Biden's Bad Polls, Lessons Learned from SBF Trial, and Guest Kashmir Hill

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[Intro music]

Kara Swisher: Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Cara Swisher. And, Scott, happy belated birthday.

Scott Galloway: Thanks very much, Cara. You got me a sweater, but I would have preferred a moaner or a screamer.

Kara Swisher: Oh, my God. Versus a sweater. Get it? That is another bad joke. You need to like up the joke game in your advanced age and stuff.

Scott Galloway: People generally find my profanity fine as long as I'm funny. What you're saying is I'm just being profane.

Kara Swisher: No, no. I think you just need to be funny. I just think as you're advancing in the years, I think you should up the game on your jokes. That's all. You know what I did for my birthday?

Scott Galloway: Yeah.

Kara Swisher: So they said, what do you want to do on your birthday? So I said, I want to have a big breakfast. I want to work out with my boys. And then me and my boys went to the Brentford-Everton game. We're going to these little or kind of smaller stadiums. We had just a really wonderful day. I think I just had a nice birthday.

Scott Galloway: That was really sweet. That's a very good birthday. We're going to be with you next year. You've already invited me to your party.

Kara Swisher: Oh, that's right. You're coming. Your big one. I'm not going to say the year, but it's a big one.

Scott Galloway: Yeah, big 50. Big 50.

Kara Swisher: 50? Do you know, just go with it. Sure.

Scott Galloway: Adam Alter, my colleague at NYU, has done all this research. Which is supposedly the year you make really big decisions whether it to change your job, get divorced, commit suicide. Disproportionately happen in the nines. Something about 29, 39, 49, which I am now. It's my birthday. It's my birthday. Why don't you just go with 29? You're 29.

Kara Swisher: Yeah, I don't. Naked, I don't look 29. If it's dark, I can pull off 49. Anyways, he said that all of your big decisions and life-changing. So here comes the big decisions. Let's get ready, Kara. What are we doing?

Kara Swisher: Wow. I don't know. That's exciting. Did I make a lot of decisions last year? I don't think I did. I guess children. Oh, I had more children. Oh, wait, that. There was that.

Scott Galloway: You decided to be 105 when your kid goes to college.

Kara Swisher: Yes, that's exactly right. Well, I had a lovely time with my children this weekend, too. We took a hike.

Scott Galloway: Where'd you go?

Kara Swisher: We took a three-mile hike to ice cream. So the kids actually walked three miles. It was great. Through the woods. It was very beautiful woods around Washington, D.C. And so we did an ice hike. And then we took the bus back. They had not taken a bus, so I took a bus with them. Anyway, it was a lovely weekend. We both had lovely family weekends. And I'm excited to spend next year's birthday with you, your 49th birthday with you next year.

Scott Galloway: There you go. In Scotland.

Kara Swisher: Scotland. I'm going to be there. I told Amanda. She gave me a high, you know, when the eyebrow cocks upwards.

Scott Galloway: Yeah. She's like, oh.

Kara Swisher: That's all she said is, oh, like that. Like that. She's excited. I'm excited.

Scott Galloway: It doesn't sound that exciting.

Kara Swisher: No, she was excited. We're very excited. We love Scotland. We think it's beautiful and we'll be there. We will be there. We shall be there for your birthday.

Scott Galloway: Good, good. So there's a lot to talk about also.

Kara Swisher: There's so much going on. There's so much going on. We're going to talk about the new election poll that has Democrats worried, what Sam Bankman-Fried's guilty verdict means for crypto. And we'll talk to The New York Times reporter Kashmir Hill about her new book on facial recognition. She's a badass of this area and a lot of crypto stuff. So it's actually a good time to talk to her. But first, the Washington Post has a new CEO, William Lewis. He's British. He's a former reporter turned executive. He previously was CEO of Dow Jones and publisher of The Wall Street Journal. Jeff Bezos said in a statement that he was drawn to Lewis's, quote, love of journalism and passion for driving financial success. I spent a lot of time finding out about him from people who know him. I missed him. He was brought in to sort of clean things up after the big hacking debacle. They brought a bunch of different people. He's a long reporter turned executive essentially. He got a pretty good rep. I would say he's right of center maybe, but people seem to like him. Lots of different people I called around to about a half a dozen people who know him. What do you think of the choice?

Scott Galloway: I think it's unimportant and the media is obsessed with itself. But anyways, the only thing I would... Come on, who gives a flying fuck who's the new CEO of Washington Post? Anyways, the thing that's interesting is that the new heads of the New York Times, Washington Post and Wall Street Journal, what do they all have in common?

Kara Swisher: What?

Scott Galloway: They're all Brits.

Kara Swisher: So CNN, right? British.

Scott Galloway: CNN. Not Meredith. Meredith is not. Meredith Levian is not British. I'm sorry. CNN, the new head of the Wall Street Journal and the new head of the Washington Post. All Brits.

Kara Swisher: Yes. Yes. Yes.

Scott Galloway: Well, they were. He's British.

Kara Swisher: Yeah. Yeah. Yeah.

Scott Galloway: Well, she's the new editor.

Kara Swisher: Yes. That's different. This guy's the CEO.

Scott Galloway: I love how you work through stuff real time. This is fun. Is this how we watch your brain working?

Kara Swisher: No. I'm just thinking. Because they're not exactly on the same level as CEO is different, is an American. But yes, there's a lot of Brits. They like a Brit. They like to bring in a Brit. If you have a British accent, you want to go to work for a consulting firm because everyone's under the impression you're 10 IQ points smarter than you actually are.

Scott Galloway: Yes, that is true. It's just you sound very smart. Or Northern European, something you can't identify. I think people who run U.S. media, they identify them and they stereotype them as being to one pole or the other, one string or the other. So I think people coming in to interview to be the head of media organizations that pride themselves on trying to be balanced or just about the facts. I think they hear someone is British and immediately think, oh, this person is a little bit more reasonable. That's what happened with Jeff. You know, this guy's got a rep for being good at talking to rich guys. That's another thing he does. So that's, I would not say it's a negative.

Kara Swisher: Good at talking to rich guys. You know, he's good at like-

Scott Galloway: Does that mean he's a prostitute at the bar of the Four Seasons? What does that mean?

Kara Swisher: No, all that, those people are also.

Scott Galloway: But it's actually-

Kara Swisher: Asking for a friend.

Scott Galloway: Is that the King Cole bar? Isn't it the King Cole bar, from what I understand?

Kara Swisher: I have been there once, and two mobsters got in a fight when I was there. I've been to the-

Scott Galloway: Oh.

Kara Swisher: Oh, but you know who I did see? I saw Jared and Ivanka there, and they came over and said hi. Jared was my student.

Scott Galloway: Oh, the King Cole bar. That to me, I have heard that's the prostitute bar in New York, but I don't know. Allegedly, allegedly. Have I told you I'm hooker blind? I'm totally hooker blind. I don't think I've ever, and then someone said to me, gave me like a quick, kind of a quick spotting mechanism. They said, Scott, for you, any woman who returns your eye contact is probably a prostitute.

Kara Swisher: Oh, that true. That true.

Scott Galloway: Yeah. But I never ever actually seen a prostitute. I'm not good at picking them out. I'm hooker blind.

