WEBVTT - Bloomberg Businessweek Weekend - November 19th, 2021 0:00:01.080 --> 0:00:05.440 This is Bloomberg Business Week Inside from the reporters and 0:00:05.600 --> 0:00:09.200 editors who bring you America's most trusted business magazine, plus 0:00:09.240 --> 0:00:13.160 global business, finance and tech news as it happened. Bloomberg 0:00:13.240 --> 0:00:16.759 Business Week with Carol Messier and Bloomberg Quick Takes Tim 0:00:16.800 --> 0:00:21.319 Stinovic on Bloomberg Radio. Hi, everyone, Welcome to the weekend 0:00:21.440 --> 0:00:24.279 edition of Bloomberg Business Week. A double issue this week 0:00:24.320 --> 0:00:27.600 as we head toward the Thanksgiving holiday, and a significant 0:00:27.600 --> 0:00:31.040 portion of the issue dedicated to something that is definitely 0:00:31.080 --> 0:00:33.319 on the minds of investors and consumers alike. Tim, we're 0:00:33.320 --> 0:00:36.440 talking about inflation. Special report on the impact of these 0:00:36.560 --> 0:00:38.960 rising costs and how they compare to the stagflation era 0:00:39.000 --> 0:00:41.640 of the nineteen seventies and what we can expect in 0:00:41.640 --> 0:00:44.400 the months and years ahead after a generation of relatively 0:00:44.479 --> 0:00:47.600 stable pricing. We're also going to examine the potential ripple 0:00:47.640 --> 0:00:50.639 effect on fiscal and monetary policy. Ahead this hour, we'll 0:00:50.680 --> 0:00:53.000 take you through the rise and fall of an aviation 0:00:53.080 --> 0:00:55.600 giant and the corporate arrogance that led to a pair 0:00:55.640 --> 0:00:58.880 of fatal Boeing seven thirty seven Max crashes. Will also 0:00:58.920 --> 0:01:01.760 explore different sort of tragedy that befell the Gucci Clan 0:01:01.840 --> 0:01:05.480 fashion sign ma Rizio Gucci's decision to leave his wife 0:01:05.560 --> 0:01:09.360 led to his murder, and the woman he wanted to 0:01:09.400 --> 0:01:11.520 be with instead shares her side of the story for 0:01:11.560 --> 0:01:14.160 the first time. This on the eve of a major 0:01:14.200 --> 0:01:17.280 motion picture release about the family's troubled history, and you'll 0:01:17.319 --> 0:01:19.880 hear from a pair of CEOs, the CEOs of Sonus 0:01:19.880 --> 0:01:23.119 and Wheels Up join us to talk earnings, supply chain constraints, 0:01:23.200 --> 0:01:26.039 and the fight for talent and Go Goes drummer Gina 0:01:26.120 --> 0:01:29.600 Shock presents an all access look at the legendary girl 0:01:29.640 --> 0:01:32.039 band's wild ride to the Rock and Roll Hall of Fame. 0:01:32.120 --> 0:01:34.200 We got to beat this week, all of that to come. 0:01:34.280 --> 0:01:36.680 We begin, though, by welcoming our editor of a Bloomberg 0:01:36.680 --> 0:01:39.279 Business Week magazine, Joel Webber. Hey, Joel, As we mentioned 0:01:39.319 --> 0:01:42.480 this week's double issue, highlighting a special report on inflation, 0:01:42.600 --> 0:01:45.800 it is back. Tell us though, how it all came together, 0:01:45.880 --> 0:01:49.040 and I gotta tell you the cover, tell us what 0:01:49.160 --> 0:01:51.760 was behind that? Thinking as well? Yeah, so you know, 0:01:51.920 --> 0:01:55.000 thinking about the Thanksgiving here. This does feel like it's 0:01:55.040 --> 0:01:57.680 going to be the topic that everyone talks about around 0:01:57.720 --> 0:02:00.680 the Thanksgiving table, because you know, one of those themes 0:02:00.680 --> 0:02:03.480 in in finance for for years now has been what 0:02:03.960 --> 0:02:06.280 happened to inflation? And actually just a couple of years 0:02:06.280 --> 0:02:08.320 ago we did a cover story that was like, is 0:02:08.400 --> 0:02:12.200 inflation dead? And now it's not. It's back and everyone 0:02:12.280 --> 0:02:15.000 wants to know how bad is it? Um? But because 0:02:15.040 --> 0:02:17.560 of the echoes from the you know, the late seventies 0:02:17.560 --> 0:02:21.359 and early eighties, that informs sort of the visual iconography 0:02:21.360 --> 0:02:23.280 that we used throughout the package and on the cover 0:02:23.400 --> 0:02:26.720 where it has sort of a Ghostbusters Poultrygeist theme with 0:02:26.760 --> 0:02:30.280 the big inflation, Um, it's back. The fear is real, 0:02:30.520 --> 0:02:33.560 but