WEBVTT - Moe on The Mission Corporation 0:00:00.160 --> 0:00:04.160 This is Bloomberg Business Week with Carol Messer and Bloomberg 0:00:04.240 --> 0:00:07.960 Quick Takes. Tim Stinovic from Bloomberg Radio. Do you want 0:00:07.960 --> 0:00:10.240 to bring in our next guest? He is someone certainly 0:00:10.280 --> 0:00:14.040 familiar to our audience. Michael Mocho, founder of gs V 0:00:14.200 --> 0:00:18.239 Asset Management. He has written several books, including the Global 0:00:18.320 --> 0:00:22.599 Silicon Valley Handbook. He has invested his firm in Facebook, Twitter, Spotify, 0:00:22.800 --> 0:00:25.960 so many well known companies. His new book is called 0:00:25.960 --> 0:00:29.640 The Mission, How Contemporary Capitalism Can Change the World one 0:00:29.680 --> 0:00:32.280 Business at a time. And he joins us on the 0:00:32.320 --> 0:00:35.640 phone from California. Michael, it is great to have you 0:00:35.680 --> 0:00:38.880 back with us. How are you? And tell me about 0:00:38.920 --> 0:00:43.440 your world, Carol, that's great to be with you. Um, 0:00:43.720 --> 0:00:47.160 everything is um, you know, so you know, we're waiting 0:00:47.200 --> 0:00:51.080 to have things open up a little bit, but you know, 0:00:51.400 --> 0:00:54.480 the world's moving ahead nonetheless. I mean, I think the 0:00:54.520 --> 0:01:00.720 acceleration to digital just as um pre stunning. But UM 0:01:01.040 --> 0:01:03.680 listen to President Biden and talk about being able to 0:01:03.760 --> 0:01:08.360 move forward with the vaccine. UM that that's encouraging news 0:01:08.440 --> 0:01:10.880 as well. Well. And I think you and others and 0:01:10.959 --> 0:01:13.320 your book really gets into this. You know, we are 0:01:13.360 --> 0:01:16.399 at this interesting time where so many trends, whether it's 0:01:16.440 --> 0:01:20.560 digitization and other trends, have been accelerated because of the pandemic. 0:01:20.640 --> 0:01:22.520 It's also a time though, that we are spending a 0:01:22.520 --> 0:01:24.920 lot of money to help out the economy, and we 0:01:24.959 --> 0:01:26.800 can think about how to do it better. Can we 0:01:26.840 --> 0:01:29.959 make you know, the world greener? Can we solve climate change? 0:01:29.959 --> 0:01:33.319 At the same time you write about better capitalism? What 0:01:33.480 --> 0:01:39.880 is better capitalism? Well, essentially, you know Adam Smith's Invisible Hand, 0:01:40.000 --> 0:01:45.560 which created the concept of capitalism, that invisible hands broken 0:01:45.920 --> 0:01:47.760 and we see that in the right of ways, and 0:01:47.760 --> 0:01:51.160 that was certainly true before the pandemic, that that became 0:01:51.800 --> 0:01:56.280 more fractured during the pandemic. And yet we don't believe 0:01:56.640 --> 0:01:59.600 the um you know. The solution to this is to 0:01:59.640 --> 0:02:02.800 cut the handoff. It's really just to fix it and 0:02:02.880 --> 0:02:07.040 fix it with um an evolution, which we call contemporary capitalism. 0:02:07.200 --> 0:02:10.040 That is that we think that the great businesses of 0:02:10.120 --> 0:02:13.720 tomorrow will combine the ambition of a for profit with 0:02:13.800 --> 0:02:16.359 the heart of a not for profit. It's this idea 0:02:16.360 --> 0:02:20.239 of multiple constituents, you know. So it's not just the shareholder, 0:02:20.400 --> 0:02:24.080 it's also the employee, it's the consumer, is the community, 0:02:24.200 --> 0:02:28.400 it's the environment and at the center all that is. 0:02:28.680 --> 0:02:31.320 Company needs to have a sense of purpose and meaning 0:02:31.360 --> 0:02:33.840 to what they do. How is it different than say, 0:02:33.960 --> 0:02:37.040 the conscious capitalism that John Mackie, co founders CE of 0:02:37.080 --> 0:02:40.200 Hall Foods and and a guest to you on our program, 0:02:40.480 --> 0:02:44.240 has written about what's different? Yeah, I would say that again. 