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Scott Galloway (0:43)

We heard you nine years of bring back the Snack Wrap and you've won. But maybe you should have asked for more. Say hello to the Hot Honey Snack Wrap. Now you've really won. Go to McDonald's and get you can. Welcome to Office Hours of Prop G. This is the part of the show where we answer your questions about business, big tech, entrepreneurship and whatever else is on your mind. If you'd like to submit a question for next time, you can send a voice recording to office hourspropgmedia.com Again, that's officehoursofgmedia.com or post your question on the Scott Galloway subreddit and we just might feature it in our next episode. First question Our first question comes from communication number 3650 on Reddit, they say. I'm curious what Scott's thoughts are on Reddit as an investment going forward and its price action. Also its price forecast and if he's still invested. Yeah, I still own shares in Reddit. I think Reddit is phenomena. I think they do a pretty good job. I have mixed feelings on Reddit and Discord is unfortunately I think a lot of young men are deciding they don't need to go out and make friends that they just spend time on Reddit and Discord. But generally speaking, as a consumer offering, I think Reddit is incredible. They've traded roughly between 80 and $280 over the past year, showing, you know, pretty serious volatility for a newer tech social IPO. The current price at the time of recording is $180. This was my big tech stock pick for 2024. I said at 34 bucks a share and granted most people didn't have access to that. I thought it was the most underpriced IPO of that year and we got that one right. The stock now trades at a pretty elevated PE and that is 100 to 120 times earnings, well above the broader market, signaling a lot of growth. Expectations are so in some I'm not a seller here, but I'm not a buyer and the reason I'm not a seller is because I like the company and I essentially the way I have always made money or the way I've made the most money is not trading, but it's buying stuff and holding onto it. For years I've had big tech stock pick. I lost almost all my money in 2008 and I took the remaining money I had and I doubled down on two or three big tech tech companies and they're up between 20 and 50x. By the way, the third company I bought was Netflix. It's up. This is the good News. I bought a 12 bucks a share. The bad news is it's at I sold it at 10 bucks a share to take the tax loss and never bought back in. And I think it's up 110x since then. So I'd be doing this podcast live from a Starlink link on my G650 had I held onto my Netflix stock. But no harm, no foul, other than I would like to invent a time machine, put me in it, go back such that I could murder me and then kill myself. Anyways, little bit of trauma, little bit of trauma. But Reddit right now is what I would call, I don't want to say fully valued because it's an incredible company and appears to be getting a lot of momentum. And if you compare it to other social media platforms, it doesn't look outrageously priced as a multiple on revenues relative to its growth. Having said that, I have trouble buying into stocks after they're up 5 or 600% since the IPO. So but again, I'm not a seller, I'm not a buyer here. What do they have? They have hundreds of millions weekly active users, double digit revenue growth since post ipo, improving margins. The thing that's probably most exciting is that they entered into a licensing agreement, I believe with OpenAI to sell their data for input into these LLMs, whether that lasts or not. Because supposedly LLMs can now synthetically create their own data, which I thought was kind of interesting. But the bull case is that Reddit has hundreds of millions of highly unintentional users and is still under monetized relative to time spent. So it's arpu, or average revenue per user is nowhere near the other platforms, which creates, you know, which is bad news. But it's also good news, meaning there's a lot of opportunity. The bear case simply is valuation. The stock trades at a premium multiple versus traditional media and even some social peers, which means a lot of future growth is already priced in. The consensus average is 250 bucks. The top end of that is 325 and the low forecasts are about 150 bucks. Overall rating consensus is a moderate buy. More buys than hold and a few sells in some. Like I said, I'm not a buyer here, but I'm also not a seller and I own shares, which I guess technically means every day you decide to buy it because you could sell it. Who? Well, mind blown. Question number two. All right, question number two comes from radiative collapse. Radiative collapse. Wow. When do these people get these things? Is there like a name generator on Reddit? They say, hi, Scott, great work you and your team do every week. Thank you. Mostly the team, in your chats with Jessica Tarlov, you've let on that you're getting more into politics and specifically into supporting candidates that will bring the Democratic Party into sync with what the country