so very, very good interview with Scott Galloway. Enjoy. But you know, we're not Scott Galloway. We don't have$100 million in the bank. So first, a message from our sponsor. Welcome to the pod. I've been listening to you for a very long time. I was a fan of yours starting, I think, with L2, with the No Mercy, No Malice videos. And the reason I've liked you is I find myself, you might be 15 or 20 years older than me, But I find myself looking up to you because I think we have a lot of very similar characteristics, which are erectile dysfunction.

2:01Not yet. Anger, depression. I have hair, but you're pretty buff. You might be buffer than me. I admire you for that. Thanks for that. Like you like to post shirtless pics. I like you for that. I do. But you're very hard to peg down politically. You're kind of like all over the map when it comes to that. You also, you have beautiful language. I'm a big fan of beautiful language. You've got beautiful language. You're better than I am. But I look, so I look up to you for that. And you started a bunch of really amazing businesses, but you're kind of known, like I've told, we did this episode where we talked about your personal finances, where you talked about spending two to 400 ,000 a month.

2:39And people were like, I didn't know Scott was so rich. And I was like, no, he created a bunch of really big companies, but you're more famous for being like Scott Galloway, the brand. And I think that that's pretty cool. And so you've done a bunch of really interesting stuff. This is the whole episode, by the way. It's just Sam complimenting you. It's like a reverse roast, actually. So you just sit there and you just get compliments. At the end of the hour, you feel good. That's what happens here. Yeah, so far, just let me say, I'm really enjoying this. It's like a verbal massage. This works for me.

3:13Anyways, go on. Keep going, Sam. Well, I read these sentences and I'm like, that's a beautiful line. I love that shit. I just love how he's coming up with that stuff. But yeah, I mean, I think it's like, I think it's really good. And what's crazy is you've had a better career as a business person. And obviously the key to my success is rejection. And that is, I've had a lot of the marketplace, businesses, capital providers, women have provided a great deal of rejection for me. And my skill is my ability to endure that and move on. and not lose my sense of enthusiasm. You know, the ability to mourn and move on is key.

3:54And the wonderful thing about America is that we don't embrace failure. That's bullshit. But we tolerate it. And I know so many really successful people who are very successful and then they do something on their own or they do something and it doesn't work for them and they get stuck. They just lose their mojo and they can't get past it. They can't handle the bullet to the chest or the bullet to the arm becomes an opportunistic infection that starts damaging everything about them. And that's my only skill. I'm really into my dogs. I started an e-commerce company. I wanted to be the Williams-Sonoma Pet Supplies.

4:30I put a million bucks of my own money in, and I sold it for like a million and a half. So I made some money, not a lot. I invested or I started another e-commerce company. I started a travel site, sold that for a little bit of money. You know, I've had a lot of kind of, And then I've had things where I, you know, I ran into a, you know, drove into a wall at 200 miles per hour. I started coming to a red envelope, which went public on the NASDAQ in 2002. And because I was young and dumb, I kept investing. And then I got in a war with the board. And I did a proxy fight. And I took over the board and put more of my money in.

5:04And then 2008 came. And there was a longshoreman strike and a software malfunction at the warehouse where we sent 10 ,000 gifts to the wrong addresses over the holidays. And then a Wells Fargo analyst who was like 14 decided the credit crisis was coming and pulled out of line. And my stock went from seven bucks this year to zero in about 11 days. And when the company had declared chapter 11 and I lost, you know, I lost pretty much everything. Do you remember how much money, when you felt that tipping point where you did feel financially secure? Not like bulletproof where nothing ever will happen, but do you remember the inflection point where you're like, okay, this feels different than I've felt on the climb?

5:41I still don't, I still haven't hit that point. I'm still very anxious about money. You know, I had, and I like to be very open about money because I think that not talking about money is basically a decorum that is promoted by the incumbents and the wealthy, such that you don't understand how much money wealthy people have to keep poor and middle class people under the illusion that, oh, you should be paying 45 % taxes while I'm paying 17. and I think it's important to be very, I think it's helpful to be transparent and I talk about how much money I've lost, all my investments, how much money I've gained, my tax rates, et cetera.

6:19But the, you know, I'm still, I'm not obsessed with money. I think about it all the time. I'm trying to get a lot more. I'm giving it away. Five years ago, I decided I was gonna give away every dollar I made in current income because I want to start catching up to the non-philanthropic Scott for the first 45 years of his life. But I'm still trying to make a shit ton of money. I still feel financially very insecure. I still worry about a recession becoming a depression, and I'm the guy who lost it again. I've lost it all a couple times. And so I don't feel I'm at that point where I don't have financial anxiety.