0:02:44.480 --> 0:02:48.200 I love what he's done, and he's certainly on influence 0:02:48.480 --> 0:02:51.360 on our thinking. I think partly what we tried to 0:02:51.400 --> 0:02:55.480 do was both to put UM some some We have 0:02:55.560 --> 0:02:58.959 seven declarations in the book talking about we think that 0:02:59.400 --> 0:03:02.120 you know, Prince A. Bowles, the companies that want to 0:03:02.200 --> 0:03:06.920 reflect this new contemporary capitalism UM to aspire to it. 0:03:06.960 --> 0:03:09.800 We purposefully kept them as general because we think this 0:03:09.919 --> 0:03:13.079 is going to get UM evolve over time into more 0:03:13.160 --> 0:03:17.520 specific ways that the companies are able to reflect that 0:03:17.600 --> 0:03:21.200 you know, their their purpose, I mean, their success is 0:03:21.320 --> 0:03:25.360 driven by UM fundamentals that are beyond just you know, 0:03:25.440 --> 0:03:28.000 making the most profit that they can to that quarter. Michael, 0:03:28.120 --> 0:03:32.280 reading in and prepping for our conversation today, I was thinking, 0:03:32.280 --> 0:03:36.960 all right, so how does China complicate this process of 0:03:37.080 --> 0:03:40.240 kind of a better capitalism? Because don't you need global 0:03:40.320 --> 0:03:45.560 cooperation in order for it to really work on all levels. Yeah, 0:03:45.560 --> 0:03:47.720 I mean again, I think the forces that work there 0:03:47.720 --> 0:03:52.119 are human forces and and it's it's gravity. And so 0:03:52.160 --> 0:03:55.720 as much as China has um, it's all in highbrid 0:03:55.840 --> 0:04:00.720 form of capitalism, you know, Chinese capitalism. I mean there's 0:04:00.760 --> 0:04:05.240 there's you know, people are people around the world, and 0:04:05.320 --> 0:04:08.120 what people are seeking and whether they say it this 0:04:08.560 --> 0:04:10.920 in an articulate way or not, is people are looking 0:04:10.920 --> 0:04:13.600 for purpose. They're looking for meaning in their life and 0:04:13.640 --> 0:04:19.680 their work. And so people being inspired or of employees 0:04:19.880 --> 0:04:23.360 either um don't like their work or neutral towards at work. 0:04:23.920 --> 0:04:27.000 And you look at the research the science behind that, 0:04:27.400 --> 0:04:29.920 there's two reasons for that. Because they don't feel like 0:04:30.000 --> 0:04:32.640 their their position matters. I mean, they don't have a 0:04:32.680 --> 0:04:34.840 purpose to what they're doing, and they don't think their 0:04:34.839 --> 0:04:36.920 company has a purpose to what they're doing, or if 0:04:36.960 --> 0:04:39.440 they do, it's not well articulated, and they don't feel 0:04:39.440 --> 0:04:42.160 like they're part of that team. And so I mean 0:04:42.160 --> 0:04:48.960 that's just a fundamental reality. You can create different do 0:04:49.080 --> 0:04:54.120 you lose, Michael, We're gonna see what. I'm sorry, I 0:04:54.160 --> 0:04:56.560 don't know where you ask We got you? Okay, So 0:04:56.600 --> 0:04:59.760 you're talking about people in the importance of you know what, 0:05:00.120 --> 0:05:03.320 basically what their work is about. Yeah, I mean people 0:05:03.360 --> 0:05:06.119 are seeking men and purpose, right, and that's that's that 0:05:06.240 --> 0:05:08.640 I think is what drives motivation, and that's going to 0:05:08.680 --> 0:05:11.359 be true whatever the political system is. No, it's listen. 