Speaker 1: This is Bloomberg Business Week with Carol Messer and Bloomberg
Speaker 1: Quick Takes. Tim Stinovic from Bloomberg Radio. Do you want
Speaker 1: to bring in our next guest? He is someone certainly
Speaker 1: familiar to our audience. Michael Mocho, founder of gs V
Speaker 1: Asset Management. He has written several books, including the Global
Speaker 1: Silicon Valley Handbook. He has invested his firm in Facebook, Twitter, Spotify,
Speaker 1: so many well known companies. His new book is called
Speaker 1: The Mission, How Contemporary Capitalism Can Change the World one
Speaker 1: Business at a time. And he joins us on the
Speaker 1: phone from California. Michael, it is great to have you
Speaker 1: back with us. How are you? And tell me about
Speaker 1: your world, Carol, that's great to be with you. Um,
Speaker 1: everything is um, you know, so you know, we're waiting
Speaker 1: to have things open up a little bit, but you know,
Speaker 1: the world's moving ahead nonetheless. I mean, I think the
Speaker 1: acceleration to digital just as um pre stunning. But UM
Speaker 1: listen to President Biden and talk about being able to
Speaker 1: move forward with the vaccine. UM that that's encouraging news
Speaker 1: as well. Well. And I think you and others and
Speaker 1: your book really gets into this. You know, we are
Speaker 1: at this interesting time where so many trends, whether it's
Speaker 1: digitization and other trends, have been accelerated because of the pandemic.
Speaker 1: It's also a time though, that we are spending a
Speaker 1: lot of money to help out the economy, and we
Speaker 1: can think about how to do it better. Can we
Speaker 1: make you know, the world greener? Can we solve climate change?
Speaker 1: At the same time you write about better capitalism? What
Speaker 1: is better capitalism? Well, essentially, you know Adam Smith's Invisible Hand,
Speaker 1: which created the concept of capitalism, that invisible hands broken
Speaker 1: and we see that in the right of ways, and
Speaker 1: that was certainly true before the pandemic, that that became
Speaker 1: more fractured during the pandemic. And yet we don't believe
Speaker 1: the um you know. The solution to this is to
Speaker 1: cut the handoff. It's really just to fix it and
Speaker 1: fix it with um an evolution, which we call contemporary capitalism.
Speaker 1: That is that we think that the great businesses of
Speaker 1: tomorrow will combine the ambition of a for profit with
Speaker 1: the heart of a not for profit. It's this idea
Speaker 1: of multiple constituents, you know. So it's not just the shareholder,
Speaker 1: it's also the employee, it's the consumer, is the community,
Speaker 1: it's the environment and at the center all that is.
Speaker 1: Company needs to have a sense of purpose and meaning
Speaker 1: to what they do. How is it different than say,
Speaker 1: the conscious capitalism that John Mackie, co founders CE of
Speaker 1: Hall Foods and and a guest to you on our program,
Speaker 1: has written about what's different? Yeah, I would say that again.
Speaker 1: I love what he's done, and he's certainly on influence
Speaker 1: on our thinking. I think partly what we tried to
Speaker 1: do was both to put UM some some We have
Speaker 1: seven declarations in the book talking about we think that
Speaker 1: you know, Prince A. Bowles, the companies that want to
Speaker 1: reflect this new contemporary capitalism UM to aspire to it.
Speaker 1: We purposefully kept them as general because we think this
Speaker 1: is going to get UM evolve over time into more
Speaker 1: specific ways that the companies are able to reflect that
Speaker 1: you know, their their purpose, I mean, their success is
Speaker 1: driven by UM fundamentals that are beyond just you know,
Speaker 1: making the most profit that they can to that quarter. Michael,
Speaker 1: reading in and prepping for our conversation today, I was thinking,
Speaker 1: all right, so how does China complicate this process of
Speaker 1: kind of a better capitalism? Because don't you need global
Speaker 1: cooperation in order for it to really work on all levels. Yeah,
Speaker 1: I mean again, I think the forces that work there
Speaker 1: are human forces and and it's it's gravity. And so
Speaker 1: as much as China has um, it's all in highbrid
Speaker 1: form of capitalism, you know, Chinese capitalism. I mean there's
Speaker 1: there's you know, people are people around the world, and
Speaker 1: what people are seeking and whether they say it this
Speaker 1: in an articulate way or not, is people are looking
Speaker 1: for purpose. They're looking for meaning in their life and
Speaker 1: their work. And so people being inspired or of employees
Speaker 1: either um don't like their work or neutral towards at work.
Speaker 1: And you look at the research the science behind that,
Speaker 1: there's two reasons for that. Because they don't feel like
Speaker 1: their their position matters. I mean, they don't have a
Speaker 1: purpose to what they're doing, and they don't think their
Speaker 1: company has a purpose to what they're doing, or if
Speaker 1: they do, it's not well articulated, and they don't feel
Speaker 1: like they're part of that team. And so I mean
Speaker 1: that's just a fundamental reality. You can create different do
Speaker 1: you lose, Michael, We're gonna see what. I'm sorry, I
Speaker 1: don't know where you ask We got you? Okay, So
Speaker 1: you're talking about people in the importance of you know what,
Speaker 1: basically what their work is about. Yeah, I mean people
Speaker 1: are seeking men and purpose, right, and that's that's that
Speaker 1: I think is what drives motivation, and that's going to
Speaker 1: be true whatever the political system is. No, it's listen.
