Humanoid Robots, Building a Service Business, and Why CEOs Won’t Save Democracy

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0:01:51 Welcome to Office Hours of Prop G.
0:01:53 This is the part of the show where we answer your questions
0:01:54 about business, big tech, entrepreneurship,
0:01:56 and whatever else is on your mind.
0:01:58 If you’d like to submit a question for next time,
0:02:01 you can send a voice recording to officehoursofpropgmedia.com.
0:02:03 Again, that’s officehoursofpropgmedia.com.
0:02:06 Or post your question on the Scott Galloway subreddit,
0:02:09 and we just might feature it in our next episode.
0:02:10 First question.
0:02:18 Hey Prop G, Franco calling in from Madrid, Spain.
0:02:21 I’d love to get your take on the humanoid robotics market.
0:02:24 There’s been a lot of movement lately.
0:02:27 Tesla pushing with Optimus and VCs pouring money
0:02:30 into players like Figure AI and Unitree in China.
0:02:33 The technology seems to be advancing fast with AI.
0:02:35 But what do you think it’ll take for humanoids
0:02:39 to move from controlled environments into truly production-ready autonomous tech?
0:02:43 And do you see this becoming a real business within the decade,
0:02:45 or more like another moonshot, like autonomous vehicles?
0:02:48 Huge fan of you and all the Prop G shows.
0:02:49 Thanks for all you do.
0:02:54 Morgan Stanley projects this could be a $5 trillion market by 2050,
0:02:56 with roughly 1 billion humanoid units in use.
0:02:58 In other words, that’s them saying they have no fucking idea.
0:02:59 By 2050?
0:03:02 By 2050, we could collide into Pluto.
0:03:07 I love these things that are like, in 20 years, it could be a $1 trillion.
0:03:11 I mean, the analyst writing that is going to be dead probably in 20 years, so who cares?
0:03:15 They see adoption ramping up slowly until the mid-2030s
0:03:18 and accelerating as cost-fall and AI capabilities catch up.
0:03:20 Goldman is more conservative.
0:03:24 They estimate the humanoid market will reach 38 billion by 2035,
0:03:26 with roughly 1.4 million robots shipped once.
0:03:28 Hardware costs decline about 40%.
0:03:33 For context, there are already more than 4.5 million industrial robots operating today,
0:03:37 and that base grew 9% last year, so the broader automation trend line is strong.
0:03:40 Component makers are also gearing up.
0:03:45 ID TechX expects a 14x expansion in humanoid parts and sensors within the decade,
0:03:48 roughly a $10 billion market, just for the guts of these machines.
0:03:52 On the funding side, venture money is also pouring in.
0:03:55 China’s taking the lead here.
0:04:00 Unitry’s low-priced models and government-backed manufacturing give it an edge over U.S. rivals,
0:04:01 at least for now.
0:04:04 And then, with respect to Tesla and their Optimus,
0:04:08 Musk has said that Tesla could start selling Optimus by the end of 2025, even talking about
0:04:10 thousands of units next year.
0:04:12 In sum, he’s full of shit.
0:04:14 I don’t even know he’s full of shit.
0:04:15 I know he’s not full of shit here.
0:04:16 I don’t think he’s ever talking…
0:04:21 Weren’t we supposed to have a million autonomous taxis by, like, 2021 or 2018?
0:04:24 Elon Musk is engaging in this ultimate weapon of mass distraction.
0:04:27 Don’t look at the fact that I have the most valuable automobile company in the world,
0:04:33 and yet my automobile company is declining, is eroding revenues faster than any automobile
0:04:38 company in the world, and I’m getting my lunch eaten by everybody, including BYD,
0:04:42 which produces a Tesla-like vehicle at about 40% of the price.
0:04:47 So I’m going to do all these jazz hands and say, “Look over here! Robots! Robovin! XAI!
0:04:53 Look anywhere!” But at the fact I’m wrapping steel around an engine or a battery, and I’m
0:04:57 trading, and I’m worth more than every automobile company in the world, which makes no fucking sense.