as we also establish, you know, the monster might 0:02:33.600 --> 0:02:36.560 not end up being quite as bad as as I 0:02:36.600 --> 0:02:39.520 think we're hearing a lot. So so that informed exactly 0:02:39.560 --> 0:02:41.839 how we kind of approached the package. Once we saw 0:02:41.840 --> 0:02:44.600 those CPI numbers that we could go, we just stopped 0:02:44.600 --> 0:02:47.399 everything we had in the works and that let's let's 0:02:47.440 --> 0:02:49.480 hone in on this and really talk about what it 0:02:49.520 --> 0:02:52.840 means for investors, consumers, companies. And so we put this 0:02:52.919 --> 0:02:54.919 pactice together kind of look at all of those things 0:02:55.000 --> 0:02:56.799 and what does it mean for From Washington, d C. 0:02:57.080 --> 0:02:59.799 The politics of inflation, Josh Green has a piece out 0:02:59.800 --> 0:03:01.760 that really says there's not a lot that Joe Biden 0:03:01.760 --> 0:03:05.280 can actually do to tame inflation, but voters are are 0:03:05.280 --> 0:03:08.400 going to blame him regardless. It's really a conundrum for 0:03:08.400 --> 0:03:11.480 for anybody in the executive branch because there's so little 0:03:11.560 --> 0:03:14.639 that um the president can actually do. And obviously, the 0:03:14.639 --> 0:03:17.119 the historical example of this that we also talked about 0:03:17.160 --> 0:03:19.200 in the package is the Jimmy Carter moment, right where 0:03:19.880 --> 0:03:23.720 every everything went wrong on for Jimmy Carter between Iran, 0:03:23.800 --> 0:03:28.440 the you know, the the pinches that consumers felt were 0:03:28.480 --> 0:03:31.320 really the thing that probably brought Reagan um into power. 0:03:31.360 --> 0:03:34.240 And so Biden is stuck in the same conundrum really 0:03:34.280 --> 0:03:37.320 that was very similar there where he does not have 0:03:37.400 --> 0:03:41.040 that many levers at his disposal, and Republicans we already 0:03:41.040 --> 0:03:44.040 know heading into mid term inflation will be a thing 0:03:44.120 --> 0:03:46.400 that they paint all over Biden. And I just want 0:03:46.400 --> 0:03:48.280 to squeeze in one last story first of all, because 0:03:48.280 --> 0:03:50.680 I love seeing Jim Ellis back in the nineteen eighties, 0:03:50.920 --> 0:03:52.840 uh and a picture of him with his little kids. 0:03:53.320 --> 0:03:55.800 It's adorable, but it's so real, like it reminds us 0:03:55.800 --> 0:03:58.200 of somebody, you know. When it comes down to it. 0:03:58.200 --> 0:04:00.960 It's what we're paying for things, right, well, Americans, what 0:04:01.080 --> 0:04:02.760 it costs to fill up at the pump and stuff. 0:04:02.800 --> 0:04:04.800 And Jim takes us back there and he remembers it 0:04:04.840 --> 0:04:07.800 really well when raiths were so high. Yeah, Jim Melis 0:04:07.840 --> 0:04:10.400 has done with the magazine for actually four years and 0:04:10.640 --> 0:04:13.080 uh he this goes back to when he was actually 0:04:13.080 --> 0:04:17.160 made bureau chief in Atlanta in the early eighties. So 0:04:17.320 --> 0:04:20.400 he gets transferred down there, and then the mortgage that 0:04:20.440 --> 0:04:23.520 he gets is fourteen and a half percent, and he, 0:04:23.680 --> 0:04:26.080 you know, he gets a two percentage point cut when 0:04:26.360 --> 0:04:29.440 mcdraw hill, who owned Business Week at the time, helped 0:04:29.560 --> 0:04:32.160 make it a little bit more palatable. But boy, you know, 0:04:32.279 --> 0:04:35.279 he goes through how how painful it was to suddenly 0:04:35.320 --> 0:04:38.240 have a mortgage rate be that high. I mean, it's 0:04:38.240 --> 0:04:41.400 just unfathomable now when you know we're looking at three 0:04:41.400 --> 0:04:46.080 percent rates feel even thirty year fixed mortgage, right three. Yeah. 0:04:46.480 --> 0:04:48.440 The other thing the legacy here that Jim connects it 0:04:48.440 --> 0:04:50.840 back to is now that he's an older American, inflation 0:04:50.920 --> 0:04:53.280 is really gonna hurt seniors because they're the ones who 0:04:53.320 --> 0:04:56.719 are living on closer to six incomes and and so 0:04:57.120 --> 0:04:58.640 you know, kind of was this thing that when he 0:04:58.680 --> 0:05:00.800 was a young man and