Speaker 1: This is Bloomberg Business Week. I'm Carol Masser and I'm
Speaker 1: Jason Kelly. We're here every day bringing you the latest
Speaker 1: news from the world's of business and finance, plus technology, politics, economics,
Speaker 1: all harnessing the power of Bloomberg Business Week reporters and editors,
Speaker 1: not to mention our journalists and analysts more than a
Speaker 1: hundred and twenty countries. You can download Bloomberg Business Week
Speaker 1: on iTunes, SoundCloud, or Bloomberg dot Com. You can also
Speaker 1: listen to our radio show weekdays at two pm Eastern
Speaker 1: only on Bloomberg Radio. We're here at the number one
Speaker 1: business school we are, indeed, we're at the stand Stanford
Speaker 1: Graduate School of Business, and we kicked off our reveal
Speaker 1: of the top graduate school of business this morning catching
Speaker 1: up with the perfect person we're talking about, the Dean
Speaker 1: of the school, John Levin, who talked with us about
Speaker 1: being name number one and really on how the NBA
Speaker 1: program continues to evolve. It's really just a testament of
Speaker 1: the fantastic students and faculty and staff and alumni we
Speaker 1: have at the school. And I couldn't be happier to
Speaker 1: be Bloomberg's top business school this year. All right, So
Speaker 1: it's pretty quiet here. It's a beautiful day. The students
Speaker 1: will be milling around very shortly. What's on their minds
Speaker 1: right now? It is a topsy turvy corporate world. And
Speaker 1: as they prepare to get into the next phase of
Speaker 1: their career, what are they most worried about? Well, the students,
Speaker 1: you know, they're arriving these days at a time of
Speaker 1: great change in business and technology and society, globalization, and
Speaker 1: those things are all in their mind. They're thinking about
Speaker 1: right now, they're thinking about what am I going to do?
Speaker 1: My A A M class, right, But then they're going
Speaker 1: to be thinking about what jobs am I going to get?
Speaker 1: Has my career going to evolve? Am I prepared for
Speaker 1: a changing world? And that's what That's what they're here for.
Speaker 1: They're here to get exposed to all kinds of different
Speaker 1: opportunities and ideas and people and develop the skills that
Speaker 1: are going to carry them forward for their careers. John,
Speaker 1: you know what's interesting too, And I think about on
Speaker 1: a day where we had the McDonald's CEO being forced
Speaker 1: to resign because of a relationship with someone who worked
Speaker 1: for him under armour, there's financial you know, looking into
Speaker 1: kind of the financials at that company. I do feel
Speaker 1: like corporate responsibility and governance is really front and center.
Speaker 1: How do you work all of that in to what
Speaker 1: you do at Stanford? Yeah, we start with that on
Speaker 1: day one. We asked the students what kind of leader
Speaker 1: do you want to be? What kind of organizations do
Speaker 1: you want to help build? And that's just carries through
Speaker 1: the curriculum and the experience here, and it's never been
Speaker 1: more important to be, you know, become leaders grounded in
Speaker 1: ethics and in thinking about purpose and what your source
Speaker 1: of real responsibility is. And that's a big part of
Speaker 1: the discussion throughout the time that students spent here at Stanford.
Speaker 1: I have to think to given where we are in
Speaker 1: Silicon Valley this time, where there's a lot of talk
Speaker 1: in Washington about Silicon Valley its role in society, how
Speaker 1: do you square all of that being really the face
Speaker 1: of Silicon valleum. Anyways, it's a great question. When I
Speaker 1: came to Stanford as twenty years ago and Washington just
Speaker 1: steamed could not have been farther away from Silicon Valley,
Speaker 1: it was irrelevant. People were that here building things, making companies,
Speaker 1: trying to make the world a better place, and it
Speaker 1: doesn't feel that way right now. It feels like Washington
Speaker 1: and Silicon Valley have come much closer together. There's more
Speaker 1: you talk about regulation, there's going to be more regulation.
Speaker 1: The impact of Silicon Valley on government and on democracy
Speaker 1: has is enormous and we're right in the middle of that.
Speaker 1: And I think that's a really important responsibility for Stamford
Speaker 1: to to be in the middle of that discussion, to
Speaker 1: try to facilitate connections between Washington and tech firms. And
Speaker 1: we're trying to do that. It's rapidly moving now, and
Speaker 1: I do think about you know, we've heard from various
Speaker 1: Stanford grads or alums. You know what happens is it's
Speaker 1: not uncommon for a lot of executives to just kind
Speaker 1: of drop in and have conversations with students here tell
Speaker 1: us about how important that is as part of kind
Speaker 1: of what they learned the experience. I think it's a
Speaker 1: huge part of what students experience here. It's part of
Speaker 1: what just opens their aperture to what are the opportunities
Speaker 1: for them in the world. Is getting exposure first of all,
Speaker 1: to having a really world class faculty that they can
Speaker 1: learn from, but then to have a mix of people
Speaker 1: just coming in through campus, talking in classes, talking to
Speaker 1: the students, meeting with them, and that's that that's really
Speaker 1: what opens their eyes to the things that they might
Speaker 1: go on to do in their lives. One of the
Speaker 1: interesting things about a business education is, for a long time,
Speaker 1: it was a fairly straightforward proposition. It was an investment.
Speaker 1: You paid X tens of thousands of dollars, You came
Speaker 1: out on the other end, you got paid very well,
Speaker 1: uh paid better than maybe you were going in. It
Speaker 1: seems more complicated now and and maybe even some existential
Speaker 1: questions around why am I getting them an m b A.
Speaker 1: How do you make the case for Stanford to students. Yes,
Speaker 1: you're number one, but still you've got to make a
Speaker 1: case that you're better than the Harvard's, the Wharton's, and
Speaker 1: the Sloans of the world. Well, all of what you
Speaker 1: said is still true. There's still great economic r o
Speaker 1: I on an NBA here and other schools. What's I
Speaker 1: think what has changed is the students have evolved. It's
Speaker 1: a much broader set of students. We have students from
Speaker 1: consulting in technology and finance, just like we always did,
Speaker 1: but now We'll have students who come in from from government,
Speaker 1: from health care, from education. We have a student in
Speaker 1: the first year class who was a central banker in Yemen,
Speaker 1: another one who was a dentist in Nigeria, a woman
Speaker 1: who was an Olympic medalist on the U S swimming team,
Speaker 1: And you put all those people in the mix together
Speaker 1: and that's part of the magic of the place. And
Speaker 1: then they go on to approximately the same richness of
Speaker 1: careers and that's changed that that sense that the NBA
Speaker 1: can prepare you for anything, for all different walks of lives,
Speaker 1: all different careers. I think that's really fundamental to to
Speaker 1: what we're trying to do. To tell. One of the
Speaker 1: things we talked about when we were here just one
Speaker 1: year ago celebrating you guys as the number one top
Speaker 1: ranked NBA program was immigration issues and how that was
Speaker 1: impacting foreign students being able to study here in the
Speaker 1: United States. What's changed in the year, if anything, that's
Speaker 1: really front and center for us more than our class
Speaker 1: is international here and that's part of what makes the
Speaker 1: programs as special as your people from sixty countries and
Speaker 1: they speak seventy languages, even though it's a very small
Speaker 1: program here and mentionally small, and I think I think
Speaker 1: one thing that I hope people appreciate it will come
Speaker 1: to appreciate, is just what an incredible asset that is
Speaker 1: for our country to bring people in from all around
Speaker 1: the world and have them study here, and many of
Speaker 1: them will stay in the United States and contribute enormously
Speaker 1: to the great companies, great great companies, going to be
Speaker 1: great leaders, and some of them will go back and
Speaker 1: that's great for us too, because they'll bring American values
Speaker 1: and understanding and thinking back to their countries around the world.
Speaker 1: So before we let you go, it's going to be
Speaker 1: a busy day here for us and for you. What's
Speaker 1: your single biggest challenge in your job as you look
Speaker 1: across the next year. I think it's actually similar to
Speaker 1: one of the big challenges faced by any organizational leader
Speaker 1: right now, which is just trying to interact with all
Speaker 1: types of different people and different constituencies. And at the
Speaker 1: Business School, we have our students, we have our faculty,
Speaker 1: we have our alumni, we have Silicon Valley, we have Washington,
Speaker 1: we have the university, we have the whole business community,
Speaker 1: and that's both can be some one of the biggest challenges,
Speaker 1: but it's also one of the things that makes my
Speaker 1: job so fun. And that was Stanford Graduate School of
Speaker 1: Business Dean John Levin. So interesting to talk to him
Speaker 1: and just reminding us to about the amount of you know,
Speaker 1: students that come from outside the United States. That's still
Speaker 1: a big deal for them, so immigration, as he said
Speaker 1: front End Center, it's a big day. Stanford number one
Speaker 1: again defending its title. And someone who knows about defending titles,
Speaker 1: Joe Lacob. He wears many hats. He's here with us,
Speaker 1: a proud a Stanford alum under the Golden State words
Speaker 1: venture Capitalists Welcome, Thank you for having us here on campus. Well,
Speaker 1: thank you. We have a nice day sitting outside here.
Speaker 1: It's beautiful. So let's talk about your time at Stanford.
Speaker 1: You are a class of eighty three. You have to
Speaker 1: remind me. We'll take us back there. What was it
Speaker 1: like on campus and your experience here. You know, it's
Speaker 1: very very different. Uh. I was a guy that came
Speaker 1: out of a very different background. I was a science
Speaker 1: biology major. I didn't really know anything about business, and
Speaker 1: I worked for a few years and I decided I
Speaker 1: need I liked it, and I needed to get some
Speaker 1: business rains, so unlike a lot of people came from
Speaker 1: maybe Wall Street jobs, I didn't. I didn't know anything,
Speaker 1: but I got in, I came here. It was one
Speaker 1: of the best schools then too. And uh it was
Speaker 1: a great, great experience and for me, perhaps better than
Speaker 1: even some other people, because I learned so much well,
Speaker 1: and you learned a lot about Silicon Valley in a
Speaker 1: lot of ways, which is where you really made your career.
Speaker 1: What is it about that connection? I mean, obviously geography helps,
Speaker 1: but there's something deeper going on between this school broadly
Speaker 1: the university, but also the business school and what's happening
Speaker 1: around us. What is it? Well, I think geography does
Speaker 1: play a big role. I mean for forty years, fifty years,
Speaker 1: I mean now we've been in what arguably is Silicon Valley.
Speaker 1: No one knows where Silicon Valley really is, but this
Speaker 1: is in the middle of it somewhere. And the truth is,
Speaker 1: the classes are great. When you come to the STAN
Speaker 1: for business school, you you're with great students, you know
Speaker 1: all these other people that are in your class, but
Speaker 1: you're in this environment that is kind of hard to replicate.
Speaker 1: I told my kids, and I tell others you can't
Speaker 1: really beat it because you're in the middle of something
Speaker 1: that is hard to explain. It's a culture, and I
Speaker 1: think that culture pervades the business school and the entire area.
Speaker 1: What do you think about we got we caught up
Speaker 1: with the deaned John Levin earlier about what's going on
Speaker 1: here UM at the school. But it's interesting I'm curious
Speaker 1: about you know, I feel like companies are dealing with
Speaker 1: a lot more in terms of E S g UM
Speaker 1: leadership concerns. I think that's it's very much fun and
Speaker 1: center accountability. Like, what do you think has to be
Speaker 1: a part of getting an MBA today? As someone who
Speaker 1: has been involved with many startups in the VC world,
Speaker 1: and we'll get into basketball at a moment, what do
Speaker 1: you think has to be part of getting an MBA today?