0:05:11.480 --> 0:05:13.359 You know, I have a lot of conversations with my 0:05:13.480 --> 0:05:17.240 younger nieces and nephews and even my own daughter, who's 0:05:17.279 --> 0:05:20.359 you know, a teenager, and they really care about this 0:05:20.360 --> 0:05:23.200 stuff in terms of what companies and you know, leaders 0:05:23.200 --> 0:05:25.640 stand for. I do wonder too, though, how does you 0:05:25.640 --> 0:05:29.760 know we live in certainly my world is a publicly 0:05:30.120 --> 0:05:34.120 you know, held market world where I know we keep 0:05:34.160 --> 0:05:37.360 hearing conversations about multiple stakeholders, and I do wonder about it, 0:05:37.839 --> 0:05:40.839 you know, if if every multiple stakeholder is as important 0:05:40.920 --> 0:05:44.039 as the other. But does the public markets complicate this 0:05:44.160 --> 0:05:48.120 idea of better capitalism or profit with a purpose? I 0:05:48.160 --> 0:05:50.120 know it doesn't have to, but I just wonder how 0:05:50.120 --> 0:05:53.840 it complicates it. Well, I think it ultimately be reflected 0:05:53.880 --> 0:05:56.839 and multiples paid for companies that have sustainable values to 0:05:56.839 --> 0:05:59.440 their business model. So you might be able to make 0:05:59.480 --> 0:06:02.520 more money this quarter because you were able to do 0:06:02.680 --> 0:06:07.560 shortcuts or make decisions that UM might benefit the near 0:06:07.640 --> 0:06:10.880 term numbers, but the multiple that investors are going to 0:06:10.920 --> 0:06:13.440 put on that, in my view, UM is going to 0:06:13.560 --> 0:06:16.000 be lower. And you're starting to see this shift is 0:06:16.040 --> 0:06:17.960 really thinking. I mean, this kind of river of business 0:06:18.040 --> 0:06:20.560 is flowing in a different way that it's ever flowed before. 0:06:21.080 --> 0:06:23.200 And so as you talk about young people, you talk 0:06:23.279 --> 0:06:26.920 about your daughter and your and your nieces and nephews. 0:06:27.200 --> 0:06:29.599 I mean, this is a this is a phenomena that's 0:06:29.760 --> 0:06:33.600 really embedded, and you know what people you know are 0:06:33.640 --> 0:06:36.160 looking for what they want and that ultimately, ultimately all 0:06:36.160 --> 0:06:39.719 companies are valued the same way, which is future casual 0:06:39.800 --> 0:06:42.719 is discud back to the day. Companies that have these 0:06:42.760 --> 0:06:47.000 mission driven values. I really you know, it really equates 0:06:47.000 --> 0:06:50.040 to more of a sustainable growth, more sustainable business model, 0:06:50.440 --> 0:06:53.080 which should mean that their future profits are going to 0:06:53.160 --> 0:06:55.919 be greater, which means that you know that what what 0:06:56.000 --> 0:07:00.040 health the market ultimately vas those should be higher. And 0:07:00.160 --> 0:07:02.479 it's interesting too because when I talked to you know, 0:07:02.760 --> 0:07:04.800 you mentioned my nieces and I mentioned my nieces, and 0:07:05.440 --> 0:07:08.279 you know, there is a feeling that capitalism is bad, 0:07:08.480 --> 0:07:10.520 and you know, I try to remind them that it 0:07:10.640 --> 0:07:14.640 builds a lot of things that we take for granted today. Um, 0:07:15.000 --> 0:07:18.040 you know, what is your what would be your message 0:07:18.080 --> 0:07:20.720 message to someone if they say, listen, capitalism just doesn't 0:07:20.760 --> 0:07:26.600 work anymore. Yeah, I mean again, young people were believe 0:07:26.680 --> 0:07:30.040 that socialism is a better system than capitalism. It's not 0:07:30.160 --> 0:07:33.240 that they're ignorant or that they don't know history. What 0:07:33.320 --> 0:07:36.680 they've experienced as a system that feels great. You see 0:07:36.760 --> 0:07:40.760 growing inequality. You see where you know the people running 0:07:40.800 --> 0:07:43.720 companies have made you know they're average feel makes four 0:07:44.040 --> 0:07:47.000 times the average worker and fewer and fear people feel 0:07:47.000 --> 0:07:49.560 like they're getting a faving a fair system. Today's world. 