Stanford Tops U.S. B-Schools Ranking

on iTunes, SoundCloud, or Bloomberg dot Com. You can also listen to our radio show weekdays at two pm Eastern only on Bloomberg Radio. We're here at the number one business school we are, indeed, we're at the stand Stanford Graduate School of Business, and we kicked off our reveal of the top graduate school of business this morning catching up with the perfect person we're talking about, the Dean of the school, John Levin, who talked with us about being name number one and really on how the NBA

program continues to evolve. It's really just a testament of the fantastic students and faculty and staff and alumni we have at the school. And I couldn't be happier to be Bloomberg's top business school this year. All right, So it's pretty quiet here. It's a beautiful day. The students will be milling around very shortly. What's on their minds right now? It is a topsy turvy corporate world. And as they prepare to get into the next phase of

their career, what are they most worried about? Well, the students, you know, they're arriving these days at a time of great change in business and technology and society, globalization, and those things are all in their mind. They're thinking about right now, they're thinking about what am I going to do? My A A M class, right, But then they're going to be thinking about what jobs am I going to get? Has my career going to evolve? Am I prepared for

a changing world? And that's what That's what they're here for. They're here to get exposed to all kinds of different opportunities and ideas and people and develop the skills that are going to carry them forward for their careers. John, you know what's interesting too, And I think about on a day where we had the McDonald's CEO being forced to resign because of a relationship with someone who worked for him under armour, there's financial you know, looking into

kind of the financials at that company. I do feel like corporate responsibility and governance is really front and center. How do you work all of that in to what you do at Stanford? Yeah, we start with that on day one. We asked the students what kind of leader do you want to be? What kind of organizations do

you want to help build? And that's just carries through the curriculum and the experience here, and it's never been more important to be, you know, become leaders grounded in ethics and in thinking about purpose and what your source of real responsibility is. And that's a big part of the discussion throughout the time that students spent here at Stanford.

I have to think to given where we are in Silicon Valley this time, where there's a lot of talk in Washington about Silicon Valley its role in society, how do you square all of that being really the face of Silicon valleum. Anyways, it's a great question. When I came to Stanford as twenty years ago and Washington just steamed could not have been farther away from Silicon Valley,

it was irrelevant. People were that here building things, making companies, trying to make the world a better place, and it doesn't feel that way right now. It feels like Washington and Silicon Valley have come much closer together. There's more you talk about regulation, there's going to be more regulation. The impact of Silicon Valley on government and on democracy has is enormous and we're right in the middle of that.

And I think that's a really important responsibility for Stamford to to be in the middle of that discussion, to try to facilitate connections between Washington and tech firms. And we're trying to do that. It's rapidly moving now, and I do think about you know, we've heard from various Stanford grads or alums. You know what happens is it's not uncommon for a lot of executives to just kind of drop in and have conversations with students here tell us about how important that is as part of kind

of what they learned the experience. I think it's a huge part of what students experience here. It's part of what just opens their aperture to what are the opportunities

for them in the world. Is getting exposure first of all, to having a really world class faculty that they can learn from, but then to have a mix of people just coming in through campus, talking in classes, talking to the students, meeting with them, and that's that that's really what opens their eyes to the things that they might go on to do in their lives. One of the interesting things about a business education is, for a long time,

it was a fairly straightforward proposition. It was an investment. You paid X tens of thousands of dollars, You came out on the other end, you got paid very well, uh paid better than maybe you were going in. It seems more complicated now and and maybe even some existential questions around why am I getting them an m b A. How do you make the case for Stanford to students. Yes, you're number one, but still you've got to make a case that you're better than the Harvard's, the Wharton's, and

the Sloans of the world. Well, all of what you said is still true. There's still great economic r o I on an NBA here and other schools. What's I think what has changed is the students have evolved. It's a much broader set of students. We have students from consulting in technology and finance, just like we always did, but now We'll have students who come in from from government,

from health care, from education. We have a student in the first year class who was a central banker in Yemen, another one who was a dentist in Nigeria, a woman who was an Olympic medalist on the U S swimming team, And you put all those people in the mix together and that's part of the magic of the place. And then they go on to approximately the same richness of careers and that's changed that that sense that the NBA can prepare you for anything, for all different walks of lives,

all different careers. I think that's really fundamental to to what we're trying to do. To tell. One of the things we talked about when we were here just one year ago celebrating you guys as the number one top ranked NBA program was immigration issues and how that was impacting foreign students being able to study here in the

United States. What's changed in the year, if anything, that's really front and center for us more than our class is international here and that's part of what makes the programs as special as your people from sixty countries and they speak seventy languages, even though it's a very small program here and mentionally small, and I think I think one thing that I hope people appreciate it will come to appreciate, is just what an incredible asset that is

for our country to bring people in from all around the world and have them study here, and many of them will stay in the United States and contribute enormously to the great companies, great great companies, going to be great leaders, and some of them will go back and that's great for us too, because they'll bring American values and understanding and thinking back to their countries around the world. So before we let you go, it's going to be

a busy day here for us and for you. What's your single biggest challenge in your job as you look across the next year. I think it's actually similar to one of the big challenges faced by any organizational leader right now, which is just trying to interact with all

types of different people and different constituencies. And at the Business School, we have our students, we have our faculty, we have our alumni, we have Silicon Valley, we have Washington, we have the university, we have the whole business community, and that's both can be some one of the biggest challenges, but it's also one of the things that makes my job so fun. And that was Stanford Graduate School of

Business Dean John Levin. So interesting to talk to him and just reminding us to about the amount of you know, students that come from outside the United States. That's still a big deal for them, so immigration, as he said front End Center, it's a big day. Stanford number one again defending its title. And someone who knows about defending titles, Joe Lacob. He wears many hats. He's here with us, a proud a Stanford alum under the Golden State words

venture Capitalists Welcome, Thank you for having us here on campus. Well, thank you. We have a nice day sitting outside here. It's beautiful. So let's talk about your time at Stanford. You are a class of eighty three. You have to remind me. We'll take us back there. What was it like on campus and your experience here. You know, it's very very different. Uh. I was a guy that came out of a very different background. I was a science

biology major. I didn't really know anything about business, and I worked for a few years and I decided I need I liked it, and I needed to get some business rains, so unlike a lot of people came from maybe Wall Street jobs, I didn't. I didn't know anything, but I got in, I came here. It was one

of the best schools then too. And uh it was a great, great experience and for me, perhaps better than even some other people, because I learned so much well, and you learned a lot about Silicon Valley in a lot of ways, which is where you really made your career. What is it about that connection? I mean, obviously geography helps, but there's something deeper going on between this school broadly the university, but also the business school and what's happening

around us. What is it? Well, I think geography does play a big role. I mean for forty years, fifty years, I mean now we've been in what arguably is Silicon Valley. No one knows where Silicon Valley really is, but this is in the middle of it somewhere. And the truth is, the classes are great. When you come to the STAN for business school, you you're with great students, you know all these other people that are in your class, but you're in this environment that is kind of hard to replicate.

I told my kids, and I tell others you can't really beat it because you're in the middle of something that is hard to explain. It's a culture, and I think that culture pervades the business school and the entire area. What do you think about we got we caught up with the deaned John Levin earlier about what's going on here UM at the school. But it's interesting I'm curious about you know, I feel like companies are dealing with a lot more in terms of E S g UM

leadership concerns. I think that's it's very much fun and center accountability. Like, what do you think has to be a part of getting an MBA today? As someone who has been involved with many startups in the VC world, and we'll get into basketball at a moment, what do you think has to be part of getting an MBA today? I mean, it's just not about what's in the books, right, It's about a lot of other things, and there's so

many issues that one has to be aware of. UM to be a CEO if that's your goal, or to be in business and the world it's a very international world now. You can't just think domestically as we all know, and affects the business I'm in even right now as we all know recently. So I think it's you really have to have an experience where you get exposure to all of those issues. And I think that's what Stanford in this place does it. It's very very good at doing that. Well. The Dean talked to us about I

think of their students. I thought it was the United States. Pretty impressive. So when you think about this place, Silicon Valley and Stanford, so many companies have been born of this, private companies. We seem to also be at a moment where private valuations public valuations. You've been in the business venture capital for a long time. What do you make of this moment where people are trying to decide what something is worth and there's candidly some disagreement out there.