Speaker 1: I mean, it's just not about what's in the books, right,
Speaker 1: It's about a lot of other things, and there's so
Speaker 1: many issues that one has to be aware of. UM
Speaker 1: to be a CEO if that's your goal, or to
Speaker 1: be in business and the world it's a very international
Speaker 1: world now. You can't just think domestically as we all know,
Speaker 1: and affects the business I'm in even right now as
Speaker 1: we all know recently. So I think it's you really
Speaker 1: have to have an experience where you get exposure to
Speaker 1: all of those issues. And I think that's what Stanford
Speaker 1: in this place does it. It's very very good at
Speaker 1: doing that. Well. The Dean talked to us about I
Speaker 1: think of their students. I thought it was the United States.
Speaker 1: Pretty impressive. So when you think about this place, Silicon
Speaker 1: Valley and Stanford, so many companies have been born of this,
Speaker 1: private companies. We seem to also be at a moment
Speaker 1: where private valuations public valuations. You've been in the business
Speaker 1: venture capital for a long time. What do you make
Speaker 1: of this moment where people are trying to decide what
Speaker 1: something is worth and there's candidly some disagreement out there.
Speaker 1: How does this end? Well, I'm not really investing as
Speaker 1: a venture capitalist here so much maybe privately as an
Speaker 1: individual to some extent, But you watch the market. I do.
Speaker 1: I do. I'm very aware of it all, and I
Speaker 1: would super aware. I'm aware you can't help, but I
Speaker 1: would say that you know, they're clearly private valuations are
Speaker 1: very very high, and there's some structural issues going on
Speaker 1: here with respect to the giant funds that have been
Speaker 1: raised and the prices they've been willing to pay for
Speaker 1: some of these startups or a little bit later stage
Speaker 1: in startups. And so I think that the public markets
Speaker 1: private markets have to sort of figure all this out.
Speaker 1: This is no different though that's gone on in the past.
Speaker 1: To some extent, We've had these periods where private company
Speaker 1: valuations perhaps have gotten what some people believe to be
Speaker 1: too high. Public companies valuations have to sort of make
Speaker 1: do with all that. I think it'll all work itself out,
Speaker 1: so jo the idea of like I p O ing
Speaker 1: is it's still going to make sense in the future.
Speaker 1: I hope so. And I think so because you know,
Speaker 1: that's something called liquidity. When you're in a private company,
Speaker 1: you don't really have that liquidity, and that's the big difference.
Speaker 1: And I think liquidity is a very important thing in investing.
Speaker 1: It's not just about return. But even with all that
Speaker 1: money that's whether it's in private equity or family wealth offices,
Speaker 1: there's so much money in the private markets right now,
Speaker 1: you don't think that that's gonna kind of put a
Speaker 1: damper increasingly on on the I P O market. I mean,
Speaker 1: it has to some extent. You could argue in the
Speaker 1: years leading up to this period where you've got all
Speaker 1: these companies now that are considered the select group that
Speaker 1: are trying to go public or have gone public recently,
Speaker 1: and uh, they you stay private for a lot longer
Speaker 1: than they would have because they had access to capital.
Speaker 1: But at some point, not all of them, but many
Speaker 1: of them really want to have the liquidity or they
Speaker 1: just need to be public companies for the exposure. All Right,
Speaker 1: I've resisted for as long as I possibly can. We
Speaker 1: got to talk about basketball, but I'd rather talk about
Speaker 1: that because I have to think. You walk through this
Speaker 1: campus and there are people who look at you and see, well,
Speaker 1: that's what I want to be when I grow up,
Speaker 1: is I want to own a basketball team. It's not
Speaker 1: easy right now, What do you make of this season
Speaker 1: so far? Because there have been some twists and turns.
Speaker 1: Every year is the same way in the NBA. It's
Speaker 1: unbelievable how you start the year and everyone has a
Speaker 1: certain mindset or expectations and they change because the fact
Speaker 1: is that players get better, some get worse, some get older.
Speaker 1: You know, the younger ones are emerging, and injuries happen,
Speaker 1: and so The truth is that every year is the
Speaker 1: same thing. You don't really know, and that's what makes
Speaker 1: it great. And this year in the NBA anyway, unfortunately
Speaker 1: for us to let me say, we have a lot
Speaker 1: of injuries, but it's really exciting, I think for the fans.
Speaker 1: But to know that, you know, truthfully there's nine or
Speaker 1: ten teams that any one of them might win the title,
Speaker 1: that's exciting. Now. I'd rather be the prohibitive favorite like
Speaker 1: we've been in notes. Of course, I'd rather, but it's sports,
Speaker 1: and things happen and you have to adjust. Well, how
Speaker 1: does it infect the season? Though? Steph Carry is out
Speaker 1: what for three months? Right now? You're up here on
Speaker 1: your basketball I see he is. He's gonna be out
Speaker 1: for three months. Clay Thompson's out for at least that,
Speaker 1: recovering from his A c L. But more than that,
Speaker 1: every single player that was on our roster last year
Speaker 1: is either gone or injured right at this particular moment.
Speaker 1: Now we will improve. We're playing a lot of young guys,
Speaker 1: and I like to tell my guys it's a you know,
Speaker 1: I'm always positive. Everything's about you've got to be positive.
Speaker 1: And I do believe the silver linings and everything, and
Speaker 1: this in particular will allow us to develop our younger players.
Speaker 1: They're gonna get a lot of time, they're gonna get better,
Speaker 1: and we've got some really good ones. So from a
Speaker 1: standpoint of basketball, I think our fans understand it. They're
Speaker 1: going to be with us, and we're gonna wind up
Speaker 1: being better. Uh sorry, NBA, We're gonna be better. We're
Speaker 1: actually gonna better when this is all over. I have
Speaker 1: to ask you about China. Everything that happened with the
Speaker 1: NBA over there, the commissioner, Lebron, everything that happened, What
Speaker 1: happens next with the NBA in China. You know, I
Speaker 1: could comment on that more, but I'm not is the truth,
Speaker 1: because I think we have a commissioner that is really
Speaker 1: a great commissioner, maybe the best in all of sports.
Speaker 1: And he's on top of this, and he's concerned about
Speaker 1: it too, obviously, and he's the one who's on the
Speaker 1: front lines dealing with these issues. And it's a very
Speaker 1: sensitive subject. It's something that I don't think all of
Speaker 1: us really here and the players and even myself can
Speaker 1: fully explain or understand. So I think it's gonna work
Speaker 1: its way out it's like everything else, and I think
Speaker 1: we'll get back to the place where we were before.
Speaker 1: That's that's my again, the optimist point of view. We're
Speaker 1: talking with Joe Lake up. We're going to continue our
Speaker 1: conversation on Bloomberg Radio. We're going to toss it back
Speaker 1: though to our folks on the TV side. Having said that, Joe,
Speaker 1: I just want to kind of push a little bit,
Speaker 1: like I do wonder what's the responsibility of like corporate
Speaker 1: leaders like yourself in terms of situations like what's going
Speaker 1: on in Hong Kong. It's complicated. Um, I think people,
Speaker 1: corporate leaders have responsibility certainly, but you know, the truth is,
Speaker 1: we have a business to run, too, and our job
Speaker 1: is not really at its most primary to uh, to
Speaker 1: look at what's going on there from a political standpoint
Speaker 1: or to make decisions about that. Our job is to
Speaker 1: run our business. Now. We have to obviously take into
Speaker 1: account all of these kinds of social issues. They are
Speaker 1: important issues, but I don't think it's something that you know,
Speaker 1: I can change personally. I can only do the right things.
Speaker 1: And um, I think Adam and our league and everyone
Speaker 1: will figure this out. And so when you think about
Speaker 1: the Abbey you talked about Adam Silver, and you talk
Speaker 1: about the NBA being a very successful league. There was
Speaker 1: a huge sort of player realignment in a lot of ways,
Speaker 1: something we haven't seen in many seasons. Why is it
Speaker 1: happening in basketball? Why is basketball having the moment that
Speaker 1: it's having, maybe versus some other professional leagues who are
Speaker 1: who are actually declining in popularity. What you're talking about?
Speaker 1: You said player realignment, the movement, the free agency, free
Speaker 1: agency like we've never seen. That's what I thought you're asking. Well,
Speaker 1: we have short term contracts. We have basically four year
Speaker 1: limits on the contracts. Baseball you can sign a contract
Speaker 1: for ten years. So I think that plays a role
Speaker 1: in all this. And so you we expected to have
Speaker 1: more movement, not as much as we expected or as
Speaker 1: we had last year. We did have a lot. In fact,
Speaker 1: the average NBA roster has I think of its players
Speaker 1: from last year on its team this year. Think about
Speaker 1: that under half. So a lot of change. But look,
Speaker 1: that's the system we are in, and I think it
Speaker 1: can be a good thing. And you go through cycles
Speaker 1: in these teams and you have to plan forward. You're
Speaker 1: gonna have a team maybe that you keep all your
Speaker 1: players and you build, and then you're going through cycles
Speaker 1: sometimes where you can't do that. Speaking of building, got
Speaker 1: a new UH stadium arena good, I know, sorry about that,
Speaker 1: but it's pretty amazing. Opened in September. And I'm just
Speaker 1: curious about the revenue streams that you anticipate getting out
Speaker 1: of that, because you, from what I understand, you've signed
Speaker 1: up a lot of already multi year deals for the building. Yeah,
Speaker 1: we have, and uh, look we built it for a reason.
Speaker 1: We had the oldest arena in the NBA, the oldest
Speaker 1: fifty years and it had been remodeled once. But the
Speaker 1: truth is we had one kitchen. I mean, you can't
Speaker 1: serve your customers with one kitchen and expected quality food.
Speaker 1: So we have many, many more kitchens. Now we have
Speaker 1: great food choices we've gotten. I think the most important
Speaker 1: thing is to give our customers a great experience. I
Speaker 1: wish we were winning a little bit more so far
Speaker 1: this year, but that will come. The truth is they're
Speaker 1: getting a great experience and they're in the great place
Speaker 1: there in San Francisco on the waterfront, and it's frankly
Speaker 1: the most expensive arena, not by choice, most expensive arena
Speaker 1: ever built, all with private funding. We're excited as hell
Speaker 1: to be able to open this this year, and you
Speaker 1: should come and see it because it's it's pretty specta.
Speaker 1: Expectations out of it hi high relatively, and we wouldn't
Speaker 1: have done it obviously if we had had not expected that.
Speaker 1: Even if you don't have a great sea then you
Speaker 1: think it'll be okay. Well we're locked in. We have.
Speaker 1: We're fortunate that we were when I say, hi, we're
Speaker 1: we brought in a lot of revenue streams this year,
Speaker 1: locked them in over ten fifteen years. Most of our
Speaker 1: contracts for suites and for sponsorships are eight to fifteen
Speaker 1: or even twenty years in pretty nice visibility. So we
Speaker 1: have a visibility on our revenues that is probably unlike
Speaker 1: most teams in all of sports. And uh, I think
Speaker 1: that's a good thing because allows us to make sure
Speaker 1: we have a competitive team because at the end of
Speaker 1: the day, it's all about winning and making sure that
Speaker 1: our fans are treated well and that that we win
Speaker 1: and we keep our players. And I knew it's early
Speaker 1: in the season, so sorry, valuations still going up, you
Speaker 1: think across the NBA. I mean, it's been unbelievable to
Speaker 1: see you know, kididly professional investors, owners, operators come in.
