WEBVTT - China Balloon and Ford's Michigan Plant 0:00:14.160 --> 0:00:16.599 I'm Caroline hired a Blomberg's World headquarters in New York 0:00:17.040 --> 0:00:20.239 and imed Ludlow in San Francisco. This is Bloomberg Technology 0:00:20.280 --> 0:00:22.520 the market risk on when it comes to tech. Caroline 0:00:22.560 --> 0:00:24.880 not too hung up on all the talk about UFOs 0:00:25.360 --> 0:00:28.120 had geopolitics not front and center for many an investor 0:00:28.200 --> 0:00:30.000 in terms of a risk capasite. Let's get to it 0:00:30.240 --> 0:00:33.120 a geopolitics at least coming up this our ed Secretary 0:00:33.200 --> 0:00:36.879 of State Blincoln's widely considering a meeting with China's top diplomat, 0:00:36.880 --> 0:00:39.440 the first face to face talks as the US shot 0:00:39.440 --> 0:00:43.320 down a Chinese by balloon. We talked tech security plus 0:00:43.360 --> 0:00:46.680 in spite of those rising tensions with China, Ford teaming 0:00:46.760 --> 0:00:49.080 up with a Chinese company to build a giant EV 0:00:49.240 --> 0:00:52.800 battery plant in Michigan. Our conversation with Lisa Drake, Ford's 0:00:52.920 --> 0:00:57.680 vice president of EV Industrialization, and the continued crypto crackdown 0:00:58.160 --> 0:01:01.160 is putting a binance link token in the crosshairs. More 0:01:01.240 --> 0:01:04.040 on the potential regulation later this hour, but first we 0:01:04.200 --> 0:01:07.479 check in those markets and as you say, enthusiasm when 0:01:07.480 --> 0:01:09.720 it comes to stocks. At least said I'm looking at 0:01:09.760 --> 0:01:11.600 one and a half percent higher on the NASAC. Now, 0:01:11.640 --> 0:01:13.839 remember last week it had its worst sell off this year, 0:01:14.040 --> 0:01:15.960 so now we're back on it seems as though some 0:01:16.000 --> 0:01:18.840 of the forward looking consumer expectations for inflation just starled 0:01:18.840 --> 0:01:20.679 down a bit the data today. We all look for 0:01:20.720 --> 0:01:23.680 that CPI print, that inflation print tomorrow, ms CI or 0:01:23.720 --> 0:01:25.840 Country World the next up eight tenths of percent. Europe 0:01:25.880 --> 0:01:28.039 had a good risk on rally as well. Two year 0:01:28.080 --> 0:01:30.680 boring costs basically flat, but we did see some elevation 0:01:30.720 --> 0:01:33.560 in terms of two your boring costs, mainly thinking that 0:01:33.600 --> 0:01:35.480 the Fed is going to have to still tackle inflation 0:01:35.480 --> 0:01:37.959 that's above six percent as we anticipate for tomorrow. Flick 0:01:38.040 --> 0:01:40.680 it on one risk asset that did not get much love, 0:01:40.880 --> 0:01:42.640 and it has been crypto. Look, we're down over the 0:01:42.680 --> 0:01:45.440 course of two days. I'm looking at the Bloomberg Galaxy 0:01:45.480 --> 0:01:48.040 INDEXUS looks at the most crypto as a whole, not 0:01:48.120 --> 0:01:50.480 just of course Bitcoin, but some of the other major 0:01:50.480 --> 0:01:53.040 traded currencies, and it was on the downward trajectory. The 0:01:53.120 --> 0:01:56.720 reason ed we all know some worries about the crackdown, yeah, 0:01:56.760 --> 0:01:59.240 and looking at single names across and as I think 0:01:59.240 --> 0:02:01.559 the vast majority a t of names were in the green, 0:02:01.600 --> 0:02:03.960 but there are some interesting stories kind of buried within that. 0:02:04.040 --> 0:02:07.160 Microsoft up three percent, continue momentum, but you saw a 0:02:07.240 --> 0:02:10.160 number of analysts out with notes syfel or Steve Fell 0:02:10.240 --> 0:02:14.600 for example, out with a by rating and upgraded price target, 0:02:14.639 --> 0:02:17.560 basically saying this is a transformational year. AI is a 0:02:17.600 --> 0:02:19.760 part of that. But four year twenty four is when 0:02:19.760 --> 0:02:22.919 we'll really see Microsoft start to flex twily, up two percent, 0:02:23.080 --> 0:02:26.120 layoffs another round of cuts seventeen percent, which we'll get 0:02:26.120 --> 0:02:28.520 into later in the show. But the market cheering that 0:02:28.560 --> 0:02:31.280 despite it being an unpleasant conversation you alluded to. It 0:02:31.320 --> 0:02:34.079 Forward up two point eight percent, finally