How does this end? Well, I'm not really investing as a venture capitalist here so much maybe privately as an individual to some extent, But you watch the market. I do. I do. I'm very aware of it all, and I

would super aware. I'm aware you can't help, but I would say that you know, they're clearly private valuations are very very high, and there's some structural issues going on here with respect to the giant funds that have been raised and the prices they've been willing to pay for some of these startups or a little bit later stage in startups. And so I think that the public markets private markets have to sort of figure all this out. This is no different though that's gone on in the past.

To some extent, We've had these periods where private company valuations perhaps have gotten what some people believe to be too high. Public companies valuations have to sort of make do with all that. I think it'll all work itself out, so jo the idea of like I p O ing is it's still going to make sense in the future. I hope so. And I think so because you know, that's something called liquidity. When you're in a private company, you don't really have that liquidity, and that's the big difference.

And I think liquidity is a very important thing in investing. It's not just about return. But even with all that money that's whether it's in private equity or family wealth offices, there's so much money in the private markets right now, you don't think that that's gonna kind of put a damper increasingly on on the I P O market. I mean,

it has to some extent. You could argue in the years leading up to this period where you've got all these companies now that are considered the select group that are trying to go public or have gone public recently, and uh, they you stay private for a lot longer than they would have because they had access to capital. But at some point, not all of them, but many of them really want to have the liquidity or they just need to be public companies for the exposure. All Right,

I've resisted for as long as I possibly can. We got to talk about basketball, but I'd rather talk about that because I have to think. You walk through this campus and there are people who look at you and see, well, that's what I want to be when I grow up, is I want to own a basketball team. It's not easy right now, What do you make of this season so far? Because there have been some twists and turns.

Every year is the same way in the NBA. It's unbelievable how you start the year and everyone has a certain mindset or expectations and they change because the fact is that players get better, some get worse, some get older. You know, the younger ones are emerging, and injuries happen, and so The truth is that every year is the same thing. You don't really know, and that's what makes

it great. And this year in the NBA anyway, unfortunately for us to let me say, we have a lot of injuries, but it's really exciting, I think for the fans. But to know that, you know, truthfully there's nine or ten teams that any one of them might win the title, that's exciting. Now. I'd rather be the prohibitive favorite like we've been in notes. Of course, I'd rather, but it's sports, and things happen and you have to adjust. Well, how does it infect the season? Though? Steph Carry is out

what for three months? Right now? You're up here on your basketball I see he is. He's gonna be out for three months. Clay Thompson's out for at least that, recovering from his A c L. But more than that, every single player that was on our roster last year is either gone or injured right at this particular moment. Now we will improve. We're playing a lot of young guys, and I like to tell my guys it's a you know, I'm always positive. Everything's about you've got to be positive.

And I do believe the silver linings and everything, and this in particular will allow us to develop our younger players. They're gonna get a lot of time, they're gonna get better, and we've got some really good ones. So from a standpoint of basketball, I think our fans understand it. They're going to be with us, and we're gonna wind up being better. Uh sorry, NBA, We're gonna be better. We're actually gonna better when this is all over. I have

to ask you about China. Everything that happened with the NBA over there, the commissioner, Lebron, everything that happened, What happens next with the NBA in China. You know, I could comment on that more, but I'm not is the truth, because I think we have a commissioner that is really a great commissioner, maybe the best in all of sports. And he's on top of this, and he's concerned about it too, obviously, and he's the one who's on the front lines dealing with these issues. And it's a very

sensitive subject. It's something that I don't think all of us really here and the players and even myself can fully explain or understand. So I think it's gonna work its way out it's like everything else, and I think we'll get back to the place where we were before. That's that's my again, the optimist point of view. We're talking with Joe Lake up. We're going to continue our conversation on Bloomberg Radio. We're going to toss it back

though to our folks on the TV side. Having said that, Joe, I just want to kind of push a little bit, like I do wonder what's the responsibility of like corporate leaders like yourself in terms of situations like what's going

on in Hong Kong. It's complicated. Um, I think people, corporate leaders have responsibility certainly, but you know, the truth is, we have a business to run, too, and our job is not really at its most primary to uh, to look at what's going on there from a political standpoint or to make decisions about that. Our job is to run our business. Now. We have to obviously take into account all of these kinds of social issues. They are important issues, but I don't think it's something that you know,

I can change personally. I can only do the right things. And um, I think Adam and our league and everyone will figure this out. And so when you think about the Abbey you talked about Adam Silver, and you talk about the NBA being a very successful league. There was a huge sort of player realignment in a lot of ways, something we haven't seen in many seasons. Why is it

happening in basketball? Why is basketball having the moment that it's having, maybe versus some other professional leagues who are who are actually declining in popularity. What you're talking about? You said player realignment, the movement, the free agency, free agency like we've never seen. That's what I thought you're asking. Well, we have short term contracts. We have basically four year limits on the contracts. Baseball you can sign a contract for ten years. So I think that plays a role

in all this. And so you we expected to have more movement, not as much as we expected or as we had last year. We did have a lot. In fact, the average NBA roster has I think of its players from last year on its team this year. Think about that under half. So a lot of change. But look, that's the system we are in, and I think it can be a good thing. And you go through cycles

in these teams and you have to plan forward. You're gonna have a team maybe that you keep all your players and you build, and then you're going through cycles sometimes where you can't do that. Speaking of building, got a new UH stadium arena good, I know, sorry about that, but it's pretty amazing. Opened in September. And I'm just curious about the revenue streams that you anticipate getting out of that, because you, from what I understand, you've signed

up a lot of already multi year deals for the building. Yeah, we have, and uh, look we built it for a reason. We had the oldest arena in the NBA, the oldest fifty years and it had been remodeled once. But the truth is we had one kitchen. I mean, you can't serve your customers with one kitchen and expected quality food. So we have many, many more kitchens. Now we have great food choices we've gotten. I think the most important

thing is to give our customers a great experience. I wish we were winning a little bit more so far this year, but that will come. The truth is they're getting a great experience and they're in the great place there in San Francisco on the waterfront, and it's frankly the most expensive arena, not by choice, most expensive arena ever built, all with private funding. We're excited as hell to be able to open this this year, and you should come and see it because it's it's pretty specta.

Expectations out of it hi high relatively, and we wouldn't have done it obviously if we had had not expected that. Even if you don't have a great sea then you think it'll be okay. Well we're locked in. We have. We're fortunate that we were when I say, hi, we're we brought in a lot of revenue streams this year, locked them in over ten fifteen years. Most of our contracts for suites and for sponsorships are eight to fifteen

or even twenty years in pretty nice visibility. So we have a visibility on our revenues that is probably unlike most teams in all of sports. And uh, I think that's a good thing because allows us to make sure we have a competitive team because at the end of the day, it's all about winning and making sure that our fans are treated well and that that we win and we keep our players. And I knew it's early in the season, so sorry, valuations still going up, you

think across the NBA. I mean, it's been unbelievable to see you know, kididly professional investors, owners, operators come in. Is that just going to continue to bring them higher. The higher valuations go, the more professional the managers and investors must be because you're now shepherding a very expensive asset. And so I think that's a natural trend that's happened.