Speaker 1: Is that just going to continue to bring them higher.
Speaker 1: The higher valuations go, the more professional the managers and
Speaker 1: investors must be because you're now shepherding a very expensive asset.
Speaker 1: And so I think that's a natural trend that's happened.
Speaker 1: When I was involved in buying the team in two
Speaker 1: thousand ten, you know, I went to some investors for
Speaker 1: limited partners and some of them frankly turned me down.
Speaker 1: They said, oh, well, you know this is a vanity investment.
Speaker 1: Well I think you're overpaying. Well they did, and it
Speaker 1: was the highest price ever pay at the time for
Speaker 1: an NBA team. But the truth is I had looked
Speaker 1: at the prior to thirty years and seeing an average
Speaker 1: rate of return that was compounded annually. That's not bad, right,
Speaker 1: that's pretty good. And because you have a limited asset,
Speaker 1: you have something that is unusual and it's live content,
Speaker 1: those things are more they're more true today than they
Speaker 1: were then. Well, that team you paid what half a
Speaker 1: billion is now worth about three point five according to Forbes.
Speaker 1: I think one of the estimates, so not a bad return.
Speaker 1: I'll let others judge what it's worth. I think it's
Speaker 1: worth more than that. What a treat graduate of dis
Speaker 1: fine institution in nine three under the Golden State Warriors,
Speaker 1: among many things. Thank you. So. Catherine august Builda is
Speaker 1: Stanford Graduate School of Business, class of nineteen seventy five.
Speaker 1: She's Vice cheer at the San Francisco based First Republic Bank,
Speaker 1: the publicly held regional bank serving coastal, urban and affluent markets.
Speaker 1: She's been at the bank for a long time, really
Speaker 1: got it to where it is today. And she joins
Speaker 1: us here at the Stanford Graduate School of Business in
Speaker 1: Palo Altars. So nice to have you with us. Delighted
Speaker 1: to be here. Tell us about your time at Stanford,
Speaker 1: And I'm curious about you know, how easily you felt
Speaker 1: accepted as a woman. I think you know pursuing an MBA.
Speaker 1: What the environment was like. Take us back there if
Speaker 1: you would. Well, it was nine I was a class
Speaker 1: of We were a class of sixty women out of students.
Speaker 1: Prior years had been four thirty and then sixties, so
Speaker 1: we were a big class of women and state at
Speaker 1: that level for a very long time. So women were
Speaker 1: for the first time a presence here. But it was
Speaker 1: a very beginning of it, and I it was before
Speaker 1: women knew they could do whatever they wanted, so it
Speaker 1: was we were certainly accepted. But I will did you
Speaker 1: feel like an equal as a student here? Absolutely? Yeah, absolutely.
Speaker 1: There were However, very few women guest speakers and classes.
Speaker 1: There were. I only think I had one female professor,
Speaker 1: one woman ever was a guest speaker in the class.
Speaker 1: But there were there wasn't the bench to choose from.
Speaker 1: So fast forward to today. You're obviously incredibly involved, I
Speaker 1: should say, obviously you are very involved in the school.
Speaker 1: What have you done and how have you sought to
Speaker 1: sort of change that? Because nineteen very different world, and
Speaker 1: and Stanford is is known for having a more diverse
Speaker 1: student body at this point in terms of women. This
Speaker 1: is now we have enough forty seven percent in the class.
Speaker 1: A group of us began about fifteen years ago working
Speaker 1: with the admissions office to interview women and to help
Speaker 1: recruit those women who would have long careers and who
Speaker 1: would be the future leaders of America in the world.
Speaker 1: And I think some of that was helpful. I think
Speaker 1: when we started that we were pent. We're now forty
Speaker 1: seven percent. So we've worked very hard to both interview
Speaker 1: recruit talk to women who are considering coming to Stanford
Speaker 1: or other places and telling them why this is such
Speaker 1: a great place to be In terms of other diversity.
Speaker 1: About ten years ago I taught I was a guest
Speaker 1: speaker in a class. I've done it for about ten
Speaker 1: years for a professor, and I was stunned to see
Speaker 1: the diversity in the class. The number of international students,
Speaker 1: the ethnicities, the gender mix was totally different than when
Speaker 1: I was here. So this is a class of mixed
Speaker 1: from all over the world, from all genders, from all
Speaker 1: all ethnicities. And I think it's great because these different
Speaker 1: people are learning together and showing each other different experiences
Speaker 1: that they will go and take back to whatever they
Speaker 1: do next. Agreed. And we know all the studies about
Speaker 1: having diversity, whether it's you know throughout your employee base,
Speaker 1: your senior executive levels as well as your boards and
Speaker 1: your C suite. One thing I want to ask you,
Speaker 1: and I was doing some research um in terms of
Speaker 1: women MBA's women with NBAS are in six or more
Speaker 1: with an m b A, but still not as much
Speaker 1: as men. Why is that still around? Why is that
Speaker 1: we're improving the pipeline. There's almost parody in terms of
Speaker 1: the number of students here. Why doesn't it carry over
Speaker 1: at all levels when we get into like kind of
Speaker 1: the corporate Well, there's been a lot of studies on this,
Speaker 1: and I'm not the expert on it, but I think, uh,
Speaker 1: in some cases, women may not have as many opportunities
Speaker 1: because people tend to promote people who are more like them,
Speaker 1: and so until people are running those corporations, they may
Speaker 1: not be as obvious. When women wind up on corporate
Speaker 1: governance committees, there generally winds up being more women on boards.
Speaker 1: So it's a matter of looking around and saying, am
Speaker 1: I comfortable with this person? And some of us look different.
Speaker 1: And so I think the more women get to the top,
Speaker 1: the more women will be throughout the pipeline, and the
Speaker 1: less they will be paid unequally uh and have unequal
Speaker 1: amounts of positions. But it's going to still take time.
Speaker 1: The thing is, uh, some women, for one reason or
Speaker 1: other may not decide to go for it. And you
Speaker 1: have to be pretty committed whoever you are, if you
Speaker 1: want to get to the top. It has to be
Speaker 1: a very core goal. One of the things I did
Speaker 1: when I was here, I felt so lucky to be here.
Speaker 1: I felt like I had wound up in a place
Speaker 1: that was going to change my life, and I wanted
Speaker 1: to be a beacon an example for other women. I
Speaker 1: think many of us felt that way, and so I
Speaker 1: always had in my mind that that was one of
Speaker 1: my objectives. Uh some women saw that and copied us,
Speaker 1: some didn't. I think it will still take more time.
Speaker 1: I think Dean Levin's focus on this is probably going
Speaker 1: to help a lot um but we have to help
Speaker 1: women understand that they can do it. They have to
Speaker 1: ask for what they want, they have to speak up,
Speaker 1: and they have to move on if they're not going
Speaker 1: to get it in their existing company. So let's talk
Speaker 1: a little bit about the world at large, because at
Speaker 1: First Republic you have the privilege and the opportunity to
Speaker 1: speak to CEOs around the world. Your customers are well healed,
Speaker 1: and many cases, how are they feeling about the economy
Speaker 1: right now? Because honestly, I feel like we get a
Speaker 1: lot of mixed signals from the data and from various
Speaker 1: folks that we hear, whether it's on earnings calls or
Speaker 1: just anecdotally, what are you hearing? Well? Here, we sit
Speaker 1: on a day when the indexes, indicries are reaching market highs,
Speaker 1: and everybody is nervous. Our clients are nervous, the press
Speaker 1: is nervous. Everyone is nervous because of some things that
Speaker 1: are real, some that are not. They're nervous because it's
Speaker 1: a ten year bowl market and we think there are
Speaker 1: cycles and don't think it can go on. But they're
Speaker 1: also nervous because they're concerned about the China trade problems.
Speaker 1: They're concerned about Brexit, they're concerned about America's relationships with
Speaker 1: its traditional allies. They're concerned about climate change. They're concerned
Speaker 1: about issues of inequality and housing shortages, and those things
Speaker 1: all told create problems for people. And technically, whenever you
Speaker 1: have an inverted Yeel curve, it usually says a recession
Speaker 1: is coming, right, So that's always been a signal. We
Speaker 1: have that some days recently, and so that's making people
Speaker 1: more nervous or technical point of view, Yeah, here we go,
Speaker 1: sit here and the market is again in an all
Speaker 1: time high. So I think our clients are at best
Speaker 1: cautiously optimistic. All right, well, we really appreciate you spending
Speaker 1: some time with this. Catherine august T Willda NBA seventy five.
Speaker 1: Trailblazer in many ways and a great window into not
Speaker 1: just this place, but the world at large. Talk about
Speaker 1: a local boy or an alument made good. John Donahoe,
Speaker 1: he's the CEO of Service. Now he ran eBay, he's
Speaker 1: on the board of PayPal, and now he's got a
Speaker 1: new job. He's going to be the CEO of Nike.
Speaker 1: We were able to catch up with him ahead of
Speaker 1: our trip out here. Here's what he had to say.
Speaker 1: It was really, I think probably the most formative experience
Speaker 1: I had that has set me up for not just
Speaker 1: my career, but to be honest, my my overall life
Speaker 1: over the last thirty years. UM. I distinctly remember many
Speaker 1: of my professors as well as my classmates, and what
Speaker 1: Stanford really really grounded me in was this notion of
Speaker 1: servant leadership. Um. It was a phrase I first heard
Speaker 1: at Stanford. It resonated with me. Ernie Arbuckle, it had
Speaker 1: been a former dean of Stanford, and that's where the
Speaker 1: phrase came from. And if I were to say, there's
Speaker 1: been one foundational, foundational, almost guiding principle for the last
Speaker 1: you know, thirty five years. Since then, it's been a
Speaker 1: real inspiration and attraction towards this notion of servant leadership. Well,
Speaker 1: and there's so many full circle elements to this, and
Speaker 1: we're going to get to them throughout the conversation, one
Speaker 1: of them being the Phil Knight. This is school. But
Speaker 1: you were the winner, I believe, of the R. Buckle Awards,
Speaker 1: So clearly whatever you learned there really took root. I mean,
Speaker 1: when you go there in the eighties, Silicon Valley is
Speaker 1: certainly developed and developing, a far cry from from where
Speaker 1: it is now. Why did you go west in the
Speaker 1: first place? You know? I I went to Dartmouth College undergrad.
Speaker 1: I was fortunate enough as a senior in college to
Speaker 1: apply to a few different business schools. I was fortunate
Speaker 1: enough to get in, but I knew I wanted to
Speaker 1: go to Stanford because Stanford, as a as a senior
Speaker 1: and a senior in college rather in two, it was
Speaker 1: known for teamwork. Um. It was known for working with
Speaker 1: and through others, and that was really attractive to me.
Speaker 1: I'd played sports my whole life. I loved team sports.
Speaker 1: I had not yet been in business, but I knew
Speaker 1: that a team approach was what I wanted to do,
Speaker 1: and that was a reputation Stanford had. I had never
Speaker 1: lived in California. So I joined Bain for two years
Speaker 1: UH with the agreement that I was going to going
Speaker 1: to Stanford in four and when I came out, I
Speaker 1: certainly wasn't disappointed. I took a lot of classes at
Speaker 1: Stanford that were about the human side of management, about
Speaker 1: the inner journey of leadership, not just accounting and marketing
Speaker 1: and finance, and so in at Stanford it was very
Speaker 1: legitimate to talk about things like the inner journey of leadership,
Speaker 1: talk about your personal and professional life, and how to
Speaker 1: build an integrative life. And so at a very young
Speaker 1: age and a very impressionable stage of my life, I
Speaker 1: feel like what I got from Stanford is those things
Speaker 1: were not only were they I legitimate, they were the
Speaker 1: best way to lead of fulfilling and hopefully impactful life.