Kara Swisher: Interesting. Okay. All right. Well, I don't know how we devolved that from the British guy. All right. In any case, you know, he's got a good reputation. I've heard from some of the people who were involved in the talks, and they were all very worried about the finances and what to do and whether Jeff had the stomach to spend money where he needs. He's got to spend if he really wants to go anywhere with this thing, or else it's just going to bump along. And that's their worry, is that it's going to bump along, as you were noting by saying, who cares? Speaking of which, he announced he might have extra money, announced he's leaving Seattle and moving to Miami to be closer to his parents, plus Blue Origin operations are shifting to Cape Canaveral. He's also from there, by the way. He graduated high school. This one I'm not so irritated about. He's there for taxes, I assume, but he is actually from there. So let us give him a break on this one.

Scott Galloway: Hold on. Give me an actual fucking break. He's moving to Florida to be closer to his father. He's close to them. So first off, at some point, these people are going to realize we're not idiots. I moved to Florida in 2011. And one of the reasons I moved down there, the primary reason I moved down there is because we couldn't get our kids into school. I wasn't making any money at the time. But anybody who moves there, especially if it's California or New York to Florida, recognizes that a 13% swing in taxes, if you reinvest it, is enormous. And there is something about, I do believe, I used to think that we needed to normalize the tax structure in the United States because it was straight tax avoidance. Now, having said that, there is something to competition that if a state like Texas or Florida can manage to run the state on higher property taxes and lower income taxes, that it creates healthy and needed competition such that when state legislatures, in order to curry votes with whoever it is, special interest groups or unions, actually says, okay, if we just tax everyone out of existence, at some point people are going to leave the state and the tax base is going to erode. There is a healthy competition. Having said that, the very disturbing part about this is that this is yet another transfer of income from the poor and the middle class to the rich. Because the bottom line is of the tens of thousands of people who work for Amazon in Seattle, who have registered capital income gains of $10,000, $100,000, maybe even a million dollars, very few of them have the luxury and the option to move to Florida. Who are the most mobile people in the world who can engage? 100%. And that's the problem. When France passes an uber wealthy tax, what do you know? The wealthiest man in the world moves to Belgium. So what you have to recognize, what I think they should probably do is what they do with options. And that is, if you move to Texas, you get to, and then you sell as Elon Musk says, you sell all the stock you have. The next day, the next year, you no longer are subject to the taxes, despite the fact that you leverage California infrastructure or that Jeff has been leveraging the unbelievable engineering department at the University of Washington. The incredible-

Kara Swisher: Also, Microsoft is there.

Scott Galloway: I mean, he's just registered all of this investment, public investment for middle-class taxpayers, and he's monetizing it and avoiding those taxes by moving to a low-income state. He gets to do that on his shares. But in terms of options, when you exercise options, it is based on where you were when those options vested.

Kara Swisher: Oh, interesting.

Scott Galloway: So if all of his capital gains were from options, and some of the capital gains that Musk realized were from options he was awarded, if they were vesting over four years and he moved to Texas three into that four-year vesting period, 75% of the gains from his options would be taxed based on California taxes. And I'm wondering, Kara-

Kara Swisher: Well, no, not for him, Seattle, because they just put a new wealth tax in Seattle and they're contemplating more. They're in Washington State.

Scott Galloway: Yeah, but isn't it held up in the quarters? Anyways, my point is-

Kara Swisher: In any case.

Scott Galloway: What I think they should move to is some sort of thing that says, okay, Jeff, you're going to start to sell down your $90 billion in Amazon stock. Our view is that the vast majority of that wealth was accreted in Washington. And any money accreted from this point forward, if you're really living in Florida, fine. But this sort of tax avoidance where you don't match the taxes to the investments made by your fellow citizens while you were there, there's something uncomfortable about that.

Kara Swisher: I would agree. I would agree. I find it disturbing. In this case, let me just say, his parents are there. He did grow up there. This is not like, he's not going somewhere weird. It is where he's from. His Blue Origin operations are going to be in Florida. So moving there seems a little more believable in that regard. And I sure Lauren is not like loving Seattle. She's a Miami gal.

Scott Galloway: I know. I'm sorry.

Kara Swisher: She just is. Look at her Instagram. She's a Miami gal. I think there are personal things here, but I agree with you that he got most of his wealth from moving he and his former wife to Seattle. That's who made him. And so he does owe something to that state and that city.

Scott Galloway: Absolutely. No question.

Kara Swisher: Anyway, another thing that you've talked about a lot and actually you wanted to talk about, and I agree with you, is major changes in the real estate industry are likely coming following a court ruling. Last week, a federal jury found the National Association of Realtors and several other brokerages conspired to artificially inflate commissions paid to real estate agents. The association and brokerages were ordered to pay damages of nearly $1.8 billion. The chief executive of National Association of Realtors resigned two days later. It's worth noting he'd also been facing sexual harassment allegations. So how will this impact buying or selling a house?

Scott Galloway: They were very interested in this. I think this is the biggest business story that was the most underreported of last week. And that is, it's not very romantic. It's not very interesting. But in terms of impact on the real economy, it's enormous. People's largest asset, or 80 or 90% of Americans' largest asset, especially older Americans, is their house. And the National Realtors Association has figured out a way to basically hide costs, transaction fees. If you want to be on the MLS, the major listing, you have to agree to what's called an offer of compensation. The compensation comes out of the seller's pocket. And they have to offer compensation to the buyer's broker so the buyer doesn't negotiate the fee directly with the broker because what difference does it make? So it's all led to an ecosystem where it's less competitive than most. And as a result, versus the UK where real estate commissions are kind of three to 4%, they're five to six in the US. And when you're talking about people who are average home $420,000. People move on average every five years. You're talking about $2,000 a year in commissions for most homeowners. That's real money. And you can trade stocks for like 0.1% commission. The biggest asset in your house, and it's a fairly liquid market, you pay 5% to 6% commission on it. There's also a ton of brokers out there. So you'd think, well, why on earth, like every other ecosystem, haven't we seen people pop up and say, I'm a new broker, I do it for you know 50 off because I need to get established? Why hasn't competition starched down the costs here? I think this is a big deal.

Kara Swisher: Yeah. Yeah. I mean, it really is interesting how we buy and sell homes. It's one of these big costs that we pretend isn't a big cost. That's what I always think when I talk to people.

Scott Galloway: That's exactly right. And we spend more time on like stock, everything else, but it is usually someone's biggest asset when they have an asset like this. Not everybody does have a house by the way. And the way it's done is so, you know, I did like, I know you make fun of some of the different real estate attempts to try to clean up the real estate selling process, whether it was Compass or whatever, or Nextdoor or something. But I did appreciate, like, why is this process so onerous? Arguably the greatest regulatory capture, other than probably the hospital and the insurance lobby for the medical industrial complex where Americans pay $13,000 a year versus $6,500 in Australia, Canada, or Britain for worse health care, the most regulatory capture that results in kind of an unusual or anomalies in the economy is the real estate industry. And that is, and who owns real estate? Rich people. So if I sell a home, I can 1031 it, and it gets tax deferred. I can roll it into another real estate without paying taxable gains. Or if I sell shares in a stock, once I sell it, I have to pay the gains on it. I can, if I own an office building, while it's appreciating in value, I can depreciate it 3% a year. I can lever it up five to one. I can write off the interest on it. The real estate lobby has made the real estate industry the most tax advantage. In addition, they're in bed with the insurance industry. Do you know, if you're in Florida or somewhere else, you can't get a mortgage unless you prove insurance. You know what I've done? I own some property in Florida. I'm in a privileged position where I didn't have to take out a mortgage. I have been self-insured on health insurance and on property, wind, fire. Because when you do the math...