When I was involved in buying the team in two thousand ten, you know, I went to some investors for limited partners and some of them frankly turned me down. They said, oh, well, you know this is a vanity investment. Well I think you're overpaying. Well they did, and it was the highest price ever pay at the time for an NBA team. But the truth is I had looked at the prior to thirty years and seeing an average rate of return that was compounded annually. That's not bad, right,

that's pretty good. And because you have a limited asset, you have something that is unusual and it's live content, those things are more they're more true today than they were then. Well, that team you paid what half a billion is now worth about three point five according to Forbes. I think one of the estimates, so not a bad return. I'll let others judge what it's worth. I think it's

worth more than that. What a treat graduate of dis fine institution in nine three under the Golden State Warriors, among many things. Thank you. So. Catherine august Builda is Stanford Graduate School of Business, class of nineteen seventy five. She's Vice cheer at the San Francisco based First Republic Bank, the publicly held regional bank serving coastal, urban and affluent markets. She's been at the bank for a long time, really

got it to where it is today. And she joins us here at the Stanford Graduate School of Business in Palo Altars. So nice to have you with us. Delighted to be here. Tell us about your time at Stanford, And I'm curious about you know, how easily you felt accepted as a woman. I think you know pursuing an MBA. What the environment was like. Take us back there if you would. Well, it was nine I was a class of We were a class of sixty women out of students.

Prior years had been four thirty and then sixties, so we were a big class of women and state at that level for a very long time. So women were for the first time a presence here. But it was a very beginning of it, and I it was before women knew they could do whatever they wanted, so it was we were certainly accepted. But I will did you feel like an equal as a student here? Absolutely? Yeah, absolutely. There were However, very few women guest speakers and classes.

There were. I only think I had one female professor, one woman ever was a guest speaker in the class. But there were there wasn't the bench to choose from. So fast forward to today. You're obviously incredibly involved, I should say, obviously you are very involved in the school. What have you done and how have you sought to sort of change that? Because nineteen very different world, and and Stanford is is known for having a more diverse

student body at this point in terms of women. This is now we have enough forty seven percent in the class. A group of us began about fifteen years ago working with the admissions office to interview women and to help recruit those women who would have long careers and who would be the future leaders of America in the world. And I think some of that was helpful. I think when we started that we were pent. We're now forty

seven percent. So we've worked very hard to both interview recruit talk to women who are considering coming to Stanford or other places and telling them why this is such a great place to be In terms of other diversity. About ten years ago I taught I was a guest speaker in a class. I've done it for about ten years for a professor, and I was stunned to see the diversity in the class. The number of international students, the ethnicities, the gender mix was totally different than when

I was here. So this is a class of mixed from all over the world, from all genders, from all all ethnicities. And I think it's great because these different people are learning together and showing each other different experiences that they will go and take back to whatever they do next. Agreed. And we know all the studies about having diversity, whether it's you know throughout your employee base, your senior executive levels as well as your boards and

your C suite. One thing I want to ask you, and I was doing some research um in terms of women MBA's women with NBAS are in six or more with an m b A, but still not as much as men. Why is that still around? Why is that we're improving the pipeline. There's almost parody in terms of

the number of students here. Why doesn't it carry over at all levels when we get into like kind of the corporate Well, there's been a lot of studies on this, and I'm not the expert on it, but I think, uh, in some cases, women may not have as many opportunities because people tend to promote people who are more like them, and so until people are running those corporations, they may

not be as obvious. When women wind up on corporate governance committees, there generally winds up being more women on boards. So it's a matter of looking around and saying, am I comfortable with this person? And some of us look different. And so I think the more women get to the top, the more women will be throughout the pipeline, and the less they will be paid unequally uh and have unequal amounts of positions. But it's going to still take time. The thing is, uh, some women, for one reason or

other may not decide to go for it. And you have to be pretty committed whoever you are, if you want to get to the top. It has to be a very core goal. One of the things I did when I was here, I felt so lucky to be here. I felt like I had wound up in a place that was going to change my life, and I wanted to be a beacon an example for other women. I think many of us felt that way, and so I always had in my mind that that was one of my objectives. Uh some women saw that and copied us,

some didn't. I think it will still take more time. I think Dean Levin's focus on this is probably going to help a lot um but we have to help women understand that they can do it. They have to ask for what they want, they have to speak up, and they have to move on if they're not going to get it in their existing company. So let's talk a little bit about the world at large, because at First Republic you have the privilege and the opportunity to

speak to CEOs around the world. Your customers are well healed, and many cases, how are they feeling about the economy right now? Because honestly, I feel like we get a lot of mixed signals from the data and from various folks that we hear, whether it's on earnings calls or just anecdotally, what are you hearing? Well? Here, we sit on a day when the indexes, indicries are reaching market highs, and everybody is nervous. Our clients are nervous, the press

is nervous. Everyone is nervous because of some things that are real, some that are not. They're nervous because it's a ten year bowl market and we think there are cycles and don't think it can go on. But they're also nervous because they're concerned about the China trade problems. They're concerned about Brexit, they're concerned about America's relationships with

its traditional allies. They're concerned about climate change. They're concerned about issues of inequality and housing shortages, and those things all told create problems for people. And technically, whenever you have an inverted Yeel curve, it usually says a recession is coming, right, So that's always been a signal. We have that some days recently, and so that's making people more nervous or technical point of view, Yeah, here we go, sit here and the market is again in an all

time high. So I think our clients are at best cautiously optimistic. All right, well, we really appreciate you spending some time with this. Catherine august T Willda NBA seventy five. Trailblazer in many ways and a great window into not just this place, but the world at large. Talk about a local boy or an alument made good. John Donahoe, he's the CEO of Service. Now he ran eBay, he's on the board of PayPal, and now he's got a new job. He's going to be the CEO of Nike.

We were able to catch up with him ahead of our trip out here. Here's what he had to say. It was really, I think probably the most formative experience I had that has set me up for not just my career, but to be honest, my my overall life over the last thirty years. UM. I distinctly remember many of my professors as well as my classmates, and what Stanford really really grounded me in was this notion of servant leadership. Um. It was a phrase I first heard

at Stanford. It resonated with me. Ernie Arbuckle, it had been a former dean of Stanford, and that's where the phrase came from. And if I were to say, there's been one foundational, foundational, almost guiding principle for the last you know, thirty five years. Since then, it's been a real inspiration and attraction towards this notion of servant leadership. Well, and there's so many full circle elements to this, and we're going to get to them throughout the conversation, one

of them being the Phil Knight. This is school. But you were the winner, I believe, of the R. Buckle Awards, So clearly whatever you learned there really took root. I mean, when you go there in the eighties, Silicon Valley is certainly developed and developing, a far cry from from where it is now. Why did you go west in the first place? You know? I I went to Dartmouth College undergrad. I was fortunate enough as a senior in college to

apply to a few different business schools. I was fortunate enough to get in, but I knew I wanted to go to Stanford because Stanford, as a as a senior and a senior in college rather in two, it was known for teamwork. Um. It was known for working with and through others, and that was really attractive to me. I'd played sports my whole life. I loved team sports. I had not yet been in business, but I knew that a team approach was what I wanted to do,

and that was a reputation Stanford had. I had never lived in California. So I joined Bain for two years UH with the agreement that I was going to going to Stanford in four and when I came out, I

certainly wasn't disappointed. I took a lot of classes at Stanford that were about the human side of management, about the inner journey of leadership, not just accounting and marketing and finance, and so in at Stanford it was very legitimate to talk about things like the inner journey of leadership, talk about your personal and professional life, and how to

build an integrative life. And so at a very young age and a very impressionable stage of my life, I feel like what I got from Stanford is those things were not only were they I legitimate, they were the best way to lead of fulfilling and hopefully impactful life. So let's go back to the mid eighties. When you come out, how does all of that inform the choices you make about the career you want to have and

where you want to have it. During my first year at Stanford Business School, my wife applied to law school and she got in, and so during the beginning of my second year, which was going to be her first year Stanford Law School. We had a one year old child. I went to the dean of the Dean of Students UM Student Affairs at Stanford Business School, Jerry Gold, and I said, Dean Gold, I have to take next year off or I have to work part time because we have a one year old. We can't both be in

graduate school at the same time. And this is classic Stanford, she says. Dean Gold says, oh, John, note just to this. Go ahead and start. And you know, if you want to take three classes instead of four, that's fine. Maybe start with four. If you want to drop one, that's fine, and we'll be flexible. You don't have you don't have

to come in with some preordained plan. Well, what she did is she gave me permission to have an open mind and a mind that said, hey, it was legitimate what my wife was doing and the fact we had a kid as well as going to business school. As it worked out, I started that second year UM started with four classes. I thought I was going to drop one, never ended up dropping one and ended up graduating on time.