Speaker 1: So let's go back to the mid eighties. When you
Speaker 1: come out, how does all of that inform the choices
Speaker 1: you make about the career you want to have and
Speaker 1: where you want to have it. During my first year
Speaker 1: at Stanford Business School, my wife applied to law school
Speaker 1: and she got in, and so during the beginning of
Speaker 1: my second year, which was going to be her first
Speaker 1: year Stanford Law School. We had a one year old child.
Speaker 1: I went to the dean of the Dean of Students
Speaker 1: UM Student Affairs at Stanford Business School, Jerry Gold, and
Speaker 1: I said, Dean Gold, I have to take next year
Speaker 1: off or I have to work part time because we
Speaker 1: have a one year old. We can't both be in
Speaker 1: graduate school at the same time. And this is classic Stanford,
Speaker 1: she says. Dean Gold says, oh, John, note just to this.
Speaker 1: Go ahead and start. And you know, if you want
Speaker 1: to take three classes instead of four, that's fine. Maybe
Speaker 1: start with four. If you want to drop one, that's fine,
Speaker 1: and we'll be flexible. You don't have you don't have
Speaker 1: to come in with some preordained plan. Well, what she
Speaker 1: did is she gave me permission to have an open
Speaker 1: mind and a mind that said, hey, it was legitimate
Speaker 1: what my wife was doing and the fact we had
Speaker 1: a kid as well as going to business school. As
Speaker 1: it worked out, I started that second year UM started
Speaker 1: with four classes. I thought I was going to drop one,
Speaker 1: never ended up dropping one and ended up graduating on time.
Speaker 1: But Stanford, both institutionally for the dean and just the culture,
Speaker 1: gave me permission to have the fact that it was
Speaker 1: a father, the fact that I was married to someone
Speaker 1: who was a peer and had a dual career that
Speaker 1: was legitimate, and so ironically I ended up following my
Speaker 1: wife when I went to bain Um thereafter, and you
Speaker 1: know that ended up working, Okay, end up staying seventeen
Speaker 1: years of Baine. Who would have figured at that time
Speaker 1: we got to talk about your new job. You're moving
Speaker 1: to Portland to become the CEO of Nike. You've served
Speaker 1: on the board there. Why take this job now? Why
Speaker 1: bring it full circle, as you say, with your esteemed
Speaker 1: history at the Phil Knight Business School and now working
Speaker 1: for the company that Phil Night created. I was lucky enough,
Speaker 1: unfortunate enough to meet Phil twenty years ago and Mark Parker,
Speaker 1: Nike's CEO, and I've always deeply resonated with Nike's purpose um,
Speaker 1: which is, you know, bring inspiration and innovation to every
Speaker 1: athlete in the world. Asterisk around athlete. If you have
Speaker 1: a body, you are an athlete, And to me, that's
Speaker 1: around human potential. It speaks to each person on this
Speaker 1: planet around the potential they have within them. And sport
Speaker 1: is sport is a very powerful and tuition in a
Speaker 1: world right now, a lot of our other institutions are
Speaker 1: falling down. They're polarizing, whether it's you know, government or politics.
Speaker 1: Sport is something that brings people together. It brings people
Speaker 1: together on a level playing field within countries and across countries.
Speaker 1: And so the the purpose of Nike and the role
Speaker 1: in impact it does and can have in the world
Speaker 1: is just something that has I've always admired deeply. It's
Speaker 1: always spoken to me. I was privileged enough to be
Speaker 1: served on the board the last five years, and when
Speaker 1: Mark and fail in the board UH invited me to
Speaker 1: have this opportunity to become CEO, it almost felt like
Speaker 1: um a calling and and a cause that I had
Speaker 1: to pursue. And very much along the lines of what
Speaker 1: we've been talking about in this conversation, Nike is at
Speaker 1: the epicenter of many things, and I think has had
Speaker 1: a track record of playing a very positive role not
Speaker 1: just with its athletes and customers and consumers, but also
Speaker 1: in the broader society. And and so I'm feel very
Speaker 1: privilege and honored to to have the opportunity to serve
Speaker 1: continue my my my quest of servant leadership by serving
Speaker 1: the employees and customers and athletes and society around Nike,
Speaker 1: and I'm looking forward to it. And that is John Donahoe,
Speaker 1: currently the CEO of Service now a graduate of the
Speaker 1: Stanford Graduate School of Business, headed to a new job
Speaker 1: a little bit north of here, up in Portland, Oregon,
Speaker 1: a dream job, I would imagine for him and for
Speaker 1: many people, and taking over at Nike at a really
Speaker 1: important time, to say the least, so steeped in areas
Speaker 1: of diversity, organizational behavior and more. Sarah soul is the
Speaker 1: more more Gridge, let me get it right, professor of
Speaker 1: organizational behavior. She's a senior Associate dean for academic Affairs
Speaker 1: at the Stanford Graduate School of Business. So nice to
Speaker 1: have you here with Jason and me. Thank you for
Speaker 1: opening us up to your home. Thank you, Thank you, Jason,
Speaker 1: it's great to have you here. We were thinking about
Speaker 1: all of the headlines today, um and in terms of
Speaker 1: what's going on at companies, how do you pull in
Speaker 1: the headlines like we have the McDonald's CEO being fired today,
Speaker 1: we have under arm or being looked at too into
Speaker 1: the last couple of years in terms of accounting concerns.
Speaker 1: But how do you pull in what's of the headlines
Speaker 1: into your teachings. That's a great question. And one of
Speaker 1: the things that is sort of distressing, of course about
Speaker 1: many of these headlines is that it actually allows us
Speaker 1: we hear about them, but it allows us wonderful learning
Speaker 1: opportunities in the classroom, particularly these days when we're bringing
Speaker 1: more and more about diversity, equity, and inclusion into all
Speaker 1: of our classes. Having these examples, these real life examples
Speaker 1: that our students have read about and are experiencing, allows
Speaker 1: us to think and work with them, to think about
Speaker 1: ways that they would better handle such situations, and allows
Speaker 1: us to really train them to be better principles and
Speaker 1: purposeful leaders. So while they're distressing to hear about, it
Speaker 1: allows us a lot of wonderful learning opportunities to learn
Speaker 1: from learn from failure. Right, And so, what are students
Speaker 1: expecting in this regard that maybe they didn't expect five, ten,
Speaker 1: twenty years ago. What are they expecting to learn? Where
Speaker 1: are they pushing you? This is another great question, Jason.
Speaker 1: Our students have changed a lot over the last ten
Speaker 1: or fifteen years. As you've probably heard about, our students
Speaker 1: have come of age in a very different era than
Speaker 1: certainly I did, and certainly many of our past students did,
Speaker 1: and they've come of age on college campuses where they're
Speaker 1: undergraduate professors, their undergraduate peers are talking about issues of diversity,
Speaker 1: about equity, inclusion, corporate social responsibility, and so they come
Speaker 1: to us as learners who have already already been exposed
Speaker 1: to some of these pressing issues, and they come to
Speaker 1: us hoping that we will give them answers and that
Speaker 1: we will be able to train them to become better leaders. Well,
Speaker 1: I gotta say, I do wonder about what the student
Speaker 1: body thinks, because right all of of like global corporations
Speaker 1: are talking about the importance of diversity, and you know
Speaker 1: how it's just better for so many different reasons. So
Speaker 1: I'm just curious, does the student body think that the
Speaker 1: corporate world is doing enough because there's so much conversation,
Speaker 1: but you know, some of the numbers are getting better,
Speaker 1: but I still think people think that there could be
Speaker 1: much more significant improvements. And I think that I think
Speaker 1: that's kind of mixed. I mean I think that there's
Speaker 1: you know, I tend to be an optimist and I
Speaker 1: sort of tend to point to the real winds that
Speaker 1: we see in many companies. Uh, And but I also
Speaker 1: believe in transparency, and I believe in making sure that
Speaker 1: companies are able to to tell us what they're doing
Speaker 1: so that we can do better. And I think our
Speaker 1: students really come to us believing that they can make
Speaker 1: positive change in the world, and that they want to
Speaker 1: make positive change in the world. So I already said
Speaker 1: I was an optimist, but but I really believe this now.
Speaker 1: So it's wonderful to see our students asking us and
Speaker 1: pushing us as professors, pushing us as leaders of the
Speaker 1: g SB to teach them the skills, the competencies and
Speaker 1: the values that they need to lead better organizations lead
Speaker 1: into the future. So talk to us about some of
Speaker 1: your work, especially around social movements, because I find that
Speaker 1: so fascinating, especially given where we're sitting right now in
Speaker 1: the heart of Silicon Valley, when there are big this
Speaker 1: is my favorite word, existential questions around technology, around humanity,
Speaker 1: around our responsibility to each other. How do you what
Speaker 1: or I guess I should say, what do you make
Speaker 1: of the last couple of years of social movements? You know,
Speaker 1: whether it's around climate change, whether it's around me to
Speaker 1: like what described the moment where we are. From your perspective,
Speaker 1: I think we are in an incredible moment where there's
Speaker 1: a lot of mobilization. I mean think not just here
Speaker 1: in Silicon Valley, but we've all been watching the news
Speaker 1: and various countries, Hong Kong, We've been watching Hong Kong, Lebanon, um, Chile,
Speaker 1: and and I think what we're seeing is what social
Speaker 1: movements parlance we call a wave of protest or a
Speaker 1: cycle of protest, and that is that people are coming
Speaker 1: together and learning from one another and are not content
Speaker 1: to just let discontent be the norm. So we're but
Speaker 1: we're also I think at a point where many of
Speaker 1: our company leaders, many of our leaders of course of
Speaker 1: not just companies, but many government leaders, are are open
Speaker 1: to and willing to change. And so we're at a
Speaker 1: moment right now where I think there's openness to learning
Speaker 1: from what it is that people activists want at the
Speaker 1: same time a willingness to work with and collaborate with activists,
Speaker 1: both at companies, but I think also in some of
Speaker 1: the some of the nations. Well, we've been having some
Speaker 1: of the conversations, certainly with some of the alum from
Speaker 1: the school, but it's interesting, and I do wonder whether
Speaker 1: the student body basically just looking at what's going on
Speaker 1: in Hong Kong and China right there's just so much
Speaker 1: tension right now, and you know, there's pressure on some
Speaker 1: of the corporations that they should be standing up, and
Speaker 1: then they're leaders are kind of backing down in the
Speaker 1: corporate world because they want to be in those markets,
Speaker 1: and there's the belief if you're in the market, you
Speaker 1: can be a much better facilitator facilitator of changed. So
Speaker 1: I just curious what the students pushed back on and say, well,
Speaker 1: wait a minute, that doesn't work so far. Yes, And
Speaker 1: I think that that's this is an age age old
Speaker 1: debate about whether we should be engaging in um in
Speaker 1: in countries that have, for example, very poor um UH
Speaker 1: poor records of human rights and should we be engaged,
Speaker 1: Can can our businesses can our presence actually make a
Speaker 1: positive change? And you know, the truth is on that
Speaker 1: the research is quite mixed, and and the more that
Speaker 1: we learn about the presence of companies in some of
Speaker 1: these nations, the better equipped we are to advise our students,
Speaker 1: and the better equipped we are, I think as a
Speaker 1: university to take a stance on some of these issues.