Kara Swisher: Wait, self-insurance means you don't have insurance, correct?

Scott Galloway: Don't have insurance. That's right. And again, again, 45 cents on the dollar of all insurance goes to profits and administration, meaning you get 55 cents back. So when I did the math on a rental property I own in Delray Beach, unless it burns to the ground every like 14 years, I'm better off self-insuring. But you can't self-insure if you're not rich and need to get a mortgage because the mortgage guys are in bed with the insurance guys. Insurance is yet. We've talked about this. My health insurance cost me $55,000 a year for me and my family because I'm a narcissist and I want the gold-plated insurance. I went naked, no health insurance.

Kara Swisher: Oh, you're a bad person, you're a bad father.

Scott Galloway: No, you're not, I have enough money to survive any illness. Five years, $275,000. That buys a lot of healthcare. So again, the insurance industry is nothing but a transfer of wealth from poor and middle people who can absorb these risks to rich people who can.

Kara Swisher: Right. That's true. Do you think Bezos has a mortgage?

Scott Galloway: Oh, God. No, he bought a big house. He pays cash for everything. You know, Ivanka was at some party with her, with Lauren. There are a lot of pictures of Kim Kardashian, Lauren, and Ivanka Trump with Marc Andreessen's wife hanging out in the background. That was quite a photo.

Kara Swisher: Anyway, should be fun times down in Florida. Let's go down. Let's go stay at your house. It'll be fun. I love Florida.

Scott Galloway: Oh, God. You've been to my house.

Kara Swisher: I have. Of course, I stayed there. I stay at all your homes. Anyway. But wait, hold on. More importantly, how many dead hookers does it take to change a light bulb?

Scott Galloway: Oh, no. Stop with the hookers.

Kara Swisher: Apparently, Kara, not three because my basement is still dark.

Scott Galloway: Oh, my God. Better?

Kara Swisher: No. Anyway, last week, over the weekend, Elon Musk launched an AI bot called Grok. One of my favorite words is Grok, so I'm kind of pissed off he's using it as part of his new venture XAI. Grok apparently has a, quote, rebellious streak, just obnoxious is what I think it is, and it answers spicy questions. Grok will be available to X premium plus users at $16 a month. I haven't tried Grok. Not going to buy Grok. What do you think of Grok?

Scott Galloway: I actually think it's a really good idea. The thing that I think is sort of strange about these LLMs is in an attempt to recognize that if you feed media, if you feed in historical data, it's going to have a bias because the history of the world and the history of America is that we have biases. We have stereotypes. We have racism built into our books, into our literature. And so you can tell these things have been tweaked to try and compensate for that. And when you ask it a question, it'll condition things and it'll say, it does come across, the LLMs do come across as a bit woke. And so him offering a LLM that I bet is going to be a little bit offensive and red pill will have an audience right out of the gates. I actually think from a marketing perspective is actually quite smart.

Kara Swisher: Do you think people will pay for it? Or is it just an entertainment? It's going to be using Twitter information. It's supposed to rival chat GPT.

Scott Galloway: Yeah, they're anodyne is what it is, is what you're saying.

Kara Swisher: I don't know if woke is really the word. It's just they don't want to say racist things to someone, which I think is probably a good thing to tweak. I'm not saying they're right or wrong doing this. I think their intentions are noble, that we want to recognize that all the data we put in here might end up with things that are not only not true, but are hurtful or discriminatory, whatever it might be, right? So they want to be thoughtful about that. They're also covering their ass because immediately everybody, when they get an LLM. I have-

Scott Galloway: Goes and tries to get it to do a bad thing.

Kara Swisher: I have PropG.ai. I built an LLM, input all the transcripts from this podcast, all of my newsletter because-

Scott Galloway: Did you ask me? No, you didn't, but go ahead.

Kara Swisher: That's good. You're being anodyne. Anyway, so-

Scott Galloway: No, I'm not.

Kara Swisher: I get a lot of emails from people asking questions and I say, I'm sorry, I don't have time. Ask PropG.ai. And it's interesting, you can tweak it to say, be more irreverent, be more profane, be more politically correct, whatever it might be. And it'll come back with a different tone. And I would bet if it's a good LLM, I would bet that people do... The opportunity in LLMs will be like a healthcare LLM or one that's focused on certain types of stocks, niches and things like that. I mean, I immediately, I was dying to get on there because I wanted to ask you questions like, should a billionaire be denying people of their severance payments. Which he's doing. It's a good form to accuse a co-worker of a sex crime when it's not founded. Did a gay lover actually beat up the speakers? I wanted to ask it those questions and see what it came back with.

Kara Swisher: That's funny. I don't love the use of woke stuff. Anodyne is the word you're looking for, bland, inoffensive, innocuous. And that's what you don't like.

Scott Galloway: That's a better word. That's what they're trying to do. And he's using woke as just like a marketing tool. Whatever. Good luck, Elon. I will not pay for it, but good luck. I don't really, I have other things that entertain me more, such as TikTok and other things.

Kara Swisher: So anyway, let's get to our first big story. Sam Bankman-Fried's trial took about five weeks, but it took a jury less than five hours to find him guilty on seven charges, including wire fraud, securities fraud and conspiracy to commit money laundering. Bankman-Fried's charges together carry a maximum sentence of 110 years. Sentencing is set to happen in March. His lawyer alluded to an appeal in a statement saying, quote, Mr. Bankman-Fried maintains his innocence and will continue to vigorously fight the charges against him. Were you surprised by how it shook out?

Scott Galloway: No. I mean, quite frankly, he not only has committed fraud, he has terrible judgment. There's no way his lawyer said you should take the stand. I remember being at the Andrew Ross Sorkin's deal book conference where he did an interview. And I remember thinking, this kid is clearly not listening to anybody because he just added 10 or 20 years to a sentence in this interview.

Kara Swisher: Wow.

Scott Galloway: You don't-

Kara Swisher: This was post, right? This was post his-

Scott Galloway: Yeah, this was after he'd been subpoenaed. Like Trump does, yeah. And I'm like, this is just the dumbest thing he could have done. And I feel bad for his parents. But look, there is a lesson here. And that is, if you're blessed with success, you have to implement. Everyone around you is going to tell you you're amazing to the point where you're going to start believing that small incremental violations of the law are not violations of the law. And then they become big violations of the law and that somehow you could just throw up your shoulders and say, I mean, he built his career based on trying to create this myth or this story that he was a genius. And then his defense became a story on how he was an idiot. Well, I didn't know. And it's like, well, okay, which is it, boss? And he's going to jail for a very, very long time. But where I was headed with this is if you're successful, the people who stay successful and stay grounded and maintain their marriages, maintain their friendships, maintain their success, maintain their economic livelihood, maintain their freedom, are people who always implement guardrails. I'm going to make sure there are people around me who can tell me like it is. I check with lawyers. I check with my board. I check with people who push back. I think kids are really important. You know why? Kids remind you you're not that fucking cool. Kids are just not impressed by it. My sons are so unimpressed by me. And to a certain extent, they kind of keep it real. And a good spouse and a good partner will tell you, like, you're full of shit. That's not true. You're reading your own press. A good board will say, no, you can't do that. That is not cool. It's illegal.