now an older man, you know, 0:05:00.839 --> 0:05:03.560 you just can't escape in place. Hey Joel, uh, well 0:05:03.600 --> 0:05:05.880 we have you. We are talking rising prices though, but 0:05:05.920 --> 0:05:08.120 we also want to talk about shares of Ribbean since 0:05:08.120 --> 0:05:10.960 it's I p O and the rising prices were rising 0:05:11.000 --> 0:05:14.240 stock prices, right, we don't that's that's the thing. In 0:05:14.279 --> 0:05:17.080 the dex section, Bloomberg News editor in chief Emeritus Matt 0:05:17.080 --> 0:05:20.080 Winkler explains why this company is one D thirty billion 0:05:20.080 --> 0:05:23.760 dollar valuation and the absence of any actual sales is 0:05:23.800 --> 0:05:27.920 the ultimate validation of Tesla and the e V business. Yeah, 0:05:27.960 --> 0:05:31.320 so this is I found an interesting story because as 0:05:31.360 --> 0:05:35.600 we've seen, Ribbyan just absolutely pop since it's I p O. Uh, 0:05:35.640 --> 0:05:38.000 you know, it actually ends up and that's not right. 0:05:38.160 --> 0:05:41.400 It validates Tesla. Tesla has been out here for ten years, 0:05:41.640 --> 0:05:43.760 and you know, the assignment came from basically like, how 0:05:43.760 --> 0:05:47.520 did Tesla compare when I PO to Ribbyan's IPO. And 0:05:47.600 --> 0:05:49.640 one of the biggest things was that actually, at the 0:05:49.680 --> 0:05:52.360 moment that Tesla IPO and people forget this, they actually 0:05:52.440 --> 0:05:55.880 had product that was generating revenue. Obviously, Ribban a different 0:05:55.920 --> 0:05:58.200 story in that matter. But because of you know, the 0:05:58.200 --> 0:06:00.720 backing of companies like an Amazon having a huge steak 0:06:00.760 --> 0:06:04.279 and Ford it's sort of uh and the fact that 0:06:04.279 --> 0:06:07.520 they're looking at product lines that Tesla has not yet 0:06:07.600 --> 0:06:10.280 quite been in. There's a lot of euphoria for really, 0:06:10.320 --> 0:06:12.320 and that investors who felt like they may be missed 0:06:12.320 --> 0:06:14.640 down on Tesla, here's another chance to get in the game. 0:06:14.720 --> 0:06:16.520 All right, Well, that's a great story. And there's another 0:06:16.560 --> 0:06:19.800 one by Claire Setteth on childcare, the most broken business 0:06:19.839 --> 0:06:23.760 in America. So definitely check out the issue on newsstands, online, 0:06:23.880 --> 0:06:25.839 and of course on the Bloomberg Joel, thank you so much. 0:06:25.880 --> 0:06:27.800 Have a great weekend our thanks to Business Week editor 0:06:27.839 --> 0:06:30.159 Joel Weber joining us with a look of this week's 0:06:30.240 --> 0:06:33.400 double issue and coming up next, an American media powerhouse 0:06:33.520 --> 0:06:37.160 is igniting a startup spark within its vast portfolio of businesses. 0:06:37.200 --> 0:06:40.360 How Comcast NBC Universals bring a new wave of entrepreneurs 0:06:40.400 --> 0:06:43.040 into the fold. You're listening to Bloomberg business Week some 0:06:43.120 --> 0:06:45.520 trends when it comes to media. That's coming up next. 0:06:45.640 --> 0:07:00.520 This is Bloomberg. This is Bloomberg. Bus to this week 0:07:00.600 --> 0:07:04.440 with Carol Messer and Bloomberg Quick Takes Tim Stinovic from 0:07:04.480 --> 0:07:09.840 Bloomberg Radio. Comcast NBC Universal recently announced its fourth Lift 0:07:09.960 --> 0:07:13.360 Labs Accelerated class. If you're not familiar, well, the initiative 0:07:13.480 --> 0:07:16.520 identifies and funds early stage companies that are innovating in 0:07:16.560 --> 0:07:19.240 the digital content and connectivity space. It's part of the 0:07:19.280 --> 0:07:22.440 mass media and entertainment giants effort to capture and nurture 0:07:22.480 --> 0:07:25.880 that startups spark within its own portfolio of businesses. It 0:07:25.960 --> 0:07:29.800 also helps aspiring entrepreneurs to refine their processes and scale faster, 0:07:30.080 --> 0:07:33.560 putting themselves in a position to provide solutions to partner needs. 