confirming that scoop 0:02:34.120 --> 0:02:36.480 from Friday that it is Michigan and it is a 0:02:36.480 --> 0:02:39.480 partnership with c at L for their latest battery plant 0:02:39.560 --> 0:02:42.200 for e VS moved to the downside. Tesla down just 0:02:42.240 --> 0:02:44.560 one percent this Monday, but on a two day basis 0:02:44.639 --> 0:02:47.160 carrying over from Friday, it's the biggest two day drop 0:02:47.160 --> 0:02:49.000 in six weeks. And I just flagged that out because 0:02:49.000 --> 0:02:50.920 a lot of voices in the market, Caroline kind of 0:02:50.960 --> 0:02:52.960 looking at that as a as a sort of treading 0:02:52.960 --> 0:02:56.520 water stock ahead of that CPI print on Tuesday, Well, 0:02:56.680 --> 0:02:59.000 not treading water at the moment, ed is a lot 0:02:59.000 --> 0:03:02.160 of the tension our UFOs and before we get to 0:03:02.200 --> 0:03:04.160 our own Twitter poll around and let's just get your 0:03:04.240 --> 0:03:05.800 speed with the fact that the US has just shot 0:03:05.800 --> 0:03:09.560 down it's forth flying objects since China's allegends by balloon 0:03:09.680 --> 0:03:14.400 last week, although Secretary State Anthony Lincoln is considering a 0:03:14.440 --> 0:03:17.800 meeting with China's Foreign Minister Wangi at a security conference 0:03:17.960 --> 0:03:20.600 later this week. This as Native Secretary General that's En 0:03:20.680 --> 0:03:25.400 Stolnberg says, China and Russia are increasing surveillance and intelligence 0:03:25.440 --> 0:03:30.639 against the Alliance. China, but those Russia are increasing their 0:03:30.680 --> 0:03:36.880 intelligence as activities against natile hours with many different platforms. 0:03:35.600 --> 0:03:40.640 We see it with satellites, more and more satellites, and 0:03:40.640 --> 0:03:45.840 we see them with balloons. That highlights the importance of 0:03:46.880 --> 0:03:54.320 our vigilance are increased presence, and also that we ramp 0:03:54.400 --> 0:03:57.840 up and step up how we share intelligence and how 0:03:57.920 --> 0:04:05.240 we monitor and protect our airspace. A's the international reaction. 0:04:05.480 --> 0:04:08.720 Let's get the reaction of Bloomberg's Alex Wayne out of Washington. 0:04:09.040 --> 0:04:13.240 Alex just tell us is this untoward? Is this weird? 0:04:13.320 --> 0:04:15.360 Or is it the fact that finally people are starting 0:04:15.360 --> 0:04:18.520 to shoot them down. We don't have a lot of 0:04:18.560 --> 0:04:21.800 answers about about what's going on and why US fighter 0:04:21.880 --> 0:04:24.599 jets are suddenly shooting so many weird objects out of 0:04:24.600 --> 0:04:27.599 the sky so far. UM. The White House Press Secretary 0:04:27.680 --> 0:04:30.320 Crane Jehan Pierre did say today that there is quote 0:04:30.320 --> 0:04:34.320 no indication end quote that it's aliens. So I suppose 0:04:34.680 --> 0:04:37.240 that explanation is ruled out and we should look for 0:04:37.240 --> 0:04:41.400 for a more mundane source for these objects. UM. The 0:04:41.440 --> 0:04:44.960 Defense Secretary Lloyd Austin said in Europe today that they 0:04:44.960 --> 0:04:48.040 have not yet recovered any debris from the objects that 0:04:48.080 --> 0:04:49.919 were shot down over the weekend, and they were shot 0:04:49.920 --> 0:04:52.919 down in some pretty remote areas over Lake Huron and 0:04:52.920 --> 0:04:55.640 in Alaska and our Canada as our as our graphics 0:04:55.680 --> 0:04:58.440 shows there, these are gonna be difficult places to get 0:04:58.720 --> 0:05:00.840 to get to recover the reece. I think it's gonna 0:05:00.839 --> 0:05:02.440 be a while. So we have any answers, that's what 0:05:02.560 --> 0:05:05.040 as to what these things are. UM. We do know 0:05:05.080 --> 0:05:07.320 that they were shot down because they presented a threat 0:05:07.360 --> 0:05:11.160 to aviation. UH. That's that comes from John Kirby, the 0:05:11.680 --> 0:05:13.880 U s National Security spokesman, who also spoke at the 0:05:13.880 --> 0:05:16.640 White House Press briefing today. I guess in part the 0:05:16.680 --> 0:05:19.839 news flow around this story is driven because for the 0:05:19.880 --> 0:05:22.040 first time, we're actually all going out and looking for 0:05:22.080 --> 0:05:24.320 these things. You know, That's the sense that I get 0:05:24.320 --> 0:05:27.360 from your team's reporting in d C. I mean, there's tie, 0:05:27.360 --> 0:05:30.880 it's the broader context, the U S. China relationship. What 0:05:31.080 --> 0:05:33.799 is happening there? What is the latest on the actions 0:05:33.839 --> 0:05:36.200 the US have taken and how they viewed that relationship 0:05:36.240 --> 0:05:41.160 with China. Yeah, well, it's not helping relations with China obviously. 