The Prof G Pod with Scott Galloway
Scott on Hotel Brands, Netflix’s Adolescence, and Theranos Takeaways
Wed, 23 Apr 2025
Scott shares his take on the explosion of hotel brands and what it says about consolidation, consumer choice, and corporate strategy. Then, he reflects on the Netflix series Adolescence and the pressures facing young men today. Finally, in our Reddit Hotline segment, Scott responds to a question about Elizabeth Holmes, Theranos, and the culture of overpromising in Silicon Valley. Want to be featured in a future episode? Send a voice recording to [email protected], or drop your question in the r/ScottGalloway subreddit. Learn more about your ad choices. Visit podcastchoices.com/adchoices
Chapter 1: What drives Scott Galloway’s passion for hotels and branding?
Thanks, Jerry. I love this question because my hobby is hotels. I know that sounds stupid. People say, what are your hobbies? I love hotels. I travel to hotels, not to cities. I get all of those surveys on Instagram or whatever, and if I see a cool new hotel, I'll travel to that. So I know a lot about hotels, or at least I think I do.
Anyways, today there are more than 1,200 hotel brands worldwide. However, many of these brands are owned by conglomerates. The six largest hotel corporations, Marriott, Hilton, IHG, Wyndham, Accor, and Hyatt own more than 150 brands, and they operate nearly 40,000 properties. The industry hasn't always been this consolidated.
Due to a series of major mergers and acquisitions, the number of large hotel groups was cut in half in the 90s. Nowadays, just 10 companies control over 65% of hotel room supply. That's not even counting Airbnb, which I think has more rooms on its platform than any hotel company.
consolidation allows hotel companies to diversify their brand portfolios, access economies of scale, and centralize operations, all without sacrificing the perception of their flagship brands. Okay, so there's a couple things. I understand the notion that Okay, one brand, you get scale, one advertising campaign, one set of associations.
Chapter 2: Why are there so many hotel brands and who owns them?
What you need is scale on the back end, but in an era of weapons of mass diligence, where people can find out that the best gym in a hotel in Berlin is the Soho House, and they can find that the coolest new hotel in Sao Paulo,
with the best restaurant is the Rosewood, or they can find that the coolest kind of hippest place for a romantic getaway with really unusual architecture in Cabo is Las Ventanas al Paraiso, also a Rosewood property. You can find your exact brand. You no longer need to defer to the brand. What does that mean? It means that a series of niche brands have been able to evolve. They sometimes have
a back end that they can consolidate around reservation systems. Because basically, the hotel industry is the following. It's a wealthy person locally wants to own all the Four Seasons. Michael Dell in Hawaii owns all the Four Seasons. And the Four Seasons runs the flag, the standards, the service, the reservation system. And they take 8% to 12% top line. And you think, well, that's not a lot.
Actually, that is the best thing to do because that's high margin revenue. and they aren't subject to the economic whims of our economy. So in 2008, basically, I think the Four Seasons of Midtown went bankrupt, but the Four Seasons out of Toronto, which only owns one of its hotels, I think it's flagship in Toronto, still gets that eight or 12%.
And the guy who owns the thing has to hemorrhage money because the Four Seasons in their ownership partnership contract says, okay, you have to maintain a certain level of standards. You have to have three check-in people. You have to clean the room twice a day. And so even in bad economic times, these companies just, the flag itself,
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Chapter 3: How do hotel conglomerates benefit from brand diversification?
which is a management company, doesn't take any capital risk, just prints money. And then they found this other kind of gangster way to make a shit ton of money, and that is they sell residences. So the almond will sell residences in Miami, and instead of, call it 2,000 bucks a square foot, they can charge 4,000 because it's an almond-branded residence.
And then when the very wealthy person who wanted to be in an almond residence isn't there, they put it back into the rental pool, an almond rents it out as a hotel room, and they split the revenue. So they not only get... much bigger gross dollar volume for selling what is a $7 million condo. They get $14 million for it.