Speaker 1: And so what we need to do, I think as academics,
Speaker 1: and this falls on us, is do a better job
Speaker 1: of assessing under what conditions will company presence or university
Speaker 1: presence make improvements and when won't it right? What really
Speaker 1: makes a difference? Rightsolutely yes, And that's our role as academics.
Speaker 1: What a treat to catch up with you, and thank
Speaker 1: you for being such a gracious host for us here
Speaker 1: at the Graduate School of Business. Sarah soul She is
Speaker 1: the Senior Associate Dean for Academic Affairs, author of two
Speaker 1: recent books, and I'm so glad we got to talk
Speaker 1: about them a little bit, Contention and Corporate Social Responsibility,
Speaker 1: and a second called a Primer on Social Movements. Very
Speaker 1: very timely came very very timely. Well, yes, indeed, Bloomberg
Speaker 1: Business Week naming Stanford the number one US business school
Speaker 1: in a NBA ranking, And that's exactly where Jason Kelly
Speaker 1: and I find myself on this lovely Monday. Let's get
Speaker 1: into it, though, because there's a lot of work that
Speaker 1: goes into it. Let's catch up with a couple of
Speaker 1: our editors are Bluemberg News Senior editor Caleb Solomon. He
Speaker 1: joins us from our Boston bureau, and also with us
Speaker 1: is our Bloomberg business Week editor Joel Webber. He's back
Speaker 1: in our New York studio. So, UM, I gotta start
Speaker 1: with you, Joel. First of all, I know there's a
Speaker 1: lot of work goes into it, we know, and talking
Speaker 1: to the alumni that everybody looks for these rankings. Um,
Speaker 1: talk to us little bit about it. Yeah, and it's
Speaker 1: the thirty first year that Business Week has has done
Speaker 1: a business school ranking. But really we we uh we
Speaker 1: we started from scratch almost a year ago, uh to
Speaker 1: basically reimagine what the business school ranking could be. And
Speaker 1: and Caleb gets big props for being one of the
Speaker 1: architects of that. And we really tried to lean into
Speaker 1: where we thought a ranking of this variety could go.
Speaker 1: And so much of that has been let's actually lean
Speaker 1: into the networks and the students and the alumni and
Speaker 1: actually start asking questions to them about their experiences. And
Speaker 1: that's what really makes this ranking be so definitive. It's
Speaker 1: very interactive, so you can actually customize the ranking based
Speaker 1: on what you're what you're interested in, and that's um,
Speaker 1: you know, I just hats off to Caleb as being
Speaker 1: one of the architects for it. So, so, Caleb, when
Speaker 1: you look at this year versus last year or even
Speaker 1: years before, what what are some of the distinguishing things
Speaker 1: that jump out at you? Thanks Joe for all that
Speaker 1: you know. So you you you nailed what we what
Speaker 1: we were, what we're all trying to do here, which
Speaker 1: is to really personalized ranking. So I mean, if you're
Speaker 1: looking at a school, you know, one of the top
Speaker 1: tier school, say in the on the West Coast, it
Speaker 1: doesn't matter to you. We're Harvard and m I t
Speaker 1: in our on our list. So we gave you the
Speaker 1: ability to really personalize this based on your scores, the
Speaker 1: region that you're interested in, the industries that you want
Speaker 1: to work in, and really create your own customized ranking.
Speaker 1: And all of the tools that we built to do that,
Speaker 1: we made them so much better this year. The personalization,
Speaker 1: this ability to sort of create your short list along
Speaker 1: the way that provides all of the comparisons of the
Speaker 1: amazing data we have. It's all at your fingertips, it's
Speaker 1: all share able. You can send it to friends, you
Speaker 1: can send it elsewhere. Those are some of the biggest
Speaker 1: changes we made and talk to us about how Stanford
Speaker 1: got the trophy. Stanford just came out number one in
Speaker 1: a couple of our big indexes and compensations. Stanford was
Speaker 1: number one, tied with Wharton interno. So that's that's one
Speaker 1: of the key measures for business school. You know, how
Speaker 1: much do you make when you get out of school?
Speaker 1: What what are alumni making five, six, seven years after
Speaker 1: they're after they left school. And the other big index
Speaker 1: that mattered a lot to Stanford was entrepreneurship, where again
Speaker 1: they came out number one. So with number one place
Speaker 1: on those two indexes, that pushed them right to the top.
Speaker 1: Carol Jason, I'm like looking at you from here and
Speaker 1: I'm like, you guys are in in in Stanford, at
Speaker 1: Stanford right now, Like what what have you guys been
Speaker 1: hearing out there? What's what's been interesting? Well, everybody knows
Speaker 1: they're the champs out here. I mean, listen, this is
Speaker 1: this school is believable in a lot of ways. When
Speaker 1: you know, we've got a chance to talk to a
Speaker 1: lot of the alum as well as the students. You know,
Speaker 1: the people who come here, it's a very diverse student body. Uh.
Speaker 1: They spent a lot of time thinking about that in
Speaker 1: terms of who they recruit, but also who's teaching and
Speaker 1: what they teach. Caleb, I did want to ask you
Speaker 1: because it did come up in some of our conversations
Speaker 1: here number two with a bullet talk coming in making
Speaker 1: bake move talk to us about that? Yeah, that really
Speaker 1: that really jumped out to all of us. UM, so
Speaker 1: talk did pretty well. Ask you on compensations exactly Dartmouth
Speaker 1: and Hanover, New Hampshire, UM near near where I live
Speaker 1: and so um. But what they really came out they
Speaker 1: surged in the networking index and our networking indexes. You know,
Speaker 1: how much do alumni interact with students? How much do
Speaker 1: alumni help other alums get jobs? What's kind of the
Speaker 1: halo the impact of like when you go looking for
Speaker 1: a job, how much does having you know, telling people
Speaker 1: that you came from talk or is they like to
Speaker 1: call the Kentucky How much does that matter? And UM,
Speaker 1: I think we got a lot better response this year
Speaker 1: from both the alumni classes that we surveyed as well
Speaker 1: as the graduating students, where they must have had a
Speaker 1: much much much better experience with other with the lums
Speaker 1: than they did in the past year. What else stood
Speaker 1: out for you guys in this year's survey. What what
Speaker 1: what stood out is just the range of responses we get.
Speaker 1: So the way we broke it down is UM, you know,
Speaker 1: so an entrepreneurship. While Stanford comes out number one, BABS
Speaker 1: in the school that overall is ranked lower than Stanford,
Speaker 1: came out number two in entrepreneurship. UH, the University of
Speaker 1: Maryland came out number five. The Salt Lake City School, Utah,
Speaker 1: the Utah School actually school in Utah, UM came out
Speaker 1: number six. So it's it's finding these gems in specific
Speaker 1: areas that may interest you where you just you know,
Speaker 1: you don't think of these schools necessarily as bastions of entrepreneurship,
Speaker 1: but they're really teaching people had to do well in
Speaker 1: this field, and we're bringing that information out to people.
Speaker 1: And Carol, one of the things that I like about
Speaker 1: it is it's not just this copy and paste thing
Speaker 1: where you get the exact same ranking more or less
Speaker 1: every year. Right. The way that it's been constructed is
Speaker 1: that different schools can actually really succeed. And like, that's
Speaker 1: what I love about this is like you have Stanford,
Speaker 1: which repeats starting to look like a powerhouse and yet
Speaker 1: out of notewhere comes Dartmouth surging up the ranking. It's
Speaker 1: like marsh Madness, you know, only in November. Yeah, yeah, no,
Speaker 1: it's really amazing. There was a lot of movement on
Speaker 1: the list this week worth checking out for sure. Caleb Salmon,
Speaker 1: the architect is Joel Webber said of this ranking, Joel Webber,
Speaker 1: the editor of Business Week, thank you both so much so, Jason.
Speaker 1: The luxury space continues to get disrupted in so many
Speaker 1: different ways. Playing into that is send Reeve. It's a
Speaker 1: director consumer brand that sells luxury handbags. Curl Chung is
Speaker 1: the founder and CEO of the company. Graduated with an
Speaker 1: NBA from Stanford in even and she's back in our
Speaker 1: Bloomberg in Director Broker Studio in New York. Coral, nice
Speaker 1: to have you here with us. We've been asking all
Speaker 1: of the Stanford alum tell us a little a little
Speaker 1: bit about your time here at the school and getting
Speaker 1: your NBA here. Thank you so much. I'm very glad
Speaker 1: to be here. I missed the sunshine from California though
Speaker 1: while I'm out in New York today, Although so I
Speaker 1: love beautiful, beautiful fall weather in New York. Um. Nothing
Speaker 1: to complain about their UM. So I started Sunrev. Actually,
Speaker 1: the concept of Sunrov was really formed while I was
Speaker 1: still at Stanford UM and it's it's a it's a
Speaker 1: very exciting place because I found myself being able to
Speaker 1: explore things and really discover my true passions during my
Speaker 1: two years there. And while I was there, I was
Speaker 1: part of a student group that led something called the
Speaker 1: lux Truk where we went to Milan and Florence and
Speaker 1: Paris and London and met with different TA luxury brands
Speaker 1: UH and it was incredibly inspiring experience for me, and
Speaker 1: through that I started to think about if I were
Speaker 1: to start a luxury brand someday, what would that look like,
Speaker 1: how it how would it be disruptive and differentiated. And
Speaker 1: it was really during that time that directed consumer as
Speaker 1: a model started to emerge, as well as digitally native brands,
Speaker 1: and I felt like it was a perfect time in
Speaker 1: the marketplace to start a company like send Rev. And
Speaker 1: so three years ago, UH, send Rev was launched and
Speaker 1: now we've been growing very rapidly over the past three years.
Speaker 1: UM and actually just closed our Series A, which was
Speaker 1: announced earlier today, Right, Yeah, so a big Series A
Speaker 1: sixteen point seven five million, I believe, So what does
Speaker 1: that allow you to do at this point with that money?
Speaker 1: Where does it go next? It's an incredible set up
Speaker 1: for us to have resources to expand. Up until now,
Speaker 1: we've been run very much in a scrappy bootstrap way,
Speaker 1: and as with every great Silicon Valley startup, the company
Speaker 1: started actually in my garage and basement and it's hard
Speaker 1: to believe that only a year and a half ago
Speaker 1: we moved out into a real space and now we
Speaker 1: have a flagship store in San Francisco UM, as well
Speaker 1: as a big fulfillment center in South San Francisco. But
Speaker 1: the capital really is to allow us to expand both
Speaker 1: our product assortment and expand into other categories beyond the
Speaker 1: handbag category, as well as grow geographically. We've shipped to
Speaker 1: over two hundred countries globally and we're doing a big
Speaker 1: expansion in Asia UM and that's a huge area of
Speaker 1: opportunity for us from a growth perspective. And we're also
Speaker 1: growing partnerships. We've launched partnerships with Neem and Marcus, with
Speaker 1: North Trum as well as recently with Apple stores. Globally,
Speaker 1: we're in some of the top Apple stores around the world,
Speaker 1: including Hong Kong. I have see Singapore, Orchard wrote, Paris, London,
Speaker 1: et cetera. Uh So, we are starting to establish ourselves
Speaker 1: as a global brand, which is very, very exciting. So
Speaker 1: and just part of that expansion Coral ultimately, and one
Speaker 1: of the conversations we've been having about is, you know,
Speaker 1: do companies still want to go public at some point?