0:05:41.640 --> 0:05:44.919 The Chinese, of course, accused US of using balloons to 0:05:44.960 --> 0:05:47.760 spy on them. That was firmly denied by the White 0:05:47.760 --> 0:05:51.160 House earlier today. I do think these things are are 0:05:51.480 --> 0:05:54.640 being discovered because since the Chinese that the alleged Chinese 0:05:54.720 --> 0:05:58.080 by balloon floated across the US UH North American air 0:05:58.120 --> 0:06:01.520 defenses have started looking for the objects, and sure enough 0:06:01.560 --> 0:06:04.440 they're finding them. Um, that doesn't mean they're they're all 0:06:04.839 --> 0:06:08.640 spied devices from from China or Russia or elsewhere. Um. 0:06:08.800 --> 0:06:12.800 There there could be more, you know, much more ordinary explanations. 0:06:12.839 --> 0:06:16.640 Perhaps there are some sort of commercial aircraft or research 0:06:16.680 --> 0:06:20.520 aircraft or something that that just got off course. I 0:06:20.520 --> 0:06:24.039 guess floated too high in the air and and the 0:06:24.040 --> 0:06:25.679 the Air Force felt like they had to be removed. 0:06:26.800 --> 0:06:29.599 Bloomberg's alex Wayne Top reporting out of d C. Thank 0:06:29.640 --> 0:06:32.039 you very much, and Caroline, I've been up for a 0:06:32.080 --> 0:06:34.159 long time today. I've covered a lot of stories and 0:06:34.200 --> 0:06:38.200 a lot of shows and as well, I just I 0:06:38.240 --> 0:06:41.240 just didn't think Monday would have me uttering you fo. 0:06:41.600 --> 0:06:43.839 And as you know, we're trying to keep our audience 0:06:43.839 --> 0:06:45.880 out there in the loops. We asked, you know, what 0:06:45.920 --> 0:06:48.480 do you guys think about UFOs? Are you worried? Are 0:06:48.480 --> 0:06:52.400 you concerned? This is the response. This is humanity for you. 0:06:53.720 --> 0:06:56.560 Of what was a lot of respondents saying not bothered, 0:06:56.960 --> 0:06:59.320 not bothered. They're more bothered about Rhianna. They're more bothered 0:06:59.320 --> 0:07:03.440 about Manchester United potentially being brought by Kata they potentially, though, 0:07:03.480 --> 0:07:06.760 are also realistic head how much is this actually tip 0:07:06.800 --> 0:07:09.360 for tap? How much is this generally going on over 0:07:09.400 --> 0:07:12.440 the skies? How many these sources of objects potentially of 0:07:12.560 --> 0:07:16.600 being sent over various from US, over to other countries 0:07:16.640 --> 0:07:19.880 and then back to US surveillance we know is kind 0:07:19.880 --> 0:07:22.600 of something we live with. Yeah, juries out until they 0:07:22.600 --> 0:07:26.240 actually find the objects which were shot down. Then then 0:07:26.320 --> 0:07:29.080 we can talk about UFOs. But let's continue the conversation 0:07:29.120 --> 0:07:32.800 nonetheless and broaden it to the risks in technology moving forward, 0:07:32.840 --> 0:07:35.800 which could become a major headwind for the sector. According 0:07:36.080 --> 0:07:39.200 to Bank of America. Take a listen. I think the 0:07:39.280 --> 0:07:43.520 other shooter drop for tech is just the regulatory background 0:07:43.560 --> 0:07:47.640 when you think about cyber attacked data privacy. This is 0:07:47.640 --> 0:07:52.680 an issue that's affecting the man and woman on the street. 