7:01I do sleep with one eye open. the big you know I sold my first company for 28 million bucks by the time I split it with my ex and my partner in taxes I ended up with a few million dollars red envelope I got a few million there but I always seemed to figure out a way to lose it but I was able to start again because I never had debt I've always lived below my means but I would say the big win was probably selling L2 and I like that oh wow I can buy a plane like that was not in my reach before um so that was kind of the big one that was like all the moons lined up what was the price what it sold for 200 or 300 million dollars no it sold for 158 million but we'd only done one round of venture capital so the you know the common shareholders you know I was the largest equity owner um so the top you know between me and the top six employees we probably own 70 percent of it um so that was that you know that was a lot of money for me i'd never had that kind of money before i'd always done well but i'd never had that kind of that kind of capital and then getting to invest that in the midst of a bull market we sold in 2017 um you know i've made more money investing actually than i've made from my small for my businesses and i'm i got a book coming out in march about uh financial um trying to develop financial security.

8:26And, you know, the ability to create an army of capital, even if it's only 50 bucks a month or 100 bucks a month, put it in a tax deferred or tax efficient vehicle, diversify it and then let time take over. Again, see above, you don't know how fast time is going to go. That's where I've built real wealth. I mean, this doesn't make sense for Sean because Sean is not worried about money at all. He's got this thing that I like to call like good emotional health. He's very emotionally healthy. His parents did him well. And he's talked to me about this. I sold my company two or three years ago, and I made a fair bit.

9:01What did you make? I'm like, I'm naked here. What did you make? Yeah, let's go. Let's go, Sam. You got to say it. He's hesitant. He's hesitant because he's worried people listening. Okay, go ahead. At the end of the process, I walked away with about$20 million. And how old are you? I was about 30. I was 31 or 32. So you should be extraordinary. You should be, unless you really screw up, you should be much wealthier than I am by my age. Because to get that sort of capital base. Yeah, but I still feel shitty. I feel the same, like I still, like I felt awesome for a minute and then I felt shitty where I was like, like when I see these world events right now, when I saw like whatever happens every six months, I'm like, the world's gonna end.

9:47And I do, like an eight, I'm boring. Sean makes fun of me. I do 80, 20 index and bonds. That's the only, I only own those two. That's exactly what you should be doing right now. I think so. And I, and then I own HubSpot stock still. And then I own Airbnb stock. That's basically, basically my portfolio. And Sean makes fun of me. He's like, how are you feeling insecure? And I'm like, dude, I'm broken. Like I'm broken. Like I, it doesn't matter how much therapy I go to. I'm just, I'm a broke. When it comes to money, I have a scarcity mindset and I'm broken. Yeah. I'm the same way. And when you talk about how you're worth, you know, a hundred million plus and you don't feel secure.

10:20And Sean said, he's like, what a little bitch like you know like you talk about masculinity man up you know what i mean like it's and i have the same thing i'm like i i can't i'm weak but the only thing i would say is just uh i mean you both you guys obviously super smart guys and you know it's sort of irrational that you're feeling that way and i guess the question i would have scott is like uh like you know you actually are financially secure now right like it would take um it would take a lot for you to get to the point where you're not able to fund your lifestyle or provide for your family or whatever at this at this point um so you know that that anxiety is somewhat irrational and you're a very smart guy and you've clearly like done the self-development work in a bunch of other areas of your life i'm just surprised that i like i can't tell is it just one of these like virtue signal things where you're like hey guys i'm just i'm still like you i'm still i still sweat it and i'm like oh is that what these guys are doing they're just trying to relate to the common man um or are you actually just not like fixing that irrational part of your brain and just being like uh you know you know working on that like getting it getting it right um which one is it yeah so first off the neuroses is real it's not a it's not a humble brag it's part of a brag but it's not a humble braids the neuroses is real but it's also it's also a feature as well as a bug because I'm all over the people managing my money.