0:07:33.720 --> 0:07:35.800 It's really cool stuff, to be quite honest him. It's 0:07:35.800 --> 0:07:40.200 about the startups, where contents going, and Comcast wants a 0:07:40.280 --> 0:07:42.680 view into all of that. Daniel Cohne is VP of 0:07:42.720 --> 0:07:46.320 Startup Engagement over at Comcast NBC Universal. Her team fits 0:07:46.320 --> 0:07:49.960 within the Conglomerate Strategic Development Unit. Her goal, well, it's 0:07:49.960 --> 0:07:52.680 all about discovering and cultivating talent that she says is 0:07:52.800 --> 0:07:55.960 quote inventing the future. Yeah, so I'm just for a 0:07:55.960 --> 0:07:59.520 little of a little contact. Startup Engagement, which includes less 0:07:59.560 --> 0:08:03.000 Labs and sports Teck at Comcast NBCU we sit within 0:08:03.160 --> 0:08:07.240 strategic development, which essentially provides an early lens for for 0:08:07.360 --> 0:08:10.960 future growth areas in our company, UM and we bring 0:08:11.040 --> 0:08:16.000 together all parts of our company, Comcast, NBC, Universal, Park, Picture, Sky, 0:08:16.200 --> 0:08:19.520 and our broader family of brands to work side by 0:08:19.640 --> 0:08:24.360 side with strategically aligned global startups UM and it's really 0:08:24.480 --> 0:08:28.560 to drive a startup mindset back into our already innovative business, 0:08:29.280 --> 0:08:32.640 to develop new startup partnerships at the earliest stage with 0:08:32.720 --> 0:08:37.080 companies that are inventing the future, making customers and employees 0:08:37.120 --> 0:08:40.640 lives better. And ultimately those are the people who are 0:08:40.679 --> 0:08:43.160 also making an impact in startup communities in which we 0:08:43.200 --> 0:08:47.400 all live and work UM. The common thread is that 0:08:47.600 --> 0:08:51.079 through these programs and collaborations, we're all kind of spotting 0:08:51.080 --> 0:08:56.520 that potential disruption, emerging technologies, the new platforms, edge opportunities, 0:08:56.600 --> 0:09:00.640 and and all together startups and our ts are gaining 0:09:00.679 --> 0:09:03.040 valuable insights and efficiencies along. So what does that mean 0:09:03.040 --> 0:09:05.559 That every company that participates in the Lift Labs accelerator 0:09:05.760 --> 0:09:11.480 gets an investment from Comcast, So every company and inter accelerators, 0:09:11.520 --> 0:09:15.080 they do get an investment UM. But beyond the investment, 0:09:15.240 --> 0:09:19.080 it's really about building the partnership with these early stage 0:09:19.120 --> 0:09:24.360 companies that are working in media, entertainment, connectivity, or sports. 0:09:24.840 --> 0:09:28.200 Some are at the earliest stage, their steed stage companies, 0:09:28.240 --> 0:09:31.800 and then we actually have programs like lift Off their 0:09:31.840 --> 0:09:36.040 for enterprise ready startups, and our team really helps them 0:09:36.080 --> 0:09:39.560 to get enterprise ready. We help them with business development, 0:09:39.679 --> 0:09:44.760 go to market strategy, how to pitch UH investors. In 0:09:44.800 --> 0:09:47.280 some cases it's even you know, how to deal with 0:09:47.520 --> 0:09:50.040 hr issues that they're having as they build their their 0:09:50.040 --> 0:09:52.520 teams at the earliest stage. I was reading about what 0:09:52.559 --> 0:09:54.280 you guys are up to. It reminded me a few 0:09:54.320 --> 0:09:56.800 years ago I did a story with Johnson and Johnson. 0:09:56.800 --> 0:09:58.920 They something called j Labs out on the West Coast 0:09:58.920 --> 0:10:02.440 and it's basically an olerator biotech incubator, and it's just 0:10:02.800 --> 0:10:06.280 a space where companies individuals who are creating things in 0:10:06.320 --> 0:10:10.120 the healthcare science space, medicine space come in get a 0:10:10.120 --> 0:10:13.120 little spot there, but can work with the company, really 0:10:13.160 --> 0:10:16.959 tap into the expertise and equipment of J and J. 0:10:17.200 --> 0:10:19.200 But it gives J and J a window into the 0:10:19.240 --> 0:10:21.680 future and an ability to invest in it. And it 0:10:21.760 --> 0:10:23.560 sounds like that's what you guys are doing on the 0:10:23.600 --> 0:10:26.480 media space. I love talking about this because it gives 0:10:26.480 --> 0:10:27.960 you an idea of maybe what are going to be 0:10:27.960 --> 0:10:32.720 the trends, the technologies, UH content and so on and 0:10:32.720 --> 0:10:35.880 so