Emory University’s Dan McCarthy on a New Approach to Valuing Companies

Dan McCarthy, Assistant Professor of Marketing at Emory University’s Goizueta School of Business, joins Robbie to share his expertise on the intersection of marketing and finance. They discuss why customer lifetime value is such an important and misunderstood metric, how to rethink the way companies are valued by the public markets, and what all of this means for subscription businesses.

Highlights from this episode:

• 2:50 - Dan introduces Customer Based Corporate Valuation (CBCV)
• 4:08 - The importance of knowing your customer data
• 8:46 - Dan’s time working with CBCV at Blue Apron
• 12:17 - The importance of focusing on the right metrics
• 15:18 - The challenges of a physical subscription
• 17:28 - The cycle of Customer Acquisition Cost (CAC)
• 24:11 - How COVID-19 has impacted customer behavior
• 27:44 - Dan’s advice for entrepreneurs
• 28:36 - Dan’s Advice for academics at the intersection of research and commercial
• 30:00 - Robbie’s Speed Round

Dan's Bio:

DANIEL MCCARTHY is an Assistant Professor of Marketing at Emory University's Goizueta School of Business. Among other things, he’s an expert on valuing companies by focusing on the lifetime value of their customers—a novel approach at the intersection of marketing and finance. His approach, which has won him many accolades, is known as “customer-based corporate valuation” (CBCV). His research has been accepted and published in top-tier academic journals, as well as nearly every major financial publication, from HBR to the Financial Times to CFO Magazine. In 2015, he co-founded a predictive analytics company, Zodiac, which was acquired by Nike in March 2018. Dan subsequently co-founded Theta Equity Partners to commercialize his work on customer-based corporate valuation. He earned a BSc, a BS, and a PhD from the University of Pennsylvania.

Links:

• Dan’s LinkedIn: https://www.linkedin.com/in/danielmcc/
• Dan’s Website: http://danielminhmccarthy.com/
• Dan at Emory University: https://goizueta.emory.edu/faculty/profiles/daniel-mccarthy
• Robbie’s Book THE FOREVER TRANSACTION: https://robbiekellmanbaxter.com/the-forever-transaction/
• Robbie’s Website: https://robbiekellmanbaxter.com/