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Speaker 1: Hi, everyone, Welcome to the Bloomberg Business Week Weekend Podcast
Speaker 1: and a very happy fourth of July. Well just about
Speaker 1: one week ago, we were live in Southampton, Long Island
Speaker 1: at the Uncharted Community Summit. It's an annual gathering of
Speaker 1: over five hundred members of the entrepreneurial community, and over
Speaker 1: the next two hours we will bring you some of
Speaker 1: our favorite conversations from that event. We'll hear from voices
Speaker 1: on artificial intelligence. In fact, I felt like everybody had
Speaker 1: a view when it came to AI. We talked capital
Speaker 1: markets and women's health. Plus we sit down with a shark.
Speaker 1: First up, though, we caught up with one of the
Speaker 1: co founders of the event, I've Uncharted and the man
Speaker 1: whose backyard we were literally broadcasting from. He is Michael Loebe,
Speaker 1: founder and CEO of lob dot NYC, who started off
Speaker 1: by telling us why this event is so important.
Speaker 3: If you were to take a look at the background,
Speaker 3: you would see, you know, six hundred people talking to
Speaker 3: six hundred other people. It's quite the event. And what
Speaker 3: we really want to do is foster relationships between investors
Speaker 3: and companies, between companies and companies, and between you know,
Speaker 3: CEOs looking for talent and talent looking for CEOs. So
Speaker 3: I think I think a good time is being had
Speaker 3: by all.
Speaker 4: You know, an event like this. You've been doing this
Speaker 4: for a few years and started during the pandemic, started
Speaker 4: a lot smaller. How do you and I heard you say,
Speaker 4: and your partner say this too, Noah, that he is
Speaker 4: running into people say, yeah, they raised money as a
Speaker 4: result of being here. They found a co founder here,
Speaker 4: they found employees here. How do you measure the success
Speaker 4: of an event such as this in the days, weeks
Speaker 4: and months following it?
Speaker 3: Right? I wish we could because I should have a
Speaker 3: big on all that.
Speaker 1: Yet you don't know it for a long time.
Speaker 3: So you know, I got to tell you we do
Speaker 3: solicit testimonials of exactly the things that you're talking about.
Speaker 3: We have quite a few of people saying, you know,
Speaker 3: I met my founder there about two years ago. Uh no,
Speaker 3: and I get an invitation and it was shrouded in mystery,
Speaker 3: and it was three women who had us go to
Speaker 3: an event downtown and they brought us up on stage.
Speaker 3: Everybody started a collap And what that was is these
Speaker 3: were three women never met before. They were all, you know,
Speaker 3: elite athletes, and they decided there should be a fund
Speaker 3: supporting elite athletes that they had a different point of view,
Speaker 3: a different sense of how to compete, and they all
Speaker 3: got along very very well. And that thesis led to
Speaker 3: a fifty million dollar fund. So it's that type of
Speaker 3: thing that you know, really propels us.
Speaker 1: Well, talk to us about you know capital, How much
Speaker 1: is out there for startups?
Speaker 3: Wow? You know it's funny things go in cycles. As
Speaker 3: you know, this is not an up cycle for capital formation.
Speaker 3: Last numbers I looked at and they're a little bit stale,
Speaker 3: but you know, down sixty or seventy percent. Certainly the
Speaker 3: secondary market, if that's any indication at all, does illustrate that,
Speaker 3: you know, there's a lot of ill liquidity looking to
Speaker 3: get liquid, not nearly as frothy as it used to
Speaker 3: be was IPOs, even though that's starting to unlock a
Speaker 3: little bit. So no, it's it is hard and the
Speaker 3: money does gravitate these days to AI, so you need,
Speaker 3: you know, if you have.
Speaker 1: So when there is an idea, when there is a startup,
Speaker 1: that's where it goes.
Speaker 3: It goes there, right. And what folks don't I think,
Speaker 3: really realize or appreciate is the forces at play in
Speaker 3: venture and venture funding and venture capital, which is I
Speaker 3: sometimes call it a beauty contest, and that is because
Speaker 3: there's one breakout winner in a category and then all
Speaker 3: the LPs are asking their gps, you know, what is
Speaker 3: your AI strategy? And if the answer is you know,
Speaker 3: we think it's a little over sold. We think it's
Speaker 3: a little bit you know, frothy. Whereas there's going to
Speaker 3: be a couple of winners and a lot of losers,
Speaker 3: weird taking a wait and see attitude. The answer is
Speaker 3: bye bye, I'm bringing my money to that fund that
Speaker 3: made that investment, so a lot of pressure for them
Speaker 3: to jump in. And it's in those situations that you know,
Speaker 3: not so good deals are made. Right.
Speaker 4: So yeah, does it you know, in terms of cycles,
Speaker 4: does it feel like this AI cycle is different than
Speaker 4: previous tech hype cycles. And the reason I ask and look,
Speaker 4: nobody wants to hear or utter the phrase this time
Speaker 4: is different. But it If you look out at the
Speaker 4: private markets right now, you've got skyhag evaluations. I think
Speaker 4: many would argue for open AI right, for anthropic, for perplexity.
Speaker 4: You have meta platforms coming in and dropping billions of
Speaker 4: dollars to buy forty nine percent of an AI company
Speaker 4: that barely existed. You have founders being poached. We're talking
Speaker 4: one hundred million dollar signing bonuses. Yeah, force an individual
Speaker 4: to go to a large company.
Speaker 3: Right. So I'm I look at my mailbox every day.
Speaker 3: I'm looking for one hundred million dollar check hasn't come
Speaker 3: in yet. Right to me, it feels different. Now, what
Speaker 3: does it feel like? I've been around for long enough,
Speaker 3: so I'm something of the elder statement here, statesman here,
Speaker 3: I've been around long enough that I've seen a few cycles.
Speaker 3: This feels like the late nineties and the late nineties
Speaker 3: was the advent of the internet, right, and it feels
Speaker 3: this profound now. You know, people can say, well, you know,
Speaker 3: if we look back two or three years, it was
Speaker 3: NFT and that was a false positive, and before that
Speaker 3: it was blockchain, which was sort of a false positive.
Speaker 3: And before that it was cannabis, and before that it
Speaker 3: was bitcoin. But this one feels real, and this adds
Speaker 3: the possibility of disrupting entire industries. I had breakfast, by
Speaker 3: the way, with a friend. He has a unicorn business
Speaker 3: is worth almost two billion dollars. He has two hundred
Speaker 3: and seventy people, and he said, Michael, by year end,
Speaker 3: it's one hundred and twenty.
Speaker 1: That's Michael Loebe, founder and CEO of Lobe dot NYC,
Speaker 1: and got to say a very very gracious host. We
Speaker 1: turned out to his Uncharted Community Summit colleague and co founder,
Speaker 1: Noah Friedman. He's the CEO of the organization, and he
Speaker 1: told us why this event is also so special.
Speaker 5: The most important thing in the truth of what I
Speaker 5: charge is all about is what's happening right now, which
Speaker 5: is people just mingling and met to each other. What
Speaker 5: we really care about here and what gets me excited
Speaker 5: as an entrepreneur is environment when I can kind of
Speaker 5: go up to anybody, shake their hand and say hello,
Speaker 5: and trust that they're going to be friendly knight and
Speaker 5: more important, someone who I can build with so I
Speaker 5: like to think that's what happened behind me, and I'll
Speaker 5: get the verdict from you guys and everyone else afterwards.
Speaker 5: If we did our jobs.
Speaker 4: What's being built right now in the startup ecosystem.
Speaker 5: Look, everything with the word AI in it is getting
Speaker 5: a ton of attention. I think there's a lot of
Speaker 5: big we talked about this show. I think there's a
Speaker 5: lot of businesses that don't have the word AI in
Speaker 5: m that are still remarkable companies that are getting a
Speaker 5: shockingly low amount of attention. And so you have this
Speaker 5: bar bell happening. I particularly am kind of on both
Speaker 5: sides of it. Right My find invests in alcohol and
Speaker 5: consumer device, which is, you know there's some AI, but
Speaker 5: that's pretty antithetical. And on the other side, I'm personally
Speaker 5: investing in trying to start companies in the AI space
Speaker 5: as well. Most of the people here, I can guarantee
Speaker 5: you if you ask them what's on your mind or
Speaker 5: now as a founder, AI is going to be obvious,
Speaker 5: and it's a natural. It's a natural thing to say,
Speaker 5: and I think that's top of mind for a lot
Speaker 5: of founders right now.
Speaker 1: When everybody's saying that, I think this is something do
Speaker 1: we talk about it with Michael or I'm trying to
Speaker 1: think We've had so many good conversations here this idea
Speaker 1: that there's just so much coming at us with an
Speaker 1: AI connection. But ultimately the dust is going to settle.
Speaker 1: There's going to be some really big winners and losers.
Speaker 1: How do you, as an investor who's also looking at
Speaker 1: these opportunities or an entrepreneur trying to start something up,
Speaker 1: how do you figure out which way to go?
Speaker 5: It's a great question. Look, I think that there's an
Speaker 5: unbelievable power law that's playing out here. I've said this
Speaker 5: a lot, and I'm going to continue to say it.
Speaker 5: I think that despite the fact that there is about
Speaker 5: to be so much money made in AI, an unbelievable
Speaker 5: title wave of innovation and opportunity, there's a lot of
Speaker 5: people who are going to get absolutely smoked, right, And
Speaker 5: the reason for that is that there's a lot of
Speaker 5: people who, out of necessity, based on funds that have
Speaker 5: raised money from LPs that are expecting them deploy, aren't
Speaker 5: trying to rush into arounds for businesses with basically a
Speaker 5: deck and an idea at fifty million dollars pre money
Speaker 5: valuations or sometimes even higher. Sometimes that will work, often
Speaker 5: it will not. And so I think that you have
Speaker 5: an interesting dynamic now where founders have a ton of
Speaker 5: power if they're willing to build an AI and I
Speaker 5: think that that plays nicely to the founder. So as
Speaker 5: an investor, as an entrepreneur, I'm thinking about how I
Speaker 5: can create leverage out of myself, use AI tools to
Speaker 5: get more out of Noah, more out of a small team,
Speaker 5: and create unbelievable levels of efficiency. But I think, like
Speaker 5: entrepreneurship as a whole, AI really is going to expose people.