But Stanford, both institutionally for the dean and just the culture, gave me permission to have the fact that it was a father, the fact that I was married to someone who was a peer and had a dual career that was legitimate, and so ironically I ended up following my wife when I went to bain Um thereafter, and you know that ended up working, Okay, end up staying seventeen years of Baine. Who would have figured at that time we got to talk about your new job. You're moving

to Portland to become the CEO of Nike. You've served on the board there. Why take this job now? Why bring it full circle, as you say, with your esteemed history at the Phil Knight Business School and now working for the company that Phil Night created. I was lucky enough, unfortunate enough to meet Phil twenty years ago and Mark Parker, Nike's CEO, and I've always deeply resonated with Nike's purpose um, which is, you know, bring inspiration and innovation to every

athlete in the world. Asterisk around athlete. If you have a body, you are an athlete, And to me, that's around human potential. It speaks to each person on this planet around the potential they have within them. And sport is sport is a very powerful and tuition in a world right now, a lot of our other institutions are falling down. They're polarizing, whether it's you know, government or politics.

Sport is something that brings people together. It brings people together on a level playing field within countries and across countries. And so the the purpose of Nike and the role in impact it does and can have in the world is just something that has I've always admired deeply. It's

always spoken to me. I was privileged enough to be served on the board the last five years, and when Mark and fail in the board UH invited me to have this opportunity to become CEO, it almost felt like um a calling and and a cause that I had

to pursue. And very much along the lines of what we've been talking about in this conversation, Nike is at the epicenter of many things, and I think has had a track record of playing a very positive role not just with its athletes and customers and consumers, but also in the broader society. And and so I'm feel very privilege and honored to to have the opportunity to serve continue my my my quest of servant leadership by serving the employees and customers and athletes and society around Nike,

and I'm looking forward to it. And that is John Donahoe, currently the CEO of Service now a graduate of the Stanford Graduate School of Business, headed to a new job a little bit north of here, up in Portland, Oregon, a dream job, I would imagine for him and for many people, and taking over at Nike at a really important time, to say the least, so steeped in areas of diversity, organizational behavior and more. Sarah soul is the more more Gridge, let me get it right, professor of

organizational behavior. She's a senior Associate dean for academic Affairs at the Stanford Graduate School of Business. So nice to have you here with Jason and me. Thank you for opening us up to your home. Thank you, Thank you, Jason,

it's great to have you here. We were thinking about all of the headlines today, um and in terms of what's going on at companies, how do you pull in the headlines like we have the McDonald's CEO being fired today, we have under arm or being looked at too into the last couple of years in terms of accounting concerns. But how do you pull in what's of the headlines

into your teachings. That's a great question. And one of the things that is sort of distressing, of course about many of these headlines is that it actually allows us we hear about them, but it allows us wonderful learning opportunities in the classroom, particularly these days when we're bringing more and more about diversity, equity, and inclusion into all

of our classes. Having these examples, these real life examples that our students have read about and are experiencing, allows us to think and work with them, to think about ways that they would better handle such situations, and allows us to really train them to be better principles and purposeful leaders. So while they're distressing to hear about, it allows us a lot of wonderful learning opportunities to learn

from learn from failure. Right, And so, what are students expecting in this regard that maybe they didn't expect five, ten, twenty years ago. What are they expecting to learn? Where are they pushing you? This is another great question, Jason. Our students have changed a lot over the last ten

or fifteen years. As you've probably heard about, our students have come of age in a very different era than certainly I did, and certainly many of our past students did, and they've come of age on college campuses where they're undergraduate professors, their undergraduate peers are talking about issues of diversity, about equity, inclusion, corporate social responsibility, and so they come to us as learners who have already already been exposed

to some of these pressing issues, and they come to us hoping that we will give them answers and that we will be able to train them to become better leaders. Well, I gotta say, I do wonder about what the student body thinks, because right all of of like global corporations are talking about the importance of diversity, and you know

how it's just better for so many different reasons. So I'm just curious, does the student body think that the corporate world is doing enough because there's so much conversation, but you know, some of the numbers are getting better, but I still think people think that there could be much more significant improvements. And I think that I think that's kind of mixed. I mean I think that there's you know, I tend to be an optimist and I sort of tend to point to the real winds that

we see in many companies. Uh, And but I also believe in transparency, and I believe in making sure that companies are able to to tell us what they're doing so that we can do better. And I think our students really come to us believing that they can make positive change in the world, and that they want to make positive change in the world. So I already said I was an optimist, but but I really believe this now.

So it's wonderful to see our students asking us and pushing us as professors, pushing us as leaders of the g SB to teach them the skills, the competencies and the values that they need to lead better organizations lead

into the future. So talk to us about some of your work, especially around social movements, because I find that so fascinating, especially given where we're sitting right now in the heart of Silicon Valley, when there are big this is my favorite word, existential questions around technology, around humanity, around our responsibility to each other. How do you what or I guess I should say, what do you make

of the last couple of years of social movements? You know, whether it's around climate change, whether it's around me to like what described the moment where we are. From your perspective, I think we are in an incredible moment where there's

a lot of mobilization. I mean think not just here in Silicon Valley, but we've all been watching the news and various countries, Hong Kong, We've been watching Hong Kong, Lebanon, um, Chile, and and I think what we're seeing is what social movements parlance we call a wave of protest or a cycle of protest, and that is that people are coming together and learning from one another and are not content

to just let discontent be the norm. So we're but we're also I think at a point where many of our company leaders, many of our leaders of course of not just companies, but many government leaders, are are open to and willing to change. And so we're at a moment right now where I think there's openness to learning from what it is that people activists want at the same time a willingness to work with and collaborate with activists, both at companies, but I think also in some of

the some of the nations. Well, we've been having some of the conversations, certainly with some of the alum from the school, but it's interesting, and I do wonder whether the student body basically just looking at what's going on in Hong Kong and China right there's just so much tension right now, and you know, there's pressure on some of the corporations that they should be standing up, and then they're leaders are kind of backing down in the

corporate world because they want to be in those markets, and there's the belief if you're in the market, you can be a much better facilitator facilitator of changed. So I just curious what the students pushed back on and say, well,

wait a minute, that doesn't work so far. Yes, And I think that that's this is an age age old debate about whether we should be engaging in um in in countries that have, for example, very poor um UH poor records of human rights and should we be engaged, Can can our businesses can our presence actually make a

positive change? And you know, the truth is on that the research is quite mixed, and and the more that we learn about the presence of companies in some of these nations, the better equipped we are to advise our students, and the better equipped we are, I think as a university to take a stance on some of these issues. And so what we need to do, I think as academics, and this falls on us, is do a better job of assessing under what conditions will company presence or university