Speaker 1: Like what's the long game for you folks as you
Speaker 1: grow the business developed partnerships. Just got about forty seconds left. Yeah,
Speaker 1: that's a great question, you know. I think at Stanford
Speaker 1: one of the things that I was very inspired by
Speaker 1: was this idea to really put away the fear, put
Speaker 1: away the caution, put caution to the wind, and just
Speaker 1: go for it. And I think when I made the
Speaker 1: decision to start this company, it was very much about
Speaker 1: going big and disrupting the luxury goods industry and establishing
Speaker 1: a global iconic brand. And so that's what we're absolutely
Speaker 1: set out to do, which is a very exciting and
Speaker 1: we have an amazing institutional investor that backing us in
Speaker 1: all the right ingredients to take the company to the
Speaker 1: next level. Al Right, well, congratulations on the big round.
Speaker 1: We're excited to see what happens. X. Have you back
Speaker 1: to talk about more success? Coral Chung NBA eleven from
Speaker 1: here at the Sanford Graduate School of Business. All right,
Speaker 1: well that is the Stanford fight song. And we're here
Speaker 1: at the number one business school in the country. Delighted
Speaker 1: to have with us. Brian Lowry, he is Senior Associate
Speaker 1: Dean for Academic Affairs at the Graduate School of Business.
Speaker 1: Great to see you, great to see through. All right,
Speaker 1: So you are right in the middle of what I
Speaker 1: think is one of the most fascinating topics right now
Speaker 1: for business people, certainly business students, and that is this
Speaker 1: intersection of society and business, the role that businesses play
Speaker 1: in the world. What's your take at this moment? How
Speaker 1: do you approach your class different maybe in twenty nineteen,
Speaker 1: because it's on everyone's mind. Yeah, thinking the school, it's
Speaker 1: on the school's mind. The really the idea of business
Speaker 1: is shifting, right. It's not just about how do we
Speaker 1: perform well in existing paradigm, So what is the new
Speaker 1: paradigm gonna be? And so we really hear are about
Speaker 1: helping our students um become prepared for this new world
Speaker 1: to participate in it. And the shape the rules that
Speaker 1: are gonna come into play. Right. So the things are
Speaker 1: changing and we really want our students to be prepared
Speaker 1: for that change. Yeah, I do wonder about what they
Speaker 1: see as their role because we feel like, you know,
Speaker 1: our policymakers have failed us in kind of you know,
Speaker 1: bringing about change, necessary change, whether it's inequalities in our society,
Speaker 1: whether it's climate change. What are the kind of conversations
Speaker 1: you're having with students about what they want to know
Speaker 1: about because they're preparing for going out into the corporate world. Right.
Speaker 1: So our students recognize that the distinction between private industry
Speaker 1: and the public civil society world is that that distance
Speaker 1: is shrinking, and so they really care a lot about
Speaker 1: these big social issues and we're trying and prepare them
Speaker 1: to engage in an effective way. So what they really
Speaker 1: think a lot about is how as a business leader,
Speaker 1: would I interact productively with government? Right? How do I
Speaker 1: think about civil society? How do I think about issues
Speaker 1: like privacy? Right? So our students really are bringing those
Speaker 1: concerns to the classroom. They're asking those kind of questions,
Speaker 1: and the faculty are more and more responding in ways
Speaker 1: that allow the students to go out there and become
Speaker 1: a different type of leader. I believe you know, for
Speaker 1: a long time, it feels like a business school curriculum
Speaker 1: would look at a lot of what we talk about
Speaker 1: now is sort of soft skills. And there's a great, uh,
Speaker 1: sort of nickname for one of the classes that you
Speaker 1: guys teach here. It's called touchy feely. Uh. Interpersonal Dynamics
Speaker 1: is I believe the actual name of the course. This
Speaker 1: is something you've been doing for a long time. It
Speaker 1: feels like you were ahead of the curve, to say
Speaker 1: the least. But how do you teach it? Like, what
Speaker 1: what does that actually look like? When you're teaching people
Speaker 1: to essentially be for lack of better humans? Huh. So
Speaker 1: what we do is we give people the opportunity to
Speaker 1: practice right. So it's not I mean, we all know
Speaker 1: how to be human beings at least I hope so, right,
Speaker 1: and so we anyway, but the head so we put
Speaker 1: them in groups, and this is the group is really
Speaker 1: where a lot of the work happens. We give them
Speaker 1: the opportunity to be open and honest with each other,
Speaker 1: like we often in life don't have many opportunities to
Speaker 1: get real feedback, Right, how am I showing up? How
Speaker 1: is it affecting you? And our students have the chance
Speaker 1: to really open up and engage with each other, get
Speaker 1: hard feedback. Sometimes there's often tears, right, because there's this
Speaker 1: deep connection is vulnerability that allows people to make sense
Speaker 1: of themselves in a different way and for many people,
Speaker 1: um they'd say epiphany to see themselves and to see
Speaker 1: how they are being responded to about others. It really
Speaker 1: can be quite transformative the class. I mean, I do
Speaker 1: wonder what Stanford thinks about is their responsibility in terms of,
Speaker 1: you know, creating the next group of corporate leaders, especially
Speaker 1: in an environment where I feel like many think that
Speaker 1: there isn't accountability to thinks, although I gotta say I
Speaker 1: feel like the headline some account there today. But I
Speaker 1: do wonder, you know what you see as your role. Yeah,
Speaker 1: I think when we talk about leaders now and especially
Speaker 1: a town of leaders that we bring here these people,
Speaker 1: the students are incredible, right, They've done incredible things, and
Speaker 1: we bring them here to leverage what they've done and
Speaker 1: to improves they can go out and have an effect
Speaker 1: on the world. So I think it's really critical and
Speaker 1: we really impress upon them the importance of being concerned
Speaker 1: about how their actions not affect only their career, but
Speaker 1: the other people. So when they make decisions and these
Speaker 1: from these positions of power, leaders affect many others lives, right,
Speaker 1: and so not losing side of the effect they have
Speaker 1: on others as a critical part of what we really
Speaker 1: try to push here for students. They're on the one side,
Speaker 1: you have humanity, but you also have technology, you know
Speaker 1: here in Silicon Valley. And it also feels like we're
Speaker 1: asking really big questions about the role of technology. Uh,
Speaker 1: you know your deed. Your boss told us earlier that
Speaker 1: Washington seemed very far away when he got here twenty
Speaker 1: years ago. It's pretty close now at least Uh philosophically
Speaker 1: and uh and figuratively. How does technology help instead of
Speaker 1: hinder your goals? It's a good question. So I think
Speaker 1: of technology obviously, it's simply a tool right there in
Speaker 1: the end, it's a tool and service of humanity, and
Speaker 1: so I think it helps our goals When people understand it,
Speaker 1: is such when they say, like, what are we trying
Speaker 1: to achieve? Like, so if we're trying to reduce, for example, loneliness,
Speaker 1: there's a sense that there's an increasing separation among people.
Speaker 1: Independent of all the technology that we have, there's still
Speaker 1: something going on that people aren't connecting. And the way
Speaker 1: we use technology has maybe increased that or um been
Speaker 1: a part of that. But we can also think about
Speaker 1: how we might use that tool to produce a different outcome.
Speaker 1: Right when we think deeply about the role of the
Speaker 1: tool and not loose sight of it as a tool,
Speaker 1: then we can achieve all sorts of positive outcomes as well.
Speaker 1: What does your student base just quickly, just got about
Speaker 1: forty seconds think about technology, because I think of the
Speaker 1: privacy concerns, we see bias in a I I mean,
Speaker 1: there's a lot of problems out here. Do they think
Speaker 1: ultimately technology is good or it can be better just quickly,
Speaker 1: very quickly? I think they're optimistic, but we also now
Speaker 1: see clearly the potential problems associated with technology and we
Speaker 1: need to solve for that. Yeah, we're gonna leave it there.
Speaker 1: Brian Lowry, great to catch up with you. Congratulations on
Speaker 1: being number one again and you really are at the
Speaker 1: core of I think what all of us are talking
Speaker 1: about as business people, as business leaders, and certainly politicians.
Speaker 1: It is on the minds of this next generation coming up.
Speaker 1: The interesting to see what the product of this phenomenal
Speaker 1: campus teaches us as they go forward. As we said,
Speaker 1: we want to get right to some students. Stanford Graduate
Speaker 1: School of Business students. Uh, and we have two with us.
Speaker 1: They are both in their second year here at Stanford.
Speaker 1: Emily Nounez Cavanets and Polka Aggarwal are both as I
Speaker 1: mentioned in the program, So nice to have you here
Speaker 1: with us. We love getting all of the different perspectives
Speaker 1: why Stanford and Emily, Emily, let me start with you, Well,
Speaker 1: thank you so much for having us. I for me,
Speaker 1: I knew Stanford really was the best business school in
Speaker 1: the world and is, and I know it's really so
Speaker 1: well positioned for leaders who want to become really strong
Speaker 1: leaders and fields like entrepreneurship, innovation and technology leadership wasn't
Speaker 1: a really important thing. How about for you, Polke it? Well,
Speaker 1: so I'm an engineer by background, and so I remember this.
Speaker 1: We both have dads that super because I didn't invention
Speaker 1: competition in undergrad and they asked me what's your business plan?
Speaker 1: And I said word of mouth, And so I realized
Speaker 1: I think business would be actually pretty beneficial for me
Speaker 1: and in entrepreneurship as well. So that's that's sort of
Speaker 1: what led the spark to do. My m B A
Speaker 1: and so Emily, tell us about your company, Sword and Plow,
Speaker 1: because it's such a cool concept that everybody can understand.
Speaker 1: It comes in part from what you did before you
Speaker 1: were in the army, and tell us about the inspiration
Speaker 1: and what it is. Former U. S. Army Captain among
Speaker 1: other accolades, thank you. So eight years ago I started
Speaker 1: a social enterprise called Sword and Plow with my sister
Speaker 1: and we work with better known American manufacturers US across
Speaker 1: the country to make bags and accessories UM such as
Speaker 1: this necklace which is made out of a repurpose of
Speaker 1: a bag next year, so this is one. And then
Speaker 1: we also have leather goods and it's just military grade
Speaker 1: materials from what I understand, some of it, yes, some
Speaker 1: of it. So we incorporate repurpose military surplus UM like
Speaker 1: this lining as well as the fifty caliber machine UM
Speaker 1: shells which are in all of our jewelry and they're
Speaker 1: all made by veteran known American manufacturers, and we donate
Speaker 1: ten percent of our profits to veteran nonprofit organizations. It's
Speaker 1: an amazing I mean, we've been looking at some of
Speaker 1: the products. It's really incredible. So Polk, it give us
Speaker 1: a sense of what it's like to be a student here,
Speaker 1: especially at a time where there's a lot expected and
Speaker 1: a lot of big questions about businesses right now. I
Speaker 1: think we would all love to sort of be in
Speaker 1: your classroom in some ways because asking big questions. How
Speaker 1: do you characterize it? Yeah, what's was actually really interesting
Speaker 1: about Stanford is that they really bring out the authenticity
Speaker 1: within you, and all the education that's given you is
Speaker 1: sort of surrounded around who you are and staying true
Speaker 1: to yourself, but then also being good at business. And
Speaker 1: the coolest thing is not only are you in the
Speaker 1: business school at Stanford, but you're also part of Stanford
Speaker 1: as a whole, and there's amazing classes and things outside
Speaker 1: as well they can use to supplement your education. That's
Speaker 1: what's interesting. We heard that from some of the administration,
Speaker 1: from the dean of the school, that the importance of
Speaker 1: it's not just about the Graduate School of Business but
Speaker 1: integrating it among all of the other schools that are
Speaker 1: here and getting kind of a more holistic education to
Speaker 1: some extent. Right, definitely, I feel the same way. The
Speaker 1: two most interesting classes that I'm taking or have taken
Speaker 1: the past are Making Social Ventures Happen, which is an
Speaker 1: amazing way to learn more about systems thinking and drawn
Speaker 1: my experiences as a social entrepreneur. But then right now
Speaker 1: I'm taking a class across the street at the law
Speaker 1: school about regulating AI and it has just been fascinating.