0:05:02 So he’s trying to say anything to give people the illusion of distraction that it’ll be something
0:05:08 else. Anyways, back to robots. Most analysts expect real commercial traction before 2030,
0:05:13 primarily in warehouses, logistics and manufacturing, but not in our living rooms. The trillion dollar
0:05:18 promise is still decades out. Within the next 10 years, we’ll likely see humanoids doing repetitive
0:05:21 labor and structure environments. My viewpoint on this, as someone who doesn’t know the space
0:05:26 very well, is the following: I think in B2B, it’s going to exceed expectations. I think in B2C,
0:05:31 it’s going to fall well short of expectations. I don’t think people want to… I don’t like having a nanny in
0:05:37 my house. I just don’t… And the idea of a robot having any sort of context or nuance to go get me
0:05:44 my tea and cookies, maybe, I don’t know. But if you look at these data centers, if you look at some of
0:05:49 the factories, the forward advanced manufacturing factories in China, they say they don’t even need
0:05:55 to turn the lights on because there’s no humans in them. So I think I’m roaming around the house. I don’t
0:05:59 know. Maybe they’ll take your dog for a walk. I don’t know. Maybe those things that deliver your
0:06:03 food. I don’t think it’s going to work. I think there’s going to be a lot of military applications.
0:06:07 They’re going to be fucking frightening in space age, but they’ll be very effective. But the idea
0:06:12 that we’re going to have robots walking our dogs and hanging out with us and bringing us
0:06:18 our dinner. Yeah, I just don’t. I don’t think so. Anyways, that’s my view. Question number two.
0:06:27 Hey, Prof G. I’m 20 years old, living in Vancouver, Canada, and I’m currently three
0:06:31 quarters of the way through an electrical apprenticeship. Because the trades pay so
0:06:37 well, about a year and a half ago, I was able to buy a condo and utilize it as an investment property.
0:06:42 Currently, I’m in the process of starting my own electrical company while I’m still an apprentice,
0:06:46 so I can be up and running and ready for business when I finally get my license in about a year.
0:06:51 Do you have any tips on how to run a services-driven business and how to differentiate from
0:06:56 all the other businesses that are around? Additionally, what advice do you have for
0:07:01 a young entrepreneur/landlord who doesn’t want his 20s to pass him by by growing up too early?
0:07:05 It’s worth noting that although I don’t drink or do drugs, I took the money that I would
0:07:10 have spent on nights out partying and bought a speedboat with it. Thank you for all the content
0:07:18 that you put out, Connor from Canada. I like the speedboat part. Okay. The point of differentiation
0:07:21 between a product business or a product-based or manufacturing-based business where you have a
0:07:26 physical thing you can touch and a services-based business is one word: relationships. I have run
0:07:33 services-based businesses my whole life. I started a strategy firm when I was 26 called Profit and the
0:07:38 last firm I sold was a firm called L2, which was basically another. We called it business intelligence,
0:07:44 which is just a fancy word for strategy. Those companies are based on relationships and the
0:07:52 reason why Profit did well was I had a strong relationship with the CEOs of the CMOs of Levi’s,
0:07:57 Williams-Sonoma, Dreyer’s. These were my first clients and it was sort of everything. And because
0:08:02 there’s a lot of good firms out there doing good work, but they want to work with people that they like,
0:08:10 they feel. My advantage was I was 26 and I developed sort of these proxy big brother,
0:08:15 little brother, father-son relationships with people who wanted to help me and liked me and thought I was
0:08:19 smart. And you have to do good work. That’s table stakes. But then it’s all about relationships and it’s
0:08:25 no accident that in the advertising or the consulting business, the people tend to be very good looking and
0:08:31 very charming. So the first thing is you have to be very social, get out there and have the ability
0:08:35 to establish relationships with clients in the services industry. That’s just kind of everything.
0:08:41 The second is a product-based company is about obviously people and engineers, but it’s a lot about
0:08:46 your IP and distribution and capital you raise. Services business is really the team of the best
0:08:53 players wins. So as the head of a services company, you are constantly thinking about recruiting. And
0:08:57 that is you meet someone who’s smart and good. What do you do? Would you be interested in coming
0:09:02 to work with me? And then if you are fortunate enough, if you get your first six or 10 people,
0:09:06 if there’s two or three, hopefully that are really good, you give them one, three, five,
0:09:12 10% of the company. And you say, you’re a partner in this business now, and I need you to do really
0:09:17 well. But I made sure that all of these people felt like they were owners in the business. Because
0:09:22 if you’re fortunate to find someone who’s really good, that’s everything. Because their ability to
0:09:28 really wow the client and build strong relationships is everything. So one, you have to be very good at
0:09:32 establishing relationships and spending a lot of time fostering those relationships. Two,
0:09:38 you really do need to think a lot about finding that initial team of really outstanding people.