presence make improvements and when won't it right? What really makes a difference? Rightsolutely yes, And that's our role as academics. What a treat to catch up with you, and thank you for being such a gracious host for us here at the Graduate School of Business. Sarah soul She is the Senior Associate Dean for Academic Affairs, author of two recent books, and I'm so glad we got to talk about them a little bit, Contention and Corporate Social Responsibility,

and a second called a Primer on Social Movements. Very very timely came very very timely. Well, yes, indeed, Bloomberg Business Week naming Stanford the number one US business school in a NBA ranking, And that's exactly where Jason Kelly and I find myself on this lovely Monday. Let's get into it, though, because there's a lot of work that goes into it. Let's catch up with a couple of our editors are Bluemberg News Senior editor Caleb Solomon. He joins us from our Boston bureau, and also with us

is our Bloomberg business Week editor Joel Webber. He's back in our New York studio. So, UM, I gotta start with you, Joel. First of all, I know there's a lot of work goes into it, we know, and talking to the alumni that everybody looks for these rankings. Um, talk to us little bit about it. Yeah, and it's the thirty first year that Business Week has has done a business school ranking. But really we we uh we we started from scratch almost a year ago, uh to

basically reimagine what the business school ranking could be. And and Caleb gets big props for being one of the architects of that. And we really tried to lean into where we thought a ranking of this variety could go. And so much of that has been let's actually lean into the networks and the students and the alumni and actually start asking questions to them about their experiences. And

that's what really makes this ranking be so definitive. It's very interactive, so you can actually customize the ranking based on what you're what you're interested in, and that's um, you know, I just hats off to Caleb as being one of the architects for it. So, so, Caleb, when you look at this year versus last year or even years before, what what are some of the distinguishing things that jump out at you? Thanks Joe for all that

you know. So you you you nailed what we what we were, what we're all trying to do here, which is to really personalized ranking. So I mean, if you're looking at a school, you know, one of the top tier school, say in the on the West Coast, it doesn't matter to you. We're Harvard and m I t

in our on our list. So we gave you the ability to really personalize this based on your scores, the region that you're interested in, the industries that you want to work in, and really create your own customized ranking. And all of the tools that we built to do that, we made them so much better this year. The personalization, this ability to sort of create your short list along the way that provides all of the comparisons of the amazing data we have. It's all at your fingertips, it's

all share able. You can send it to friends, you can send it elsewhere. Those are some of the biggest changes we made and talk to us about how Stanford got the trophy. Stanford just came out number one in a couple of our big indexes and compensations. Stanford was number one, tied with Wharton interno. So that's that's one of the key measures for business school. You know, how much do you make when you get out of school? What what are alumni making five, six, seven years after

they're after they left school. And the other big index that mattered a lot to Stanford was entrepreneurship, where again they came out number one. So with number one place on those two indexes, that pushed them right to the top. Carol Jason, I'm like looking at you from here and I'm like, you guys are in in in Stanford, at Stanford right now, Like what what have you guys been hearing out there? What's what's been interesting? Well, everybody knows

they're the champs out here. I mean, listen, this is this school is believable in a lot of ways. When you know, we've got a chance to talk to a lot of the alum as well as the students. You know, the people who come here, it's a very diverse student body. Uh. They spent a lot of time thinking about that in terms of who they recruit, but also who's teaching and

what they teach. Caleb, I did want to ask you because it did come up in some of our conversations here number two with a bullet talk coming in making bake move talk to us about that? Yeah, that really that really jumped out to all of us. UM, so talk did pretty well. Ask you on compensations exactly Dartmouth and Hanover, New Hampshire, UM near near where I live and so um. But what they really came out they surged in the networking index and our networking indexes. You know,

how much do alumni interact with students? How much do alumni help other alums get jobs? What's kind of the halo the impact of like when you go looking for a job, how much does having you know, telling people that you came from talk or is they like to

call the Kentucky How much does that matter? And UM, I think we got a lot better response this year from both the alumni classes that we surveyed as well as the graduating students, where they must have had a much much much better experience with other with the lums than they did in the past year. What else stood out for you guys in this year's survey. What what what stood out is just the range of responses we get. So the way we broke it down is UM, you know,

so an entrepreneurship. While Stanford comes out number one, BABS in the school that overall is ranked lower than Stanford, came out number two in entrepreneurship. UH, the University of Maryland came out number five. The Salt Lake City School, Utah, the Utah School actually school in Utah, UM came out

number six. So it's it's finding these gems in specific areas that may interest you where you just you know, you don't think of these schools necessarily as bastions of entrepreneurship, but they're really teaching people had to do well in this field, and we're bringing that information out to people. And Carol, one of the things that I like about it is it's not just this copy and paste thing where you get the exact same ranking more or less

every year. Right. The way that it's been constructed is that different schools can actually really succeed. And like, that's what I love about this is like you have Stanford, which repeats starting to look like a powerhouse and yet out of notewhere comes Dartmouth surging up the ranking. It's like marsh Madness, you know, only in November. Yeah, yeah, no, it's really amazing. There was a lot of movement on

the list this week worth checking out for sure. Caleb Salmon, the architect is Joel Webber said of this ranking, Joel Webber, the editor of Business Week, thank you both so much so, Jason. The luxury space continues to get disrupted in so many different ways. Playing into that is send Reeve. It's a director consumer brand that sells luxury handbags. Curl Chung is the founder and CEO of the company. Graduated with an NBA from Stanford in even and she's back in our

Bloomberg in Director Broker Studio in New York. Coral, nice to have you here with us. We've been asking all of the Stanford alum tell us a little a little bit about your time here at the school and getting your NBA here. Thank you so much. I'm very glad to be here. I missed the sunshine from California though while I'm out in New York today, Although so I love beautiful, beautiful fall weather in New York. Um. Nothing

to complain about their UM. So I started Sunrev. Actually, the concept of Sunrov was really formed while I was still at Stanford UM and it's it's a it's a very exciting place because I found myself being able to explore things and really discover my true passions during my

two years there. And while I was there, I was part of a student group that led something called the lux Truk where we went to Milan and Florence and Paris and London and met with different TA luxury brands UH and it was incredibly inspiring experience for me, and through that I started to think about if I were to start a luxury brand someday, what would that look like,

how it how would it be disruptive and differentiated. And it was really during that time that directed consumer as a model started to emerge, as well as digitally native brands, and I felt like it was a perfect time in the marketplace to start a company like send Rev. And so three years ago, UH, send Rev was launched and now we've been growing very rapidly over the past three years.

UM and actually just closed our Series A, which was announced earlier today, Right, Yeah, so a big Series A sixteen point seven five million, I believe, So what does that allow you to do at this point with that money? Where does it go next? It's an incredible set up

for us to have resources to expand. Up until now, we've been run very much in a scrappy bootstrap way, and as with every great Silicon Valley startup, the company started actually in my garage and basement and it's hard to believe that only a year and a half ago we moved out into a real space and now we have a flagship store in San Francisco UM, as well

as a big fulfillment center in South San Francisco. But the capital really is to allow us to expand both our product assortment and expand into other categories beyond the handbag category, as well as grow geographically. We've shipped to over two hundred countries globally and we're doing a big expansion in Asia UM and that's a huge area of opportunity for us from a growth perspective. And we're also growing partnerships. We've launched partnerships with Neem and Marcus, with

North Trum as well as recently with Apple stores. Globally, we're in some of the top Apple stores around the world, including Hong Kong. I have see Singapore, Orchard wrote, Paris, London, et cetera. Uh So, we are starting to establish ourselves as a global brand, which is very, very exciting. So and just part of that expansion Coral ultimately, and one of the conversations we've been having about is, you know, do companies still want to go public at some point?