11:48I know where my money is. I think a lot about diversifying. Sam, what you're doing is exactly what you should be doing because you're not looking to get, you're looking to get richer, but more than anything, you're looking to not get poor. And the mistake I made at your age when I had some wins was I would double down and I would start another company and put all my money into one thing. Like you're, quite frankly, you should be selling down your Airbnb and your HubSpot stock and just letting you don't need the needle in a haystack you just need to buy the whole haystack because you've got enough capital I have a price target like I I have like a number where I'm like when we get to around this we're gonna we'll get out of those yeah but I would I mean a longer conversation but Sean here I think about financial insecurity a lot it is still very possible you know there's been periods in economic history where if you're invested and you know you can lose most or all of it um I've put a little bit of pressure on myself because and this is virtue signaling I give a lot of money away so but yeah I don't and also I have a really nice lifestyle but no the insecurity is still there I I was always financially insecure growing up and I just don't know if that goes away but I think some of it is a good thing.

13:06I have my eye on stuff. I think about it a lot. And it's like, if you want to be good at money, if you want to be good at anything, if you want to be good at tennis, if you want to be good at stamp collecting, you need to think about it a lot. It doesn't, you know, Roger Federer thinks about tennis a lot, a lot. And if you want to be good at money, I think you have to have a certain amount of financial literacy. You have to understand interest rates. You have to be thinking, wait, when my mortgage rolls in 14 months, Is it going to go from two and a quarter percent to seven percent? Oh, wait, it is.

13:37Does that mean I should be thinking about selling it, paying off my mortgage? You just, if you want to be wealthy, unless you're extraordinarily talented at something, I mean, extraordinarily talented and also can live below your means. And most extraordinarily talented people have a tough time living below their means. It's not how much you make. It's how much, you know, you spend and your ability to create a delta. So you always save, live below your means. Yeah, the insecurity is real. It really, I still am very fearful of being broke. I don't want to go back there. And now I'm getting to an age right.

14:14I don't have that much time to make it back. So no, the insecurity, the insecurity is real. What helps is that you have cashflow now. Like a lot of startup people, you're poor, you're poor, you're poor. And then you're poor for seven years. Then you maybe hopefully have an exit. Then you get a windfall. and then it feels good for a little while and then you're like, but there's no more income. What changed for me because this podcast and Sean, this podcast has done well and a few other things that we have got going on in our life. We actually have regular, really great cash flow. You have the same.

14:49That has made me feel better is like getting checks every month and like seeing the balance go up on a consistent basis. The cash flow, like there's a difference between entrepreneurs I've found between who sell and just make windfalls versus who have a business that they fully own and they're able to take out income every quarter or every year. And having that cash flow definitely makes me feel better. Oh, no doubt. You always want to be making money. And also, it keeps you in shape. Being subject to trying to make as much money as you spend, or ideally more at any age, keeps you in the market.

15:21You have to understand what the market values and doesn't value. It keeps you. it's how I think it keeps me that an exercise keeps me is is hopefully going to keep me sort of young and that is understanding how how to how to create something in the marketplace whether it's a podcast or a book or a talk for me that people are willing to pay for keeps me in the game it keeps me in the ring it keeps me in shape so I think it's really important to and also you're Right. It does. If you at the end of the year know, okay, if my, even if my investments are down 20 or 30%, which they were last year, I'm still making, you know, almost as much or more than I spend.

16:05That's that you do get huge comfort and peace from that. You know, one of the things we like to do on this podcast is that's different than most is that we, we ask every guest who comes on about what they're seeing now. So like so far, we talked about the past and most podcasts are just about your past. how'd you do it but um we like to talk about trends opportunities business what business would you be starting or do you see as something people could start now right like if you go on if you go on hot ones you eat hot wings if you come on mfm you talk about ideas and opportunities that's sort of the shtick um in fact we almost canceled this podcast because we didn't know if you were prepped and ready with that but sam said no no he's gonna be he's good he's good off the cuff, you'll be ready.

16:49What opportunities or ideas do you see today that either you're tempted to do or you say, no, I'm out of the game, but if I was 25 again, this is what I would be running at. This is what I would be working on. This is a problem that I think somebody could go solve. What do you see out there today? So first off, a lot of it is situational, right? Someone coming out of someone with a degree from an elite university who has the ability whose parents will support them and doesn't have a high burn and maybe a partner that works. You know, it's just a lot of it's situational. I don't like it. I've never liked this hustle culture where people say, go offer to carry Jeff Bezos bags or have coffee.