0:09:44 That’s what a services company lives and dies on, full stop. And then what else would I say
0:09:48 about the services business? I’ll give you the upsides. It doesn’t take a lot of capital.
0:09:54 You make good money. It’s an incredible training. I’ll give you the downsides. It’s really tough on
0:09:59 your relationships. It’s very demanding. It is hard to make money in your sleep. I used to get on,
0:10:03 when I was running profit, I used to get on, Audi was like one of our biggest clients. I used to get on a
0:10:08 plane from fucking San Francisco to Munich and then get in a car and drive to Ingolstadt, which is the
0:10:15 armpit of central Europe, and then do a meeting the next day and try and convince them that the
0:10:19 Audi brand identity should be the modern art of motion. I came up with that and I thought it was
0:10:23 great. And then they would tell me there’s no real word for modern art or motion in German. And I’d have
0:10:27 to fly back and say, I’m just going to hit the drawing board again. And on the way over, I would
0:10:32 literally be in the back of the galley of the coach section because it was my company. We didn’t have
0:10:37 any money with a bunch of kids trying to pull together slides and then figure out where the
0:10:41 Kinko’s was in Munich. This was, I’m dating myself to go print out. I mean, it was just so fucking
0:10:47 stressful. Oh God. I’m literally getting hard palpitations just thinking about it.
0:10:53 Ton of stress, really hard on your relationships. And that’s why I sold my first room. I wanted out.
0:10:57 I was sick of managing people. I was sick of managing clients. I found that, Jesus Christ,
0:11:02 I’m getting a headache just thinking about it. So real upsides, real downsides. But again,
0:11:07 just to summarize, you got to be social, got to have the ability to create really strong relationships,
0:11:11 got to over-serve your first three clients. They need to be evangelists for you. I mean,
0:11:16 they just got to feel like you’d do anything for them. You would jump on a grenade for them because
0:11:21 you want them to be evangelists for you. Those first three or five clients are kind of everything.
0:11:25 Spend a lot of time trying to get to three or four outstanding people, then give them big chunks of the
0:11:29 firm such that they won’t go anywhere. The only way to get people to act like owners is to make them
0:11:34 owners and also recognize the upsides and downsides of what it means to be in a services business.
0:11:41 Go Canada! Thanks for the question. We’ll be right back after a quick break.
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0:14:08 full-time jobs that you rarely, if ever, get to clock out of, at least until you get to the point
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0:15:09 Welcome back onto our final question, which comes from Reddit, user SincerelyTrue asks,
0:15:14 Hi Scott, I recently finished Why Nations Fail, and there’s a section on preventing authoritarianism.
0:15:18 They recommend mobilizing a broad segment of society, including unions, churches,
0:15:22 and business organizations. How can the Democratic Party or other movements better mobilize business
0:15:27 organizations and leaders in the fight for democracy when so many have backed Trump? Oh God,
0:15:33 I wish I knew. I have been shocked at how little resistance and pushback there’s been from the
0:15:36 corporate world. And I’m not sure you’re going to find it from corporations because
0:15:43 in America, it is so tempting to just try and get from a million and worth to three million to five
0:15:48 million from one billion to a billion. America is just all pretty much about how much stuff you have,
0:15:52 because how much stuff you have is really the healthcare you can provide yourself and your
0:15:57 children, the opportunities you can provide your children, how hot or not hot your husband or your
0:16:03 wife is, how interesting a party is, how nice a vacations. The market has become so stratified.
0:16:07 When I was a kid, my dad’s boss had a slightly bigger house. We kind of lived in the same neighborhood
0:16:15 and we all were at the same summer club or country club. He had, you know, he had a Ford Thunderbird.
0:16:19 My dad had a Grand Torino. I mean, they did slightly better life, but it was in striking distance.
0:16:25 Now, you know, people who don’t make a lot of money are flying Spirit Airlines and watching
0:16:30 drunk people physically abuse each other and then having to deplane while everyone,
0:16:35 while this guy gets escorted off by airport security and really rich people get to fly on a Gulfstream
0:16:41 650 where they can watch Netflix and do FaceTime on the plane and have some really hot dude bringing
0:16:46 the mimosas on the plane. And oh, if they’re 30 minutes late because they want to grab an additional
0:16:52 30 minutes with their kid over dinner, they just text their party. I mean, the delta between what
0:16:58 it means to be middle-class and what it means to be rich in this country has gone from three inches
0:17:06 to fucking two million miles. And so the incentives to make the incremental decisions to become wealthy
0:17:13 are just so incredibly dramatic. And one of the best ways to get wealthy right now is to play into the
0:17:18 the authoritarian’s handbook. People start showing up with golden grave tacky trophies and saying,
0:17:23 we love spending time with Melania. Jesus Christ, Tim Cook, what a fucking coward you are.
