Galloway always predicts that every tech company is a bubble. Every now and then he's right.

Right, maybe not every tech company but he is wrong more often than he is right.

For example, he predicted both Amazon and Google would be 'losers' back in 2015.. oops:

https://www.forbes.com/sites/stevedenning/2015/04/09/the-fut...

From the article “For Galloway, the winner will be Macy’s, which has successfully gone online,”

Macy’s Stock https://g.co/kgs/8KZ1Kj

Prediction is a hard business.

Prediction is very difficult, especially if it's about the future. - Niels Bohr

I had previously heard this attributed to Yogi Berra, so I had to check. Apparently[1], it's an old Danish proverb.

[1]: https://quoteinvestigator.com/2013/10/20/no-predict/

So non-future prediction is also difficult it seems!

What pumped up their stock so much in 2015?

Levine is skeptical/amused by the nonsensical valuations but takes a more neutral stance, probably because he was never truly invested in/familiar with/cared that much about new technology and what people promise it can do. Galloway is more idealistic and Levine is more practical taking things at face value and breaking them down. They're both very knowledgeable and worth reading.

> ..probably because he was never truly invested in/familiar with/cared that much about new technology and what people promise it can do.

Where's the technology in WeWork?

We are current WeWork tenants. WeWork can’t even provide us an interface to manage and view who used WeWork credits in our org. We asked for a report and got a pdf after 2 days.

Tech my foot. The printer software is an abomination.

I found the best way to print in Wework is to email the document to the reception and have them print it for me.

> The printer software is an abomination.

...that's a surprise....

If I recall correctly, there was also no uninstaller (at least on Mac, 2 years ago).

Oh, so they are a classic tech company, then.

After a year I never figured out how to print. You should be able to print from their app.

It's a cornerstone of their brand relative to other office space leasing companies, and tech investors are how/where they got a lot of their funding. Check out their S-1, they mention "technology" 110 times:

"Technology is at the foundation of our global platform. Our purpose-built technology and operational expertise has allowed us to scale our core WeWork space-as-a-service offering quickly, while improving the quality of our solutions and decreasing the cost to find, build, fill and run our spaces. We have approximately 1,000 engineers, product designers and machine learning scientists that are dedicated to building, integrating and automating the complex systems we use to operate our business. As a result, we are able to deliver a premium experience to our members at a lower price relative to traditional alternatives."

https://www.sec.gov/Archives/edgar/data/1533523/000119312519...

It’s “tech theatre,” not tech. It’s how they got their funding, but reading what even the happy users on HN have had to say, the technology isn’t core to why people rent from them.

> the technology isn’t core to why people rent from them

Okay, I'll bite: what is the core of their value-proposition? A cultural aesthetic? Cheap rent?

As a former WeWork tenant, their value proposition to customers is that they provide office space quickly and without any long term obligation in convenient, trendy locations. They're also very eager to beat competitors on price in my personal experience.

Since it's very easy to set up a competitor (at least in my area, since numerous knockoffs have been created in the last few years) their margins are low at best, and they have almost no customer lock-in, I have no idea what their value proposition is for investors.

I'm not sure about the price-beating anymore.

A few days ago I moved into a WeWork clone called JustCo. The spaces are much larger, look virtually identical and are in a neighbouring building. Price difference per month was $2300 vs $1600 + a month free. WeWork's best offer was 5% off if we signed for 12 months. No free beer here, but I've got a beer budget of $700 a month with the savings.

It seems WeWork's sales guys here in Sydney have very little freedom to discount.

Nailed it. Brilliant.

1000 engineers for what? Again, where is the technology?

Maintaining internal frameworks, delivery pipelines, infrastructure, instrumentation and product roadmaps. Transitioning to new organizational structures. Internal hackathons and lunch ‘n learns. What am I forgetting?

Blog posts, conference talks, building at scale, open source contributions, core libs, platform, tools, dashboard migrations

Ping pong.

How did I forget?

He is bullish on AirBnB[0] and Shopify[1].

[0] https://www.vox.com/2018/10/26/18029008/pivot-kara-swisher-s...

[1] https://www.youtube.com/watch?v=m58YkxEjzT4

____

Edit

Linked to a better resource.

most tech companies are bubbles or at least unrealistically over valued. its just that if you keep believing the myth long enough, it starts being true.

In the long view, all tech companies are small bubbles. They don’t stick around and have no long term value.

What evidence do you have to support that conclusion?