Kara Swisher: Yeah, this guy had nothing around him. Or he pushed people around. I think he was quite aggressive in terms of pretending he was feckless. And then everybody did what he said. Interesting. The Atlantic had a headline, Silicon Valley may never learn its lesson. Do you think people keep falling for these characters? Attorney General Merrick Garland said in a statement this case she sent a clear message to anyone who tries to hide their crimes around a shiny new thing they claim no one else is smart enough to understand. The Justice Department will hold you accountable. Interestingly, the VC firm Sequoia is getting dragged after in the aftermath. One of the partners, I think it was Alfred Lin, tweeted about how the company evaluated its due diligence process after FTX collapsed and determined it had been deliberately misled and lied to. These people didn't do due diligence. Firms included New Enterprise Associates, SoftBank, Sequoia, BlackRock. I collect you're putting $2 billion into FTX. So talk to me about that, the due diligence part of it. You get involved in all kinds of companies. And it's sort of a lot of people go along to get along kind of thing.

Scott Galloway: There's just a different approach. When General Catalyst invested in my last or two companies ago, L2, I think conservatively, they called 50 people I had worked with.

Kara Swisher: Oh, wow.

Scott Galloway: And interviewed them about me. I mean, people that I hadn't talked to in 10 years. And the amount of diligence they did on the numbers and they brought in an accounting firm to pour over everything. This firm was calling me and saying, we see this $4,000 charge here. I mean, they did a full body cavity search. What I also found out from another investor is he was about to put a billion dollars into FTX that when they asked for financials, he said, we don't have financials. I can send you a text message that summarizes our financials.

Kara Swisher: Wow.

Scott Galloway: And when you see the gains that the people invested last year made, your standards come down. You're like, okay, this is a new world. Let's get super aggressive. Everyone's making money but us. We have access to something special. This is a tale as old as time, and it's not gonna stop.

Kara Swisher: Yeah, I agree. That's what I said. Whether it's Adam Neumann, there'll be Elizabeth Holmes, there'll be a new character that comes across as very honest, comes across as an innovator, and the opportunity, the sense, you know, the illusion of scarcity to get in erodes your ability. And look at those guys are in it. Those guys are in it. Those guys are in it. You know, that's what happens. Oh, Sequoia's in it. You know, oh, Andreessen's in it. Oh, that carries along a lot of these firms. There's so many dozens of firms that this has happened, even sort of minor ones like Juicero. When they came, we're like, we don't get this, right?

Kara Swisher: We were just sitting there going, nice people, but this seems stupid. And they just pile the money in. I don't know why. I never understood the mentality. I've been asked to be a venture capitalist many times and I've turned it down because I never understood.

Scott Galloway: Well, you can empathize with the fact that if you invest in some of these firms, some of them got 7 to 10x returns in 12 months, at least on paper. So it's like, okay, all of my buddies at the firm down the road, Sand Hill Road, have literally clocked $100 million in limited partner carried interest by moving.

What happened was the following. There was this tidal wave of capital into these companies that they needed to deploy. In order to deploy it, it became a war around how to get into a finite number of hot firms that seemed to be going to the moon. FTX was one of them. They could only compete on a few things. They could compete on relationships—that's how you got introduced to Sam Bankman-Fried. You could compete on valuation. Everyone was willing to pay these crazy valuations.

So a new form of competition, a new form of differentiation and winning the deal, happened across CO2, Tiger, SoftBank. They said, "Sam, we can move fast. We can do this round in 48 hours." All of a sudden, that won these guys a lot of deals. But it also meant you can't put 10 pounds of diligence in a one-pound box and conduct anything resembling diligence.

Kara Swisher: And you can be sure that Sequoia said to Sam Bankman-Fried.

Scott Galloway: Oh, they did. They wrote an essay about it, how adorable it was. "We can move fast. Oh, you need $500 million at an $8 billion value? No problem. We have so much capital under management. We have such incredible relationships with our investors. We can sign the term sheet in 48 hours. We can fund in seven days."

They were all doing it, Kara. Or not all of them. But if you wanted to deploy capital and have fun at Studio 54 of this incredible wealth generation, you had to go along and pay not only these outrageous valuations, but be ready to fund in no time flat.

Kara Swisher: Right, right. No, I agree. It's really—I mean, there was an essay that Sequoia did about it that was just embarrassing. I don't know what else to say.

Scott Galloway: You mean the blowjob on a piece of paper?

Kara Swisher: Yeah, it was crazy. Oh my God. This is the now-removed Sequoia profile of SBF and FTX that they put up. It was called "Sam Bankman-Fried Has a Savior Complex—And Maybe You Should Too." It's so embarrassing. They were saying that as if it's a good thing?

Scott Galloway: No, if you want really embarrassing—again, I have a bit of a bias against Sequoia—but go to Sequoia's website and look at the quotes from the partners. There's one young partner who shall remain nameless. This is literally an exact quote: "When I meet with the founder CEO, I don't want to know just about the company. I want to know about how he's doing."

I thought to myself, I'm going to reach out to this guy and say, "No joke, I'm a 3x-backed Sequoia-backed CEO. I have prostatitis, erectile dysfunction. Can we get together? Because I'd really like to hear from a 29-year-old who learned on the mean streets of Groton and Dartmouth how I'm doing." The quotes from these partners are just comical.

Kara Swisher: This piece, you should read it. It's in the Wayback Machine. Let me just read this one thing: "With SBF doing the hard work of interviewing himself, I'm free to think. And finally, just as the clock is running out on my allotted hour—by the way, hour—I ask what might be the first non-stupid question of the entire interview. So I summarize, 'You are young and vital and peaking at precisely the moment when the world is, as you see it, at peak crisis.' SBF nods in agreement, deep in another round of Storybook Brawl." He's playing a video game during this.

"Does that strike you as a lucky coincidence, or does it strike you as perhaps a signal that your thinking is flawed and you have a savior complex?' 'That's an interesting question,' he says, stalling. I double down. Ooh, journalism. 'You happen to be alive at the most important time in the history of the human race. Is it the existential point, really?' SBF hedges. 'It certainly would not be one's prior, at least not naively.'"

It just goes on. I literally am like, this guy is a horse's ass, and this is nonsense. It's beyond belief. Anyway, good luck, Sam Bankman-Fried.

Scott Galloway: Is this the end of crypto? Bitcoin is up. Bitcoin has doubled this year.

Kara Swisher: I think the crypto universe will, and maybe correctly, try to say we've bottomed out here. We've starched out the bad players. There's real value here. It's time for the adults in the room—whether it's a Mike Novogratz or people who are seen as aggressive but honest, ethical players making a market in the space. There is some technology here, but it should be a small niche market where there's probably some real innovation. If you're in an emerging market with an unstable currency, there is value to getting your Argentinian pesos converted to something more stable.

Scott Galloway: I'm listening to the best Spotify music channel, Bangles Radio, which is all this 80s music. One of the greatest songs from the Bangles—of which there aren't a ton, but there are a few—"The Hero Takes a Fall." I'm doing my predictions deck. So many heroes have taken a fall. Elizabeth Holmes, Adam Neumann, Sheryl Sandberg, Sam Bankman-Fried. What do you think has happened to Elon Musk's brand in the last 12 months?

Kara Swisher: Right, yeah. I would bet 90% of the world had positive views on Elon Musk just 12 months ago. My son did. Remember I told you my son was like, "I liked him, now he's such a douche." That's the word he used. But it'll happen again. There'll be someone next year.

Scott Galloway: Yeah, someone. Not us, though.