forth, media, how we consume it going forward? What 0:10:36.000 --> 0:10:39.079 should we be thinking about, um, Danielle when we kind 0:10:39.080 --> 0:10:40.880 of open up our eyes in terms of where this 0:10:40.960 --> 0:10:44.640 is all going. And I know the folks that j 0:10:44.800 --> 0:10:47.079 labs and they do an amazing job, and we are 0:10:47.200 --> 0:10:50.560 we are similar in in our approach. UM. You know, 0:10:50.600 --> 0:10:53.640 the focus areas for us change all the time because 0:10:53.679 --> 0:10:56.400 they are based on trends that we're seeing both insider 0:10:56.440 --> 0:11:00.440 company and outside. UM. We've recently concluded at our our 0:11:00.520 --> 0:11:02.679 fourth program. As you mentioned, we had a demo day 0:11:02.720 --> 0:11:06.160 a couple of weeks ago, and the two primary trends 0:11:06.200 --> 0:11:09.520 that we saw last year that led to this year's class. 0:11:09.559 --> 0:11:12.480 One was in the future of work, a reoccurring theme 0:11:12.520 --> 0:11:16.240 that everyone every listener is feeling. UM. You know, really 0:11:16.240 --> 0:11:19.319 if you think about hybrid work collaboration tools. So we've 0:11:19.360 --> 0:11:22.280 got a bunch of companies that came through last year's 0:11:22.360 --> 0:11:25.600 class in this year's class. UH company called the Guiche 0:11:25.600 --> 0:11:27.960 from Israel as a mobile app that allows people who 0:11:28.000 --> 0:11:31.240 are deaf and hard of hearing to communicate via phone 0:11:31.440 --> 0:11:34.160 by converting speech to text and text to speech faster 0:11:34.640 --> 0:11:37.560 and more accurately than ever before. Our team's actually using 0:11:37.600 --> 0:11:40.800 them for for doing interviews with people who are hard 0:11:40.800 --> 0:11:44.679 of hearing. Another company think Confluent out of Paris as 0:11:44.720 --> 0:11:48.760 an AI assistant that can analyze free form, open ended 0:11:48.840 --> 0:11:52.719 survey questions that we've all done from employee surveys and 0:11:52.760 --> 0:11:56.360 get sentiment analysis what did someone mean by what they said? 0:11:56.840 --> 0:12:00.880 In second and out of Philadelphia headquarters, they employee Cycle, 0:12:00.920 --> 0:12:04.320 which curates multiple HR tools into one dashboard, making it 0:12:04.360 --> 0:12:07.360 really easier for businesses of all sizes to understand their 0:12:07.360 --> 0:12:11.160 employees concerns and what's going well you were talking about 0:12:11.240 --> 0:12:13.360 or you wanted to mention another theme that you guys 0:12:13.360 --> 0:12:18.160 have been focusing on take it away, Yeah, absolutely, UM. 0:12:18.200 --> 0:12:20.880 As you know, as an innovation company, we're always challenging 0:12:20.880 --> 0:12:23.280 the status quo and looking at new focus areas, and 0:12:23.320 --> 0:12:25.400 our our team is just you know, one part of 0:12:25.440 --> 0:12:30.480 the company's cross company collaborative innovation strategy. And one of 0:12:30.480 --> 0:12:33.080 the themes that came up this year that really stood 0:12:33.080 --> 0:12:37.840 out was interactive and immersive experiences. UM. We're really inspired 0:12:37.880 --> 0:12:41.000 by the creativity of the startups and their enthusiasm and 0:12:41.040 --> 0:12:44.320 building and launching and scaling these very novel solutions like 0:12:44.800 --> 0:12:48.720 Helodia UM, which is a fitness tech company that creates 0:12:48.920 --> 0:12:53.840 incredible VR experiences to enhance your workout at home or 0:12:53.840 --> 0:12:56.240 in the office. I tried it. It's in our fitness 0:12:56.240 --> 0:12:58.679 center at the Comcast Technology Center and it is out 0:12:58.679 --> 0:13:01.800 of this world. And another our company called Zoo, which 0:13:01.840 --> 0:13:05.400 makes it more engaging for grandparents and parents and their 0:13:05.480 --> 0:13:08.880 kids to stay in touch through augmented reality storytelling. And 0:13:08.920 --> 0:13:11.640 those are just two of the themes. We generally have 0:13:11.800 --> 0:13:13.960 about five themes for the year when we start to 0:13:14.040 --> 0:13:17.920 scout for startups UM and you know, over the years 0:13:17.960 --> 0:13:20.679 we have had a real proven track