Speaker 1: You know, I have a lot of conversations with my
Speaker 1: younger nieces and nephews and even my own daughter, who's
Speaker 1: you know, a teenager, and they really care about this
Speaker 1: stuff in terms of what companies and you know, leaders
Speaker 1: stand for. I do wonder too, though, how does you
Speaker 1: know we live in certainly my world is a publicly
Speaker 1: you know, held market world where I know we keep
Speaker 1: hearing conversations about multiple stakeholders, and I do wonder about it,
Speaker 1: you know, if if every multiple stakeholder is as important
Speaker 1: as the other. But does the public markets complicate this
Speaker 1: idea of better capitalism or profit with a purpose? I
Speaker 1: know it doesn't have to, but I just wonder how
Speaker 1: it complicates it. Well, I think it ultimately be reflected
Speaker 1: and multiples paid for companies that have sustainable values to
Speaker 1: their business model. So you might be able to make
Speaker 1: more money this quarter because you were able to do
Speaker 1: shortcuts or make decisions that UM might benefit the near
Speaker 1: term numbers, but the multiple that investors are going to
Speaker 1: put on that, in my view, UM is going to
Speaker 1: be lower. And you're starting to see this shift is
Speaker 1: really thinking. I mean, this kind of river of business
Speaker 1: is flowing in a different way that it's ever flowed before.
Speaker 1: And so as you talk about young people, you talk
Speaker 1: about your daughter and your and your nieces and nephews.
Speaker 1: I mean, this is a this is a phenomena that's
Speaker 1: really embedded, and you know what people you know are
Speaker 1: looking for what they want and that ultimately, ultimately all
Speaker 1: companies are valued the same way, which is future casual
Speaker 1: is discud back to the day. Companies that have these
Speaker 1: mission driven values. I really you know, it really equates
Speaker 1: to more of a sustainable growth, more sustainable business model,
Speaker 1: which should mean that their future profits are going to
Speaker 1: be greater, which means that you know that what what
Speaker 1: health the market ultimately vas those should be higher. And
Speaker 1: it's interesting too because when I talked to you know,
Speaker 1: you mentioned my nieces and I mentioned my nieces, and
Speaker 1: you know, there is a feeling that capitalism is bad,
Speaker 1: and you know, I try to remind them that it
Speaker 1: builds a lot of things that we take for granted today. Um,
Speaker 1: you know, what is your what would be your message
Speaker 1: message to someone if they say, listen, capitalism just doesn't
Speaker 1: work anymore. Yeah, I mean again, young people were believe
Speaker 1: that socialism is a better system than capitalism. It's not
Speaker 1: that they're ignorant or that they don't know history. What
Speaker 1: they've experienced as a system that feels great. You see
Speaker 1: growing inequality. You see where you know the people running
Speaker 1: companies have made you know they're average feel makes four
Speaker 1: times the average worker and fewer and fear people feel
Speaker 1: like they're getting a faving a fair system. Today's world.
Speaker 1: Basically your future depends on how well how well you
Speaker 1: select your parents, which is not it's not a fair system.
Speaker 1: So people are looking for a better system, and that's
Speaker 1: what we're saying. You can't in socialism is O N
Speaker 1: forty two, So we know that. So it's really how
Speaker 1: do you, as I said before, how do you fix
Speaker 1: the invisible hand of capitalism that's broken and make it
Speaker 1: better and make it reflect where there's worth going. So
Speaker 1: what's out there on the horizon that gives you hope,
Speaker 1: whether it's leaders, whether it's companies, whether it's the younger
Speaker 1: generation that gives you hope that capitalism can be better. Well,
Speaker 1: I think you do. Ship and the young entrepreneurs and
Speaker 1: what they are doing in terms of the businesses they're creating.
Speaker 1: It's not just how can they get rich? In fact,
Speaker 1: most of them are saying, how can they dent the
Speaker 1: universe for good? How can they change the world for good?
Speaker 1: You talk about Left is a company that you had
Speaker 1: good numbers to report, um, you know, an interim and
Speaker 1: the stock reflecting that. Well, the fact is Left as
Speaker 1: a company has embetted values that I think reflect a
Speaker 1: lot of what we talked about contemporary capitalists going vack.
Speaker 1: To see this last twelve months of what we've gone to,
Speaker 1: this race to create a vaccine, which is just extraordinary.
Speaker 1: What's happened. There's this cooperation between big pharmaceutical companies which
Speaker 1: aren't exactly the most loved you know, and that's not
Speaker 1: the best behavior. Even all of a sudden, it was
Speaker 1: sort of this kind of rallying for good, for doing
Speaker 1: making a society better or not not from how to
Speaker 1: make more money. So that those kind of signs are encouraging. Hey, listen,
Speaker 1: just got about thirty forty seconds here just quickly, Michael,
Speaker 1: if there was one government policy, I know you talk about,
Speaker 1: you know, better tax incentive structures. If there's one policy
Speaker 1: that could come down that would really make a difference here,
Speaker 1: what would it be, and just quickly if you could, ye,
Speaker 1: I think it's it's you know, it's it's removing friction
Speaker 1: from the whole start up ecosystem. And I think it
Speaker 1: really be more than just tax policy. It's liberating companies
Speaker 1: to tax big problems and have investors support those problems
Speaker 1: that they're going to make a little better. So whether
Speaker 1: that's health care with its education for that environment and climate,
Speaker 1: and then we can we can we can create them
Speaker 1: sent us to just see the resources and focus developed there.
Speaker 1: I always feel inspired, Michael, thank you, Thank you so much.
Speaker 1: Really appreciate it. Michael Moe, co founder of gs V
Speaker 1: Asset Management. Check out his book The Mission Corporation, How
Speaker 1: contemporary capitalism can change the world one business at a time.