Speaker 5: It's a aritocracy. If you are good enough to figure
Speaker 5: out how to use AI, there's an unbelievable opportunity at
Speaker 5: hand right now.
Speaker 4: There's been a lot of talk of AI today, talk about.
Speaker 3: Booze, let's do it.
Speaker 4: I'm into it. I'm curious about the where you see
Speaker 4: opportunity right now because we're seeing a real rise in
Speaker 4: non alcoholic beers, non alcoholic drinks. I mean, it's not
Speaker 4: weird to go and order a mocktail anymore. It used
Speaker 4: to be something that like kids did at bar and
Speaker 4: bought mitzvahs, but like that's actually happening in bars around
Speaker 4: New York City. What are the other vices and vice
Speaker 4: type categories that you're investing in, because it seems like
Speaker 4: there's this really movement away from vice.
Speaker 3: So I'll tell you right now.
Speaker 5: I have a potentially controversial opinion that the notion of
Speaker 5: betting against alcohol is a bad idea. I think alcohol,
Speaker 5: for a long time has proven that is remarkably resilient.
Speaker 5: This is not the first time and it won't be
Speaker 5: the last time that we hear headlines indicate that no
Speaker 5: one's drinking anymore. It is just not true. If you
Speaker 5: take the actual trajectory of alcohol consumption and sales over
Speaker 5: the last fifty years, it basically was a straight line
Speaker 5: north every single year, where the only thing we knew
Speaker 5: is that it was going to be higher next year
Speaker 5: than it was a previous year. In COVID, it's spiked
Speaker 5: like crazy every but he started drinking like fish, and
Speaker 5: everything went to the moon until all the manufacturers made more,
Speaker 5: the distributors bought more, the retailers ordered work as consumers
Speaker 5: were buying more, and then lockdown's ended and people said,
Speaker 5: you know what, I should get healthy, I should try longevity.
Speaker 5: I should focus on saunas and optimizing my sleep. I
Speaker 5: think that's a moment in time. I believe in the
Speaker 5: longevity space. But we've had a slight dip in all
Speaker 5: time high which has created this compression in the market
Speaker 5: where it's creating all these headlines under the indication that
Speaker 5: people are not drinking more. It's really just a reset.
Speaker 5: And if you actually look at the sales in twenty
Speaker 5: twenty four and twenty twenty five, they're higher than they
Speaker 5: were in twenty nineteen. So my personal hypothesis, and we're
Speaker 5: investing accordingly, is that yes, non OUC is real, it's interesting,
Speaker 5: but who's is and will continue to be a deeply
Speaker 5: important part of the American and global psyche economy and
Speaker 5: so many other things. I also think at the same time,
Speaker 5: nicotine pouches super super interesting, huge opportunity there. We're investing
Speaker 5: THHC beverages, huge opportunity there. So look, consumers and humans
Speaker 5: at the most fundamental level, put the market to side.
Speaker 5: They need escapism, they need social connectivity, they need connection.
Speaker 5: And until there's other commercially reasonable and available things like
Speaker 5: alcohol and nicotine and THHCH that can solve for it,
Speaker 5: there's gonna be a lot of money to be made
Speaker 5: in those spaces, all.
Speaker 1: Right, but something like non alcoholic beer, I mean substantial
Speaker 1: growth some reports indicating and you're like four hundred and
Speaker 1: fifteen percent increase from twenty eighteen to twenty twenty four
Speaker 1: in retail sales. And mind you, it's coming from maybe
Speaker 1: a smaller bottom. But having said that, are you not
Speaker 1: playing in that space?
Speaker 5: We haven't yet. I think if I had to guess
Speaker 5: in my in my funds, I think we'll make a
Speaker 5: couple a couple bets in the space. I just think
Speaker 5: I think it behaves distinctly differently than traditional alcohol and vice.
Speaker 5: I think there is a market for it. My personal
Speaker 5: bet is that we are probably near the top. I
Speaker 5: do think any beer is going to continue to grow.
Speaker 5: I think NA beer is probably the best use case
Speaker 5: for it. I think NA cocktails are a little bit tougher.
Speaker 5: NA wine's a little bit tougher. I don't quite get it.
Speaker 4: On the nicotine pouches. Yeah, you know, I've heard of
Speaker 4: some of the sort of direct consumer startups like Lucy's
Speaker 4: for example.
Speaker 3: We're investors.
Speaker 4: How do you compete with Zen?
Speaker 3: Though?
Speaker 4: I mean we're talking Philip Morris International, We're talrying about.
Speaker 5: We're talking about billions and billions of dollars. Yeah, Zen
Speaker 5: is the ten thousand pound grill in the room. They
Speaker 5: have more money than they know what to do with
Speaker 5: the reality and this goes into a fundamental thesis I
Speaker 5: have consumers are inherently promiscuous. I think they're excited to
Speaker 5: try new things. When you have a market that is
Speaker 5: and is going to continue to be as big as
Speaker 5: nicotine pouches are, there just has to be room for more.
Speaker 5: And so my thesis in bed is that, yes, Philip
Speaker 5: Morris has crushed it. Unbelievable acquisition was in and they're
Speaker 5: doing a great job. By definition, all the other big
Speaker 5: tobacco players and even I'm willing to bet that a
Speaker 5: lot of the booze companies as well are going to say,
Speaker 5: you know what, this is a huge market that behaves
Speaker 5: similarly to alcoholm Anyways, we need to play there.
Speaker 1: Thanks to Uncharted's Noa Friedman and Michael Lobe, coming up
Speaker 1: on Bloomberg Business Week more of our favorite conversations from
Speaker 1: the Uncharted Community Summit that was held just recently in Southampton,
Speaker 1: Long Island. It's an annual event up next as serial
Speaker 1: entrepreneur involved in the early days of the changing fintech landscape.
Speaker 1: You know, such things as PayPal and into It. Bill
Speaker 1: Harris is coming up next. This is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Weekdaily podcast. Catch us
Speaker 2: live weekday afternoons from two to five pm Eastern. Listen
Speaker 2: on Apple CarPlay and Android Auto with the Bloomberg Business app,
Speaker 2: or watch us live on YouTube.
Speaker 1: This is a special holiday edition of Bloomberg BusinessWeek, featuring
Speaker 1: some of our favorite conversations from the Uncharted Community Summit
Speaker 1: held recently in Southampton, Long Island. And I got to
Speaker 1: say this. Next guest needs no introduction.
Speaker 4: Okay, you promised. We talked to a serial entrepreneur who
Speaker 4: has a ton of experience in the fintech space. I
Speaker 4: want to bring in Bill Harris. He's a longtime fintech executive.
Speaker 4: He's founded or led several personal finance companies, think from
Speaker 4: companies such as into It, PayPal as well. He was
Speaker 4: the founding CEO there. He ran TurboTax, he founded personal Capital,
Speaker 4: you remember just a few years ago that was bought
Speaker 4: by Empower. Right, so he knows a thing or two
Speaker 4: about yeah, how people are using these apps these days,
Speaker 4: all right, now.
Speaker 1: That the event is underway. I'm just curious anybody you've
Speaker 1: talked to, any interesting conversations that you've had so far?
Speaker 6: Well, sure, you know.
Speaker 7: The most interesting fella here is, of course Michael Lobe,
Speaker 7: and I've known him actually for now.
Speaker 6: I talked to him just a moment ago. Forty years wow,
Speaker 6: forty years ago.
Speaker 7: We worked together in the magazine industry, which of course
Speaker 7: is no longer, but.
Speaker 1: In a subscription business, right that Time Warner bought.
Speaker 6: That's right.
Speaker 7: But first we worked together at Time Ink and then
Speaker 7: he left to go build the subscription business that he
Speaker 7: sold back to Time Inc.
Speaker 1: Kind of fascinating. I just can we just go there
Speaker 1: for a minute. Media, the changes that we have seen
Speaker 1: in content production where you get it, I don't know
Speaker 1: who'd have thought. I mean, I used to do subscriptions,
Speaker 1: right in terms of magazines and various newspapers. We don't
Speaker 1: do that anymore. Where do you think it's all going?
Speaker 7: Well, it's you know, finance and media are the two
Speaker 7: industries most profoundly changed by digital technology. Yeah, because they
Speaker 7: are all just figments of our imagination, and you can
Speaker 7: create them with no assets, just your mind. And so
Speaker 7: you know what happened though, is that media. The tsunami
Speaker 7: of digitization hit media fast, and old media came crumbling down,
Speaker 7: and new media obviously has just done nothing but the
Speaker 7: upward tilt. It has not yet happened, generally speaking, in
Speaker 7: financials and services, and you still have the same fifty
Speaker 7: year old, one hundred year old, one hundred and fifty
Speaker 7: year old firms that dominate, and so that industry is
Speaker 7: now ripe for digitization.
Speaker 4: A lot of folks are working to digitize that industry.
Speaker 4: You've been working in that for decades at this point.
Speaker 4: But it's a very lucrative industry. It's also very sticky
Speaker 4: when it comes to the way people manage their assets.
Speaker 4: They don't want to move advisors, they don't want to
Speaker 4: move firms. They I think, especially high net worth individuals,
Speaker 4: still feel like they want somebody to talk to and
Speaker 4: that service comes with fees eighty basis points, one hundred
Speaker 4: and twenty basis points. Those fees eat into returns. This
Speaker 4: is something that you've been working on for years. You
Speaker 4: did it at Personal Capital, Yes, what are you doing
Speaker 4: now at Evergreen Wealth?