Kara Swisher: Anyway, let's go on a quick break. Good luck, Sam. Godspeed. When we come back, what to make of a new poll about the 2024 election. And we'll speak with friend of Pivot, Kashmir Hill, about her new book on facial recognition.

[Break for advertisements]

Kara Swisher: Scott, we're back. The 2024 election is now under a year away. Incredibly, President Biden is currently losing to Donald Trump in five major battleground states, according to a new poll by The New York Times and Siena College released over the weekend. Age is one of the biggest issues voters have with Biden, as you've noted, with 71% saying he's too old to be an effective president—an opinion shared across all demographic and geographic groups polled.

Now, Obama was way down at this point before he won reelection, but I'll posit that. But if the results of the poll were the same next November, Trump would easily win the election with more than 300 electoral college votes. David Axelrod, who was an advisor to Obama, pointed out on Twitter, "Biden needs to decide whether running for president is in his best interest or the country's." What do you think?

Scott Galloway: I think it's a little too early. That's my feeling. A lot of people I respect think that, like Mike Madrid and others.

Kara Swisher: When you say too early, what do you mean?

Scott Galloway: I think we don't know. People are not like—this is just off the top of their head. First of all, we don't know if Trump gets convicted. I think that'll change a lot of people's minds. I don't think they suddenly like him more after he gets convicted. A conviction is different than just being accused of a crime. There's the wars, what's happening in Ukraine and Israel. There's all kinds of that. We have the economy still TBD. Things could change. I think there's just a lot to come. A poll at this point is kind of meaningless.

Although there's no getting around it, the fact that the president, after what are by any reasonable metric historic accomplishments—lowest inflation among the G7, fastest growing economy, more jobs created in two and three-quarter years than any president has done in four years—

Kara Swisher: He's not getting credit.

Scott Galloway: He's got—if there is a piece to be kept, the reason why the conflict in the Middle East hasn't become a regional conflict is because he immediately sent two carrier strike groups over there, and people believe he will use them if the Iranians get too involved. I think the guy has literally put on a master class in presidency. And at the same time, two-thirds of his party doesn't want him to run.

Here's the thing: people recognize that the mortality rate across our species is still 100%. And not only that, it's not death they're worried about—it's the two or three years leading up to death they're worried about.

Kara Swisher: Fair point.

Scott Galloway: He's been running for president since I was in elementary school. I like the president, but like any person who ever agrees to put up with the bullshit to become president, he's a bit of a narcissist. This narcissism has infected everyone from Ruth Bader Ginsburg to Senator Feinstein. If he announced today, "I wanted to step in, I saw an opportunity, I think this country really needed me, and now I think it's time for a new generation," I think he'd go down as one of the greatest presidents in history.

Kara Swisher: Yeah, he's been a great president. He has. But I would love to see—I'm interviewing the congressman from Minnesota tomorrow, Phillips. Let me talk about him very briefly.

Going back to the age issue, Congressman Dean Phillips is challenging Biden, trying to make the case that Democrats need a younger candidate. Phillips is 54, a third-term congressman. He's an heir to a distilling empire and co-owner of a gelato company. I feel like perhaps not the most qualified to be president. Nonetheless, he's running. One House Democrat called Phillips' campaign "an exercise in futility." The New York Times polling does have an unnamed generic Democrat doing better than Biden. Obviously, RFK Jr. is doing rather well against both Trump and Biden.

Phillips was on Bill Maher on Friday. Let's listen to what he said about more candidates joining the field.

[Audio clip plays: Dean Phillips: "The more the merrier. It's still not too late to jump into this race. I wish we had more competition instead of a coronation. This is not that difficult. And I don't understand why people are so hesitant to do what the country needs so desperately."]

Kara Swisher: So tell me what your thoughts are.

Scott Galloway: I've been saying this for a while. I think so much pressure is building up. I don't know if he's the finger out of the dike, if you will, or if he breaks the seal. But when you see Governor Newsom headed to Israel and debating Ron DeSantis, and when you see Governor Whitmer, there's a lot of people waiting and saying, "Put me in, coach." I think the Democratic bench is really strong.

It's like when Steve Young—this is as deep as my sports metaphor goes—the greatest quarterback in history was Joe Montana. The second greatest was Steve Young on the bench. We have a really strong bench. Right now, as I've said, we're playing not to lose. Congressman Phillips, while I don't think he will win, I think he might have a very profound impact. He's going to poll in the high single or double digits with no name recognition. I think the pressure is going to build and somebody who's more credible is going to say, "I'm in. Go up the middle."

Kara Swisher: Interesting. RFK Jr., speaking of which, there's a new poll showing he has a good amount of support and is in a position to be a serious threat to both parties. Trump people are worried too.

Scott Galloway: That is just a radical narcissism that shows you don't give a flying fuck about America. Whether it's Ralph Nader or Ross Perot, all you're doing is handing the presidency to someone else in an exercise of narcissism. And this guy—

Kara Swisher: But Phillips is not doing that? Or no, it's just within the Democratic Party?

Scott Galloway: He's not a spoiler. He's running to get the nomination of the Democratic Party. It's the independents that bastardize and create unintended consequences or outcomes.

Kara Swisher: What does Biden do to pull himself out of this poll? There's the problematic Israel-Hamas war for Biden's re-election. I think it's early for that, too. There's increased infighting within the Democratic Party over Biden's support of Israel, although Blinken has been visiting all over the place. But how does he pull himself out of the hole?

Scott Galloway: By not running.

Kara Swisher: That's what you're saying.

Scott Galloway: I just think biology is the most unforgiving arbiter in the world. There's nothing you can do. Think about how hard all of us are fighting biology. He's done everything he can. The guy is remarkable. I mean, we took my father's driver's license away when he was five years younger than President Biden. Time waits for no man.

This is also true of Trump, although I gotta give it to Trump—he comes across as more robust.

Kara Swisher: Well, he's crazier. That's why.

Scott Galloway: Yeah, but you're right. He's got this great tan, whatever. But at some point—I go to one scene, Kara, and I ask you to answer me honestly here. The first presidential debate: "Ladies and gentlemen, please welcome the Republican nominee, President Donald Trump. And ladies and gentlemen, please welcome the Democratic nominee for president." Now scan your emotions when you say Joe Biden versus when you say Governor Newsom or Governor Whitmer.

Kara Swisher: I'd rather have them.

Scott Galloway: I think the majority of Democrats, the majority of moderates who will decide this election, go, "I'm looking forward to seeing the contrast here." If it's Joe Biden, they're like, "Oh God, I hope he doesn't fuck off."

Kara Swisher: Oh, I think we are. I think you and I are a nervous wreck at that debate with Joe Biden on stage.

Scott Galloway: Yeah, that is 100% true.

Kara Swisher: That said, I think he's done a very good job handling Trump compared to everybody else. I was a big supporter of him earlier than anybody last year, a couple of years ago, as you remember, and you made fun of me. But I thought he was the right answer for the time and the others were flash in the pans. In this case, I'm sort of mixed. I think he can handle it. But I also think it's early. I think Trump is going to be convicted.

Scott Galloway: Think about your mom six years ago versus today.

Kara Swisher: Yeah, I'd agree.

Scott Galloway: Six years ago versus today. Let me guess, she was driving, living on her own.