record. We now 0:13:20.720 --> 0:13:24.160 have about fifty companies in our portfolio that have gone 0:13:24.160 --> 0:13:26.719 on to to raise millions. All right, so Tim and 0:13:26.800 --> 0:13:30.760 I are dying to ask you metaverse, how is that 0:13:30.800 --> 0:13:34.440 playing in thinking or interest when or are some of 0:13:34.480 --> 0:13:40.199 the companies that are working uh uh in the accelerator. Yeah? Absolutely, 0:13:40.240 --> 0:13:43.400 I mean I think one of the companies that I mentioned, Helodia, 0:13:43.679 --> 0:13:48.240 is really about immersive experiences and uh, I'm not someone 0:13:48.320 --> 0:13:51.280 who loves to work out and I tried a rowing 0:13:51.360 --> 0:13:53.839 machine for the first time, not alone in that. I'm 0:13:53.880 --> 0:13:57.479 just going to tell you you're not alone. Well try Helodia, 0:13:57.640 --> 0:13:59.920 because I worked out for thirty minutes and I do 0:14:00.000 --> 0:14:02.320 it not realized I had worked out, and I was 0:14:02.440 --> 0:14:05.800 so in awe of the visual and what was happening 0:14:05.840 --> 0:14:08.760 around me. Is it a headset? You know? It's so 0:14:09.000 --> 0:14:11.760 you use a a VR headset, you'll use an oculust, 0:14:11.840 --> 0:14:13.920 but it's sort of agnostic. You can use it with 0:14:13.960 --> 0:14:17.240 any machine. But the more you row, the greater the 0:14:17.320 --> 0:14:21.000 visual experiences. And it made me work out. That was 0:14:21.120 --> 0:14:25.200 Danielle Cone, vice president of startup Engagement at Comcast NBC Universal. 0:14:25.360 --> 0:14:27.600 Still ahead on Bloomberg Business Week, we go from Lift 0:14:27.640 --> 0:14:30.160 Labs to Lift Off, the CEO of Wheels up stops 0:14:30.160 --> 0:14:33.400 by the talk earnings and surprise supply chain trouble. Even 0:14:33.440 --> 0:14:36.040 the private jet industry cannot avoid it. Plus how the 0:14:36.080 --> 0:14:38.520 company is providing incentives to its pilots to keep them 0:14:38.560 --> 0:14:47.640 out of commercial cockpits. This is Bloomberg broadcasting from the 0:14:47.720 --> 0:14:51.320 financial capital of the world, Bloomberg Eleve in Rio in 0:14:51.400 --> 0:14:55.880 New York to Washington, d C. Bloomberg to Boston Bloomberg 0:14:55.960 --> 0:14:58.960 one oh six one does San Francisco, Bloomberg nine six 0:14:59.240 --> 0:15:02.960 to the country, Sirius XM Chamber, and around the globe, 0:15:03.080 --> 0:15:07.280 the Bloomberg Business and Bloomberg Radio dot Com. This is 0:15:07.320 --> 0:15:11.240 Bloomberg Business Week with Carol Messer and Bloomberg Quick Takes. 0:15:11.360 --> 0:15:17.520 Tim Stinovin on Bloomberg Radio Product claims Tim, it definitely 0:15:17.520 --> 0:15:19.400 felt like it was a luxury that grew into a 0:15:19.440 --> 0:15:21.480 necessity at least for some during the height of the 0:15:21.480 --> 0:15:24.000 COVID nineteam, I mean I feel like luxuries understatement, right, 0:15:24.000 --> 0:15:26.200 this type of flying makes first class look like a 0:15:26.240 --> 0:15:29.960 bargain basement price. I know, listen, perspective, perspective here, folks 0:15:30.320 --> 0:15:32.880 supply jain worries. Though cost pressures are weighing on the 0:15:32.880 --> 0:15:35.760 outlook for wheels Up. It's a business that our next guest, though, 0:15:35.800 --> 0:15:38.560 believes it's still poised for significant growth. He definitely does. 0:15:38.640 --> 0:15:41.240 Kenny Dictor is the founder, chairman, and CEO of wheels Up. 0:15:41.360 --> 0:15:45.320 It's a publicly held private chartering company that reported earnings recently, 0:15:45.680 --> 0:15:48.400 posting a quarterly net loss of fifty nine and a 0:15:48.400 --> 0:15:51.400 half million dollars against a profit more than twenty million 0:15:51.400 --> 0:15:54.480 one year ago, shareholders looked past the fifty year over 0:15:54.560 --> 0:15:56.920 year revenue increase that brought in a company record at 0:15:56.920 --> 0:16:00.320 three million dollars. These are figures that dictor X spects 0:16:00.360 --> 0:16:03.440 to continue as share prices try to bounce back from 0:16:04.200 --> 0:16:07.760 one lows. First up, though, dealing with today's bottlenecks supply 0:16:07.960 --> 0:16:12.640 chain constraints definitely making it more expensive for us to 0:16:12.760 --> 0:16:16.360 deliver for our membership and over deliver for our membership. 