Speaker 6: We're doing two things. We're doing wealth management.
Speaker 7: Wealth management for people who have let's say investable assets
Speaker 7: of a million to five and these are people who
Speaker 7: don't get the kind of white glove service that people
Speaker 7: who have ten twenty one hundred million dollars do. And
Speaker 7: so what they need is somebody who can take the
Speaker 7: tax and investment principles that the people who have more
Speaker 7: money utilize because they have tax attorneys and all the rest,
Speaker 7: and then look for someone who can use technology to
Speaker 7: make that scalable and in fact precision engineering to make
Speaker 7: it even better than traditional wealth managers deliver. If we
Speaker 7: do that, we can give them better pre tax return
Speaker 7: and then better after tax return, because that's the thing
Speaker 7: that everyone forgets.
Speaker 1: Can everybody benefit by this?
Speaker 7: Yes, absolutely, everyone who has sufficient resources that the tax
Speaker 7: impact is meaningful. And so a couple of one hundred
Speaker 7: thousand dollars to a couple of million dollars, yes, you
Speaker 7: should absolutely be managing your investment portfolio in a tex
Speaker 7: aware way.
Speaker 4: You're the founding CEO of PayPal. We talk a lot
Speaker 4: about the PayPal mafia. Those folks we've spoken to Read Hoffman,
Speaker 4: David Sachs. These guys really don't need any introduction. Elon Musk,
Speaker 4: of course, is among them to what extent are these
Speaker 4: folks still in your universe right now?
Speaker 7: Well, for the most part, we've gone separate ways. Even
Speaker 7: many of the people within within the so called mafia.
Speaker 7: I've moved from Silicon Valley to Miami, so I have
Speaker 7: sort of a new set of people.
Speaker 4: That I'm working at.
Speaker 6: Them have too somehow, Yes, that's right.
Speaker 4: And some of them have moved back to San Francisco too.
Speaker 4: There maybe Texas some of them as well. Yeah, okay,
Speaker 4: so on that and sort of on payments. Yes, I
Speaker 4: thought of you the other day because the crypto firm
Speaker 4: Kraken Yes, is launching this competitor to to Venmo into
Speaker 4: the cash app, essentially using the blockchain to transfer money.
Speaker 4: And I'm wondering how you look at that as somebody
Speaker 4: who really pioneered technology for sending money over the internet.
Speaker 4: Is the blockchain? Is crypto really going to disrupt that?
Speaker 7: I think the blockchain is very good for some purposes.
Speaker 7: I don't have much use for cryptocurrency, because we have
Speaker 7: plenty of currencies that are very good, but the blockchain
Speaker 7: can do a heck of a lot, particularly on international
Speaker 7: money movement, because we're looking at Swift, you know, which
Speaker 7: takes at least a day, sometimes multiple days to get
Speaker 7: significant money moved from America to Singapore.
Speaker 6: And with the right crypto networks, you can do it
Speaker 6: like that, that easy, sure, and that fast.
Speaker 4: So that sounds like Western Union gets disrupted in a
Speaker 4: situation like that. That's what it sounds like to me.
Speaker 7: Not quite, because Western Union. Western Union is all about
Speaker 7: the last mile, and Western Union is doing lots of
Speaker 7: little payments and for most in most of the world,
Speaker 7: it's actually agents, physical agents who are who are taking
Speaker 7: the money and giving out the money.
Speaker 6: So that's a very different thing.
Speaker 7: But if you're doing bank to bank payments or business
Speaker 7: to business plans.
Speaker 6: The big guys, the big guys.
Speaker 1: Yeah, So does it happen eventually?
Speaker 7: Oh yes, yeah, yeah. There is no reason whatsoever in
Speaker 7: this day and age it should take multiple days to
Speaker 7: get money from here to there.
Speaker 4: Amen.
Speaker 7: But and we were doing twenty five years ago. We
Speaker 7: were moving money instantly, skittering it around the world at PayPal.
Speaker 6: It's not that hard.
Speaker 1: So are there going to be big players in it?
Speaker 6: I don't know. I don't follow, I don't follow what's happening.
Speaker 7: You know, Ripple took a stab at it for a
Speaker 7: while but I haven't heard anything about that in a while,
Speaker 7: So I don't.
Speaker 1: Know what you know. Just got about thirty seconds here.
Speaker 1: I mean, AIS have obviously the trend that everybody talks
Speaker 1: about in terms of its impact. Is there anything else
Speaker 1: though outside of AI? Or is it really just about
Speaker 1: artificial and eence which is not a new thing, but
Speaker 1: it's certainly on a different level too.
Speaker 4: Yeah.
Speaker 7: So I'll just say quickly, in what I'm doing Evergreen Wealth,
Speaker 7: we're doing two things. First of all, we're using AI
Speaker 7: to revolutionize how financial advice can be delivered. But the
Speaker 7: other important thing we're doing is bringing tax considerations into
Speaker 7: investment management, because.
Speaker 6: It's not what you earn, it's what you keep that counts.
Speaker 1: That's former PayPal CEO Bill Harris speaking with us at
Speaker 1: Michael Loebe's annual Unsharted Summit. Another guest we heard from
Speaker 1: at the event Allie McCartney. She is Managing director of
Speaker 1: Private Wealth Management at UBS, and she started off by
Speaker 1: telling us why she comes to this event.
Speaker 8: So UBS and I traffic at the intersection in liquidity
Speaker 8: events and in individuals, and so what does that mean?
Speaker 8: That's entrepreneurship and so one of the beautiful things about
Speaker 8: this event and about our partnership with it is. Michael
Speaker 8: Lobe opened by saying, this is a celebration of entrepreneurs
Speaker 8: and entrepreneurialism. Right, and so if you go through all
Speaker 8: of the things things that are happening in our world today,
Speaker 8: all of the trends, deglobalization being a big one, right right.
Speaker 8: Where does wealth come from in this country? It's intellectual property.
Speaker 8: It is six million businesses founded last year. It is
Speaker 8: being at these events and having funders and founders meet,
Speaker 8: providing very valuable networking opportunities, and for us to be
Speaker 8: able to be supportive of that community full stop is
Speaker 8: really the bread and butter of what we do at ubs.
Speaker 4: Does it give you new opportunities to bring new money
Speaker 4: into your firm or is it more like, okay, when
Speaker 4: I'm allocating my client's assets. Yeah, I'm thinking about these
Speaker 4: alternatives because I talked about these types of businesses with
Speaker 4: people at this conference.
Speaker 8: So yes, and yes, I would say there are three
Speaker 8: things it does. It is certainly, you know, a prospecting,
Speaker 8: right rich environment in terms of there are people here
Speaker 8: who obviously we know the numbers of the success of
Speaker 8: startups and franchises of these people are going to be
Speaker 8: the next unicorns, right, So there's that. The second is
Speaker 8: it allows me to learn about AI or why the
Speaker 8: founder of Tesla, you know, founded Tesla and what he's
Speaker 8: thinking about now. And then the third thing is it
Speaker 8: allows me to find new opportunities for myself and my
Speaker 8: clients to be outside of this environment, both educated and
Speaker 8: proximant to the new trends that are driving sort of
Speaker 8: where the puck is and how we'll invest for sure.
Speaker 1: You know, it's funny you see the founder of Tesla,
Speaker 1: because Elon Musk was not actually the founder, was he?
Speaker 3: He?
Speaker 8: So it was very funny because the first panel was
Speaker 8: someone who's just been seven months in the White House. Yeah,
Speaker 8: and so Elon Musk was a topic of conversation there.
Speaker 8: And then the next man after was the founder of Tesla,
Speaker 8: who I thought, who very elegantly decided not to answer
Speaker 8: that question.
Speaker 1: You know what's funny too, is and I think about
Speaker 1: wealth management. You do have, I'm assuming as clients a
Speaker 1: lot of folks that are founders, and whether they're looking
Speaker 1: to sell their company and find a deal, or maybe
Speaker 1: you have other clients who have money they want to
Speaker 1: put to work. And they want to have a piece
Speaker 1: of a company. A lot of that is what goes on, right.
Speaker 8: Oh, a lot of that is what goes on. So
Speaker 8: I think like, if you think about the path of
Speaker 8: a founder of an entrepreneur, right, you have an idea,
Speaker 8: there's something disruptive, there's some challenge or problem you're trying
Speaker 8: to solve in the world. And you know, we were
Speaker 8: learning today that most people sell fund that by using
Speaker 8: credit cards, personal assets and their four to one K, right,
Speaker 8: they make less than one hundred thousand dollars for years
Speaker 8: and years and years, and they are just so embedded
Speaker 8: in their company and the mission and the branding that
Speaker 8: they're not thinking about the tax consequences, whether they can
Speaker 8: take advantage of qualified solled business stock. Could the business
Speaker 8: be stuck in a marriage in court and decided by
Speaker 8: the state of California or Florida if they don't have
Speaker 8: a pre nut so all of the So what we
Speaker 8: do is we say, look, if you are extremely successful,
Speaker 8: you're going to get to a liquidity point where some
Speaker 8: lawyer or some general counsel or Anderson Tax is going
Speaker 8: to say, have you talked about the planning and this?
Speaker 8: And at that point you can maybe add a couple
Speaker 8: percent of value. But if you can find these people
Speaker 8: as they are stuck in what I call the valley
Speaker 8: of death, sort of that middle part of building a business,
Speaker 8: and you can get an hour with them, just to say,
Speaker 8: there are a couple things we can do from an
Speaker 8: investment perspective, an entity perspective, and a tax perspective that
Speaker 8: if you are as successful as you think you are,
Speaker 8: you can protect yourself and investors and you can make
Speaker 8: your net much bigger than what it would be otherwise.