0:07:53.760 --> 0:07:57.160 M let's bring in John holt Quist, vice president of 0:07:57.240 --> 0:08:02.000 Intelligence analysis at Mandy and Security um Google Cloud. John, 0:08:02.080 --> 0:08:06.360 you've heard all the preamble, the geo political tension UFOs 0:08:06.440 --> 0:08:10.680 out there. Three, the year of bracing for risk in 0:08:10.720 --> 0:08:15.040 whatever form it comes. Well, we see a tremendous amount 0:08:15.040 --> 0:08:18.160 of you know, activity from all kinds of all the 0:08:18.240 --> 0:08:20.880 kinds of corners of the earth. We see stuff from 0:08:20.880 --> 0:08:24.120 the Chinese actors, Russian actors, North Korean actors, and they're 0:08:24.160 --> 0:08:28.560 increasingly aggressive and increasingly targeted everyday people. Right We see, 0:08:28.920 --> 0:08:32.040 for instance, North Korean actors now are carrying out a 0:08:32.240 --> 0:08:35.760 campaign it's affecting hospitals in the United States and the 0:08:35.800 --> 0:08:40.080 globe where they're trying to ransom those hospitals for money, right, 0:08:40.760 --> 0:08:45.800 John Manny and specializes in cybersecurity intelligence, seeing what's out there. 0:08:45.840 --> 0:08:50.080 What conversations are you having with customers, big corporate customers 0:08:50.440 --> 0:08:54.120 about the risk they face. What are they most worried about? Well, 0:08:54.200 --> 0:08:56.680 you know, I think we see a lot of you know, 0:08:56.760 --> 0:08:58.840 see a lot of our customers are actually pretty pleased 0:08:58.840 --> 0:09:01.400 with the intelligence we've been able to give them these days. 0:09:01.400 --> 0:09:03.719 We were much better than we used to be at 0:09:03.720 --> 0:09:06.520 seeing what these actors are up to. The problem really 0:09:06.600 --> 0:09:10.000 is is how do you change your posture, your security 0:09:10.040 --> 0:09:13.200 posture and actually you know, adapt to the adversary. And 0:09:13.240 --> 0:09:15.840 that's a tough job, right. It takes a lot of 0:09:15.960 --> 0:09:18.440 It takes a lot of work to actually, you know, 0:09:18.559 --> 0:09:22.959 shift shift your posture every time you actor developed, something 0:09:23.000 --> 0:09:26.400 like new ransomware or a new tactic is developed. And 0:09:26.400 --> 0:09:28.600 that's precisely what we have to do. We have to 0:09:28.640 --> 0:09:32.960 evolve ahead of of these of these actors. John, how 0:09:33.040 --> 0:09:37.000 much when you're asking your clients and people you talk 0:09:37.080 --> 0:09:39.679 with when you're going and putting fort leadership out there 0:09:39.679 --> 0:09:42.000 with reports that you just have done today, for example, 0:09:42.800 --> 0:09:45.120 how much is this self inflicted from some companies? How 0:09:45.200 --> 0:09:48.880 much is it that actually we have the right security 0:09:48.960 --> 0:09:51.520 to put in place, it's just people aren't putting it in. 0:09:51.600 --> 0:09:57.359 We're still leaving holes and vulnerabilities. Well, you know, it's 0:09:57.559 --> 0:10:00.680 it's it's really hard to always be perfect in this 0:10:01.040 --> 0:10:04.240 in this space. And you know, adversaries absolutely take advantage 0:10:04.240 --> 0:10:07.400 of the smallest mistakes, right. I think that's in many 0:10:07.520 --> 0:10:10.280 of the cases we've seen they have you know, for instance, 0:10:10.320 --> 0:10:14.200 they take advantage of users who may not understand what 0:10:14.280 --> 0:10:16.960 they're looking at, or or they may take advantage of 0:10:17.040 --> 0:10:20.880 misconfiguration for instance. That happens all the time. But really, 0:10:20.920 --> 0:10:24.360 you know, these are very advanced adversaries and in many 0:10:24.360 --> 0:10:27.280 cases these are state actors, these are spies. They are 0:10:27.400 --> 0:10:30.720 not easy targets. Uh. And we we have we have 0:10:30.880 --> 0:10:34.520 been forced to essentially continue to raise our game against 0:10:34.559 --> 0:10:37.800 an adversary that, uh, we shouldn't really have to face. 0:10:38.559 --> 0:10:42.280 But we do talk to us about how people, how 0:10:42.360 --> 0:10:45.200 clients feel about their security levels. What are they most 0:10:45.200 --> 0:10:49.720 worried about? Is it nation state actors or is it activists? 