Like what's the long game for you folks as you grow the business developed partnerships. Just got about forty seconds left. Yeah, that's a great question, you know. I think at Stanford one of the things that I was very inspired by was this idea to really put away the fear, put away the caution, put caution to the wind, and just go for it. And I think when I made the decision to start this company, it was very much about going big and disrupting the luxury goods industry and establishing

a global iconic brand. And so that's what we're absolutely set out to do, which is a very exciting and we have an amazing institutional investor that backing us in all the right ingredients to take the company to the next level. Al Right, well, congratulations on the big round. We're excited to see what happens. X. Have you back to talk about more success? Coral Chung NBA eleven from here at the Sanford Graduate School of Business. All right, well that is the Stanford fight song. And we're here

at the number one business school in the country. Delighted to have with us. Brian Lowry, he is Senior Associate Dean for Academic Affairs at the Graduate School of Business. Great to see you, great to see through. All right, So you are right in the middle of what I think is one of the most fascinating topics right now for business people, certainly business students, and that is this intersection of society and business, the role that businesses play

in the world. What's your take at this moment? How do you approach your class different maybe in twenty nineteen, because it's on everyone's mind. Yeah, thinking the school, it's on the school's mind. The really the idea of business is shifting, right. It's not just about how do we perform well in existing paradigm, So what is the new paradigm gonna be? And so we really hear are about helping our students um become prepared for this new world to participate in it. And the shape the rules that

are gonna come into play. Right. So the things are changing and we really want our students to be prepared for that change. Yeah, I do wonder about what they see as their role because we feel like, you know, our policymakers have failed us in kind of you know, bringing about change, necessary change, whether it's inequalities in our society, whether it's climate change. What are the kind of conversations you're having with students about what they want to know

about because they're preparing for going out into the corporate world. Right. So our students recognize that the distinction between private industry and the public civil society world is that that distance is shrinking, and so they really care a lot about these big social issues and we're trying and prepare them to engage in an effective way. So what they really think a lot about is how as a business leader, would I interact productively with government? Right? How do I

think about civil society? How do I think about issues like privacy? Right? So our students really are bringing those concerns to the classroom. They're asking those kind of questions, and the faculty are more and more responding in ways that allow the students to go out there and become a different type of leader. I believe you know, for a long time, it feels like a business school curriculum would look at a lot of what we talk about

now is sort of soft skills. And there's a great, uh, sort of nickname for one of the classes that you guys teach here. It's called touchy feely. Uh. Interpersonal Dynamics is I believe the actual name of the course. This is something you've been doing for a long time. It feels like you were ahead of the curve, to say the least. But how do you teach it? Like, what what does that actually look like? When you're teaching people

to essentially be for lack of better humans? Huh. So what we do is we give people the opportunity to practice right. So it's not I mean, we all know how to be human beings at least I hope so, right, and so we anyway, but the head so we put them in groups, and this is the group is really where a lot of the work happens. We give them the opportunity to be open and honest with each other, like we often in life don't have many opportunities to get real feedback, Right, how am I showing up? How

is it affecting you? And our students have the chance to really open up and engage with each other, get hard feedback. Sometimes there's often tears, right, because there's this deep connection is vulnerability that allows people to make sense of themselves in a different way and for many people, um they'd say epiphany to see themselves and to see how they are being responded to about others. It really

can be quite transformative the class. I mean, I do wonder what Stanford thinks about is their responsibility in terms of, you know, creating the next group of corporate leaders, especially in an environment where I feel like many think that there isn't accountability to thinks, although I gotta say I feel like the headline some account there today. But I

do wonder, you know what you see as your role. Yeah, I think when we talk about leaders now and especially a town of leaders that we bring here these people, the students are incredible, right, They've done incredible things, and we bring them here to leverage what they've done and to improves they can go out and have an effect on the world. So I think it's really critical and we really impress upon them the importance of being concerned about how their actions not affect only their career, but

the other people. So when they make decisions and these from these positions of power, leaders affect many others lives, right, and so not losing side of the effect they have on others as a critical part of what we really try to push here for students. They're on the one side, you have humanity, but you also have technology, you know here in Silicon Valley. And it also feels like we're asking really big questions about the role of technology. Uh,

you know your deed. Your boss told us earlier that Washington seemed very far away when he got here twenty years ago. It's pretty close now at least Uh philosophically and uh and figuratively. How does technology help instead of hinder your goals? It's a good question. So I think of technology obviously, it's simply a tool right there in the end, it's a tool and service of humanity, and so I think it helps our goals When people understand it, is such when they say, like, what are we trying

to achieve? Like, so if we're trying to reduce, for example, loneliness, there's a sense that there's an increasing separation among people. Independent of all the technology that we have, there's still something going on that people aren't connecting. And the way we use technology has maybe increased that or um been a part of that. But we can also think about how we might use that tool to produce a different outcome.

Right when we think deeply about the role of the tool and not loose sight of it as a tool, then we can achieve all sorts of positive outcomes as well. What does your student base just quickly, just got about forty seconds think about technology, because I think of the privacy concerns, we see bias in a I I mean, there's a lot of problems out here. Do they think ultimately technology is good or it can be better just quickly,

very quickly? I think they're optimistic, but we also now see clearly the potential problems associated with technology and we need to solve for that. Yeah, we're gonna leave it there. Brian Lowry, great to catch up with you. Congratulations on being number one again and you really are at the core of I think what all of us are talking about as business people, as business leaders, and certainly politicians. It is on the minds of this next generation coming up.

The interesting to see what the product of this phenomenal campus teaches us as they go forward. As we said, we want to get right to some students. Stanford Graduate School of Business students. Uh, and we have two with us. They are both in their second year here at Stanford. Emily Nounez Cavanets and Polka Aggarwal are both as I mentioned in the program, So nice to have you here

with us. We love getting all of the different perspectives why Stanford and Emily, Emily, let me start with you, Well, thank you so much for having us. I for me, I knew Stanford really was the best business school in the world and is, and I know it's really so well positioned for leaders who want to become really strong leaders and fields like entrepreneurship, innovation and technology leadership wasn't

a really important thing. How about for you, Polke it? Well, so I'm an engineer by background, and so I remember this. We both have dads that super because I didn't invention competition in undergrad and they asked me what's your business plan? And I said word of mouth, And so I realized I think business would be actually pretty beneficial for me and in entrepreneurship as well. So that's that's sort of

what led the spark to do. My m B A and so Emily, tell us about your company, Sword and Plow, because it's such a cool concept that everybody can understand. It comes in part from what you did before you were in the army, and tell us about the inspiration and what it is. Former U. S. Army Captain among

other accolades, thank you. So eight years ago I started a social enterprise called Sword and Plow with my sister and we work with better known American manufacturers US across the country to make bags and accessories UM such as this necklace which is made out of a repurpose of a bag next year, so this is one. And then we also have leather goods and it's just military grade materials from what I understand, some of it, yes, some

of it. So we incorporate repurpose military surplus UM like this lining as well as the fifty caliber machine UM shells which are in all of our jewelry and they're all made by veteran known American manufacturers, and we donate ten percent of our profits to veteran nonprofit organizations. It's an amazing I mean, we've been looking at some of

the products. It's really incredible. So Polk, it give us a sense of what it's like to be a student here, especially at a time where there's a lot expected and a lot of big questions about businesses right now. I think we would all love to sort of be in your classroom in some ways because asking big questions. How

do you characterize it? Yeah, what's was actually really interesting about Stanford is that they really bring out the authenticity within you, and all the education that's given you is sort of surrounded around who you are and staying true to yourself, but then also being good at business. And the coolest thing is not only are you in the business school at Stanford, but you're also part of Stanford as a whole, and there's amazing classes and things outside

as well they can use to supplement your education. That's what's interesting. We heard that from some of the administration, from the dean of the school, that the importance of it's not just about the Graduate School of Business but integrating it among all of the other schools that are here and getting kind of a more holistic education to

some extent. Right, definitely, I feel the same way. The two most interesting classes that I'm taking or have taken the past are Making Social Ventures Happen, which is an amazing way to learn more about systems thinking and drawn my experiences as a social entrepreneur. But then right now I'm taking a class across the street at the law school about regulating AI and it has just been fascinating. And the access that we have to cutting edge thinkers

in the tech field is um is amazing. Until what do you think about the impact of the NBA on on the choices that you make going from here? Like, what do you do next? Not to put too much because you've got a company to right, Yes, yeah, exactly. I started a recruiting agency for the blockchain space before business school, and so I'm thinking of going to Singapore.