Speaker 4: As you know, entrepreneurs are not focused on this stuff.
Speaker 3: We now no, no, no.
Speaker 4: So if they haven't taken advantage of something like the QSBS, yeah,
Speaker 4: and if they didn't set up the business that way
Speaker 4: initially can get can they change it to actually get
Speaker 4: that benefit?
Speaker 8: It becomes increasingly difficult as you take and capital, you
Speaker 8: have more LPs, et cetera. But there are many many
Speaker 8: ways to do it. And I think most people know
Speaker 8: about that ten million dollar headline number. So I've seen
Speaker 8: many many times that protected Our goal is to try
Speaker 8: to be in front of entrepreneurs and support them, but
Speaker 8: to try to get them either to think about which
Speaker 8: is really challenging or get them to sort of open
Speaker 8: up themselves to allowing someone to act on their behalf
Speaker 8: even when they're not there yet.
Speaker 1: That's Ali McCartney, Managing Director, Private Wealth Management at EBS.
Speaker 9: Still ahead on.
Speaker 1: Bloomberg Business Week. More from our visit to Michael Lobe's
Speaker 1: Unsharted conference in the Hamptons. Up next to check on
Speaker 1: the health and activity of capital markets with someone who
Speaker 1: knows a lot about it has a front row seat.
Speaker 1: He has the vice chair of the New York Stock Exchange.
Speaker 1: That's next. This is Bloomberg.
Speaker 2: This is the Bloomberg Business Week Daily Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on Applecar and
Speaker 2: Android Auto with the Bloomberg Business App. You can also
Speaker 2: listen live on Amazon Alexa from our flagship New York station,
Speaker 2: Just Say Alexa played Bloomberg eleven thirty.
Speaker 1: This is a special holiday edition of Bloomberg Business Week,
Speaker 1: featuring some of our favorite conversations from the Uncharted Community Summit.
Speaker 1: It was held recently in Michael Lobe's backyard in the Hamptons.
Speaker 1: At the summit was Michael Harris. He has his finger
Speaker 1: on the pulse of what is going on when it
Speaker 1: comes to publicly held companies, old issues and new issues
Speaker 1: that have come to market, such as IPOs. He's vice
Speaker 1: chairman and global head of Markets at the New York
Speaker 1: Stock Exchange.
Speaker 4: Last time we spoke with you was at another event
Speaker 4: equally beautiful, by the way, equally beautiful downtime exactly.
Speaker 10: That was.
Speaker 4: That was back in early March. A lot has happened. Yeah,
Speaker 4: since then, we've kind of had a round trip when
Speaker 4: it comes to equity markets. There were some concerns a
Speaker 4: few weeks after we spoke about companies pulling their IPOs
Speaker 4: as a result of what was happening with trade. Those
Speaker 4: IPOs they ended up happening in May and June. How
Speaker 4: would you describe the environment right now?
Speaker 11: I mean, I think, you know, the round trip that
Speaker 11: you described is exactly the way to think about it.
Speaker 11: You know, we've seen a complete one hundred and eighty
Speaker 11: degree turn in terms of sentiment, in terms of where
Speaker 11: the market backdrop is, and it's playing out in the
Speaker 11: IPO market on a couple different factors. On one hand,
Speaker 11: we're seeing the subscription levels in terms of interest on
Speaker 11: IPOs are through the roof. So these deals that are
Speaker 11: coming to the marketplace are multiple times over subscribed interest
Speaker 11: from a wide range of investors. The second part of
Speaker 11: it is when they do come to the market, the
Speaker 11: actual pricing outcomes are oftentimes very much in the favor
Speaker 11: of the issuers. And then the third part of it
Speaker 11: is the performance, which you mentioned just now, the performance
Speaker 11: on day one, the follow through in the aftermarket, all
Speaker 11: the way through the offer to today's performance has been
Speaker 11: absolutely phenomenal. So that really keeps the cycle in terms
Speaker 11: of investor interest continuing to go. And so what we're
Speaker 11: seeing that play out is really in our backlock. So
Speaker 11: we see a very active summer, we see an active September,
Speaker 11: and we think it's going to be a very active
Speaker 11: twenty twenty five right forward.
Speaker 1: What does that backlog look like? You say active, I
Speaker 1: mean how backed up is it and how eager are
Speaker 1: these that are back ready to go?
Speaker 11: Yeah, Well, you know, for the first part, you're seeing,
Speaker 11: on one hand, a lot of companies that were delaying
Speaker 11: their IPOs because of some of the tensions that happened
Speaker 11: in the beginning part of the year. So some of
Speaker 11: them have taken a step back and they were kind
Speaker 11: of waiting to see. On one hand, just what happened
Speaker 11: from a geopolitical standpoint, how things are playing out in
Speaker 11: terms of just the tensions that we're in the air.
Speaker 11: And also they're waiting to see from the investor community
Speaker 11: what the reception was going to be for some of
Speaker 11: the more recent crop of IPOs. So we've gotten those results.
Speaker 11: Those results have been in many cases much better than
Speaker 11: they thought they would be, and so they're now ready
Speaker 11: to push forward. The other part of it is what
Speaker 11: we're seeing now is a much more diverse array of
Speaker 11: companies that are going public. You know, when you and
Speaker 11: I talked, we were talking about who would be the
Speaker 11: most likely companies to go public, and they would be
Speaker 11: likely the more defensive names. Now we're seeing that start
Speaker 11: to broaden out, so or our pipeline and looks more
Speaker 11: diverse than it was back in March. It looks awester
Speaker 11: for larger companies that are also going to be coming
Speaker 11: So really, in all respects, it tends to be a
Speaker 11: very healthy outcome.
Speaker 4: How has that pipeline diversity shifted in recent years? I
Speaker 4: remember when I spent three four years working from the
Speaker 4: floor of the New York Stock Exchange as a reporter,
Speaker 4: and there was a period in twenty seventeen twenty eighteen,
Speaker 4: no joke, no exaggeration. Almost every other day there was
Speaker 4: a Chinese company going public in the United States. These
Speaker 4: were companies we had never heard of. There were companies
Speaker 4: that we haven't heard from since. I mean, it was
Speaker 4: really really wild times. Then there was this crackdown on
Speaker 4: a lot of these companies that were listed from China
Speaker 4: in the US. Yeah, has that business completely dried up
Speaker 4: for you? I mean she and has filed confidentially to
Speaker 4: listen to.
Speaker 11: IDEO in k We saw that today, Yeah, yeah, yeah,
Speaker 11: you know, it's interesting. There's still a class of companies
Speaker 11: that are for the most part microcap in nature, a
Speaker 11: lot of them domiciled in China that are still coming public.
Speaker 11: That's a class of companies that quite frankly, we have
Speaker 11: the New York Stock Exchange really don't really look to
Speaker 11: Some of our competitors tend to focus on that market.
Speaker 11: And we've seen a number of articles, whether it's from
Speaker 11: the Wall Street Journal, Financial Times or others, that have
Speaker 11: really pointed to some of the problems that have become
Speaker 11: as a result of that. So that's not something really
Speaker 11: focus on. But we are still seeing some of those
Speaker 11: companies come to the public markets. But I think there's
Speaker 11: some challenges with that, and there's going to probably continue
Speaker 11: to be challenges with that going forward.
Speaker 4: Still out of China, some are they choosing to list
Speaker 4: in other areas of the world.
Speaker 11: Yeah, you know, it depends a little bit on market cap,
Speaker 11: it depends on the sector. I think what you are
Speaker 11: seeing is a bit of a preference for many companies
Speaker 11: just for liquidity. So the US market still continues to
Speaker 11: be a place where they would like to list, but
Speaker 11: for larger names, the home markets continue to be also
Speaker 11: very attractive, you know, Cattle being a great example of that.
Speaker 11: Early in the year, shean looking to the Hongkong relative
Speaker 11: to London. So, depending on the name, depending on the sector,
Speaker 11: depending on the specifics of those companies, home markets can
Speaker 11: also be a very viable alternative.
Speaker 9: To Michael.
Speaker 1: In some of the cases with the IPOs, we've really
Speaker 1: seen quite a pop on that first day of trading, right.
Speaker 9: That's a good sign.
Speaker 1: You know, we want to see that as certainly a
Speaker 1: company that's going public wants to see that. But it
Speaker 1: always begs the question, were they too conservative in you know,
Speaker 1: the numbers that they put out there. I am curious,
Speaker 1: what are the conversations that you're hearing from those folks,
Speaker 1: and those companies that are looking to go public, are
Speaker 1: they would they rather be a little conservative going in
Speaker 1: and making sure that that's a good first day of trading.
Speaker 4: Yeah.
Speaker 11: You know, I think when you talk to people in
Speaker 11: the world of IPOs, whether they're bankers or lawyers, you know,
Speaker 11: it's often talked about being more of an art than
Speaker 11: a science, and I think there is a little bit
Speaker 11: of truth to that. Yeah, there's a balancing act that
Speaker 11: always has to happen, and also companies that are investors
Speaker 11: rather they're going to be supporting the company from a
Speaker 11: liquidity perspective, and there's a balance of the two in
Speaker 11: the aftermarket. And the reality is, until you actually get
Speaker 11: to that stage where you're in the pricing room and
Speaker 11: you're actually confronting with management in terms of what the
Speaker 11: dynamics look like, it's sometimes tough to tell. And so
Speaker 11: I think the underwriters do a great job of being
Speaker 11: able to offer what those trade offs are going to
Speaker 11: be to management teams. Ultimately, the management teams are the
Speaker 11: ones that have to make those really tough decisions. But
Speaker 11: I always think about it in terms of the IPO
Speaker 11: process Ultimately it's a day one event, and really what
Speaker 11: management teams, what their stakeholders need to focus on is
Speaker 11: really trying to set up a company for success over
Speaker 11: the long term and not focus on necessarily the day
Speaker 11: one performance. Obviously you want a great pricing outcome, but
Speaker 11: really you're managing this company for the long haul. It's
Speaker 11: not really just for the day one IPO event.