17:29Because if you're a single mother, that's just not an option for you. So some of it's situational. So I'll go through a few situations. If I'm a young man or woman and I haven't had the opportunity to get credentialed. I don't have a traditional four-year college degree, much less a college degree from an elite institution. I think there are going to be a lot of businesses, whether it's carpet cleaning or gas stations or hanging and selling draperies into small furniture companies that are owned by boomers, they're going to need transition. Nice small businesses and these individuals will need liquidity events that they're just aging out of the business they don't you know they're hitting their 60s and 70s and they don't want to be calling on car washes to sell in you know their product or whatever it is and these are businesses doing between half a million and 10 million a year that have no succession strategy because if they made money their kids don't want to be in this type of business because their kid went to emery and wants to go to work at Google.

18:33And I would try and find, be really scrappy about getting into a business, understanding it, trying to find people who own it and figure out a way to buy it using that person's capital. Approach somebody and say, I want to take over your business. I'm going to buy it slowly over five years and then I'm going to give you coupons so you can retire. If I'm a credentialed person, if I have a degree, I'm fortunate enough, I would go to work for a big platform. I think we live in an era of where antitrust is no longer in effect. So the big companies, if you were to divide the stock market into deciles, the 10, the companies with the largest market cap over the last 30 years have outperformed the bottom nine by huge factor.

19:14So going to work for a big company is vastly underrated. They can abuse their monopoly position. They will have that mole removed. You will get rich slowly working at Google or at McKinsey. So if you're credentialed, you know, we over-romanticize entrepreneurship. If you have the ability to get into the greatest wealth-creating vehicle in history, and that is the U.S. corporation, do it. But they have security at the front saying, do you have a degree from an elite college? But if you do, absolutely go to work for a big multinational conglomerate. If you're an entrepreneur, I think that the, and credentialed and can raise money, I would say that the intersection between AI and healthcare.

19:55The most disruptable business in the world is U.S. healthcare, three and a half to four trillion dollars. Four out of five people aren't happy with it. It's cost of outpaced inflation for the last 40 years, meaning it's got the biggest chin in the world. And I think the fists of stone coming for it is artificial intelligence, where we can take healthcare from a defensive-based industry to offensive. I give my grocery receipts, my workout routine, my healthcare records, my sleep patterns to a company that figures it all out and then gives me prescriptive, goes on offense, proactive lifestyle, grocery, and exercise recommendations.

20:37And I think there's just going to be a ton of niche businesses and healthcare that leverage some form of AI. Are there any out there that you like? Yeah, I'm an investor in a company called 98.6 that does text-based healthcare. It's a private company, so we sell into B2B a big, you know, Sam's, and Sam's offers for$3 a month to every employee, or we charge them$3 a month, an ability to text somebody, and then AI says, okay, it's a rash, we're getting a dermatologist on the line, they look at the rash using your smartphone and say, this is fine, I'm sending you a cream, or this needs a prescription.

21:15we're hitting the pharmacy and by the way that that investment i've written down by 80 it's been really hard i've lost money so far on that so i don't want to pretend that this is all easy but i would say if i were young and had intellectual capital and credentialing i would go into something around ai and health care and then man well like that shocks me that you said that say that because when i look at i've done a few health care things and i look at like the landscape it It seems like impossible to like, it just, there seems like there's a shit ton of regulation. Figuring out insurance companies seems like the hardest thing there is.

21:50And even though everyone is frustrated about their setup, this seems like a, like a very challenging space to crack into. And of course there's, there's huge rewards if you can pull it off, but it seems very, very challenging. I just look at this. I look at this category and how much money is in this category. And it's going to happen. It's just, there's never been a business, there's never been a carcass so tempting, so bloated, swimming so slowly as U.S.-based healthcare. We spend$13 ,000 per person, but we die earlier and we're obese and we're more depressed. The U.K. spends six and a half that.

22:30How can the U.K. and Australia be living longer and spending half what we in the U.S. spend on healthcare? That's just the mother of all chins. there's going to be disruption there and I'd want to get in the way of that. The other thing I'm really excited about and I think it's the most under-hyped I just did a blog post on this I think GLP-1 is bigger than GPT-4. What's GLP-1? Ozampic, Wagovia. Oh, yeah, yeah, yeah, yeah. Yeah, which I've tested semi-glute a ton. It's amazing. I think there's so many crazy implications on what it could do. I've been saying this I don't know shit by the way other than I tested it and I had drinking problems in the past I think it could like help solve alcoholism I think there's so many crazy things there was this guy on Twitter uh our buddy from CB Insights was like what did he say did he say that um uh food companies are going to lose money because people are eating less and he said airline companies are going to make more money because people weigh less he's like that's how big of a deal these drugs are If I was starting a hedge fund right now, I would have a fund that did nothing but go short food stocks, McDonald's.