0:10:49.760 --> 0:10:53.400 Is it just people wherever they might be based, wanting 0:10:53.400 --> 0:10:56.640 to do some financial run somewhere in some way runk 0:10:56.640 --> 0:11:00.400 it for us the anxiety amongst people, Uh, I think, 0:11:00.679 --> 0:11:03.600 you know, I think it's what's really interesting is that, uh, 0:11:03.760 --> 0:11:08.760 for every organization, the threat picture has is entirely different, right, 0:11:08.800 --> 0:11:10.840 And that's why the intelligence is so important. You have 0:11:10.920 --> 0:11:14.400 to determine who matters the most to you, right uh. 0:11:14.600 --> 0:11:17.000 Right now, for instance, we're seeing this campaign of North 0:11:17.080 --> 0:11:20.840 Korea against hospitals and and and I think hospitals probably 0:11:20.840 --> 0:11:24.240 didn't consider these actors a threat before, but now they 0:11:24.280 --> 0:11:30.079 have to reconsider their their entire security posture because of this. UM. 0:11:30.120 --> 0:11:33.439 I've seen many time, and many times I've seen organizations 0:11:33.440 --> 0:11:36.360 who thought that Russian State actors were gonna be the 0:11:36.480 --> 0:11:38.720 you know, be the ones who went after them, and 0:11:38.760 --> 0:11:41.600 the reality is was Russian criminals were the ones that 0:11:41.640 --> 0:11:45.160 caused him the real pain. Uh, using intelligence to actually 0:11:45.200 --> 0:11:49.199 make those decisions is what gets you ahead of the adversary. 0:11:50.000 --> 0:11:53.360 Don hold Quest, vice president of Anteligens Andnalysis, and Mandy 0:11:53.400 --> 0:11:55.640 and just terrific and time the conversation. Thank you so 0:11:55.760 --> 0:11:59.199 much for coming on the show. Now coming up, could 0:11:59.200 --> 0:12:02.760 that be a man extinction event coming up for early 0:12:02.960 --> 0:12:06.160 in mid stage companies. That's what I VPS Tom Laverry thinks. 0:12:06.400 --> 0:12:17.760 And we'll ask him next why this is Bloomberg. The 0:12:17.800 --> 0:12:21.000 inflation will come down, but I think it will stay 0:12:21.080 --> 0:12:23.800 persistent for a period of time, probably longer than we 0:12:23.840 --> 0:12:27.120 originally anticipated um when they started bringing interest traits up. 0:12:27.200 --> 0:12:31.800 I personally am optimistic that we will find a balance 0:12:31.880 --> 0:12:35.280 point in the five percentage range. That's my personal view. 0:12:35.320 --> 0:12:38.120 Of course, I'm at this from one person's view, but 0:12:38.280 --> 0:12:40.240 I also think that that we will end up staying 0:12:40.280 --> 0:12:44.880 there for longer. That was Nasdack, chair and CEO Adina 0:12:44.920 --> 0:12:48.480 Freedman speaking at the Saudi Capital Market Forum in readd 0:12:48.480 --> 0:12:51.600 and giving her take on rate hikes, inflation, and the 0:12:51.600 --> 0:12:53.280 I p O pipeline. I want to stick with this 0:12:53.320 --> 0:12:56.000 conversation and get the private markets take with i VP 0:12:56.440 --> 0:12:59.960 general partner Tom Lavero and about his prediction for start 0:13:00.080 --> 0:13:02.839 ups in this landscape. I VP has eight point seven 0:13:02.840 --> 0:13:07.000 billion dollars of assets deployed or under management. Tom, you 0:13:07.120 --> 0:13:10.360 tweeted at the end of January that late twenty three 0:13:11.840 --> 0:13:15.280 would be a mass extinction event for early to midstage startups. 0:13:15.520 --> 0:13:18.040 We've had one FED meeting since and we have an 0:13:18.080 --> 0:13:20.480 inflation print tomorrow. Look we're showing it on the screen. Now. 0:13:21.280 --> 0:13:25.160 Do you stick with that thesis? Right? Now in this moment, absolutely, 0:13:25.200 --> 0:13:27.560 I think the trends that I was talking about in 0:13:27.600 --> 0:13:29.760 that threat are going to persist for at least a 0:13:29.800 --> 0:13:33.720 couple of years. LP capital pulling back, a fewer adventure 0:13:33.760 --> 0:13:36.719 dollars going out. I've heard some things out in the marketplace, 0:13:37.200 --> 0:13:39.120 and my question, she is, what do these startups do 0:13:39.200 --> 0:13:41.680 then if they face a mass extinction event. I've heard, 0:13:41.679 --> 0:13:44.600 for example, some going to their bankers and saying, get 0:13:44.640 --> 0:13:48.040 someone to buy me because I can't raise funds. My 0:13:48.200 --> 0:13:50.880 valuation has come down. Is that what's happening right now? 0:13:51.400 --> 0:13:53.480 I think a lot of startups in the past couple 0:13:53.480 --> 0:13:57.240 of years