Kara Swisher: Yeah, I remember she drove, but we didn't want her to. Remember your house? Oh my God, that was one of the scariest things I've ever seen. Looking at her like, couldn't find the door out. Then I see her in a car behind the driving wheel. I'm like, "You headed that way, right?" And immediately she makes a left. I'm like, "That's it, she's going to end up in Cuba." Oh my God, do you remember that?

Scott Galloway: I do remember that. And your aunt. I'm like, she's not only going to kill herself, she's going to kill her aunt.

Kara Swisher: But here's the thing, and this is the opportunity for the guy.

Scott Galloway: Yeah, it is. Think about what a service to the country it would be to say, "It's time to let a new generation." I'd love to see—I don't know if it's going to be Trump either. I think Christie and Asa Hutchinson are right. This guy's getting convicted. The candidate who's going to gain momentum there is, by far, Haley. Because if you look at the top issues—inflation, conflicts around the world, who can unite America—Haley. She has a real shot. My biggest fear is that Trump picks her as his VP.

But if Biden said, "I'm opening this up to this incredible bench," I'd love to see Mayor Pete run. Or Secretary Pete. I'd love to see Secretary Blinken on the debate stage. That's the man. I think he's fantastic.

Kara Swisher: Yeah. Our bench is so deep here of candidates who, in contrast to President Trump, would be like, "Oh, I'm definitely going with that guy or gal." I don't know. So far, that's not what I picked up. We'll see.

Anyway, we've got to move on. We'll see what happens. That was a very good discussion. You were very good. You weren't just making old jokes.

Let's bring in our friend of Pivot, Kashmir Hill. She is a technology and privacy reporter at The New York Times and author of "Your Face Belongs to Us: A Secretive Startup's Quest to End Privacy as We Know It." Welcome, Kashmir. How are you doing?

Kashmir Hill: I'm good. Thanks for having me on.

Kara Swisher: Good. As you know, I think you're a fantastic reporter. This came out of an investigation into facial recognition startup Clearview AI. I'd love you to give us a background on what made you start digging. Obviously, facial recognition has been a topic I've talked about for a long time. But what made you start digging into this company? I want to specifically note that what Clearview did was not a scientific breakthrough—it was ethical arbitrage. Why don't you start from there?

Kashmir Hill: Yeah. I mean, you're actually in the book here asking about facial recognition a decade ago. I initially started digging into Clearview AI because I heard about them through a tipster who had come across the company in a public records request. They claimed to have done something pretty extraordinary: they had scraped billions of photos from the public web, including social media sites, to build this facial recognition app where you take a picture of somebody, upload it to their app, and it shows you everywhere else they appear on the internet. They claimed it worked with 98.6% accuracy.

I hadn't heard of a facial recognition technology product that worked that well, that searched at that scale. It was very striking to me knowing what I did at that point. At that point, I thought facial recognition technology honestly didn't work that well. I'd heard it was very clunky, that police didn't consider it a very powerful tool. I hadn't seen another company do something like that. It seemed like something I would hear about Facebook or Google doing, not a little startup that was very secretive. Nothing was known about them. So that's why I initially started digging into them.

It was pretty extraordinary what they built. But what was extraordinary about it was, as you said, they were willing to do what others hadn't. The building blocks were there.

Kara Swisher: The reference you were making, the other companies have been working on similar technology. In the book, you mentioned an interview that Walt Mossberg and I did with Google's then-chairman, Eric Schmidt. He told us Google had built facial recognition technology—we were very intent on finding out about it—but that they had withheld it, largely for ethical reasons, in terms of not understanding the power of it. Every time I was at Google, you could tell they could do it. Whether it was looking at not just faces, but things like the Eiffel Tower in Paris, they were way down that road, much further than people realized.

Kashmir Hill: Yeah. The technology got better. Like with ChatGPT and these other products, the neural net technology and large-scale learning models really made the technology more powerful. But both Google and Facebook got to this point where they said, "Yeah, you can take a stranger's picture and figure out who they are, organize photos you have of them by face." But they both looked at facial recognition technology—and I thought this was striking because these aren't companies known for being particularly conservative in terms of new data usage—and they said, "The downsides are too large here."

I think Eric Schmidt specifically said, "Imagine what an evil dictator could do with this. There are positive uses, but we're too worried about the harmful uses." So they sat on the technology. But they could do it. Same thing with generative AI.

I actually watched this video of Facebook engineers a few years back. They're sitting in a conference room in Menlo Park with a smartphone strapped to the brim of a hat—a very janky version of the future augmented reality glasses. They looked around the room, and when the camera saw a face, it would call out the person's name. So they both had it. They sat on it. And it took this startup with nothing to lose to go ahead and put this out there and see what they could gain through it.

Kara Swisher: Which is always the danger, whether it's CRISPR or anything else. The cloning was done by someone in China as opposed to the more famous scientists who were able to do it. Scott?

Scott Galloway: Nice to meet you, Kashmir. My sense of these technologies is that if the utility is strong, it'll run away from the privacy concerns. People talk a big game about privacy, and then they want it adopted. In the last week, I've had facial recognition expedite my journey at airports and through TSA. Is your sense that the utility is going to get so far out ahead of privacy concerns that a lot of externalities will emerge? What, if anything, are you most worried about with this technology?

Kashmir Hill: Yeah. I hear a lot from activists who say facial recognition technology is too dangerous—like nuclear weapons, the downsides are so large that we need to ban it. I don't see that happening. I think there are a lot of beneficial uses. But it's a spectrum.

The version of it that I wouldn't want to see—it's great for getting into a country, great for opening your smartphone, even solving crimes. I've talked to officers who've been able to solve very horrible crimes using this technology. But the idea of it becoming ubiquitous—if you have facial recognition algorithms running on all the surveillance cameras all the time, where the government can track anybody, if every company and business has this running so they identify you as you walk through the front door—I think that's really alarming.

We've already seen that happen with Madison Square Garden. This is my favorite example. They installed facial recognition algorithms a few years ago for security reasons. Then in the last year, they decided, "Well, we've got this infrastructure in place. Why don't we use this to keep out the people we don't like?" Such as lawyers from opposing law firms who sued them. You get that surveillance creep, that function creep. I really think there should be guardrails so we don't see the worst applications start to be embraced.

Kara Swisher: Which we first saw with police. We'll talk about that in a second. I was in Whole Foods the other day and they wanted to do palm recognition through Amazon One. Have you seen this in the stores now? You put your palm up and it recognizes your palm and you can pay by your palm. I said, "It's a palm too far, Jeff Bezos. It's not happening." I saw this at a Whole Foods in San Francisco. I asked the attendant there, "How many people actually sign up and give their palm?" Not very scientific, but his estimate was 2 or 3% of customers.

It was funny to me because a company called Pay by Touch in the early 2000s was collecting people's fingerprints to have them pay for groceries. The reason why the one law that's super relevant to facial recognition technology in the United States—the Biometric Information Privacy Act, or BIPA—exists is because an ACLU lawyer was there. The clerk was trying to collect his fingerprint. He's like, "What is this company?" When he looked into them, he was very disturbed by who was running it and that they were asking for people's biometrics instead of a credit card just to pay for groceries. It seemed ridiculous to him. His research led to this super strong law that's been one of the main hurdles for companies that want to do facial recognition technology.

But what is the future? Because there was the pushback with police with cams on them, or in Britain using so much excessive facial recognition in the streets and the mistakes that are made. Obviously, racial bias is a major issue. I remember interviewing Andy Jassy about the issues around their facial recognition technology, which was called Recognition with a K. Talk a little bit. Where is the future? Because they definitely get slammed up against these issues pretty quickly. It does seem like the dream for technology companies is to create a world in which we don't need to carry any bags around with us. They keep trying to sell us on this, right?