Speaker 1: And the access that we have to cutting edge thinkers
Speaker 1: in the tech field is um is amazing. Until what
Speaker 1: do you think about the impact of the NBA on
Speaker 1: on the choices that you make going from here? Like,
Speaker 1: what do you do next? Not to put too much
Speaker 1: because you've got a company to right, Yes, yeah, exactly.
Speaker 1: I started a recruiting agency for the blockchain space before
Speaker 1: business school, and so I'm thinking of going to Singapore.
Speaker 1: The biggest thing about Stanford is it opens so many
Speaker 1: more doors, and so the first thing that people think
Speaker 1: about is, oh my gosh, there's now so many options.
Speaker 1: Have to not think about which option to consider, and
Speaker 1: so that takes two years on its own, and so
Speaker 1: I think I'm closer towards the end of that process.
Speaker 1: But I think I want to go to Singapore and
Speaker 1: start a company there. Well, and it's interesting too because
Speaker 1: I do think about some of the really important issues
Speaker 1: that we spend a lot of time talking about UM
Speaker 1: and how the graduate programs, including Stanford, are bringing them into,
Speaker 1: whether it's climate change, whether it's diversity. Tell me a
Speaker 1: little bit about, you know, some of the discussions that
Speaker 1: you want to be having because you think it's obviously
Speaker 1: going to be something that you're gonna be carrying with
Speaker 1: you once you leave. Tell me a little bit about
Speaker 1: that pocket. Yeah. One of the biggest things for me
Speaker 1: is I think that culture within a company is going
Speaker 1: to become more and more important the more we go
Speaker 1: from data and information can all be done by computers.
Speaker 1: The aspect that people are going to bring that's gonna
Speaker 1: be different is who they are and what kind of
Speaker 1: person they are. And we're seeing more of that, you know,
Speaker 1: coming from the manufacturing just people are machines to now
Speaker 1: big companies are focusing on their people culture and these
Speaker 1: new roles are coming up, and so I really want
Speaker 1: to be part of that, and I think I want
Speaker 1: to do a bit of that in the recruiting space
Speaker 1: or the people operations space in Singapore. And so Emily,
Speaker 1: do you plan to expand your company even further, another
Speaker 1: company on the horizon. What do you have? Yes, well,
Speaker 1: I've definitely been busy and UM Sort and Plow has
Speaker 1: a lot of exciting things coming up, including a really
Speaker 1: large collaboration with a publicly traded accessors company coming out
Speaker 1: this Veterans Day and being here at Stanford has just
Speaker 1: been incredible to really dive deeper into social entrepreneurship and
Speaker 1: learn about other fields to like technology and increasingly some
Speaker 1: of the issues around UM, cultural and social issues that
Speaker 1: these company. He's a wrestling I feel like such a
Speaker 1: low achievers. I don't know, I don't know. Anyway, We
Speaker 1: wish you both good luck and thank you so much
Speaker 1: for talking. Uh to ask, I have a quick question
Speaker 1: five seconds each. Do you think politicians and CEO should
Speaker 1: use social media to communicate? Well quickly, I think as
Speaker 1: a social entrepreneurs social media has been a great way
Speaker 1: to get our message and take a y people are
Speaker 1: looking on social media, so if you want to communicate,
Speaker 1: social media is an option alright. Good Emily nunyez Kevanez
Speaker 1: and polkt Agarwall two second years here at the number
Speaker 1: one business school in the country. Thank you so much. Well,
Speaker 1: our next guest is a Stanford alum class of ninety nine,
Speaker 1: got his MBA. Then he gave the commencement speech last year.
Speaker 1: He's the head of the leading global brewer. It's a
Speaker 1: big name. A b in BEV. We're talking about Carlos Brito. Yeah,
Speaker 1: a great conversation with him and his story, his journey.
Speaker 1: Here is where we started, and it's a good one.
Speaker 1: Take a listen. When I was applying to business school,
Speaker 1: I was in Brazil. Brazil was a very close country
Speaker 1: in those days. Everything was difficult. Nobody would travel abroad,
Speaker 1: didn't send the money abroad to pay for fees too.
Speaker 1: To apply to a college in the US was a
Speaker 1: big deal. We had to know somebody in the US
Speaker 1: and all that. So I started researching and back then
Speaker 1: Business Week had a ranking of business schools and Standford
Speaker 1: number one. So I said, my looked at the magazine. Yeah, yeah, yeah,
Speaker 1: that that was our bible and all the ranking. So
Speaker 1: I looked at it and said, hey, yeah, I'm gonna
Speaker 1: apply to the schools, but Standford for sure, it's number one.
Speaker 1: And at the time, Stanford would take only one Brazilian
Speaker 1: per year, and he did it. Did that through the
Speaker 1: eighties through the nineties, and uh, I said, oh, we'll apply.
Speaker 1: Long story short, I was accepted and then I had
Speaker 1: to fight for scholarship because my my parents didn't have
Speaker 1: that kind of money to send me to school. So
Speaker 1: and then I went to Standford Business School and uh,
Speaker 1: it changed my life. You gotta talk about the financing
Speaker 1: to get there. Well, it was interesting because I got
Speaker 1: a scholarship from the Rotary Association, but they didn't cover Stanford,
Speaker 1: so at the end Rotary Club. So at the end
Speaker 1: when I went, when I got accepted Stanford, in the
Speaker 1: last round of acceptances, I tried to change the scholarship.
Speaker 1: They said, no, we don't cover Stanford. So long story short.
Speaker 1: There was a businessman in Brazil that had a boutique
Speaker 1: investment bank called Georgia. Paulo Lemon, one of the top
Speaker 1: guys today in the world of business. And I knew
Speaker 1: that he had a bank that would give loans to
Speaker 1: some of the bank employees that were pursuing an NBA abroad.
Speaker 1: I was not one of them. I worked for Shell Oil.
Speaker 1: But because I was the Brazilian accepted Stanford that year,
Speaker 1: decided to make my case and he decided to pay
Speaker 1: for my first year, not out of the bank pockets,
Speaker 1: but out of his own pocket because I was not
Speaker 1: an employee of the bank. So I went to Stanford
Speaker 1: because of him. And uh, it was interesting because he
Speaker 1: asked three things of me when I went. It said, first,
Speaker 1: keep in touch. Second, before you accept any full time
Speaker 1: job offer when you're done with Stanford, talked to me. First,
Speaker 1: no obligation to come for me. And third, helps somebody
Speaker 1: as I'm helping you in the future if you can't
Speaker 1: pay it for it. Yeah, So that was it. So
Speaker 1: I always say that his financial generosity got me to Stanford, right,
Speaker 1: But he was this time and commitment to me that
Speaker 1: got me through Stafford, because that's a different way to
Speaker 1: go to school in many ways. You know, some people
Speaker 1: have their parents, you know, sort of lording over them,
Speaker 1: but other people, you know, they're just sort of left
Speaker 1: to their own devices. Sort of having him sitting on
Speaker 1: your shoulder must have given you a different perspective exactly
Speaker 1: because he was my sponsor for the first year. Then
Speaker 1: I had to figure out how to pay for the
Speaker 1: second year, which was also part of his education in
Speaker 1: terms of me not getting evenything for free. So you asked,
Speaker 1: you got the scholarship for the first year, but guess
Speaker 1: what second year? You have to figure it out. So
Speaker 1: I had a good summer job. I also had got
Speaker 1: a scholarship from the Brazilian government and I was able
Speaker 1: to conclude the second year. So that was part of
Speaker 1: the education. Now, talking about the education at Stanford, what
Speaker 1: that experience it was like? You know, for me, it
Speaker 1: transformed the way I view the world. It was a
Speaker 1: very international, a place in the Pacific room, so very
Speaker 1: open to the world, even in those days. It was
Speaker 1: also a place where I learned the veil of talent.
Speaker 1: I was surrounded by the best people in the world
Speaker 1: pretty much at that age group, with that kind of
Speaker 1: orientation businesses, and I had to op my game. I
Speaker 1: used to be the top students, that always top of
Speaker 1: my class in Brazil, and I went to Stanford, I
Speaker 1: was not top my class. I had to work harder
Speaker 1: elevate my bar And what I got from Stanford was
Speaker 1: that in life it's about first who Then what I
Speaker 1: learned that talented people want talented, very talented guy or
Speaker 1: a person is worth ten very good people, but it's
Speaker 1: hard to find. All right, So let's talk about your
Speaker 1: consumer a little bit. It's an interesting time to say
Speaker 1: the least in the world. You have a global view. Uh,
Speaker 1: let's go straight to China, you know where business it's
Speaker 1: a huge business. And yet there are concerns about the
Speaker 1: Chinese consumer right now, what do you see? And that
Speaker 1: played out in your latest earnings and and investors were
Speaker 1: well spooked by it. No, no, no, But the China
Speaker 1: for us has been an amazing story. And the thing
Speaker 1: is that many years ago we decided to focus on
Speaker 1: the premium and super premium side of the market in China.
Speaker 1: And if you look at China, you cannot talk averages.
Speaker 1: You have to go by segment. Interesting because such a
Speaker 1: huge market, right It's the biggest market in the world
Speaker 1: for beer, for most consumer goods. And when you go
Speaker 1: segment by segment, what you see is that this year
Speaker 1: there is industry declining China, but that's on average. But
Speaker 1: if you go to premium superpremum, they're growing and that's
Speaker 1: where the growth is in the margins are in China.
Speaker 1: For example, Budweis is the number one premium beer in
Speaker 1: China by far. In Corona Story Garden lead the super
Speaker 1: premium segment by far. Again so we lead both segments
Speaker 1: where the margins are and where the growth is. So
Speaker 1: that for us, that's why our business in China, our
Speaker 1: profitsibility is way higher than any of our competitors in China,
Speaker 1: even if you add them together. This bite us being
Speaker 1: number three invited, but we're number one and profitability even
Speaker 1: if you had the next four. So that's because of
Speaker 1: the brands we have, the premium, dague command, the consuming
Speaker 1: sides we've always had, and the things we offer given
Speaker 1: the consuming sides were to help me out here because
Speaker 1: I thought in terms of your latest earnings report, you
Speaker 1: did talk about consumer demand below in the United States
Speaker 1: and in China, and from some other makers, some beverage makers,
Speaker 1: we've seen that they've talked about increased demand in China.