that were kind of marginal got funded and 0:13:57.360 --> 0:14:00.720 that was an easy money environment. That change, and so 0:14:00.880 --> 0:14:02.760 we're trying to get out there and tell founders the 0:14:02.800 --> 0:14:06.400 world has changed, be conservative with your cash. Raise sooner, 0:14:06.840 --> 0:14:10.040 and you're absolutely right, there's gonna be a lot more 0:14:10.200 --> 0:14:13.000 M and A as the valuations on these startups come down. 0:14:13.360 --> 0:14:17.160 The public markets, buyers, the pe buyers are taking notice. Okay, 0:14:17.360 --> 0:14:20.600 raise sooner in this current environment, Tom, what does that 0:14:20.640 --> 0:14:23.200 look like? What sort of foundations can you hope for? 0:14:23.440 --> 0:14:25.920 What are you being pegged to? Is it profitabilities at 0:14:25.960 --> 0:14:30.680 revenue it's a good question. It depends on the given startup, 0:14:31.160 --> 0:14:33.960 but I think as a rule of thumbs, startups go 0:14:34.040 --> 0:14:35.920 into the red zone on how much cash they have 0:14:36.040 --> 0:14:39.160 left when they've got about twelve months of cash. So 0:14:39.240 --> 0:14:43.800 you should be raising before then, ideally, and certainly have 0:14:44.000 --> 0:14:46.600 your round close by, say six or seven months of 0:14:46.640 --> 0:14:51.400 cash left at the latest um. And in terms of valuations, listen, 0:14:51.440 --> 0:14:53.920 the public markets have reset to a place that we 0:14:53.960 --> 0:14:57.120 think we view as healthy. It was unhealthy. We had 0:14:57.160 --> 0:15:01.520 public private companies going fifty a hundred times revenue. Those 0:15:01.600 --> 0:15:03.920 days are gone, and now if you look at the 0:15:03.920 --> 0:15:06.640 public markets growth, adjust those and that's a good benchmark 0:15:06.720 --> 0:15:10.480 for startups. Tom I VP has more than forty years 0:15:10.600 --> 0:15:13.800 in this game, and you stick around for forty years 0:15:14.040 --> 0:15:18.040 by being sort of collaborative, by working well with other 0:15:18.080 --> 0:15:20.600 players in the space as well. I'm interested in your 0:15:20.640 --> 0:15:23.160 perspective of what it's like right now when people are 0:15:23.160 --> 0:15:25.840 coming to you for a check, and how you're treating 0:15:25.840 --> 0:15:29.160 the earlier investors. I'm hearing time and time again that 0:15:29.280 --> 0:15:31.480 some of the first checks that are being written and 0:15:31.480 --> 0:15:33.880 then when you go to the second round, they're they're 0:15:33.920 --> 0:15:36.960 losing a lot of their power those first early money 0:15:37.000 --> 0:15:39.640 in their being diluted enormously if they haven't got the 0:15:39.760 --> 0:15:41.320 money to be able to put in at the same 0:15:41.360 --> 0:15:43.440 time as your second round or third round. How are 0:15:43.440 --> 0:15:48.040 you seeing that evolve. Who's losing out who's winning here? Tom, 0:15:48.040 --> 0:15:51.720 It's a great question. Our style of investing, we tend 0:15:51.800 --> 0:15:54.119 to invest in the things that are growing the fastest, 0:15:54.560 --> 0:15:57.240 and we try and partner with those early stage investors. 0:15:57.880 --> 0:16:00.760 But I think the early stage investors are paying attention 0:16:00.840 --> 0:16:03.280 to the markets. They have portfolio companies that are later 0:16:03.320 --> 0:16:06.640 stage that are about to go public or maybe went public. 0:16:06.960 --> 0:16:09.720 So I think we're generally on the same page. Where 0:16:09.720 --> 0:16:12.720 it gets tricky, of course, is when startups have to 0:16:12.800 --> 0:16:15.720 raise a new round below the valuation of their last round. 