0:07:49.960 --> 0:07:53.240 Basically your future depends on how well how well you 0:07:53.280 --> 0:07:57.000 select your parents, which is not it's not a fair system. 0:07:57.040 --> 0:08:00.280 So people are looking for a better system, and that's 0:08:00.320 --> 0:08:03.200 what we're saying. You can't in socialism is O N 0:08:03.280 --> 0:08:06.680 forty two, So we know that. So it's really how 0:08:06.680 --> 0:08:08.880 do you, as I said before, how do you fix 0:08:09.160 --> 0:08:13.400 the invisible hand of capitalism that's broken and make it 0:08:13.520 --> 0:08:16.200 better and make it reflect where there's worth going. So 0:08:16.560 --> 0:08:19.080 what's out there on the horizon that gives you hope, 0:08:19.480 --> 0:08:22.800 whether it's leaders, whether it's companies, whether it's the younger 0:08:22.840 --> 0:08:27.560 generation that gives you hope that capitalism can be better. Well, 0:08:27.600 --> 0:08:31.000 I think you do. Ship and the young entrepreneurs and 0:08:31.040 --> 0:08:33.679 what they are doing in terms of the businesses they're creating. 0:08:34.000 --> 0:08:36.520 It's not just how can they get rich? In fact, 0:08:36.640 --> 0:08:38.680 most of them are saying, how can they dent the 0:08:38.760 --> 0:08:41.400 universe for good? How can they change the world for good? 0:08:41.720 --> 0:08:44.520 You talk about Left is a company that you had 0:08:45.360 --> 0:08:49.120 good numbers to report, um, you know, an interim and 0:08:49.400 --> 0:08:51.559 the stock reflecting that. Well, the fact is Left as 0:08:51.559 --> 0:08:55.040 a company has embetted values that I think reflect a 0:08:55.040 --> 0:08:57.319 lot of what we talked about contemporary capitalists going vack. 0:08:57.320 --> 0:09:00.040 To see this last twelve months of what we've gone to, 0:09:00.520 --> 0:09:03.120 this race to create a vaccine, which is just extraordinary. 0:09:03.120 --> 0:09:07.720 What's happened. There's this cooperation between big pharmaceutical companies which 0:09:07.760 --> 0:09:10.320 aren't exactly the most loved you know, and that's not 0:09:10.400 --> 0:09:12.960 the best behavior. Even all of a sudden, it was 0:09:12.960 --> 0:09:14.840 sort of this kind of rallying for good, for doing 0:09:14.920 --> 0:09:17.240 making a society better or not not from how to 0:09:17.360 --> 0:09:21.400 make more money. So that those kind of signs are encouraging. Hey, listen, 0:09:21.440 --> 0:09:23.960 just got about thirty forty seconds here just quickly, Michael, 0:09:23.960 --> 0:09:26.520 if there was one government policy, I know you talk about, 0:09:26.679 --> 0:09:29.760 you know, better tax incentive structures. If there's one policy 0:09:29.760 --> 0:09:31.800 that could come down that would really make a difference here, 0:09:32.240 --> 0:09:34.960 what would it be, and just quickly if you could, ye, 0:09:35.120 --> 0:09:38.400 I think it's it's you know, it's it's removing friction 0:09:39.120 --> 0:09:42.319 from the whole start up ecosystem. And I think it 0:09:42.440 --> 0:09:47.079 really be more than just tax policy. It's liberating companies 0:09:47.080 --> 0:09:51.240 to tax big problems and have investors support those problems 0:09:51.360 --> 0:09:53.120 that they're going to make a little better. So whether 0:09:53.160 --> 0:09:56.760 that's health care with its education for that environment and climate, 0:09:57.080 --> 0:09:58.679 and then we can we can we can create them 0:09:58.760 --> 0:10:03.160 sent us to just see the resources and focus developed there. 0:10:03.240 --> 0:10:05.839 I always feel inspired, Michael, thank you, Thank you so much. 0:10:05.880 --> 0:10:08.280 Really appreciate it. Michael Moe, co founder of gs V 0:10:08.360 --> 0:10:11.240 Asset Management. Check out his book The Mission Corporation, How 0:10:11.240 --> 0:10:15.080 contemporary capitalism can change the world one business at a time.