0:17:29 Literally, what a coward you are. Right up there with Bob Iger, literally Neville Chamberlain in a
0:17:33 cashmere sweater minus the dignity, all these people bending a knee. And now why do they do it?
0:17:37 Because they feel a lot of responsibility. They’re fiduciaries for their shareholders and the
0:17:43 temptations to make more money are so huge. And Trump, to his authoritarian credit, has created a
0:17:49 bright blue line path between kissing his ass and ignoring democracy and not engaging in capitalism
0:17:57 and engaging in cronyism because you will get richer. Right? So these guys, if we’re waiting on the better
0:18:04 angels of companies, of CEOs to show up, don’t hold your breath. You know, Sam Altman, all these
0:18:08 fucking douchebags showing up and bending a knee so they can get richer so they can get their eighth
0:18:14 billion instead, you know, from seven billion. I’ve been hugely disappointed. What can they do?
0:18:18 I don’t know. I don’t think it’s up to them. I think it’s up to us. I think seven million people
0:18:23 showing up for a protest is important. I think voting is really important. I am moving back to the United
0:18:27 States early because I want to be in the fight. How am I going to be in the fight? I’m going to
0:18:33 use my social media platforms and this platform and my writing to try and inform people around what I
0:18:40 think is going on, why I think it is wrong and methods for pushback. I think donating money to
0:18:45 candidates. I’m going to try and bring a bunch of candidates on my other podcast, Raging Moderates,
0:18:49 to elevate their profile. I’m going to give some money. I’m going to do a tour and try and bring
0:18:56 attention to Democratic candidates for Congress. I don’t think we can rely on the better angels of
0:19:00 companies. I think it has to be voters. I think it has to be citizens. I think it has to be protest.
0:19:04 I think it has to be talking to your friends about what’s wrong with this. I think it has to be. I’d
0:19:08 like the idea of a national economic strike where people stop buying shit on a certain day or targeting
0:19:15 certain companies with specific asks. So I think there are things we can do, but I think waiting on the
0:19:19 better angels of CEOs, don’t hold your breath. It never fucking happens. We’re always hoping that
0:19:24 Sheryl Sandberg is different because she cares about gender balance. She wrote a book about it,
0:19:27 despite the fact she came up with a business model to encourage teenage girls to start cutting
0:19:33 themselves. She cares. She cares. And then there was Sam Altman with his hushed tones, his hushed tones.
0:19:39 These are fears we worry about. Thank you, Senator, for the question. Fuck you with your synthetic
0:19:45 relationships and deciding that porn’s okay. By the way, the collision of porn and synthetic
0:19:51 relationships for young men is a disaster waiting to happen. What happens when a 15-year-old boy
0:19:56 approaches a girl at the cool kid’s table and gets rebuffed? And there’s a word for that. It’s called
0:20:01 being a 15-year-old boy and decides, you know what? I have this incredible synthetic AI brought to be my
0:20:08 Musk or Sam Altman that will perform erotic acts for me and tell me I’m great and it’s funny and knows
0:20:12 exactly how to keep me glued to my computer. And before I know it, I lose all mojo to talk to
0:20:16 strange women or spend money trying to take a woman to a movies. I don’t talk to my dad. I don’t talk to
0:20:21 my sister. And I wake up fucking 30 years old in a basement playing video game, obese and anxious.
0:20:27 That is literally where we’re headed. Too much? Too much? So I think it’s more vocal pushback. But boss,
0:20:33 if we’re waiting on corporations, the army isn’t showing up. Thanks for the question.
0:20:38 That’s all for this episode. If you’d like to submit a question, please email a voice recording
0:20:44 to officehours at propgmedia.com. Again, that’s officehours at propgmedia.com. Or if you prefer
0:20:48 to ask on Reddit, just post your question on the Scott Galloway subreddit and we just might feature
0:20:57 it in an upcoming episode. This episode was produced by Jennifer Sanchez. Our assistant producer is Laura
0:21:01 Janair. Drew Burrows is our technical director. Thank you for listening to the PropG Pod from PropG Media.