Schumpeter

I wouldn't give that much worship to Galloway it's not like he is always right or my guess even close to that (and nobody is). For example this post circa 2017 about the bubble. I can't tell you how many people have not called the bubble since the last bubble correctly. Galloway is one of them:

https://www.profgalloway.com/every-seven-years

Market was at 21,600 (very roughly) on the approx. date of that post and now is at close to 27,000. It did not go lower than 22,400 in the interim.

To wit (that post):

> There are several hard metrics for why we may be nearing full-monty bubble, including things my NYU colleagues spend a great deal of time thinking about, and understand much better. But you don't need a Nobel to see the similarities between 1999 and 2017. (Btw, NYU Stern has three active Nobel Prize winners… We. Rule. But that's another post.)

Very generally if you are predicting a collapse ala 1999 you need to be a bit more accurate than that.

I didn't do a great deal of work to find that post either, it was linked in the post you gave.

Edit: Also love his being so proud of the anointed 3 active nobel prize winners. Would like to remind everyone that until recently the game in business was making money or a great product or being loved by your customers not winning academic awards and platitudes.

Galloway's strength is that he's an amazing communicator and very arrogant. People eat up what he says without a moment's thought. And to be fair he's had some great calls, ie, Amazon's stock run in 2017 and this WeWork fiasco (although the WeWork one wasn't that hard to predict after the reports on the corporate malfeasance came out). Combine an arrogant and vociferous personality with a couple of correct calls and you have something that sells.

But he's also made some really bad calls. For example he predicted that Spotify was going to be the next FANG and that the stock price would double last year. That's not a crime, nobody knows what is going to happen in the future, but it's the arrogance and condescension and air of certainty that bothers me.

He was so adamant about the dominance of voice and how Alexa was going to take over and largely disrupt touch screens. That was the call that I never agreed with and made me more skeptical of what he says. More than once I saw him on tv talking very condescendingly to people who questioned that call and in the end, two years later, I still don't know a single person who has ordered anything using Alexa. To this day it remains a cooking timer and a way to control audio equipment (if I'm really lazy). Galloway called it the most transformative device in ten years. Really?

I occasionally order from Alexa but we call them “Amelia Bedelia orders” because there’s really no telling what we’ll actually get. It’s kind of fun.

My favorite so far has been the bulk-order of travel size bars of dove soap. Why is that even a thing? Surely anyone who could fit 12 travel bars in their suitcase could just as easily fit a regular bar?

> Surely anyone who could fit 12 travel bars in their suitcase could just as easily fit a regular bar?

... why would you assume someone would take all of them at the same time? Instead of maybe multiple family members using them, keeping a stockpile at home (so they don't have to order an individual one every time they need one), keeping them on hand for guests, ...

> ... why would you assume someone would take all of them at the same time?

I was being facetious... taking it literally à la Amelia Bedelia.

People who travel a lot for work and need one bar at a time and (for some reason) prefer Dove soap.

Yeah but what if you're travelling with twelve kids, apostles, etc?

Yeah, if you’re bragging about Nobel prizes in economics, you’re doing it wrong. They make the Peace Prize seem rigorous.

I think it's deliberate, he never gives a 'maybe this, maybe that' answer. He does the analysis, but then does an intuitive glance at the end and takes a side one way or the other

Sure he's wrong a lot, but at least he's never half-right half-wrong

I wouldn’t say he “predicted” anything unless I’m missing something. He commented on the S-1 after it was released.

He also gave a glowing take on Smile Direct Club the day before the IPO, which has tanked 50% in a few weeks and had the biggest IPO flop in a decade, so YMMV.

It has been super interesting listening to Scott Galloway blast WeWork and their business model on the podcast Pivot.

Would be great to remove Kara Swisher's self-aggrandizement and name-droppery and isolate Galloway's takes entirely.

God, Kara Swisher is perhaps the most annoying tech journalist on the planet. Her "analysis" consists of inserting random name-drops that are completely unrelated to the topic at hand and then regurgitating the analysis of smarter people without any additional value add.

It seems Kara Swisher's entire reason for existing is for expressing disdain. In any organization she'd be that political person who adds no value to projects but rises due to her expertise at networking and name dropping.

I much prefer the journalists on the Economist podcast and the people on The Weeds (Vox) and FiveThirtyEight.

I really bought into the hype and gave her a try - she adds absolutely nothing to the conversation.

The a16z podcasts are way better - I can't recall the name of the ladies who generally host that but they are much more effective interviewers and analysts.

Yeah, it's pretty impressive in this day and age that someone read the S-1.