actually needs in these fraught times. My question is, in your engagement with political players, do you get a sense of where the Democrat is on strategy? Midterms 2028 and beyond. Thanks again and I look forward to your comments. So I'm incredibly disappointed in Democratic leadership, specifically Leader Schumer or Senate Minority Leader Schumer. Even most recently around ice. He said there needs to be restraint and restriction like a bunch of fucking blah, blah. I thought his leadership was epitomized by. I sent a strongly worded letter. Well, that's going to do a lot, Chuck. Thanks for that. I just think he's too old. I think he's too. I don't think he has the weapons at his disposal for change. I think some of the younger Dems, whether it's Talarico or Crockett or aoc, while they're probably a little bit further left than I am, I find that they're stars unafraid and know how to kind of weaponize the weapons of choice and are just, quite frankly, clear blue flame thinkers. And I think, for God's sakes, enough, enough of the Golden Girls and the Walking Dead. It's time for a new generation of Dem leadership. I am consistently inspired when I speak to Democratic Senators. Senator Murphy, Senator Booker, Senators Kelly. I supported Senator Bennett for president. I think he is incredibly smart, moderate. I just think there's a. I think we have an amazing bench. Some of the governors. Governor Shapiro feels like he was built in a factory of lesser presidential candidates or parts from lesser presidential candidates. He is very good. I'm an enormous fan of Govern Newsome. I was at Davos and I walked down into the main Congress hall and there was like this enormous crowd asking what felt like Adele or Lady Gaga or Taylor Swift for autographs. And it was this big, tall, handsome guy with great hair. And I immediately recognized it was the governor. The guy literally walked around Davos as if he was going to be the next president. He just sort of felt and looked that way. And I compared and contrasted with. I saw Lindsey Graham walking around desperately looking for someone to talk to and no one gave a shit about him or that he was there. So I think Governor Newsom. And for all the shit he gets about California, the reality is as governor or president of California, he's overtaking Japan as the largest economy in the world. And all these people shitposting him are shitposting him from their computers in their homes in California. And the people the most options decide to live and wait for at California. Anyway, I think our bench is really strong. Governor Whitmer, I think, would be a decent vp. I think these are. I think there's just. I love Senator Klobuchar. I think she's incredibly smart, understands antitrust, which I think should play a huge role. Anyway, long winded way of saying, I think we have a fantastic bench. I think their strategy right now is to what Sun Tzu said, when your enemy is making mistakes, stay out of their way. I think they're sort of staying out of the way. I think they're doing a good job highlighting how outrageous this is. I think the governor of Minnesota's done a good job. The mayor of Minneapolis has done a good job. The frustration is that, well, okay, what actual impact are they having? The answer is little to none other than raising awareness, which hopefully builds momentum going into 2026, the midterms, and there's already evidence that Dems are beginning to win races they traditionally haven't won before. And then hopefully that carries over into 2028. But Timothy Snyder, the professor from the University of Toronto and the historian, said something really powerful. And he said change never starts with political parties. Change starts with people and then the political parties. So I think I keep hoping for some sort of religious Mandela, Jesus like figure to descend from the hilltop of the Democratic Party and save us all. And I shouldn't hold my breath, but I think their strategy is to highlight, affordability violation of constitutional rights, and what feels like really serious overreach of a mass police force, secret police force, going into American cities and trying to convince, okay, the president believes that harsh activity at the border was warranted and a lot of people support him. And I think he's done a good job at the southern border. But now what he's trying to do is bring the border everywhere in the United States to justify violent, harsh reaction, as if every citizen is trying to illegally enter the country. And that's just not the case. So their strategy, let them continue to shoot themselves in the foot with what is a lot of people consider depraved behavior, focus on affordability, find good candidates and wait till the election. I don't think that's, I think that's a good strategy for the midterms. I don't think it's the right strategy for now. I think we need to do more that has a more of a short term impact because I think unfortunately between now and November, the Trump administration can do a lot of damage. Very much appreciate the question. We'll be right back after a quick break. Foreign.