You Can Take The Losses and Retail Can’t — Challenging Kevin O’Leary | by Wasif M Rahman | Coinmonks | Mar, 2023
“I would imagine you would feel some level of guilt when some of the companies that you are promoting end up leaving retail investors holding the bag.”
This was a line from Hasan Minhaj during a 34-minute debate with Kevin O’Leary on The Daily Show.
O’Leary is an iconic investor, educator and judge on Shark Tank. He is fondly referred to as “Mr. Wonderful” and is one of the most influential figures in modern finance.
The crux of the debate fell on O’Leary’s dual role as an investor and spokesperson for FTX.
Hasan Minhaj pointed out that O’Leary has a lot of influence over retail investors and was handsomely compensated for promoting FTX while his followers lost their life savings.
My highest-performing article from last year was titled “Why Influencer Accountability Matters”.
It was about the influencers who promoted FTX and their lack of accountability after the collapse of the infamous crypto trading platform.
A lot of people said I was being too harsh.
No one knew FTX was a giant ponzi scheme and it’s unfair to hold influencers accountable for what had happened.
That’s totally valid.
To be clear, I don’t think we should blame influencers for the consequences of the FTX debacle…and in hindsight, I may have failed to convey my actual point.
What I wanted to bring to light was the disparity in outcomes for the influencer and the influenced.
The parasocial relationship is at the heart of what makes influencer marketing powerful.
The audience looks to their favorite finance influencer as someone who could be relied upon for quality education and advice. No one expects to lose their life savings on a recommendation from an influencer they trust.
The dynamic is further complicated by the fact that a lot of influencers are being paid to provide financial recommendations.
What the FTX situation demonstrates is that influencers have little regard for the outcomes of their recommendations. At the end of the day…the audience is just stats and metrics on a dashboard.
Influencer accountability is important because it entails a greater sense of responsibility for what happens to your audience.
When shit hits the fan, a person like O’Leary can wash his hands clean of the situation and walk away. He has many other investments and he will financially recover.
Meanwhile, his audience will lose their homes, and their kid’s college tuition and some are going to get divorced.
It was refreshing to see Hasan Minhaj relentlessly challenge Kevin O’Leary on his position of influence over retail investors.
The outcomes for the influencer and influenced are drastically different and there should be a greater sense of accountability in this space overall.
As always, thank you for reading.
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