Speaker 4: Can you give us an update on the New York
Speaker 4: Stock Exchange Texas launch this year? We talked about it
Speaker 4: back in March.
Speaker 11: Yeah, yeah, we have, you know, multiple companies that are
Speaker 11: now listed there. We have a pretty fairly healthy pipeline
Speaker 11: of companies that are going to be going listing on
Speaker 11: the exchange over the next several months. We are very
Speaker 11: close to signing a lease in Dallas. It's really continuing
Speaker 11: to take on momentum, and so we really are excited
Speaker 11: about it.
Speaker 4: Do you think it's perhaps a hedge in New York
Speaker 4: City losing its place when it comes to capital markets?
Speaker 4: And I ask this kind of came into sharp relief
Speaker 4: this week with I think a lot of people would
Speaker 4: argue with what happened in the Democratic primary for the
Speaker 4: mayoral election. We certainly have a lot of outspoken billionaires
Speaker 4: who've talked about concerns when it comes to capital markets
Speaker 4: here in New York in the position of New York
Speaker 4: City as being the epicenter of Wall Street.
Speaker 11: Yeah, I mean for Texas, the way that we've thought
Speaker 11: about it is when we look at our own listed
Speaker 11: community and we look at the number of companies in
Speaker 11: terms of where they're domiciled, Texas really stands out tends
Speaker 11: to be the area where we have the most number
Speaker 11: of companies from a really diverse range.
Speaker 3: Of sectors that are represented.
Speaker 11: And so when we kind of really thought about it
Speaker 11: from the perspective of what Governor Abbott's doing to try
Speaker 11: to make sure that the ecosystem of companies within Texas
Speaker 11: is vibrant, and you know, it intersects with a lot
Speaker 11: of what we're trying to do in terms of getting
Speaker 11: a great environment for our own listed community, it really
Speaker 11: made sense. So we think about this more from the
Speaker 11: long term perspective of offering the best environment for our
Speaker 11: listed community, less in terms of like a short term
Speaker 11: strategy in terms of what might be happening in the
Speaker 11: New York ecosystem. We still are big believers that New
Speaker 11: York continues to be a great place for capital raising
Speaker 11: and also for companies to be domiciled.
Speaker 1: But longer term than does that mean, does it expand
Speaker 1: the model?
Speaker 11: It's hard to know, you know, really just focused on
Speaker 11: kind of where we see the greatest opportunity for our
Speaker 11: community right now. But we're always forward thinking in terms
Speaker 11: of really trying to see where the greatest opportunity results
Speaker 11: for our community.
Speaker 1: That's Michael Harris, Vice Chairman and Global head of Markets
Speaker 1: at the New York Stock Exchange. We also caught up
Speaker 1: with a shark at the Uncharted Community Summit on Long Island.
Speaker 1: Damon John is the founder and CEO of Fubu, and
Speaker 1: of course he's also a shark on ABC's reality show
Speaker 1: Shark Tank. We spoke about how hard it is to
Speaker 1: start a brand.
Speaker 11: It is not easy.
Speaker 1: Is it getting any easier or is it harder? And
Speaker 1: I feel like it's an environment where anybody can almost
Speaker 1: have a brand.
Speaker 12: I do think it's getting harder. I think because you
Speaker 12: have to find this niche audience. But not only do
Speaker 12: you have to create the brand itself for your product
Speaker 12: or services, but you as a CEO and a founder have.
Speaker 3: To be a brand as well.
Speaker 1: What does that mean?
Speaker 12: Well, that means that people would not only want to
Speaker 12: know why they're investing in the brand or the product
Speaker 12: or buying it. What story does that brand or product
Speaker 12: have as well as founders?
Speaker 3: Who are you?
Speaker 13: You know?
Speaker 12: I always say on Shark Tank that you know, none
Speaker 12: of us are original. I mean, there's a million real
Speaker 12: estate agents, there's only one Barbara Corkan. A lot of
Speaker 12: people own sports teams, Mark Cuban clothing line, you.
Speaker 3: Know what I mean?
Speaker 12: People we had created personal brands, and then our brands
Speaker 12: now walk into the room before we do when we
Speaker 12: want to raise capital, when we want to make decisions,
Speaker 12: when we want to defend the fact that somebody is
Speaker 12: saying negative about our brand and our company and affecting
Speaker 12: our payroll and our amazing staff that works for us.
Speaker 4: Do you think you could create Fubu today?
Speaker 12: Absolutely, one hundred percent.
Speaker 4: But today's it's a completely different environment.
Speaker 12: Today's Fubu would be a different right, There's no there's
Speaker 12: not new to have four young African American men designing
Speaker 12: for their own markets.
Speaker 3: So what would food will be today?
Speaker 12: I would probably do more of the avon uh you
Speaker 12: know type of thing where I would have one male,
Speaker 12: one female in a college and a high school. They
Speaker 12: would get probably about a one thousand dollars worth of
Speaker 12: fooble on credit for about three hundred dollars, probably underwritten
Speaker 12: by hopefully somebody great. And the more they sell, they
Speaker 12: would get more digital curriculums and various other things and
Speaker 12: very much of an Avon model. So I would have
Speaker 12: hopefully two million sales reps around the world.
Speaker 4: It's so interesting that you say that, because the retail
Speaker 4: environment has completely changed. It's done. It's done, Yeah, completely done.
Speaker 12: You know, I've been to fifty six trade shows this year.
Speaker 12: You know, I speak at a lot of shows, and
Speaker 12: the traffic besides the franchise show and maybe the medical
Speaker 12: tech show, it is one third of the traffic at
Speaker 12: these shows. Because these retailers are now dying. They're not
Speaker 12: walking the door. You know, who's walking in. It's a
Speaker 12: bunch of kids or people. Influencers, could be grand influencers
Speaker 12: who are now doing live selling, whether on Amazon or
Speaker 12: TikTok or whatnot.
Speaker 4: And that's what's happening live selling. That's something that I
Speaker 4: think is very familiar to people in China, but not
Speaker 4: necessarily familiar to many people in the US at least
Speaker 4: yet explain exactly what that is.
Speaker 12: Well, I'm selling as you go, and I'll give you example.
Speaker 12: There's an app call Whatnot, right, and people have twenty
Speaker 12: second auctions for one little device or let's say a
Speaker 12: piece of makeup, right, sell for about twelve dollars right now.
Speaker 12: They can do this three separate times in one minute, right,
Speaker 12: so they make a profit about four dollars every time
Speaker 12: they sell it. So now all of a sudden, twelve
Speaker 12: dollars a minute. You times app and now they have
Speaker 12: friends coming on everything. You times app by sixteen hours
Speaker 12: a day. And that's what's happening because then when people
Speaker 12: buy it, now you know who the client is and
Speaker 12: the customer you can sell it to them again. Remember
Speaker 12: but there's only three ways to ever deal with the customer.
Speaker 12: Acquire a new one, upsell a current one, or make
Speaker 12: one buy more frequently. That's why you want to supicize
Speaker 12: everybody's fries, and now you know who they are, they
Speaker 12: can upsell them or buy more frequently.
Speaker 1: That's Damon John, founder and CEO of fu Bou and
Speaker 1: of course one of the sharks on ABC's Shark Tank.
Speaker 1: And that wraps up our first hour of this special
Speaker 1: holiday edition of Bloomberg Business Week from Bloomberg Radio. Coming
Speaker 1: up in the next sixty minutes. More from our visit
Speaker 1: to the Uncharted Community Summit held recently in Southampton. We'll
Speaker 1: talk about investing in women's health issues with Jessica Kamada,
Speaker 1: She's founder and managing partner at Swizzle Ventures. Plus more
Speaker 1: from our hosts Michael Loeb and Noah Friedman, who come
Speaker 1: back to discuss investing principles in the VC world. This
Speaker 1: is Bloomberg BusinessWeek. I'm Carol Masser along with Tim Steneviec.
Speaker 3: Stay with us.
Speaker 1: Today's top stories and global business headlines are coming up
Speaker 1: right now.
Speaker 2: If you are listening to the Bloomberg Business Weekdaily podcast,
Speaker 2: catch us live weekday afternoons from two to five pm Eastern.
Speaker 2: Listen on Apple, Our Play and Android Auto with the
Speaker 2: Bloomberg Business Act, or watch us live on YouTube.
Speaker 1: Welcome to a special holiday weekend edition of Bloomberg Business
Speaker 1: Week and happy fourth of July. We continue with our
Speaker 1: recent live broadcast from Southampton, Long Island. We were at
Speaker 1: the annual Uncharted Community Summit, an annual gathering of more
Speaker 1: than five hundred members of the startup community, and over
Speaker 1: the next sixty minutes, we continue to bring some of
Speaker 1: our favorite chats from the event. We'll hear from someone
Speaker 1: that runs an incubator for disruption in the tech sector
Speaker 1: and another investor targeting women's health specifically. First of this hour, though,
Speaker 1: I was joined by Bloomberg' Paul Sweeney to get some
Speaker 1: background on the event that you've been hearing about and
Speaker 1: hearing conversations from in the last hour. Event hosts Michael Loebe,
Speaker 1: founder and CEO of Lobe dot NYC. You heard about
Speaker 1: him in the last hour, and also Noah Friedman, CEO
Speaker 1: of Uncharted. They both joined us for a bit of
Speaker 1: a roundtable on the initial idea behind Uncharted.