The biggest thing about Stanford is it opens so many more doors, and so the first thing that people think about is, oh my gosh, there's now so many options. Have to not think about which option to consider, and so that takes two years on its own, and so I think I'm closer towards the end of that process. But I think I want to go to Singapore and

start a company there. Well, and it's interesting too because I do think about some of the really important issues that we spend a lot of time talking about UM and how the graduate programs, including Stanford, are bringing them into, whether it's climate change, whether it's diversity. Tell me a little bit about, you know, some of the discussions that you want to be having because you think it's obviously going to be something that you're gonna be carrying with

you once you leave. Tell me a little bit about that pocket. Yeah. One of the biggest things for me is I think that culture within a company is going to become more and more important the more we go from data and information can all be done by computers. The aspect that people are going to bring that's gonna be different is who they are and what kind of

person they are. And we're seeing more of that, you know, coming from the manufacturing just people are machines to now big companies are focusing on their people culture and these new roles are coming up, and so I really want to be part of that, and I think I want to do a bit of that in the recruiting space or the people operations space in Singapore. And so Emily, do you plan to expand your company even further, another

company on the horizon. What do you have? Yes, well, I've definitely been busy and UM Sort and Plow has a lot of exciting things coming up, including a really large collaboration with a publicly traded accessors company coming out this Veterans Day and being here at Stanford has just been incredible to really dive deeper into social entrepreneurship and learn about other fields to like technology and increasingly some of the issues around UM, cultural and social issues that

these company. He's a wrestling I feel like such a low achievers. I don't know, I don't know. Anyway, We wish you both good luck and thank you so much for talking. Uh to ask, I have a quick question five seconds each. Do you think politicians and CEO should use social media to communicate? Well quickly, I think as a social entrepreneurs social media has been a great way to get our message and take a y people are looking on social media, so if you want to communicate,

social media is an option alright. Good Emily nunyez Kevanez and polkt Agarwall two second years here at the number one business school in the country. Thank you so much. Well, our next guest is a Stanford alum class of ninety nine, got his MBA. Then he gave the commencement speech last year. He's the head of the leading global brewer. It's a big name. A b in BEV. We're talking about Carlos Brito. Yeah, a great conversation with him and his story, his journey.

Here is where we started, and it's a good one. Take a listen. When I was applying to business school, I was in Brazil. Brazil was a very close country in those days. Everything was difficult. Nobody would travel abroad, didn't send the money abroad to pay for fees too. To apply to a college in the US was a big deal. We had to know somebody in the US and all that. So I started researching and back then Business Week had a ranking of business schools and Standford

number one. So I said, my looked at the magazine. Yeah, yeah, yeah, that that was our bible and all the ranking. So I looked at it and said, hey, yeah, I'm gonna apply to the schools, but Standford for sure, it's number one. And at the time, Stanford would take only one Brazilian per year, and he did it. Did that through the eighties through the nineties, and uh, I said, oh, we'll apply. Long story short, I was accepted and then I had to fight for scholarship because my my parents didn't have

that kind of money to send me to school. So and then I went to Standford Business School and uh, it changed my life. You gotta talk about the financing to get there. Well, it was interesting because I got a scholarship from the Rotary Association, but they didn't cover Stanford, so at the end Rotary Club. So at the end when I went, when I got accepted Stanford, in the last round of acceptances, I tried to change the scholarship. They said, no, we don't cover Stanford. So long story short.

There was a businessman in Brazil that had a boutique investment bank called Georgia. Paulo Lemon, one of the top guys today in the world of business. And I knew that he had a bank that would give loans to some of the bank employees that were pursuing an NBA abroad. I was not one of them. I worked for Shell Oil.

But because I was the Brazilian accepted Stanford that year, decided to make my case and he decided to pay for my first year, not out of the bank pockets, but out of his own pocket because I was not an employee of the bank. So I went to Stanford because of him. And uh, it was interesting because he asked three things of me when I went. It said, first, keep in touch. Second, before you accept any full time job offer when you're done with Stanford, talked to me. First,

no obligation to come for me. And third, helps somebody as I'm helping you in the future if you can't pay it for it. Yeah, So that was it. So I always say that his financial generosity got me to Stanford, right, But he was this time and commitment to me that got me through Stafford, because that's a different way to go to school in many ways. You know, some people have their parents, you know, sort of lording over them, but other people, you know, they're just sort of left

to their own devices. Sort of having him sitting on your shoulder must have given you a different perspective exactly because he was my sponsor for the first year. Then I had to figure out how to pay for the second year, which was also part of his education in terms of me not getting evenything for free. So you asked, you got the scholarship for the first year, but guess what second year? You have to figure it out. So

I had a good summer job. I also had got a scholarship from the Brazilian government and I was able to conclude the second year. So that was part of the education. Now, talking about the education at Stanford, what that experience it was like? You know, for me, it transformed the way I view the world. It was a very international, a place in the Pacific room, so very open to the world, even in those days. It was also a place where I learned the veil of talent.

I was surrounded by the best people in the world pretty much at that age group, with that kind of orientation businesses, and I had to op my game. I used to be the top students, that always top of my class in Brazil, and I went to Stanford, I was not top my class. I had to work harder elevate my bar And what I got from Stanford was that in life it's about first who Then what I learned that talented people want talented, very talented guy or a person is worth ten very good people, but it's

hard to find. All right, So let's talk about your consumer a little bit. It's an interesting time to say the least in the world. You have a global view. Uh, let's go straight to China, you know where business it's a huge business. And yet there are concerns about the Chinese consumer right now, what do you see? And that played out in your latest earnings and and investors were well spooked by it. No, no, no, But the China

for us has been an amazing story. And the thing is that many years ago we decided to focus on the premium and super premium side of the market in China. And if you look at China, you cannot talk averages. You have to go by segment. Interesting because such a huge market, right It's the biggest market in the world for beer, for most consumer goods. And when you go segment by segment, what you see is that this year

there is industry declining China, but that's on average. But if you go to premium superpremum, they're growing and that's where the growth is in the margins are in China. For example, Budweis is the number one premium beer in China by far. In Corona Story Garden lead the super premium segment by far. Again so we lead both segments

where the margins are and where the growth is. So that for us, that's why our business in China, our profitsibility is way higher than any of our competitors in China, even if you add them together. This bite us being number three invited, but we're number one and profitability even

if you had the next four. So that's because of the brands we have, the premium, dague command, the consuming sides we've always had, and the things we offer given the consuming sides were to help me out here because I thought in terms of your latest earnings report, you did talk about consumer demand below in the United States and in China, and from some other makers, some beverage makers, we've seen that they've talked about increased demand in China.