Kashmir Hill: Amazon's like, pay with your palm, and then that means you're free to wander the world carrying nothing. Amusement parks and gyms and other places like that really like the idea of biometrics to prevent ticket fraud or membership abuse. They can make sure the person that buys that ticket and walks in is the same person that tries to get in later. So there's certainly a push for it from a lot of different companies. And I do think the use of facial recognition technology in situations that benefit us, society will probably embrace that.

Kashmir Hill: For the book, I went to London to do research into how the U.K. police are using facial recognition technology quite heavily. I landed at Heathrow and instead of waiting hours to be processed to cross the border, I walked up to a little kiosk, put my passport down, looked into a facial recognition camera, and it made sure my face matched the biometric chip in my passport. I was in the country 20 minutes after the plane landed. It's incredibly convenient. But there are two different versions of this. One is making sure that you are who you say you are. The other version, what Clearview AI is selling, is finding you in a huge database of persons and tracking you, using facial recognition in a way that doesn't benefit you and may harm you. I think that's what we're going to see the pushback against.

Kashmir Hill: They'll come for more biometrics. It's going to be your palm print, your voice print. I'm sure there's going to be a company that does what Clearview AI did, but for voice, where you upload somebody talking and it finds everywhere else on the internet where they're in a video talking. That is, unless we put some kind of guardrails around it that say you can't just use people's information this way without their consent.

Kara Swisher: So how does that happen? With advances in AI and everything else, this makes it very easy to do this. What are companies working on to address that? And legislation on a national level—you mentioned one piece of legislation, but it's something where cities tend to act, states tend to get in line, especially around racial bias, which is evident in a lot of these police cams. Some of that is good because we found out what they're actually doing versus what they say they're doing. What are the companies doing to address it? Or will we always be plagued by a Clearview AI kind of company that doesn't care? We're just lucky because we're relying on the kindness of Google not to track us everywhere.

Kashmir Hill: Right. I wanted the book to get at the fact that with these new technological tools, and the fact that they're open source and these models are increasingly accessible to anyone with technical savvy, it is going to be the most radical actors, small actors like Clearview AI. It's just this ragtag crew of founders that are able to cross the lines that have existed. I think we're going to see this in other spheres beyond just facial recognition technology, other kinds of AI.

Kashmir Hill: In terms of what companies can do, we saw Google and Facebook decide to sit on this and hold it back. I see companies like Signal, the private messaging app, creating face blurring tools so that when you are taking a photo of a crowd, you can blur out their faces before you put it online. Basically, limiting the supply of faces. Every time I had a Clearview AI search done on me, it wasn't just finding the photos I put out there. It was me at a concert in the background of someone else's photo. It was tracking where I've been as other people have taken photos of it. So that's one way they're addressing it—the supply of faces.

Kashmir Hill: I do think the most effective route is going to be regulations, a policy framework. Europe is, as they often are on privacy laws, ahead of us. They said that what Clearview AI did was illegal, that you can't collect this sensitive information about people and put them in a database like this without their consent. They essentially kicked Clearview out of their country. In the U.S., we have that law I was talking about earlier, BIPA in Illinois. It says that you can't use people's face prints or voice prints or fingerprints without their consent or face a very hefty fine. Because of that law, Madison Square Garden, which is keeping lawyers out of their New York venues like MSG and Beacon Theater and Radio City Music Hall, they have a theater in Chicago. They're not using facial recognition technology to keep lawyers out there because it would violate this law. So these laws can work. We've regulated technology in the past that we found frightening or taboo, and I think we can do it again.

Scott Galloway: So there are obvious applications here: travel, hospitality, retail. What other industries do you think are going to be able to substantially lower their costs or reduce consumer friction here? What do you think is the next industry to adopt facial recognition?

Kashmir Hill: We're seeing it adopted a lot in amusement settings. I'm seeing a lot of sports stadiums that are starting to use facial recognition technology, sometimes for picking up your food. You can order it on an app and then you just show up and it scans your face and you get it. I think that's something we'll see a lot. I think real estate buildings are interested in this as an access tool.

Kashmir Hill: My fear with this is that we see the kind of tracking we already have online—every time you go to a website, they're trying to figure out who you are, what you've bought in the past, how much you have to spend. There's all of this background tracking happening all the time as we move through the internet. What facial recognition technology could mean is taking all that and moving it into the real world. You walk into a store and they have these cookies that are attached to your face, knowing what your leanings are, your purchase history, how much you have to spend. The idea of everything knowable about us on the internet trailing us in the real world would be pretty chilling.

Kashmir Hill: I always think about how people will use this, the little brother aspect. If everyone has a Clearview AI type app on their phone, what that means for day-to-day privacy and the kind of trolling that happens online suddenly leaping into the real world. They see you buy something sensitive at the pharmacy, take your picture, and tweet out, "Look who just bought hemorrhoid cream." Or you're having a sensitive conversation over dinner, assuming you're anonymous, and they take a photo of you and now they know. All these ways we assume we're anonymous as we move through the world—that everyday comfort could just disappear.

Kara Swisher: Remember it was Sun Microsystems: "There is no privacy, get used to it." Scott McNeely, right?

Kashmir Hill: Yeah.

Kara Swisher: What advice do you have for people trying to protect their own privacy? What can they do?

Kashmir Hill: With facial recognition technology specifically, the vendors have made sure that this works even with masks on. You could wear a ski mask. That would be a very effective way of making sure you weren't tracked this way.

Kara Swisher: Great. Then you get arrested, but go ahead.

Kashmir Hill: Thinking more deliberatively about your image on the public internet, there are more and more benefits to posting privately and restricting your image being available. I've asked a couple of law firms, knowing what you know now about what MSG did with retaliation against lawyers, are you thinking about taking your photos off your websites so that they can't make this kind of list? Because that's how MSG made it—they scraped the law firm website's bio pages. So just thinking about what you're putting out there.

Kashmir Hill: If you are so lucky to live in a state that has privacy laws that allow you to access what a company has on you and delete it, you can go to Clearview AI or to some of the other public face search engines and say, "Delete me from your database." If you live in California, Colorado, Connecticut, or Virginia, they have laws that say you can get yourself deleted from companies' databases.

Kara Swisher: But it's hard to do. You have to be proactive.

Kashmir Hill: You have to be proactive. California actually requires companies to say how many of these requests they get. I looked at Clearview AI's website, and over the last two years, they've had something like 800 requests for deletions in California. California's population is 34 million people.

Kara Swisher: So not many people.

Kashmir Hill: So what you have to do is not have a face, really.

Kara Swisher: Scott, last question. What would you tell parents to do regarding pictures of their kids posted on social? Don't do it?

Scott Galloway: I think unless there is some real benefit to posting publicly, you should be doing it privately. You should have a private account limited to family and friends. I went to PimEyes, which is one of these public face search engines, and I asked about the search of kids' faces. They've actually decided to block results for minor faces. So that was a company making a proactive move. But generally, I say don't do it. When you get those waivers from the school or the daycare that say, "Is it okay if we post your kid online?" Say no. Feel free to say no. I really don't see the benefits in that kind of public posting in the world that we're in today.