They also get incremental recurring revenue from someone else who has sponsored and took all the capital risk. So if you can develop an amazing niche brand, you can do really well. And some amazing niche brands have developed specifically based on demographics. What do I mean by that? The fastest growing cohort in the world is the super wealthy.
And the number of people who are worth more than $10 million has absolutely exploded globally. And so it used to be that the Four Seasons, the Mandarin Orient, and the Ritz-Carlton were sort of the high-end brands. And then a series of like massive, over-the-top, high-experience, exceptional location brands emerged and went super luxury, right?
Rosewood, Almond, Cheval Blanc, Six Senses, the Okator Group, which includes my favorite hotel in the world, the Hotel du Cap. They came in at the very, they out-luxuried luxury and they started charging $1,500, $2,000, $5,000 a night, recognizing there are some people who have become totally price insensitive.
And if they want to take their family somewhere on their limited time off, they have much more money than time. They will pay 5,000 bucks a night or seven or 8,000 bucks a night to stay at the Six Senses in Thailand. And they are exceptional experiences. Down towards the middle end, it's all about scale and cost and offering people a good value. And it's about scale at the back end.
So these big kind of conglomerates that have multiple brands. They use the same backend. They use some of the same service and headquarters and infrastructure, and they will buy some of these brands. I think actually IHG purchased the almond. I'm not sure. Is that right? I can't remember.
But anyways, I think that you're actually seeing, I don't want to call it fragmentation of brands, but you can now... You can now support a single brand because of the weapons of mass discovery. The thing that is dictating and shaping the global travel industry right now Instagram. I did my 50th birthday in Scotland, 60, and everyone there was complaining that Scotland had been overrun. Why?
Because supposedly they invited 20 or 30 very, very influential Instagrammers, influencers, to Scotland two summers before, and they went apeshit. Scotland is like a giant Instagram orgy. It is spectacularly beautiful. And everyone saw all over the world that Scotland's amazing, and they thought, it's cool, I haven't been there.
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Chapter 4: What is the role of Instagram and social media in shaping hotel popularity?
And it just sort of breaks my heart that when you hear women say that if they're walking down the street and a group of guys is coming towards them, they sometimes cross the street.
And I'd like to think, and I have this aspirational view of masculinity, but I haven't lived that life, that if a woman or someone who feels physically threatened immediately would look, just the way you look, who are the most masculine role models, cops and fire people? You go to those people when you need protection. And it just breaks my heart that we're not
That people in our society don't look to men for protection, that they're scared of men. And I think what I took away is at a very early age, we got to first off acknowledge that masculinity and being a boy is a wonderful thing and to embrace it. But to really bring home the notion that your evolution from boyhood to manhood is around protection.
And very much so, ground zero for protection for any boy is protection of girls and women. And I think a lot of men feel this way. I know I felt this way when I was very young. I felt very protective of my mother. But also just heartbreaking that you see this kid. And what's fascinating about the program is it's not a whodunit. You know who did it. But it's an exploration of why they did it.
And it made me think a lot about, um, fathering and how important it is to really understand what your kid's up to and his, his views on girls and, and violence and misogyny. And more than anything, the thing that came to me was, you know, as parents and are you letting the internet raise your kid?
Because the thing is, a lot of people, their nannies or other people or their school raises their kid, right? My son's at Wellington College, this wonderful school. I know the school really well. I'm in contact with the people there. I've sat in on classes. I've spoken there. I have a pretty decent idea who is raising my kid.
Whenever we've had a nanny or someone who spends a lot of time with our kid because my partner is working, we know that person really well. We have a really good sense of who's raising our kid. I don't know who's raising my 14-year-old because he spends a lot of time on the internet. And I'd like to think, oh, I'm smart. I'll figure it out. No, I haven't figured it out.
I absolutely haven't figured it out. He spends way too much time on his phone. And anyone who says, oh, well, that's bad parenting, you don't have kids. They get their homework. If they can't be on their phone, they're ostracized from their peer group because that's how they communicate with each other.