Speaker 3: So what the intention is is that Noah and I
Speaker 3: started building Uncharted about four years ago, was in the
Speaker 3: teeth of COVID when nobody was getting together with anybody else,
Speaker 3: and we started having dinners at my house in the
Speaker 3: city and was very popular. And what the thesis is
Speaker 3: is that entrepreneurs need as much support as they can get,
Speaker 3: including emotional support, and the best way to do that
Speaker 3: is put entrepreneurs in a room with other entrepreneurs and
Speaker 3: they are as a class. They drive the economy, drive jobs,
Speaker 3: drive wealth, and yet there I think underappreciated, and as
Speaker 3: a serial entrepreneur myself, and actually one or two things worked,
Speaker 3: I'm you know, very empathetic and just with all the
Speaker 3: miles on the tires, I am kind of a senior
Speaker 3: statesman by definition. Right, this is a young guy's game.
Speaker 3: I say that I have the privilege of working with
Speaker 3: people half my agent, twice as smart. I used to
Speaker 3: say that. Now it's three times as smart and one
Speaker 3: third of my age. But that was the intention. And
Speaker 3: it's grown to a tribe of maybe twenty five hundred entrepreneurs,
Speaker 3: of which about a third of them show up to this,
Speaker 3: So we will have about eight hundred today.
Speaker 1: No, come on in on this. You're the CEO of
Speaker 1: Uncharted too, right, and so we're seeing things being set up.
Speaker 1: There's going to be a lot of great conversations and
Speaker 1: speakers going on. Tell us what it's been grown into
Speaker 1: and what kind of conversations are going to be happening
Speaker 1: later on.
Speaker 5: The common thread of everything that we've done it Uncharted
Speaker 5: since the first dinner on May twenty, twenty twenty one,
Speaker 5: and I'll never forget.
Speaker 1: It was it just you two by the way us.
Speaker 3: To at dinner. Yeah, it was just us too.
Speaker 5: We just sat and talked for four hours and here
Speaker 5: you were going.
Speaker 3: No, not about it. We also held ounce.
Speaker 5: We did all dance the whole time.
Speaker 3: Yeah, it's very romantic.
Speaker 12: Now.
Speaker 5: We had about twenty entrepreneurs around the table, kind of
Speaker 5: eight of each of our friends and then a couple others.
Speaker 5: If you will look, the common thread of every single
Speaker 5: event we've done, whether it's our dinners or the past
Speaker 5: three summits or the breakfast we've done, has always been
Speaker 5: trying to create safe spaces for real entrepreneurs, founders, exceptional
Speaker 5: participants in the entrepreneuri community, as we say, to truly
Speaker 5: drop their guard, drop their hair, and trust that they're
Speaker 5: in an environment where they can speak openly and honestly.
Speaker 5: Any entrepreneur or anyone who's building and really doing it,
Speaker 5: the real ones. Hopefully this will resonate when they hear
Speaker 5: it. It is really hard. It's very hard to build businesses.
Speaker 5: It's really hard to play this game at the high level.
Speaker 5: And I think if we can offer a rare environment
Speaker 5: where people can feel like they are amongst their true peers,
Speaker 5: or they can really drop their guard and connect with
Speaker 5: people in a place where no matter who you go
Speaker 5: talk to, they're all going to be exceptional. It's special.
Speaker 5: And so we've really tried to guard the energy. We've
Speaker 5: really tried to keep the sanctity of the fact that
Speaker 5: if you come to an uncharted event, you're going to
Speaker 5: meet someone amazing. And that's really been the common thread.
Speaker 1: I just want to say, it's a reminder of that,
Speaker 1: like Google, Apple, all of these companies that are now
Speaker 1: you know, the biggest market caps that are out there
Speaker 1: and that we talk about and you know all the time.
Speaker 1: I mean, they all started as an idea an entrepreneur.
Speaker 1: And that's the point, yea.
Speaker 3: And if you look at kind of success rates and
Speaker 3: everything else, if you're an entrepreneur, if you really knew
Speaker 3: all that stuff, why would you do this? Because the
Speaker 3: failure rate is incredibly high, hours are incredibly long, the
Speaker 3: pay you know, is dreadful until it's not until you
Speaker 3: have a big score. But the number of big scores
Speaker 3: is very very small, and there's so many forces and
Speaker 3: so many you know, so many exogenous things that are
Speaker 3: you know, anti entrepreneur that we wanted to have a
Speaker 3: sanctuary here that other entrepreneurs can meet other entrepreneurs, and Noah,
Speaker 3: you're fond of saying that. Not a week or two
Speaker 3: goes by where we don't get a phone call saying
Speaker 3: I met my co founder here two years ago.
Speaker 10: No Who's What are the areas that are most interested
Speaker 10: entrepreneurs today? Is it technology? Is healthcare? Are there certain
Speaker 10: industries that are getting most of the attention.
Speaker 5: Look, I think the obvious buzzword that you can't go
Speaker 5: too far in any of the new cycles to that
Speaker 5: hearing is AI. And I think that unlike other cycles
Speaker 5: that have come and went and entered the zeitgeist and left,
Speaker 5: this one feels very real. I can tell you that
Speaker 5: amongst all my friends, whether they're in CpG, health tech,
Speaker 5: pure AI, deep tech, what have you tech, and all
Speaker 5: of them are thinking explicitly about how AI is going
Speaker 5: to impact their business if they're not already, and how
Speaker 5: they're going to get into it. So I think we're
Speaker 5: certainly going to talk about that a lot. I think
Speaker 5: it's top of mind for a lot of people. The
Speaker 5: movement is real. I think that the implications and repercussions
Speaker 5: are unclear how it's going to land right now, but
Speaker 5: everybody's thinking about it, and they should be when.
Speaker 3: I think it's unclear, but it's going to be brought,
Speaker 3: it's going to be broad, it's going to be brought.
Speaker 3: And you mentioned cycles. I've been around for a few.
Speaker 3: This reminds me of the late nineties where the Internet
Speaker 3: happened and we had a lot of full starts two
Speaker 3: three years ago. Everybody was talking about NFTs before that,
Speaker 3: blockchain before that, cannabis before that, you know, something else.
Speaker 3: But this feels like another eruption. This feels like another
Speaker 3: advent of the Internet, one that we haven't had absolu earlier.
Speaker 1: Yeah, on the same level, no doubt about or even.
Speaker 3: More I think on the same level.
Speaker 4: Yeah.
Speaker 3: I mean, you know, it's hard to project and predict,
Speaker 3: but I had breakfast with a heroic entrepreneur a couple
Speaker 3: of days ago. He has built a business now worth
Speaker 3: one point eight billion dollars, and over breakfast, he says,
Speaker 3: I have two hundred and seventy people by year end,
Speaker 3: it's gonna be one twenty. Yeah, okay, interesting.
Speaker 5: I would add to that if I'm may, sorry, I
Speaker 5: think that there's this interesting tension with AI right now
Speaker 5: where I think Michael's right and I would even argue
Speaker 5: that this might I didn't live through the late nineties
Speaker 5: period of seeing it at least.
Speaker 6: All right, thanks for having me, guys, If you don't.
Speaker 3: I think that letting your hair down seven thing. I mean,
Speaker 3: why do you work with having? It's crazy?
Speaker 5: Everyone asked me that. But I think there's an inherent
Speaker 5: tension where I actually think it could be more disruptive.
Speaker 5: And at the same time, I do think that there's
Speaker 5: a lot of people who are betting big dollars than
Speaker 5: AI that are going to get wiped out because I
Speaker 5: think there's gonna be an absolute power law dynamic here
Speaker 5: where small select group of companies at the top end
Speaker 5: aggregate a ton of power and resource. I also think
Speaker 5: it's going to be a Barbell warre on the bottom end.
Speaker 5: You know, I've invested personally in companies that have two
Speaker 5: or three people on the team and have rocketed millions
Speaker 5: in arr because they're able to get ten x productivity
Speaker 5: if it's a killer founder. So I think there's a
Speaker 5: Barbell thing happening right now where the killer founders who
Speaker 5: actually know how to leverage resources are going to crush it,
Speaker 5: as are the big businesses.
Speaker 3: Well.
Speaker 1: Because of that and what AI can do genera of
Speaker 1: AI and so on. I mean, does it give entrepreneurs
Speaker 1: even more opportunities to start up? We talked about that
Speaker 1: after the pandemic. Basically create a website and you can
Speaker 1: go and then maybe that's simplifying things, but does AI
Speaker 1: kind of have a multiplier effect to on entrepreneurial activities?
Speaker 3: Without a doubt, I think that's the opportunity. I think
Speaker 3: that's right. And if you just look at what has
Speaker 3: happened over the years, you know, it used to be
Speaker 3: that if you build a business, a brand new business
Speaker 3: in the Internet, you need it. You needed hundreds of people, right,
Speaker 3: and now that's really compressed to just a few. But
Speaker 3: to Noah's point, there's going to be winners and there's
Speaker 3: going to be a lot of losers, and that's very
Speaker 3: hard to predict.
Speaker 10: Michael, talk to us about monetization. I'm not seeing a
Speaker 10: lot of IPOs. I'm not seeing a lot of m
Speaker 10: and A. How great entrepreneurs monetize the value they've created.
Speaker 3: That's a that's a great question. I would I would
Speaker 3: say that everything you just mentioned is part of a cycle,
Speaker 3: and we're just in that type of cycle where everything
Speaker 3: is a little bit bollock. Stop uh and but you
Speaker 3: know it's it's we're going to be on the other
Speaker 3: side of that, and there's going to be some great
Speaker 3: companies built, and there's going to be some great flameouts,
Speaker 3: a lot of people are going to lose a lot
Speaker 3: of money, and then there's going to be a few
Speaker 3: that are going to be extraordinarily successful. But to your point,
Speaker 3: we can build it now with instead of three hundred people,
Speaker 3: three and there's been predictions that there's going to be
Speaker 3: a unicorn with all of three people. Serious, Yeah, I
Speaker 3: believe that.