Kara Swisher: Yep, and they can get them anyway from other places, as you say, from walking down the street. Unfortunately, they can see them everywhere they go. This is going to change, especially as the technology becomes better and better. It is not just face, although your book is called *Face*, it's voice, palm, everything. Your signature, how you walk—your gait can be different than someone else's.

Kashmir Hill: This is what's so hard about privacy. We put this information out there or share information about ourselves in one context, and it gets used in a way we don't expect. With the technology getting better all the time, it's hard to predict how the information you make available could come back to haunt you. I just don't think that most of us who were putting our face online over the last two decades anticipated that something like this would come along that would reorganize the internet and make it searchable by face.

Scott Galloway: I don't know. I think they knew, Kash.

Kara Swisher: You think? Well, you knew, Kara. You're not the normal.

Kara Swisher: I have a section in my book where they get mad at me, the Google founders, because I said they couldn't control all of search. I said, "I'm worried about a dangerous person running it." I call them thugs. I said, "I'm not worried about you. I'm worried about someone else." But they weren't even thinking of it. You're right. They were never thinking of it. It's a real blind spot, so to speak, on this particular podcast.

Kara Swisher: Anyway, it's a really important book. Kash is an amazing reporter, does some of the top stuff around these issues. The book is called *Your Face Belongs to Us: A Secretive Startup's Quest to End Privacy as We Know It*. They will probably be successful. Thank you so much, Kash.

Kashmir Hill: Thank you, Kara. Thank you, Scott.

Scott Galloway: Thank you.

[Break for advertisements]

Scott Galloway: Okay, Scott, wins and fails. May I go first?

Kara Swisher: May I go first?

Scott Galloway: Something I wish was going to be a win, but I suspect it's not going to be. *The Marvels* is opening up. A lot of the MCU movies are showing signs of fatigue. This one is women, so they'll probably have even more fatigue. It's with Brie Larson, who I adore. I loved her in *Lessons in Chemistry*. I think she's great. But it's pacing. It's not pacing well in terms of sales. Another theory, far more likely, is no one really asked for a Captain Marvel sequel. While the film grossed over a billion dollars when it released in 2019, it has almost no cultural footprint and passionate goodwill in 2023. It served its purpose of connecting one Avengers movie to another and set up Larson's superhero as an effective, if dull, hero who takes out the best villain Marvel has yet produced, Thanos. But none of the many trailers have convinced audiences. I'm sorry, I'm going to go see it, but it's a win for me because I love Brie Larson and the whole gang. Probably a fail at the box office. The superhero movies look like maybe they've got the stuffing knocked out of them a little bit.

Kara Swisher: All right. Any fails?

Scott Galloway: That is a fail. I wish it wasn't. I bet it's a great movie. I'm excited to see it. My fail is continuing the creepiness of Mike Johnson. It continues. He had an app to monitor his porn use with his son. The anti-gay stuff is getting more and more clear, what he was doing. The bank account—just a strange man, just a strange fella.

Kara Swisher: Got it.

Kara Swisher: Okay, so my win is Caleb Williams. He's the quarterback for the USC Trojans, who I hate as a Bruin, but he's probably going to be number one draft pick. Most recently this weekend, it made news everywhere. He kind of lost the game and he ran over, was sort of inconsolable, and jumped into the fans where he embraced his mother and began to sob while he was still in uniform. I thought that was such a seminal moment in what needs to happen among young men who unfortunately let masculinity get in the way of expressing their emotions. 77% of suicides now are men. It used to be three to one, it's now edging towards four to one. A big problem is that men have this vision of masculinity meaning that when you are struggling, you keep it to yourself. Of all the addictions, the one that has the greatest incidence of suicide is actually gambling. Because if you have an addiction to alcohol or opiates or meth, people notice it and they move in. With gambling, you can get in really deep and no one even knows, and people feel as if there's no way out.

Scott Galloway: The key to getting better is a practice of expressing your emotions. This kid said to the entire world, "I'm going to be the Heisman Trophy winner. I'm an amazing athlete. I define masculinity. And when I am really sad, I go and embrace my mother and I don't give a flying fuck who is watching." That one unscripted moment literally advanced masculinity and mental health among young men light years, because it's a huge problem among men that they don't want to express their hurt and their emotions for fear of being seen as less manly. I just thought this was such a powerful, raw, moving moment. I think it'll have a real positive impact.

Kara Swisher: Oh, I like that. Yeah.

Kara Swisher: Anyway, so my win is Caleb Williams. My fail is that I think at some point, university leadership across America's universities is going to realize that there's a difference between free speech and hate speech and start kicking out students.

Scott Galloway: I almost got kicked out of UCLA several times, mostly because I would get below a 2 GPA more than two quarters in a row. There was a window called the emergency loan window. With your student ID, you could get 50 bucks, no questions asked, but you had to pay it back within seven days. I went past seven days once and I got a notice saying you've been kicked out of UCLA. So we kick people out of UCLA all the time. We kick people out of universities all the time. But when people show up to a university and say things, it's free speech. If you want to march with a flag, if you want to say "down with Israel," if you want to be a professor that says she was affirmed by certain actions of the Palestinians, I actually think that's fine. I disagree with it. But if I went to the campus at NYU and said, "Burn the gays" or "Gas or lynch the blacks," I would be out the next day, and I should be out the next day.

Scott Galloway: Everybody goes through this bullshit First Amendment. We have a Second Amendment, but if you show up with an AR-15 to campus, you are kicked out of school. It's one thing to have free speech, another thing to be saying things like "gas the Jews," "burn the Jews." Then I get an email from my department head saying microaggressions will not be tolerated. My attitude is, where between micro and aggression is students actually engaging in this type of hateful speech? There is a difference between free speech and hate speech. It is time for our university leadership to step up and say, if you say "burn" anybody, if you say anything that invokes violence against any group, we are kicking your ass out of school. It is time.

Kara Swisher: Yeah. Bill Ackman also had a very good letter to Harvard about this. I usually think he sometimes goes off, but he had a good letter. It's interesting because a lot of the people who are sort of "let everybody say what they want" crowd is now on the other side of that, which is interesting because it's complex, as you know. I do tend to agree with you here. It really has gone too far. Some of it is just casual cruelty, such as pulling down the hostage pictures. I don't even understand what child does that. If a child of mine did that with a disrespect for other people's opinions or putting up their stuff, I would be furious. This stuff has gone past the point of tolerance. I would agree with you.

Kara Swisher: Anyway, it's a sad time. Hopefully, people will get back to a more central place where they treat each other with respect that everybody deserves. But who knows? Probably not right now, the way we're headed in this country sometimes. That's how a lot of people feel. We want to hear from you. Send us your questions about business, tech, or whatever's on your mind. Go to nymag.com/pivot to submit a question for the show, or call 855-51-PIVOT. Please feel free to disagree with us. I suspect a lot of people will disagree with us on this issue for sure.

Kara Swisher: Scott, that's the show. We'll be back on Friday for more. Can you read us out?

Scott Galloway: Today's show was produced by Lara Naiman, Zoe Marcus, and Travis Larchuk. Ernie Andertott engineered this episode. Thanks also to Drew Burrows, Mille Saverio, and Gaddy McBain. Make sure you subscribe to the show wherever you listen to podcasts. Thank you for listening to *Pivot* from New York Magazine and Vox Media. We'll be back later this week for another breakdown of all things tech and business. Young men, displaying your emotions is a feature, not a bug. That is part of what it means to be a man.