Speaker 1: So I guess we're trying to reconcile what's going on
Speaker 1: in China right now. Well in China right now, for sure,
Speaker 1: there was some deceleration but still growing. You know, at
Speaker 1: six the whole economy and in our business, nightlife is
Speaker 1: a very important channel where Budweiser dominates as the most
Speaker 1: of the share in that nightlife got the beat a
Speaker 1: bit um the emphasize given some of the celebrations in China,
Speaker 1: So that happens from time to time, so it's not
Speaker 1: kind to time that the nightlife goes down a little
Speaker 1: bit comes back up. So this quarter was a quarter
Speaker 1: in which nightlife cames back, came came down a little bit,
Speaker 1: and that's that impacts botherwise, which is a main Brandon chime.
Speaker 1: So investors, this is something temporary. So investors overreacted that
Speaker 1: in your view, because they saved something like twenty billion
Speaker 1: dollars off your market cap. So is that an overreaction?
Speaker 1: You know, like, how do you how do you read that?
Speaker 1: As somebody who runs this massive company, you see the
Speaker 1: global trends, you look longer term, how do you read
Speaker 1: something like that? Our company is very different than respect
Speaker 1: in that we have a control group. We're a public company,
Speaker 1: but we'll have a control group, and because of that,
Speaker 1: we have the luxury of looking at the short term,
Speaker 1: but most of all looking at the long term. So
Speaker 1: we're not shy of investing the short term even when
Speaker 1: the cycle is negative for some sort, because we're investing
Speaker 1: for next year's, next five years, next ten years. So
Speaker 1: we've always been that kind of company. We've been in
Speaker 1: business half for thirty years, and we've had situations in
Speaker 1: where there was a disconnect in which the short term
Speaker 1: sometimes there's some pressures, most of which we anticipated, by
Speaker 1: the way, at the beginning of the year that the
Speaker 1: third quarter would be on the pressure. But so what
Speaker 1: this is one quarter? And that was Carlos Brito's CEO
Speaker 1: of A B n BEV. We caught up with him
Speaker 1: just before we left New York to head out to
Speaker 1: Stanford roc Journal. But you let me drive. Oh no, no, no, no, home, honey, please,
Speaker 1: I'll do the riding. Drivel ext me. I want to drive,
Speaker 1: Just drive, baby, the questions trying. This is the Drive
Speaker 1: to the Globe Community. Thanks, we'll drying us on Bloomberg Radio,
Speaker 1: and it is time for the Drive to the Clothes
Speaker 1: and we're joined by Nadine Term and she has found
Speaker 1: her CEO and c i O of Sulstein Capital. She
Speaker 1: joins us on the phone from Francisco and very much
Speaker 1: of a piece with the theme of this show. She's
Speaker 1: a graduate of the Stanford Graduate School of Business, which,
Speaker 1: by the way, you might have heard, it's the number
Speaker 1: one business school in America. And Carol Math and I
Speaker 1: are here on campus. Nadine It's too bad that you
Speaker 1: know you're working so hard, because otherwise you could have
Speaker 1: class outside with us. It's great to have you with us.
Speaker 1: Way they Unfortunately, I couldn't release the details of the
Speaker 1: announcement beforehand, so I drove into the city for work.
Speaker 1: But I'm glad that you're enjoying sunshine. We are, indeed,
Speaker 1: and check out this market environment right now. Tell us
Speaker 1: a little bit about um kind of how you see it,
Speaker 1: because here we are. You know, we hit some records
Speaker 1: again in terms of those major equity averages. What's the
Speaker 1: investment environment look like to you? Sure? I think there's
Speaker 1: a few things to look at, first being earning, second
Speaker 1: being complacency or how investors are positioned, and the third
Speaker 1: would be um, why the market is up today? Right? So,
Speaker 1: I think the first one, if you look at earnings,
Speaker 1: what you have is about um. You know, you only
Speaker 1: have about hundred forty more companies in the SMP five
Speaker 1: hundred report. And while top line growth is positive, earnings
Speaker 1: have been down, especially in energy materials, consumer discretionary financials,
Speaker 1: and infotex. So that's a lot of sectors. So it's
Speaker 1: really a story of haves and have not. So instead
Speaker 1: of looking at just top down how things are going,
Speaker 1: you really have to pull back the onion here all
Speaker 1: the layers to see what's happening. And what you're seeing
Speaker 1: is margins being squeezed, So you know, we're staying long
Speaker 1: things like reads and utilities, which tend to do well
Speaker 1: when GDP growth is slowing. UM and inflation growth and
Speaker 1: up is up and margins are down. So that's one
Speaker 1: thing that we would tell folks to take a look at,
Speaker 1: is like who's winning and why, who might be losing
Speaker 1: and why, and making sure that your position correctly UM.
Speaker 1: And the second is complacency. The if you look at
Speaker 1: the vixed positioning, I think I saw it on top
Speaker 1: Bloomberg News too, there's a kind of a dual story there.
Speaker 1: But you're at one in three years the scores of
Speaker 1: negative one point five. So just like April, just like July,
Speaker 1: investors are really betting on new all time highs in
Speaker 1: the market and lower volatility. So whenever we see a symmetry,
Speaker 1: we tend to look at that and say, Okay, if
Speaker 1: that doesn't come to pass, you probably make a lot
Speaker 1: of money on the other side. Yeah, the whole volatility question,
Speaker 1: I am fascinated. But you know, we'd bring our investors
Speaker 1: the VIX and update on the VIX every day after
Speaker 1: the close of trading. And you know, a twelve handle,
Speaker 1: a thirteen handle, I mean that is unbelievable when you
Speaker 1: think about sort of where we would expect to be
Speaker 1: at this point, how do you square that? You know,
Speaker 1: what what ends up happening is there's not just investors
Speaker 1: and passive investors, but you have machines that are trading momentum.
Speaker 1: And so when things to move up, the momentum is
Speaker 1: to go up. When things go down, momentum can be
Speaker 1: to go down. To be really careful, as an individual
Speaker 1: investor who's betting on found of monels or I'm looking
Speaker 1: to say, well we're is the puck going after today
Speaker 1: or tomorrow, would just say, well, do I really believe
Speaker 1: in that positioning? Like on the flip side of what
Speaker 1: you said, you look at soybeans, the one year Z
Speaker 1: score in terms of CFTC nine commercial net long positioning
Speaker 1: is about two point five. And so what it's also
Speaker 1: saying is like everyone's already bet on the train deal.
Speaker 1: Who know, some beans are going to get bulked. So
Speaker 1: other than that, other than you know, the motility going
Speaker 1: down reaching all new ties. UM. One else right, And
Speaker 1: one of the areas we love the most that's probably
Speaker 1: has been most non consensus till the past week was
Speaker 1: really inflation. So we came on Bloomberg TV and Radio
Speaker 1: talking a little bit about reflation and how to bet
Speaker 1: on that. So talk to us, we want to you know,
Speaker 1: glad to get your market perspective, but tells a little
Speaker 1: bit two about your time here at Stanford and getting
Speaker 1: your m b a. And what that experience was like. Sure,
Speaker 1: I was one of the few female investors coming into school.
Speaker 1: I did take a few years I think six or
Speaker 1: seven working before I came in, so I was at
Speaker 1: a point in my life where I knew what I
Speaker 1: wanted to do. In fact, I had gotten into school
Speaker 1: before I even came UM, but then delayed it for
Speaker 1: three years. So going back was special for me. I
Speaker 1: went there as an undergrad, but I really appreciated the environment. UM.
Speaker 1: Anyone who knows there goes there and really sees the
Speaker 1: love of innovative and entrepreneurial spirit from the faculty, the
Speaker 1: students UM. And I was actually an example of someone
Speaker 1: who started my own firm in an industry where it's
Speaker 1: very rare for women to exist at all, if you
Speaker 1: want to say that, um and I think part of
Speaker 1: the appeal relates to not just all the resources inside
Speaker 1: the university and Stanford Business School, but it's surrounding it.
Speaker 1: A lot of people talk about it, is it luck
Speaker 1: because just because they were in Silion Valley? But did
Speaker 1: they also help build it? So when you're there, it
Speaker 1: does give you a lot of optimism to think big, say, well,
Speaker 1: what can I build? What can I do? How do
Speaker 1: I make a difference? So it was a special time
Speaker 1: for me. Well, and I do wonder you know, given
Speaker 1: your background working in both private equity and you know,
Speaker 1: investing in private and public companies, Nadine, what you make
Speaker 1: of this moment where we are We've talked a lot
Speaker 1: about we work. We're don here from Peloton Tomorrow, which
Speaker 1: is another example of a company where the private marks
Speaker 1: and the public markets maybe had a little bit of
Speaker 1: a disagreement about what a company was worth. What do
Speaker 1: you make of that? As someone who has looked across
Speaker 1: the whole spectrum of investments, you know, it's interesting because
Speaker 1: there's still a lot of private equity folks who are
Speaker 1: doing a lot of roll up your sleeves, work to
Speaker 1: create value, increase EBITDA, increase cash flow, pay now and debt,
Speaker 1: do things like that. But then there was also just
Speaker 1: a lot of money chasing private deals. I mean, if
Speaker 1: you look twenty five years ago, you didn't have public
Speaker 1: company investors going investing pre i p O and you
Speaker 1: saw that from hedge funds and pensions in the last decade,
Speaker 1: as well as a ton of capital from and allocators
Speaker 1: going to private equity because you don't have the mark
Speaker 1: to market risk. So it's I believe that it's very
Speaker 1: understandable and probably expected that when we have a ton
Speaker 1: of money chasing deals, whether they're you know, be a
Speaker 1: market buyout or pre I p O, whether it's you
Speaker 1: know round for five six, you know, series apt of financing,
Speaker 1: what you end up is that there's going to be
Speaker 1: people piling into money in the hope that ghost public
Speaker 1: or taken out, and if it doesn't happen, there's a
Speaker 1: lot of unhappy investors there. Did you just have about
Speaker 1: a minute left here? Um? I'm curious to you about
Speaker 1: running a hedge fund. Uh in this space, I feel
Speaker 1: like hedge funds. We've talked an awful lot about under
Speaker 1: performance and the inability to you know, kind of find returns.
Speaker 1: Tell me, from what I understand, you guys pick a
Speaker 1: few um targets, right, and that our positions and really
Speaker 1: kind of focus on them. Just your quick thoughts on
Speaker 1: that just got about forty seconds. Sure, I think for
Speaker 1: us being able to define where you can add value
Speaker 1: is really important and have data to back it up.
Speaker 1: And as global investors, we're not I guess we don't
Speaker 1: have the necessity to look just at TNT or the US.
Speaker 1: We can look at all factors. We can look across
Speaker 1: the ward the world to be able to choose some
Speaker 1: more high conviction plans. So for us, it's been freeing
Speaker 1: to have that type of I guess, um more active
Speaker 1: returns and active profile as an investor versus a very
Speaker 1: small box or or small area to plane. And that's
Speaker 1: how we founded our niche it will be high conviction
Speaker 1: for our investors. All right, we're gonna leave it there.
Speaker 1: Thank you so much for your thoughts. Natie Determined, founder
Speaker 1: CEO and c I O Soulstein Capital, on the phone
Speaker 1: from San Francisco. Proud Alama, the Stanford Graduate School of Business.
Speaker 1: You may have heard their number one. Thanks for listening
Speaker 1: to Bloomberg Business Week. You can subscribe to the podcast
Speaker 1: on iTunes, SoundCloud, or Bloomberg dot com. You can also
Speaker 1: listen to our radio show every weekday at two pm Eastern,
Speaker 1: only on Bloomberg Radio