Speaker 1: Okay, that kind of makes sense. And we've started to
Speaker 1: see IPOs actually in general come to market and it's
Speaker 1: a much more favorable market. I got to ask you,
Speaker 1: I think we'd be remiss of the macro that's going
Speaker 1: on and different policies in the world being upended in geopolitics.
Speaker 1: What does that do for the entrepreneur. Entrepreneur who's trying
Speaker 1: to you know, we know can be lean and mean
Speaker 1: in the beginning when it comes to a startup. What
Speaker 1: about some of these macro issues, What would be more
Speaker 1: helpful to them?
Speaker 3: What kind of environment, well, anything that helps with capital formation,
Speaker 3: anything that kind of reduces regulation. I was hopeful that
Speaker 3: this administration would attack some of that stuff and maybe
Speaker 3: not terrorists. But anyway, it's still early. It's still early.
Speaker 3: We're here now. They are very active and very proactive,
Speaker 3: and I'm just hopeful that what you really want to
Speaker 3: give is entrepreneurs just charter. I mean, let them do
Speaker 3: their thing as much as you can. And our hope
Speaker 3: is by the way that this environment, believe it or not,
Speaker 3: will put a dent in that world, right, that they
Speaker 3: will find support here in many different ways.
Speaker 1: Well, I always think it's kind of amazing how much
Speaker 1: time we spend and obviously this is our world, right,
Speaker 1: the publicly held markets, right, this is what we track,
Speaker 1: you know, all the movements. But we talk constantly about
Speaker 1: the importance of small business and startups in terms of
Speaker 1: the backbone, and I just think it kind of gets
Speaker 1: lost a little bit.
Speaker 3: Yeah. I do think though, that you're going to see
Speaker 3: AI up end just about every industry. And I think
Speaker 3: those big companies are going to find themselves woefully behind
Speaker 3: and they're going to have no choice but to make
Speaker 3: some acquisitions.
Speaker 10: Well said, no, what capital is it out there for
Speaker 10: entrepreneurs today?
Speaker 3: It is?
Speaker 5: But I think that you're seeing an interesting dynamic with
Speaker 5: the vcs in private equity that they're chasing a lot
Speaker 5: of trends almost blindly. You know the fact that right
Speaker 5: now there are really good businesses that don't have the
Speaker 5: word AI that are struggling to raise money, whereas there's
Speaker 5: other businesses that have a deck and pre seed and
Speaker 5: barely an idea and or raising money at fifty million
Speaker 5: dollar pre money valuations. I think is indicative of what's
Speaker 5: going on.
Speaker 1: Yeah, we saw venture raise. It's been really difficult.
Speaker 5: It's been very difficult unless you're a credentialed AI founder
Speaker 5: have a good idea in the AI space, because there's
Speaker 5: a lot of VC funds chasing chasing ideas, and I
Speaker 5: think some of them will work, but the unfortunate realities,
Speaker 5: I think a lot of them are going to get
Speaker 5: absolutely smoked because they can't all work, especially not at
Speaker 5: fifty million dollar pre So to answer your question directly,
Speaker 5: sure there's capital out there, I wish there was more.
Speaker 5: I wish there was more going to more ideas that
Speaker 5: were based just on meritocracy and their actual traction versus
Speaker 5: the notion that they have AI in it. As bullish
Speaker 5: as I am on AI and investing in a personally
Speaker 5: to be abundantly clear, but it's an interesting moment right now,
Speaker 5: very interesting.
Speaker 3: I will only add that that is not too much
Speaker 3: different than what we've always seen. True, there's always been
Speaker 3: the bright, shiny object, and the investors feel like they
Speaker 3: got to follow that.
Speaker 1: Did you really start working for you in high school?
Speaker 3: That's fantastic, Gotta start them young.
Speaker 1: Yeah, talk about that off air, exactly right.
Speaker 10: Michael Lope, thank you so much, Founder CEO of Lobe
Speaker 10: dot NYC. And Noah Freedman, CEO of Uncharted. Thank you,
Speaker 10: gentlemen for being having a great conference today. I'll have
Speaker 10: a lot of great ideas circled about and a lot
Speaker 10: of great deals.
Speaker 3: Thanks for having me.
Speaker 1: Thanks to Michael Lobe, founder and CEO of Lobe dot
Speaker 1: NYC and Noah Friedman, CEO of Uncharted. Coming up on
Speaker 1: Bloomberg Business Week more from our visit to the Uncharted
Speaker 1: conference in the Hampton's held recently in Southampton. Paul Sweeney
Speaker 1: stays with me as we learn about AI's potential to
Speaker 1: replace human workers. It's a conversation and narrative that is
Speaker 1: gaining a lot of momentum that's coming up next.
Speaker 13: This is Bloomberg.
Speaker 2: This is the Bloomberg Business Week Daily Podcast. Listen live
Speaker 2: each weekday starting at two pm Eastern on Applecarplay and
Speaker 2: the Android Auto with the Bloomberg Business App. You can
Speaker 2: also listen live on Amazon Alexa from our flagship New
Speaker 2: York station, Just Say Alexa played Bloomberg eleven thirty.
Speaker 1: We're back here on this special holiday edition of Bloomberg
Speaker 1: Business Week, featuring some of our favorite conversations from the
Speaker 1: Uncharted Community Summit. It was held recently in Southampton in
Speaker 1: Michael Loebes's backyard. What we keep hearing from tech leaders,
Speaker 1: including those at some of the big ones. We're talking
Speaker 1: about Microsoft and Alphabet, how they talk about AI's potential
Speaker 1: and likelihood to replace human workers. Salesforce among the latest,
Speaker 1: noting its internal AI use has allowed it to hire
Speaker 1: fewer people. Kind of makes you say, uh, oh, Well.
Speaker 1: Someone who knows a lot about our changing workforce is
Speaker 1: Cheryl Grice. She is senior partner at the consulting giant EY.
Speaker 1: She's also global executive sponsor for the EY Entrepreneurial Winning
Speaker 1: Women's Global Program.
Speaker 13: She joined me and.
Speaker 1: Paul Sweeney to talk about her first visit well, this
Speaker 1: is your first one and you have clients and you
Speaker 1: deal with them. Tell us what you are hoping to
Speaker 1: get out of this, What are the conversations you're looking
Speaker 1: to have.
Speaker 14: Well, for us, we want to help our entrepreneurs really
Speaker 14: establish better community, better connections, and access access to capital
Speaker 14: in particular, so events like this go a long way
Speaker 14: to helping them get scaled in a way that they
Speaker 14: can't do by themselves. And this is like one event
Speaker 14: that brings it all together in such an amazing way.
Speaker 10: How do you bring capital and entrepreneurial ideas and talent together?
Speaker 3: How does that happen?
Speaker 13: How do you bring it together?
Speaker 14: Events like this have private investors, private equity, venture capital, bankers, etc.
Speaker 14: That are looking to find people that fit their mold
Speaker 14: for what they want to invest in. And so this
Speaker 14: is one stop shopping for hundreds of entrepreneurs to come
Speaker 14: in and find access like that. And these companies are
Speaker 14: here for that.
Speaker 1: Do you know what I never understand, Cheryl? We always
Speaker 1: talk about the world being a wash in capital. You know,
Speaker 1: everybody's starting private credit funds, There's plenty of money out there,
Speaker 1: but why is it so tough for smaller business, for startups?
Speaker 1: What is it that makes it so tough.
Speaker 14: I think you have to break down the startup in
Speaker 14: the population a little bit. I mean we often say
Speaker 14: in the statistics one bucket. It's not one bucket. Statistics
Speaker 14: haven't changed. For example, only two percent of the world's
Speaker 14: venture capital goes to females.
Speaker 3: Wow.
Speaker 14: So so when you can find an event like this
Speaker 14: and you can give them that kind of access where
Speaker 14: they can actually be ready, Like we do a lot
Speaker 14: of work at EY to get them ready for those
Speaker 14: conversations so that they can ask for the capital in
Speaker 14: a way that the VC wants to provide that capital,
Speaker 14: or a private equity or a bank or a private investor.
Speaker 14: There's a lot of work that goes into that, and
Speaker 14: not all of the same populations. A lot of the
Speaker 14: populations are overlooked. They don't get that same kind of
Speaker 14: coaching and council to be able to find that capital,
Speaker 14: to be able.
Speaker 13: To ask for it in a way that they'll get it.
Speaker 10: Kara and I were just talking with Noah Freeman, the
Speaker 10: CEO of and Charted, and he was saying, Wall, if
Speaker 10: you don't have AI.
Speaker 3: In your name, it's tough to attract capital.
Speaker 10: It's almost like the late nineties, if you didn't have
Speaker 10: a dot com at the end of your company's names,
Speaker 10: it's tough to raise capital.
Speaker 3: How do you How are you guys seeing that part
Speaker 3: of the business.
Speaker 14: Well, it's not just it's so funny through there's such
Speaker 14: an evolution. You know, in the two thousands, it was
Speaker 14: the Internet and e commerce, and then you go to
Speaker 14: two thousand and seven and to two thousand and nine,
Speaker 14: and it's all about social media and what are you
Speaker 14: doing where everything is transactive from the palm of your hand?
Speaker 14: And now it's AI. AI's been around for a long time,
Speaker 14: but it's AI. Where how are you using agents and
Speaker 14: agentic and so forth? To us, digital is a growth engine,
Speaker 14: but inclusiveness is also a growth engine.
Speaker 13: So it's not just about digital, it's about the.
Speaker 14: Communities that you're getting to be able to bring digital
Speaker 14: to life.
Speaker 13: So it's relevant.
