Post Corona: From Crisis to Opportunity

by Scott Galloway

March 19, 2021 — March 26, 2021

Los Angeles, CA

Damn this book is great! I’ve heard great things about Scott Galloway’s writing, my high expectations were met and it was one of those books which I had to put a time limit on reading to avoid forgetting about the day. It’s very well-written with a lot of information, providing an overview of what happened that will give you flashbacks with valuable facts and information accompanied by compelling analysis on trends and events, with an attempt to help us look beyond our unprecedented present and predict the future by understanding how we can create it, catalyzing a dialogue that crafts better solutions. While it focuses on how the pandemic reshapes the business environment, it also connects the business story to the broader society story and discusses higher education, capitalism and cronyism, socio-economic inequality, dynamics of governments, and the greater global economy. Tying it all into what we should think of, prepare for, and start doing. I highly recommend this book since it is probably one of the most relevant books we can all read, it has provided me with a more cultivated lens of the world we live in and I feel further informed when making decisions or advising. I actually think this book is an essential read for everyone, to understand that the pandemic’s most enduring impact will be as an accelerant and that in any crisis there is an opportunity; the greater and more disruptive the crisis, the greater the opportunities. Throughout the book, I constantly left my “damn” annotation due to all the surprising and shocking facts presented.

The author starts off with discussions about valuations of companies and the market, how some industries got slaughtered while others skyrocketed, placing an emphasis that the industries we will see have the most rise are healthcare, higher education, and groceries/retail. What I found super interesting is that startups that launched or got evaluated by firms during the pandemic received very flawed valuations since a valuation is based on its numbers but also its narrative, so firms deemed innovators and gave them valuations based on estimates of cash flows 10 years from now, and discounted back at an incredibly low rate. They’re basically holding bets about the post-corona environment, which is why some start-ups are seeing massive gains while others are falling into quick decline. This made me stop looking at new start-ups’ recently raised money or put out their valuation to flex, it’s flawed and I’m not going to get fooled by the numbers. What would have been smart though is to get a valuation during the pandemic for an express ride. Then it dives into aspects of life such as remote work, different business models (red and blue), and other futuristic aspects that the pandemic accelerated and pulled towards us to make it a present reality.

The Author then pays homage to his older and most known bestseller, "The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google" (he adds Microsoft in this book) by discussing how those companies have accelerated their path to dominance, explaining why they got stronger and revising what relevant events that occurred during pandemic impacted their evolution. These are the companies one should invest in, the unregulated monopolies of the big tech industry founded on innovation that make up 21% of the value of all publicly traded US companies and have an unlimited potential for expansion, diversification, and scale. They are taking over the world, the pandemic allowed that conquest to rise and their banks to boom.

Then we are introduced to the disrupt ability index, the key signal being the dramatic increase in price without accompanying increase in value or innovation, the unearned margins basically. The industries ripe for disruption are healthcare, higher education, and grocery/retail. This is because the existing players in these areas failed to adopt a technological change to improve their quality and accessibility. He introduces start-ups that are now disrupting this arena, which made me think a lot about my friend Kenny Lin since he’s in this arena, especially since a whole chapter is dedicated to higher education’s possibility for reform and integrating tech to improve it. A discussion about what to look for in the founders’ attitudes and the companies messages, before talking about the recipe for disruption: the T Algorithm, T stands for Trillion as in having the chance of a trillion-dollar valuation. The elements are appealing to human instinct, accelerant, balancing growth and margins, rundle, vertical integration, Benjamin Button products, visionary storytelling, and likability. Presenting examples of companies and start-ups that encompass the elements. I began changing my investments, I’m truly convinced that these will rise.

When it comes to wealth and power, America has been all about the wasta, but it’s in disguise, unlike the MENA. We underrate how much impact being born with privilege has on one’s livelihood and future in this world due to privilege providing accessibility and leverage. While the author is a proponent of capitalism and uses logic to defend it as it gives birth to innovation and leverages cooperation, he acknowledges it has no moral compass and suggests governmental patronage and supervision in order to keep it healthy. Furthermore, a very interesting point he points out about why America failed to control the pandemic regards individualism, which was a recipe for self-destruction in times when the sacrifice was needed, by putting the nation and population before one’s desire to live their life.

Another interesting remark he makes is regarding cronyism, which I really thought a lot about and began to adopt new choices in how to deal with to avoid it, he says that he doesn’t meet with people in person and only online when they ask him for something to avoid placing empathy over logic in making a decision. I think this lack of accessibility is great to ensure meritocracy, but when I think about it more it’s also a root for cronyism since those who are wealthy have more accessibility, therefore get farther in life. We’re in an era where the disparity is growing and the sides are pushing away from each other at an accelerated pace, it’s never been easier to become a billionaire, but harder to become a millionaire, it’s all based on what you were born into (I don’t want to hear the “entrepreneurial spirit” bullshit that if you work hard it doesn’t matter what you came from right now, this is what’s going on in the world). He lays out the fact that if we want a better government, we should stop allowing qualified people to rule. Our idolatry of the rich convinces us that we need a “businessperson” to help us “succeed and fix things”, but running a business is nothing like running a country, even if you run a multi-national monopoly conglomerate. In the records, the best presidents of the US have been unsurprisingly politicians followed by military leaders, those with primary pre-White House careers in business (ex: Harding, Coolidge, Trump) have been markedly less successful. I’m going to end it here and start implementing my plans to continue building opportunities out of this crisis as it comes to an end.