But I wonder if we're, as parents, I think it's a really good question is, who's raising your kid? And this story is just so rattling because it's clear that these good people just didn't know what influences were raising their kids. So what to do about it? No kid should be on social media under the age of 16. And by the way, my 14-year-old is. So do as I say, not as I do.
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Chapter 5: Which hotels does Scott recommend and why?
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Chapter 6: What insights does Scott share about the Netflix series Adolescence?
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And they're made with no artificial colors or flavors. Get up to 45% off when you go to Gruns.co and use code PROFG. That's G-R-U-N-S dot C-O. Using code PROFG for 45% off. Welcome back. We asked and Reddit delivered. Let's bust right into it. Our Reddit question today comes from Ethan Rab. They say, or he says, Hi, Scott. Did you ever meet Elizabeth Holmes? What was your impression of her?
Were you offered a chance to invest in Theranos? And if so, did you see through it or get caught up in the hype? More broadly, what's your take on the fake it till you make it founder philosophy? Okay, a lot there. I'll come back to whether I know her or not. I didn't see it.
I remember the cover of Time showing her with a vial, and she was, I think, the youngest billionaire or the youngest female billionaire at that point. There is a very strong gestalt in the Valley of raise as much money as you can, become a hype machine. I mean, take it till you make it. How many times has Elon Musk lied to us about when autonomous driving... Autonomous driving is a year away.
Chapter 7: How does Scott view masculinity and the challenges facing young men today?
I think he said in 2017. I mean, there's just no getting around it. Your ability to tell a story that verges on exaggeration, embellishment, adjectives, maybe even crosses the line at some point into fraud. I mean, the difference between storytelling and fraud sometimes, quite frankly, is your performance.
So I think in the Valley, there's unfortunately this gestalt that says, exaggerate, get cheap capital, and then pull the future forward with your capital. Now, having said that, when you start lying about your numbers as that, I think it was, was it Nikola, Nikola, the guy who put a truck on a slanted hill and said that it was a motor driving the car, you know, that guy deserves to go to jail.
But I believe if Adam Newman's board was not Japanese or driven by Masayoshi San and was worried about a loss of face of saying I got fooled and his board went after him, I think there's a good chance Adam Newman would be in prison. And with Elizabeth Holmes, yeah, she lied to her investors. Her investors were sophisticated. No retail investor lost money.
And there was never really any health ramifications. It wasn't like anyone was taking an HIV test and got false results and as a result was hurt. So should she have been punished, fired, and maybe sentenced to prison? Yes. But what bothered me about the whole situation is she was sentenced to 10 years. And I just find only two or 3% of unicorns are founded by women.
And it struck me that, okay, yeah, we seem to find one to put in prison for 10 years. So why? She's very unlikable. And I think that there's a weirdness in our society, a misogyny where a woman taking the position and taking on male attributes who ends up to be full of shit, We dislike that person more than a guy who's exaggerating or even lying. And I think she paid the price.
And someone in her family, I won't say who, reached out to me and asked if I would openly advocate for her prison sentence. And I didn't respond. I'm not going to get involved in that. But I wonder had Adam Newman's board been angry and gone after him, if things would have turned different for him. And there's something that bothers me about a founder who ends up spending 10 years in prison
is one of the 2% that has ovaries. There's just something uncomfortable there. The fake it till you make it, never lie about your numbers, never lie to consumers that you're serving at that moment. But let's be honest, you have to paint a vision. I don't have an answer for you. I think it's gone too far.
And what I have generally found, generally found is that the way I serve on a, or served on a bunch of public company boards, that the people, the managers, in public companies, at least traditionally, that with the most respect were the ones that under-promised and over-delivered.
Having said that, though, in private companies and startups, I mean, I can tell you how many business plans I see of people raising money and their ability, you know, and I would say 90% probably aren't going to hit those numbers. Anyways, that's all for this episode. If you'd like to submit a question, please email a voice recording to officehourspropertymedia.com. Again, that's
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