0:16:16.440 --> 0:16:20.200 So short term pain here, but I think in the 0:16:20.240 --> 0:16:24.960 long run, this has been just a super supermarket for UH, 0:16:25.360 --> 0:16:28.600 for private aviation, and we see the demand really coming 0:16:28.640 --> 0:16:31.400 strong for you know, an extended period of time. You know, 0:16:31.400 --> 0:16:33.080 a friend of my husband and I well known in 0:16:33.120 --> 0:16:35.680 the airline industry and UH he and his wife both 0:16:35.680 --> 0:16:37.800 are and they've talked about though some of the shortages 0:16:37.840 --> 0:16:40.880 in constraints, whether it's pilots and workers coming back, that's 0:16:40.880 --> 0:16:43.920 some of what you guys experienced as well. Yeah, I mean, 0:16:43.960 --> 0:16:47.680 you know, you have this historic demand level that our 0:16:47.760 --> 0:16:51.000 industry is seeing. In the private aviation side, I think 0:16:51.040 --> 0:16:54.960 the supply chain, third party maintenance. You know, when a 0:16:55.000 --> 0:16:57.920 plane goes down a O g UH, it needs to 0:16:57.960 --> 0:17:01.440 be fixed that return to service time is critical. It's 0:17:01.440 --> 0:17:04.639 a little bit slower than it's been historically pilots as 0:17:04.680 --> 0:17:08.600 the commercial airlines are schooling back up. There's a movement 0:17:08.600 --> 0:17:12.040 around where again, I think that the industry is kind 0:17:12.040 --> 0:17:14.720 of finding its footing as it relates to the cost. 0:17:14.840 --> 0:17:19.399 I think they're they're temporary and transitory in nature for 0:17:19.440 --> 0:17:22.240 the most part. I think from a wheels up perspective, 0:17:22.280 --> 0:17:25.040 we're now giving our pilots equity. We rang the bell 0:17:25.080 --> 0:17:28.520 of the New York Stock Exchange uh July four team 0:17:28.560 --> 0:17:31.320 this year, So our pilots are all our partners now. 0:17:31.400 --> 0:17:33.879 So I think we have a really differentiated program to 0:17:33.920 --> 0:17:37.120 be able to attract the pilots and and keep them 0:17:37.160 --> 0:17:40.399 and again their partners in the business. Hey, Kenny, what 0:17:40.400 --> 0:17:43.119 can you tell us about demand and the way that 0:17:43.200 --> 0:17:45.959 demand has shifted during the pandemic Because this your business 0:17:46.000 --> 0:17:48.560 was around before the pandemic. You know, I've spoken many 0:17:48.560 --> 0:17:51.680 times before. How how did demand shift during the pandemic 0:17:51.720 --> 0:17:53.760 and how do we know that that demand will be 0:17:54.119 --> 0:17:56.960 uh long lasting, that that demand won't be transitory once 0:17:56.960 --> 0:18:00.600 the pandemic is over. Yeah. Well, going into the pandemic, 0:18:01.240 --> 0:18:06.320 our our industry was ramping up the convenience of flying privately. Uh, 0:18:06.359 --> 0:18:08.280 the idea of it you can get from A to 0:18:08.359 --> 0:18:10.120 B to see in one night and still be home 0:18:10.160 --> 0:18:12.840 for dinner. All of that was in play. I think 0:18:12.880 --> 0:18:15.920 technology is the big unlock here. You know, we partnered 0:18:15.960 --> 0:18:19.040 with a couple of former Amazon executives. Greg Realley was 0:18:19.040 --> 0:18:22.160 our chairman of Marketplace and Vanyak head Day, who's now 0:18:22.200 --> 0:18:25.639 our president. Uh. Technology is the big unlock in this space. 0:18:25.720 --> 0:18:28.000 You think about what Open table did for restaurants and 0:18:28.000 --> 0:18:31.199 what Hotel Tonight did for a real time availability in 0:18:31.240 --> 0:18:35.240 the hotel space. You know, nobody has endeavored to become 0:18:35.280 --> 0:18:38.480 the Amazon or the the Uber or the Airbnb of 0:18:38.520 --> 0:18:41.560 the private aviation space. And there's just so much latent 0:18:41.600 --> 0:18:45.960 capacity out there in the airframes. Like Travis Klinik and 0:18:45.960 --> 0:18:49.320 Garrett camp Will figured out that the American car was 0:18:49.400 --> 0:18:52.200 parked twenty three hours and thirty minutes a day. Uh, 0:18:52.240 --> 0:18:54.720 the