23:39Nobody walks into Arby's and looks around and thinks, this was a good decision. No one ever thinks that. And if all of a sudden I could get an ejection or take a pill every week that helped me make better decisions, our instincts have not cut up to the institutional production of our economy. We drink too much. Anytime we're near salt, fat, or sugar, we gorge. Because for 99, again, 99 % of our species history, we couldn't find these things. When mating, the majority of men have had almost no mating opportunities through history. A small minority of men have had all the mating opportunities. And then you're presented with a reasonable facsimile of sex called porn.

24:22and there's a decent segment of men out there who aren't working, aren't getting out of the house because they're staying home and watching too much porn and they're also not engaging in relationships. We drink too much. I'm addicted to other people's affirmation. My kid is on snap too much. This could be scaffolding. I mean, the weight loss thing is arguably the biggest addressable market in the world. 40 % of America is obese, 70 % is obese and overweight. But even bigger than that, This could be the scaffolding on our instincts to update our instincts to where they need to be within the industrial production that has gone exponential in the last 100, 150 years with assembly line technology and the microprocessor and say, okay, Scott, you like THC too much.

25:10You like alcohol way too much. You're too desperate for other people's affirmation. And what people say about you on Twitter bums you out way too much. we're going to calibrate these GLP-1 drugs to help you moderate your cravings. I mean, what these things do is they moderate your cravings when your cravings are getting the incorrect signals from 300 ,000 years of instinct on the Savannah. And everybody, I mean, they're finding out people on Ozempic drink 60 % less alcohol. They're biting their nails less. so the opportunity to update our instincts for the entire i mean the market i i'm just i'm blown away by this thing i think it could be just enormous and there isn't anybody that doesn't have that has instincts that has a behavioral model that is that is driven by instinct that is caught up to our world i don't care who you are have you tried it i haven't but as you can tell I'm ready.

26:15Yeah, geez. I feel like you just injected me digitally just now with it. That was amazing. You know how much it costs a month? About a thousand bucks a month, right? It's between 500 and a thousand dollars a month. When I was trying it, it was 500 a month out of pocket. Most insurance companies, and I think if you have diabetes, they actually only cover it, I think, for a limited time. But most people using it now are just paying 500 to a thousand dollars a month. And here's the crazy shit about this drug. You have to increase your dosage every week. So you start with a very small amount. And every two weeks or so, you have to increase it.

26:51Like forever? Well, I don't know forever. But over a course of at least a year, you have to. So when I first started taking it, I would test out just a little bit. And it would make me a little bit sick to my stomach. You know, the downside of, there's a few downsides. One is upset stomach. And then after about three weeks, I'm like, all right, I feel great. Let's increase it. And then now at the end of six months, you're taking 10 times. Basically on a syringe, you got to fill the thing up to 100. At first, you fill it up to 10. And over a year, you have to increase it. And so you have to pay more and more money.

27:22What could go wrong? There's a lot of things that can go wrong with that. I've tested it. One downside is I actually don't know if you develop healthy eating habits. You just eat less. And you lose muscle. You lose muscle. There are definitely downsides to it. It's not a terribly new drug. I think that these types of things have been around for like 30 years. So there's some studies, but as it's being prescribed now, it's definitely new-ish. So there are definitely going to be downsides, but it's super promising. Another one is metformin, which isn't in the same category entirely, but it does similar things.

27:57That's super interesting. I always think it's interesting when people like Sam Altman, like these geniuses who see everything, take it. And he's been like, this is the drug I take. I take metformin all the time. So that's super fascinating. So I agree. I think this classification of drugs is quite interesting. I mean, I was even thinking, I'm trying to figure out the second order effects here. And like, does Moderna stock go down 80 %? Because the reality is, through the pandemic, the far right weaponized and politicized masks and vaccines and decided, well, if you take them, it means you're far left.

28:28So if you're far right, you don't want to take these things. On the far left, we weaponized and politicized obesity. We didn't want to acknowledge that 88 % of mortalities had one comorbidity at least that was obesity related. And we started with this trope of, oh, you're not obese. You're finding your truth. No, you're not. You're finding diabetes. There's nothing to celebrate here. And so we decided we didn't want to have an open conversation about the fact that America is obese. 40 % of America. The kids, you're more likely to commit suicide, obesity, and children. It's terrible. You're much more likely to be depressed as an adult, not go to college, and become more likely to kill yourself.