0:16:15.720 --> 0:16:19.440 That's called a down round, and that's where incentives can 0:16:21.040 --> 0:16:24.880 diverge from early investors and late investors. We haven't done 0:16:24.920 --> 0:16:27.240 one of those down rounds because we're really focused on 0:16:27.280 --> 0:16:29.720 the companies that are growing, But I think we're going 0:16:29.800 --> 0:16:31.560 to have to grapple with that here in the next 0:16:31.600 --> 0:16:34.680 couple of years as well. The whole industry. There's those 0:16:34.720 --> 0:16:38.080 that delayed funding from last year. I'm hearing that in 0:16:38.120 --> 0:16:41.880 some cases Series B investors want to see evidence of 0:16:41.920 --> 0:16:44.640 profit and then you have structured deal. You have a choice, 0:16:45.040 --> 0:16:47.560 do a structured deal and avoid a downround or do 0:16:47.600 --> 0:16:51.320 a down round. How do you handle all of those situations? Yeah, 0:16:51.360 --> 0:16:53.720 and to be clear, we're not looking for profitability. We 0:16:53.800 --> 0:16:58.360 want companies to be efficient but also grow and so 0:16:58.480 --> 0:17:01.040 for us we do mostly Series B and C investing, 0:17:01.080 --> 0:17:04.640 and we expect companies to be taking pretty significant losses. 0:17:04.680 --> 0:17:08.000 But what we're focused on is the unit economics. And 0:17:08.040 --> 0:17:10.920 so what we tell companies is get those unit economics right, 0:17:11.359 --> 0:17:14.000 and if they get the unit economics right, we can 0:17:14.000 --> 0:17:18.960 evaluate whether we want to fund them. Tom always such 0:17:18.960 --> 0:17:21.600 great analysis. Thank you for bringing that Twitter storm onto 0:17:21.640 --> 0:17:24.600 the real life of television with us. Tom Lavero, We 0:17:24.680 --> 0:17:28.000 thank you, my VP general partner, stay well. Meanwhile, Amazon 0:17:28.320 --> 0:17:31.920 squeezing more money from its own two million small businesses 0:17:31.920 --> 0:17:34.560 at sell products on its online marketplace. Now for the 0:17:34.560 --> 0:17:37.560 first time, Amazon's average cut of each sale surpassed fifty 0:17:38.680 --> 0:17:41.240 two that's going to a study one marketplace Pulse, which 0:17:41.280 --> 0:17:44.679 sumples sell the transactions going back to and with online 0:17:44.720 --> 0:17:48.359 shopping not as strong after pandemic era lockdowns ended, many 0:17:48.359 --> 0:17:51.320 sellers are now struggling to make money, prompting some to 0:17:51.400 --> 0:17:54.760 handle shipping themselves and to spend less to advertise on 0:17:54.800 --> 0:17:59.919 Amazon sites. Plus matters. Chief business officer Marmy Levine stepping 0:18:00.000 --> 0:18:02.760 down after more than twelve years with the company. Metro 0:18:02.800 --> 0:18:07.240 announced that earlier today. Levine has held several possessions at Meta, 0:18:07.359 --> 0:18:11.680 including head of Global Policy, chief operating officer over at Instagram. 0:18:11.840 --> 0:18:14.560 Levine will leave her post later this month and depart 0:18:14.600 --> 0:18:16.840 the company this summer. Her exit, of course, comes at 0:18:16.880 --> 0:18:19.120 a time of transition. Let's called it for Meta, which 0:18:19.160 --> 0:18:20.840 announced in November that it would be cutting more than 0:18:20.880 --> 0:18:33.080 eleven thousand jobs in the first major workforce production Twilio, 0:18:33.280 --> 0:18:35.840 it's the latest tech company to slash jobs and sing 0:18:35.880 --> 0:18:38.040 it again. The software maker is saying it will cut 0:18:38.040 --> 0:18:41.240 about sevent of workers, just months after a previous major 0:18:41.320 --> 0:18:44.240 round of layoffs. Now the CEO also is saying they're 0:18:44.240 --> 0:18:46.959 planning to reduce office space and pair back benefits as 0:18:46.960 --> 0:18:49.480 part of the focus on profitability. Here for more is 0:18:49.480 --> 0:18:53.560 Bloomberg's Roodie Ford and it is notable that they've had 0:18:53.600 --> 0:18:56.520 to come back and do a second call here. Yeah, 0:18:56.560 --> 0:18:58.520 this is frightening if you're a tack worker, right, because 0:18:58.520 --> 0:19:00.320 I think most of us assume that if you get 0:19:00.359 --> 0:19:03.000 a major layoff as they had was about eleven back 0:19:03.000 --> 0:19:06.120 in September, you think, if you made it, I'm cool. 0:19:07.040 --> 0:19:08.959 But no, I mean this show is that if market 0:19:08.960 --> 0:19:12.479 conditions continue to worse and companies will make additional cuts. 0:19:12.760 --> 0:19:15.560 Today this brings it to a total of about twenty 0:19:15.600 --> 0:19:19.159 six percent of the company, which by my math, I mean, 0:19:19.160 --> 0:19:20.840 know if I'm wrong, anybody watch him, but I