The Prof G Pod with Scott Galloway Rethinking Corporate Valuations — With Daniel McCarthy
Oct 7, 2021
Daniel McCarthy, a marketing professor at Emory University, dives into the world of customer-based corporate valuations. He critiques the chaotic state of public disclosures, especially highlighting Facebook's ethical dilemmas. McCarthy urges a reevaluation of how customer acquisition costs are viewed in corporate valuations, warning against the 'growth at all costs' mentality. The conversation emphasizes the need for clearer guidelines in IPO practices and advocates for grassroots movements to hold corporations accountable.
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Facebook's Profit-Driven Polarization
- Facebook prioritizes profits over user well-being, exploiting polarization for financial gain.
- Internal documents reveal Facebook's awareness of harmful content amplification and negative impacts on teen girls.
Customer-Based Valuation
- Customer-based corporate valuation forecasts revenue by modeling customer acquisition, retention, order frequency, and spending.
- It integrates revenue forecasting with traditional financial models for better profitability assessment.
Prioritize Profitable Acquisition
- Focus on variable profitability, ensuring that acquiring each new customer generates profit.
- Don't solely chase growth; prioritize sustainable customer acquisition economics.