The Private Equity for Families Blog

Post Pandemic Lifestyles And Our Hamster Wheel Society

As we emerge from our Covid-19 caves and rejoin business, commercial and personal worlds, I have begun to wonder what institutions, interactions, professions, entertainment and lifestyles will be altered in a material way. For most of my life I have been on a hamster wheel of expected behaviors like showing up for work, interactions being face to face, and going somewhere other than home for socializing and entertainment. I never had any reason to consider whether that lifestyle was effective or fulfilling. It was just what you were expected to do.

Business Interaction In Flux

I have written in prior blogs about diminishing business travel and meaningful changes in spending on conferences, business entertainment, and customer retention https://capitalworks.net/covid-19-challenges-the-hamster-wheel-of-sales-marketing/. However, budgets for customer acquisition will probably increase as business reopens and “showing up” for face-to -ace introductions becomes a critical part of new business. Many of our portfolio companies have reduced sales expenses by curtailing “hamster wheel” business travel where time is consumed in travel to meet with existing customers. This line item will be slow to return given the apparent adequacy of online meetings for maintenance of relationships.

Business lodging is probably going to be a casualty as well. There are simply too many rooms for the permanent reduction in overnight business travel. Some entrepreneur will figure out how to repurpose that excess supply.

Medical Experiences Are Also Changing

Medical interactions are also changing. Covid-19 forced many non-surgical interactions with medical professionals online. I wonder about radiology and dermatology where super computers have databases for analyzing x-rays and scans that are more accurate than trained professionals. The biopsy process is at risk for suspicious skin growth. You can take a smart phone picture and data analytics can name the cells.  On the other hand physical therapy will be booming. Active aging comes at a price. The backlog of deferred physical therapies right now is like the “Ever Given” back up in the Suez Canal.

Our Spiritual Fulfillment May Be Virtual

The spiritual life may be undergoing major changes as well. I was shocked at the response I got when I asked several friends who were serious church goers before the Pandemic what they were going to do for Easter. They apparently have found spiritual satisfaction online. A couple in Florida has daily interactions online with broadcasts from Boston and Cleveland. They shocked me when they said they will never go back to accepting the mediocre spiritual content offered up by the parish church when there is such a robust alternative online. My father used to contend that religion was not meant to be entertainment. That opinion may now be turned 180 degrees. For the spiritual experience to survive, it may have to provide engaging and entertaining content including music, song and sermon. This could devastate religious communities already in decline from pedophile priests and swindling preachers.

Going To The Office Is Never Going To Be The Same

Going to office will mean something different as well. More and more employees will walk downstairs at 5:15pm in their apartments or homes and announce “Honey I am Home.” Collaboration spaces and conference rooms will remain, but the idea of the individual office is changing fast. If securities traders can survive in their profession https://capitalworks.net/an-insiders-tutorial-on-programmatic-trading, without any physical proximity, how hard can it be for the rest of us who are not required to make moment to moment decisions worth millions of dollars every 15 minutes? 

The whole business commuting ecosystem is probably going to shrink.  Parking budgets will be slashed. Commuter infrastructure like trains and buses may no longer operate for the primary convenience of the weekly commuter. Anticipating this possible shift, the current infrastructure legislation proposals for public transportation may have to be re-imagined.

Segmentation of Entertainment by Cohorts

National Parks, state and local greenspaces, cityscapes, beaches, and even outdoor recreation in declining sports like skiing and golf made a dramatic Covid-19 comeback. For the short term these are all popular alternatives to indoor entertainment.

I am not sure about more crowded venues like theme parks, movie theatres, stadiums, art museums, performing arts centers, and race tracks?  

Outdoor dining has also become preferable for an older generation who now perceives their longevity is at risk in crowded environments. Group interactions may balance out at about 60/40 physical versus virtual depending on the age cohorts involved. There may be a whole new segmentation of entertainment experiences for the various age cohorts as well. I know for certain I will be limiting my indoor, crowded experiences for a long time. I trust most of my age cohort to act responsibly because of mutually assured destruction, but I am not sure younger cohorts have the same risk equation.

One lesson from the Pandemic is PROXIMITY IS PERILOUS in a connected world where virulent flu seems to be as regular as rain. I am also concerned for the first time about germ warfare. Its disruptions are devastating and hard to trace. History has shown it can change the balance of world power. Germs have toppled some of the most advanced cultures like the Incas. That cannot be lost on groups intending to generate terror and fear.

Education Has Also Changed

Maybe nursery school, kindergarten and grades 1 and 2, will still mostly be face to face education, but after that I think education will be a mix of in person and virtual. The older the cohort, the more likely the experience will be virtual. The big question is what will people pay for 4 years of college when 60% of the experience may be virtual? Technology is inherently deflationary and the virtual product may be perceived as second rate.

Getting Off The Hamster Wheel

We have all been off our normal wheel long enoughto start asking these kinds of questions. Many things I have done without thinking over the last 70 years are no longer automatic. In many ways spinning that old wheel was its own purpose. Covid-19 has left many of us questioning why, where and when we want to jump back on.

The above commentary is for informational purposes only.  Not intended as legal or investment advice or a recommendation of any particular security or strategy. Information prepared from third-party sources is believed to be reliable though its accuracy is not guaranteed. Opinions expressed in this commentary reflect subjective judgments based on conditions at the time of writing and are subject to change without notice.

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Rob McCreary

Rob McCreary has more than 40 years of transactional experience as an attorney, investment banker and private equity fund manager, and has spent his career in building entrepreneurial organizations with successful track records Founder and chairman of CapitalWorks, he is responsible for developing and maintaining senior relationships with investors and portfolio governance.

This blog represents the views of Rob McCreary and do not reflect those of CapitalWorks or its employees. This blog is not intended as investment advice. Any discussion of a specific security is for illustrative purposes only and should not be relied upon as indicative of such security’s current or future value. Readers should consult with their own financial advisors before making an investment decision.

Private Equity for Families Blog | CapitalWorks Private Equity Cleveland Ohio

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