think 0:19:20.880 --> 0:19:24.720 that is larger than any other large, publicly traded tech company. Yeah, 0:19:24.720 --> 0:19:27.200 it is an interesting beast, isn't it? Eleven billion dollar 0:19:27.240 --> 0:19:29.960 market cap even with the cuts head count at sixty 0:19:30.040 --> 0:19:31.960 six thousand. What I thought was so interesting as well 0:19:32.480 --> 0:19:34.960 is that they have a found a CEO, Jeff Lawson, 0:19:35.400 --> 0:19:37.840 and he's addressing his own compensation. What do we learn 0:19:37.880 --> 0:19:42.040 about the cutbacks he's making to his own compensation. Yeah, 0:19:42.040 --> 0:19:43.919 so they didn't make a huge deal of it, but 0:19:43.960 --> 0:19:47.520 he cut his compensation, and many of us are tempered 0:19:47.560 --> 0:19:51.560 to say, oh, understanding, ceo. But you gotta remember that's 0:19:51.600 --> 0:19:54.919 a mounch to about point four percent of the total compensation, right, 0:19:54.960 --> 0:19:57.359 I mean, this is not a huge reduction. Um, this 0:19:57.600 --> 0:20:00.200 is he's still making Uh well, we don't know does 0:20:00.200 --> 0:20:04.000 new com packages, but compared to one it's about point 0:20:04.000 --> 0:20:06.439 four percent and he made about fourteen point five million. 0:20:06.800 --> 0:20:09.720 So we're seeing a lot of CEOs take cuts and compensation. 0:20:09.760 --> 0:20:12.480 But you've got to remember when it comes to executives, 0:20:12.560 --> 0:20:15.080 it's not in the base salary, it's in the stock options. 0:20:16.280 --> 0:20:19.080 I mean, we therefore wonder what several looks like, what 0:20:19.480 --> 0:20:21.800 benefits and how they support the work, is that they 0:20:21.800 --> 0:20:24.120 do have to let go a second time. It seems 0:20:24.160 --> 0:20:25.560 as though a lot of tech companies have tried to 0:20:25.560 --> 0:20:28.560 be helpful in that way. Ultimately they'll give the read 0:20:28.600 --> 0:20:31.439 across for us, Bertie, is this is twally different? Is 0:20:31.480 --> 0:20:34.520 it more exposed than others or could this be a domino? 0:20:35.520 --> 0:20:39.720 Twilio has some uniquely unique troubles here. For example, they're unprofitable. 0:20:39.720 --> 0:20:42.360 I mean we both know that unprofitable tech has been 0:20:42.400 --> 0:20:44.360 battered in the current market. Announcer and I think they 0:20:44.400 --> 0:20:48.719 lost of market value in two But I think, no 0:20:48.760 --> 0:20:51.199 matter what company you are, if you're seeing this at 0:20:51.200 --> 0:20:54.200 a second round of layoffs is possible. That's a frightening 0:20:54.240 --> 0:20:57.760 thing across the market, no question, Hey, Bertie, as you 0:20:57.800 --> 0:21:00.960 look across the companies that you cover, what what is 0:21:01.000 --> 0:21:04.240 the kind of commonality between them? Is this it? The 0:21:04.320 --> 0:21:07.520 layoffs are due for this year? Are we expecting more? Well, 0:21:07.560 --> 0:21:10.120 they're a handful of large companies that happened on layoffs. 0:21:10.160 --> 0:21:12.640 A lot of people have spectleing why Apple hasn't done them, 0:21:12.680 --> 0:21:15.680 Oracle hasn't done them. UM, I would say that we 0:21:15.760 --> 0:21:18.480 are not done. We don't know that, but we see 0:21:18.480 --> 0:21:21.439 reports almost every single day of this person in the 0:21:21.480 --> 0:21:24.040 company's anxious more layoffs are coming. So I think it 0:21:24.160 --> 0:21:26.680 is not put to bed. I think that people should 0:21:26.760 --> 0:21:30.280 continue to watch um and if market conditions continue to worsen, 0:21:31.280 --> 0:21:34.560 no one knows, right Bloom Doug's Brady for great reporting, 0:21:34.600 --> 0:21:45.919 Thank you very much. A crackdown on crypto keeps coming. 0:21:46.200 --> 0:21:50.000 This time authorities are taking on two pretty key pillars 0:21:50.000 --> 0:21:53.600 of the ecosystem. Number one, stable coins being most traded 0:21:53.640 --> 0:21:58.400 crypto tokens out there, and to finance the world's biggest exchange. 0:21:58.840 --> 0:22:02.560 Now on this occasion, the New York Finance Regulator wants 0:22:02.560 --> 0:22:05.080 to stop to the issuance of b u s D 0:22:05.480 --> 0:22:08.160