So I guess we're trying to reconcile what's going on in China right now. Well in China right now, for sure, there was some deceleration but still growing. You know, at six the whole economy and in our business, nightlife is a very important channel where Budweiser dominates as the most of the share in that nightlife got the beat a bit um the emphasize given some of the celebrations in China, So that happens from time to time, so it's not kind to time that the nightlife goes down a little

bit comes back up. So this quarter was a quarter in which nightlife cames back, came came down a little bit, and that's that impacts botherwise, which is a main Brandon chime. So investors, this is something temporary. So investors overreacted that in your view, because they saved something like twenty billion dollars off your market cap. So is that an overreaction? You know, like, how do you how do you read that?

As somebody who runs this massive company, you see the global trends, you look longer term, how do you read something like that? Our company is very different than respect in that we have a control group. We're a public company, but we'll have a control group, and because of that, we have the luxury of looking at the short term, but most of all looking at the long term. So we're not shy of investing the short term even when the cycle is negative for some sort, because we're investing

for next year's, next five years, next ten years. So we've always been that kind of company. We've been in business half for thirty years, and we've had situations in where there was a disconnect in which the short term sometimes there's some pressures, most of which we anticipated, by the way, at the beginning of the year that the third quarter would be on the pressure. But so what this is one quarter? And that was Carlos Brito's CEO

of A B n BEV. We caught up with him just before we left New York to head out to Stanford roc Journal. But you let me drive. Oh no, no, no, no, home, honey, please, I'll do the riding. Drivel ext me. I want to drive, Just drive, baby, the questions trying. This is the Drive to the Globe Community. Thanks, we'll drying us on Bloomberg Radio, and it is time for the Drive to the Clothes and we're joined by Nadine Term and she has found

her CEO and c i O of Sulstein Capital. She joins us on the phone from Francisco and very much of a piece with the theme of this show. She's a graduate of the Stanford Graduate School of Business, which, by the way, you might have heard, it's the number one business school in America. And Carol Math and I are here on campus. Nadine It's too bad that you know you're working so hard, because otherwise you could have class outside with us. It's great to have you with us.

Way they Unfortunately, I couldn't release the details of the announcement beforehand, so I drove into the city for work. But I'm glad that you're enjoying sunshine. We are, indeed, and check out this market environment right now. Tell us a little bit about um kind of how you see it, because here we are. You know, we hit some records again in terms of those major equity averages. What's the

investment environment look like to you? Sure? I think there's a few things to look at, first being earning, second being complacency or how investors are positioned, and the third would be um, why the market is up today? Right? So, I think the first one, if you look at earnings, what you have is about um. You know, you only have about hundred forty more companies in the SMP five

hundred report. And while top line growth is positive, earnings have been down, especially in energy materials, consumer discretionary financials, and infotex. So that's a lot of sectors. So it's really a story of haves and have not. So instead of looking at just top down how things are going, you really have to pull back the onion here all

the layers to see what's happening. And what you're seeing is margins being squeezed, So you know, we're staying long things like reads and utilities, which tend to do well when GDP growth is slowing. UM and inflation growth and up is up and margins are down. So that's one thing that we would tell folks to take a look at, is like who's winning and why, who might be losing and why, and making sure that your position correctly UM.

And the second is complacency. The if you look at the vixed positioning, I think I saw it on top Bloomberg News too, there's a kind of a dual story there. But you're at one in three years the scores of negative one point five. So just like April, just like July, investors are really betting on new all time highs in the market and lower volatility. So whenever we see a symmetry, we tend to look at that and say, Okay, if that doesn't come to pass, you probably make a lot

of money on the other side. Yeah, the whole volatility question, I am fascinated. But you know, we'd bring our investors the VIX and update on the VIX every day after the close of trading. And you know, a twelve handle, a thirteen handle, I mean that is unbelievable when you think about sort of where we would expect to be

at this point, how do you square that? You know, what what ends up happening is there's not just investors and passive investors, but you have machines that are trading momentum. And so when things to move up, the momentum is to go up. When things go down, momentum can be to go down. To be really careful, as an individual investor who's betting on found of monels or I'm looking to say, well we're is the puck going after today or tomorrow, would just say, well, do I really believe

in that positioning? Like on the flip side of what you said, you look at soybeans, the one year Z score in terms of CFTC nine commercial net long positioning is about two point five. And so what it's also saying is like everyone's already bet on the train deal. Who know, some beans are going to get bulked. So other than that, other than you know, the motility going

down reaching all new ties. UM. One else right, And one of the areas we love the most that's probably has been most non consensus till the past week was really inflation. So we came on Bloomberg TV and Radio talking a little bit about reflation and how to bet on that. So talk to us, we want to you know, glad to get your market perspective, but tells a little bit two about your time here at Stanford and getting

your m b a. And what that experience was like. Sure, I was one of the few female investors coming into school. I did take a few years I think six or seven working before I came in, so I was at a point in my life where I knew what I wanted to do. In fact, I had gotten into school before I even came UM, but then delayed it for three years. So going back was special for me. I

went there as an undergrad, but I really appreciated the environment. UM. Anyone who knows there goes there and really sees the love of innovative and entrepreneurial spirit from the faculty, the

students UM. And I was actually an example of someone who started my own firm in an industry where it's very rare for women to exist at all, if you want to say that, um and I think part of the appeal relates to not just all the resources inside the university and Stanford Business School, but it's surrounding it. A lot of people talk about it, is it luck because just because they were in Silion Valley? But did

they also help build it? So when you're there, it does give you a lot of optimism to think big, say, well, what can I build? What can I do? How do I make a difference? So it was a special time for me. Well, and I do wonder you know, given your background working in both private equity and you know, investing in private and public companies, Nadine, what you make of this moment where we are We've talked a lot

about we work. We're don here from Peloton Tomorrow, which is another example of a company where the private marks and the public markets maybe had a little bit of a disagreement about what a company was worth. What do

you make of that? As someone who has looked across the whole spectrum of investments, you know, it's interesting because there's still a lot of private equity folks who are doing a lot of roll up your sleeves, work to create value, increase EBITDA, increase cash flow, pay now and debt, do things like that. But then there was also just

a lot of money chasing private deals. I mean, if you look twenty five years ago, you didn't have public company investors going investing pre i p O and you saw that from hedge funds and pensions in the last decade, as well as a ton of capital from and allocators going to private equity because you don't have the mark

to market risk. So it's I believe that it's very understandable and probably expected that when we have a ton of money chasing deals, whether they're you know, be a market buyout or pre I p O, whether it's you know round for five six, you know, series apt of financing, what you end up is that there's going to be people piling into money in the hope that ghost public or taken out, and if it doesn't happen, there's a lot of unhappy investors there. Did you just have about

a minute left here? Um? I'm curious to you about running a hedge fund. Uh in this space, I feel like hedge funds. We've talked an awful lot about under performance and the inability to you know, kind of find returns. Tell me, from what I understand, you guys pick a few um targets, right, and that our positions and really kind of focus on them. Just your quick thoughts on

that just got about forty seconds. Sure, I think for us being able to define where you can add value is really important and have data to back it up. And as global investors, we're not I guess we don't have the necessity to look just at TNT or the US. We can look at all factors. We can look across the ward the world to be able to choose some

more high conviction plans. So for us, it's been freeing to have that type of I guess, um more active returns and active profile as an investor versus a very small box or or small area to plane. And that's how we founded our niche it will be high conviction for our investors. All right, we're gonna leave it there. Thank you so much for your thoughts. Natie Determined, founder CEO and c I O Soulstein Capital, on the phone from San Francisco. Proud Alama, the Stanford Graduate School of Business.

You may have heard their number one. Thanks for listening to Bloomberg Business Week. You can subscribe to the podcast on iTunes, SoundCloud, or Bloomberg dot com. You can also listen to our radio show every weekday at two pm Eastern, only on Bloomberg Radio