I’m not concerned about Venmo’s threat to banks for two reasons. 1) The vast amount of transaction volume and cash held at banks are commercial in nature (i.e. businesses and corporations), not personal/retail (see article below ). If I recall correctly, something like 98%+ of all money transfers (by value) in the US are for business transactions rather than personal expenses, and it’s not likely that Boeing is going to start Venmo-ing GE for their airplane engines anytime soon. 2) Venmo still seems like it’s more of a complement to banks rather than a potential replacement. What I mean is that Venmo does not provide any of the traditional, basic functions of the bank such as lending money and paying interest on deposits. Thus, I see Venmo and banks operating a interrelated, but fundamentally different spaces.
I have two general concerns with schools making the push towards online education and MOOCs. First is that I think making a school’s courses and materials so readily available and accessible dilutes its brand.  Why am I paying $100k a year to attend HBS, MIT, etc. when I can take many of their classes online for a much lower cost (or free in many instances)? Per the article below, I think there is a disconnect as consumers who haven’t tried either product (the online or the in person class) might not understand what the real difference is between the two, and what the value of the in person experience is. Secondly, as many people say, the real value of business school and HBS is not what you learn in class, but who you meet and the relationships you build. I assume that would be practically nonexistent in an HBX Live curriculum. If it’s just about learning the materials, I think you would be indifferent between taking a class via HBX, Coursera, Edx, etc. What we learn in our finance classes is not fundamentally different from what you would learn at another school, and if anything I think the case method fall short in actually teaching the material itself so I’m not sure I’d want to learn accounting or marketing via HBX Live—you’d probably learn a lot more watching a more traditional finance class.
I’m not sure I agree staffless is the way to go for Hilton. Hilton’s primary customer base and the bulk of their revenue is not from millennials (see financial report ), it’s from business/corporate travelers (Hilton, Hampton Inn, Doubletree) or families (for their Homewood Suites, Embassy, Hilton Garden Inn, etc. brands). These two categories of consumers would, in my opinion, be less interested in the whole keyless entry, self check-in, etc. if it comes at the cost of convenience. Additionally, for Hilton’s higher end Waldorf and Conrad brands, customer service is a critical component. Any luxury hotel chain can install new technology, but it’s the personal touch of a hotel concierge, receptionist, or other staff member that keeps people coming back.
I’m not sure I agree that there is still an opportunity for Lending Club to repair its business. I think the company has lost its luster and investors, who recently fired the CEO over faulty loans, have lost their patience. The whole premise doesn’t make much sense to me—why would you expect to get better risk-adjusted returns lending to individuals with generally weak credit scores than you would lending to robust corporations? I think, as the article below says, Lending Club is just another one of many companies that shows that there are limitations to what technological disruption can do. 
Why do you believe Barnes and Noble has a competitive advantage over Amazon because of its physical presence? Do you still buy books in physical stores? Amazon, according to the below article, has over 60% market share in all book sales, and Barnes is not even close.  Also, doesn’t Barnes’ push towards ebooks seem counterintuitive in relation to their “competitive advantage” of having physical presence? Why would you need a physical presence if you’re trying to sell ebooks? Also, as the article below discusses, Barnes has no chance of competing against Amazon’s rock bottom prices. Given that Amazon is both cheaper and more convenient, how could Barnes possibly salvage their business?
Phil–I’m having a hard time seeing the connection between Goldman’s initiatives and the reduced earnings/increased risk in businesses more broadly (presumably Goldman’s clients) due to climate change. Even if climate change costs companies billions (or trillions), why does that impact Goldman’s business lines directly? M&A activity will continue (or maybe even increase as the need to consolidate increases in face of rising costs), a loan default doesn’t really impact Goldman as most of their financing fees are made on close, restructurings will result in fees to financial advisors, and sales and trading is a spread business that in theory should not depend on whether a company’s stock rises or falls.
More broadly, energy-inefficient business models will be replaced by clean energy ones, so the total $ value of businesses in the US is not going to decline. While there certainly are other reasons for GS to have these energy initiatives (PR/CSR, etc.), I don’t think they personally care if the earnings of certain companies decline because of climate change costs.
Max—I understand the point that climate change will increase the risk of natural disasters and the total aggregate cost of weather-related damages (to both insured and non-insured). But why is this risk not already factored into the premiums that these insurance companies charge? In other words, if I believe the risk of a hurricane causing damage in a certain book of business, why would I not adjust the premiums upward accordingly to account for this risk such that my overall profitability does not change? Taking it a step further, in theory insurance companies exist to profit off people’s aversion to risk, so could increasing risk from climate change result in more insurance opportunities for these businesses?
Dimitris—this was an interesting blog post as it seems to be one of the few instances where an industry actually directly benefits from climate change as rising temperatures reduce ice levels and make it more economically and operationally feasible for shippers to take advantage of the Northern Sea Route. Is there any concern that companies like Dynagas would actually be incentivized to accelerate the impact of climate change so as to increase their access to the NSR, or is it unlikely that a few shipping companies could do enough to materially change the situation in any negative way? Also, are there environmental or ecological impacts of utilizing this shipping route beyond what one would have with a traditional (non-Arctic) shipping route?
Lee, interesting posts. Three counterpoints come to mind:
1) I’m not convinced that Teslas are as inelastic as you’re suggesting. If that were the case, in theory Tesla could charge an extra $10k ($116 instead of $106k) for their car and make more profit but there would be no corresponding change in quantity.
2) Even if luxury car buyers are more price inelastic, I think there’s also a psychological side where you’re more likely to buy the car if you think you’re getting a car that’s really “worth” $106k for the price of $96k
3) On the flip side, if Tesla is capturing the value of the subsidy (by selling a $96k car for $106k) instead of the consumer, then the tax subsidy would also help encourage companies to produce more electric vehicles because they could charge consumers a higher price for the same value car.
What do you think are the benefits of having an integrated cleantech company versus focusing on one particular vertical? I understand the need for Tesla to invest in battery technology as it’s part of their car production, but it’s less clear to me that Tesla needs to own power generation. In general, most of electric cars are powered by the grid which draws power from multiple sources (natural gas plants, nuclear plants, wind farms, hydro plants, solar farms, etc.). Power generation more broadly will shift towards cleaner sources as a result of improvements in clean technology and government regulation. So what is the benefit of Tesla having control of their own generation versus sourcing it from the market? I would argue that Solarcity can exist as a separate legal entity, and the net benefit to the environment that Solarcity provides in the form of clean energy will not be in any way reduced as a standalone entity supplying power to the grid versus as a Tesla owned entity.