average business jets parked twenty three hours and forty 0:18:54.720 --> 0:18:58.439 minutes a day. Well yeah right, and think about you 0:18:58.480 --> 0:19:01.600 know that's there. You're losing money just sitting there. Um. 0:19:01.640 --> 0:19:03.679 But I'm wondering, though, I want to go back to 0:19:03.760 --> 0:19:06.200 Kenny if I may the cost equation and the cost 0:19:06.240 --> 0:19:09.479 sight of your business. Total costs and expenses. We're up 0:19:09.480 --> 0:19:14.080 a year over year three sevent million dollars. We talked 0:19:14.119 --> 0:19:16.000 about you know, you guys are having to pay up 0:19:16.000 --> 0:19:19.879 to retain those pilots along with crew. Does that continue 0:19:19.920 --> 0:19:23.600 or how long does that continue into next year? Well, 0:19:23.640 --> 0:19:26.439 I would say the pricing. We have pricing power. Our 0:19:26.440 --> 0:19:30.680 industry has pricing power. We took very gently. We took 0:19:30.680 --> 0:19:34.000 eight on our entry level, the King Air and the 0:19:34.119 --> 0:19:37.199 light jet program. Uh, people will pay more now. We 0:19:37.240 --> 0:19:41.000 have a membership model I think Amazon Prime, think Costco, 0:19:41.240 --> 0:19:43.680 and we want to make sure that our members feel 0:19:43.680 --> 0:19:45.520 like that membership has a lot of value. And I 0:19:45.520 --> 0:19:48.159 would save it the wheels up membership today because of 0:19:48.160 --> 0:19:51.360 our availability and because of our willingness to take care 0:19:51.400 --> 0:19:54.639 of our members in this environment where prices are going up. 0:19:55.000 --> 0:19:57.639 We just want to be super gentle because we know 0:19:57.760 --> 0:20:02.880 how valuable these folks are lifetime value. And uh, again, 0:20:03.000 --> 0:20:05.000 if we took a short term approach, or we were 0:20:05.040 --> 0:20:08.480 a you know, sort of a charter broker or or 0:20:08.560 --> 0:20:11.400 somebody that was doing this one off, we couldn't take 0:20:11.440 --> 0:20:13.960 this long term approach. But we really believe in the 0:20:14.000 --> 0:20:17.000 lifetime value of our membership. That's Kenny Dickter. He's the founder, 0:20:17.040 --> 0:20:19.960 chairman and CEO of private aviation firm Wheels Up. You're 0:20:19.960 --> 0:20:22.520 listening to Bloomberg Business Week. Up next week turn our 0:20:22.520 --> 0:20:25.600 attention from private aviation to the commercial jet industry and 0:20:25.640 --> 0:20:29.520 a much larger company with much larger problems. We're going 0:20:29.560 --> 0:20:32.320 to talk with Bloomberg News Projects and Investigations reporter Peter 0:20:32.400 --> 0:20:36.359 Robison about truly an incredible new book that he's written. 0:20:36.480 --> 0:20:40.240 The title is Flying Blind Then Max Tragedy and the 0:20:40.240 --> 0:20:43.119 fallow Boeing How cost cutting in corporate arrogance at the 0:20:43.119 --> 0:20:46.439 world's largest planemaker led to tragedy in the air and 0:20:46.480 --> 0:20:57.040 a disaster for the company. This is Bloomberg. You're listening 0:20:57.080 --> 0:21:01.160 to Bloomberg Business Week with Carol Messer Bloomberg Quick Takes 0:21:01.240 --> 0:21:06.040 Tim Stinovik from Bloomberg Radio. It was a Bloomberg Big 0:21:06.080 --> 0:21:08.040 Take from the past week. One of our most read 0:21:08.119 --> 0:21:11.919 stories on the Bloomberg when it hit. It's also featured 0:21:11.920 --> 0:21:14.879 in the double issue of Business Week magazine, A chilling 0:21:14.880 --> 0:21:19.400 look inside the aviation giant Boeing. It is packed with details. 0:21:19.400 --> 0:21:22.960 It reads like fiction but we know Tim, it's reality. Yeah, 0:21:23.040 --> 0:21:26.120 a series of tragedies that certainly our listeners are familiar with, 0:21:26.160 --> 0:21:29.200 but new information about a series of missteps and oversights 0:21:29.240 --> 0:21:31.639 that would lead to a pair of major air disasters 0:21:31.640 --> 0:21:35.000 involving its prize seven thirty seven Max jet. The result 0:21:35.040 --> 0:21:38.280 was hundreds of lives lost and lasting reputational damage to 0:21:38.320 --> 0:21:41.280 the world's biggest planemaker. Well. The story is excerpted from 0:21:41.280 --> 0:21:44.080