Speaker 1: Well, that's really fascinating. You know, when you talk about women,
Speaker 1: you talk about minorities. And I'm going to go back
Speaker 1: to women for a moment because I remember a few
Speaker 1: years ago, and maybe this was coming off the pandemic,
Speaker 1: Bloomberg putting out a story that even female venture capitalists
Speaker 1: weren't really you know, more prone to maybe support female entrepreneurs.
Speaker 1: So again, how do we is is it an education
Speaker 1: Like I understand what you're saying about, like educating entrepreneurs
Speaker 1: so that when they have to talk to the folks
Speaker 1: that have the money, like it's the right conversation. But
Speaker 1: how do we really finally move some of that, whether
Speaker 1: it's for minorities, for women, really move the needle on that,
Speaker 1: because those are pockets of consumers and areas that can
Speaker 1: provide a lot of economic momentum, a lot of business.
Speaker 13: To me, there are three gaps at uy. We always
Speaker 13: say there's three gaps.
Speaker 14: There's do they have the community necessary so that they
Speaker 14: can stick together in their growth agenda and find like
Speaker 14: minded people that have been there before so that they
Speaker 14: can learn from those people. Then and there's the capital
Speaker 14: that we've already talked about. And then there's the connections.
Speaker 14: A lot of the connections are how do you educate
Speaker 14: yourself and get the right level of insights so that
Speaker 14: you can talk to a capital provider.
Speaker 13: Many people don't have that education.
Speaker 14: So for us, programs like the ones that we have,
Speaker 14: like on Chartered have they're intended to help them get
Speaker 14: those connections and the insights necessary to get access to
Speaker 14: those things. Vcs don't necessarily go after the underserved or
Speaker 14: overlooked populations because they just don't know how to communicate
Speaker 14: yet with the capital providers.
Speaker 13: Our job is to help them.
Speaker 10: What is the real opportunity for you today? What do
Speaker 10: you think is going to you're hoping to get together today?
Speaker 14: I want to meet thirty more entrepreneurs that I haven't
Speaker 14: met and help them with their journeys. My goal is
Speaker 14: to get them the things that they need so that
Speaker 14: we're not on the sidelines. We're very much in the
Speaker 14: mix with them to get them to the next level.
Speaker 1: Thirty seconds A success story.
Speaker 14: A success story, we watched a female entrepreneur who was
Speaker 14: one of our winning Women back in twenty fifteen create
Speaker 14: an adult beverage company as a school teacher and sell
Speaker 14: it for undisclosed amount. But we're guessing it's over a
Speaker 14: billion wow in the last year.
Speaker 1: So that's that's Cheryl grice Ey, Senior Partner for Global
Speaker 1: Client Services, Bloomberg's Paul Sweeney sticking around for our next conversation,
Speaker 1: and that was with Brett Markinson. He is founder and
Speaker 1: CEO of the in Event Capital Group. His company's website
Speaker 1: notes that he launched his firm as an incubator and
Speaker 1: platform for launching businesses that leverage disruptive technology to innovate
Speaker 1: old ways of doing things. We started by asking Brett
Speaker 1: what he is hearing from attendees of the Uncharted Community Summit.
Speaker 15: Everybody's talking their bod to the Bloomberg Business Weekdaily podcast,
Speaker 15: Catch us Lived at.
Speaker 2: Watch us live on.
Speaker 15: YouTube, And I just kind of personally enjoy the origin stories.
Speaker 15: So I try to spend as much time as I
Speaker 15: can understanding how people got to where they are by
Speaker 15: way of where they came.
Speaker 1: All Right, it's like a gift when someone says that,
Speaker 1: because I want to talk about your origin story a
Speaker 1: little bit. Media folks were kind of obsessed with media
Speaker 1: caning us back to the nineties. You were selling non
Speaker 1: linear digital editing base tollies. No, but it's like all
Speaker 1: these things shape us. I remember doing, you know, paper prompters.
Speaker 1: I'm going to age myself. It's very different nowadays. So
Speaker 1: tell us about what that was like and how it
Speaker 1: does shape your perspective as you see things change.
Speaker 6: Sure.
Speaker 15: Well, first of all, like any early stage business, it
Speaker 15: was brutal I think what made this challenging was whenever
Speaker 15: you're too far in front of something, it's very difficult
Speaker 15: selling vision to the visionless, and people have a lot
Speaker 15: invested in the way they're doing things and the way
Speaker 15: things were. In the case of nonlinear editing, I think
Speaker 15: what made that's so difficult was the editor was very
Speaker 15: comfortable in the basement by himself with no oversight and
Speaker 15: not having too much of the producer in over his
Speaker 15: kind of shoulder telling him how to do things. And
Speaker 15: the nonlinear editing system just changed the landscape entirely because
Speaker 15: now the producer was able to kind of be involved
Speaker 15: in the editing process and brought the guy upstairs, surrounded
Speaker 15: him with a whole bunch of people, and the efficiencies
Speaker 15: that it brought were incredible and the impact indelible. But
Speaker 15: to a lot of editors it really changed the way
Speaker 15: they thought about what they did and how they did it.
Speaker 15: So getting it to take took some time, but like
Speaker 15: anything wants to damn cracked, it just became a floodgate.
Speaker 1: Is internet or AI right, Like it's kind of the
Speaker 1: same story.
Speaker 10: Hey, bred, you're on a panel today talking about exits. Yes,
Speaker 10: I haven't seen a lot of IPOs in the last
Speaker 10: few years. I haven't seen a lot of M and
Speaker 10: A in the last five years. How did guys like
Speaker 10: you and the folks here. They've got an idea, they
Speaker 10: get it funded, they get it off the ground, and
Speaker 10: now they're thinking about an exit, a monetization event. Where
Speaker 10: are we today in that environment?
Speaker 15: Well, when I start at the very early stage, a
Speaker 15: little north of the napkin, I like to call it.
Speaker 15: And for companies like that, it oftentimes doesn't make a
Speaker 15: lot of news in terms of acquisitions, but there's plenty
Speaker 15: of that stuff happening. In a lot of cases. They're
Speaker 15: accu hiers that you hear about. So in the end,
Speaker 15: it really comes down to a couple of very key things.
Speaker 15: Building a great product, validating it with solid product market fit,
Speaker 15: finding and understanding those customers and getting those customers to
Speaker 15: accept your product and tell other customers. And once you
Speaker 15: get that flywheel moving, it's kind of a snowball rolling
Speaker 15: down a hill and it kind of takes on a
Speaker 15: momentum of its own. And if you reach that capacity
Speaker 15: for your business where you are growing and need help,
Speaker 15: capital finds you. And as capital is hunting for you,
Speaker 15: so are other larger businesses that want access to your
Speaker 15: customers and want access to what you're doing. So at
Speaker 15: the very early stage of things, it's not too difficult
Speaker 15: to be able to find exit opportunities. It just depends
Speaker 15: on whether or not you're able to find product market
Speaker 15: fit and demonstrate that.
Speaker 1: How often, though, is it for an entrepreneur bread, is
Speaker 1: it just tough for them to let go after they've
Speaker 1: started a company and they realize it's time for them
Speaker 1: to either sell merged, I mean, in order to take
Speaker 1: it to the next level, Like, how difficult and how
Speaker 1: often does that happen where it's just time that they
Speaker 1: need somebody else?
Speaker 15: Now, that's it's an interesting question, but I think the
Speaker 15: answer is emotional. Yeah, And I think people with high
Speaker 15: eqs are capable of seeing that they're in over their
Speaker 15: head or to get to the next level, they need
Speaker 15: competence beyond their capability or skill set, and for some
Speaker 15: they just can't see the forest through the trees, and
Speaker 15: it becomes a very emotional thing. You know, you have
Speaker 15: a whole persona and identity that has been formed around
Speaker 15: this thing that you brought to life. You know, I
Speaker 15: oftentimes think about startups is giving birth to a child
Speaker 15: in the ICU.
Speaker 6: Wow.
Speaker 4: Thanks check it is.
Speaker 15: You know your kids in good hands. All the appropriate
Speaker 15: people are there on a twenty four to seven basis,
Speaker 15: but it's still touch and go.
Speaker 1: That's Brett Markinson, founder and CEO of in Event Capital Group.
Speaker 1: Still ahead on Bloomberg Business Week. More from our visit
Speaker 1: to Michael Loeb's Uncharted conference recently in Southampton. We'll hear
Speaker 1: about investing in women's health and how Washington policy might
Speaker 1: be impacting all of that. That's coming up next. This
Speaker 1: is Bloomberg.
Speaker 2: You're listening to the Bloomberg Business Weekdaily Podcast. Catch us
Speaker 2: live weekday afternoons from two to five pm Eastern. Listen
Speaker 2: on Apple CarPlay and Android Auto with the Bloomberg Business app,
Speaker 2: or watch us live on YouTube.
Speaker 1: We'll back here on our special holiday edition of Bloomberg
Speaker 1: Business Week, continuing to highlight some of our favorite conversations
Speaker 1: from the Uncharted Community Summit, which was held recently in Southampton,
Speaker 1: in fact, in Michael Loeb's backyard. Returned out to Jessica Kamada.
Speaker 1: She's founder managing partner at Swizzle Ventures, a new venture
Speaker 1: capital firm that's raised a fund to focus on women's
Speaker 1: health caregiving, and financial health. We started by asking her
Speaker 1: what she looks for in a company before deciding to invest.
Speaker 16: We're looking at really the course of a woman's lifetime
Speaker 16: and investing in companies that advance women's health and wealth through.
Speaker 9: Pivotal life stages.
Speaker 16: We see three sectors as really billing the gaps for
Speaker 16: women over those three over those life stages, so healthcare,
Speaker 16: physical health care, caregiving responsibilities on the elder side, and
Speaker 16: early childcare, and then financial health.
Speaker 1: I want to say good, good, good, because especially when
Speaker 1: you get just down to medical health and health care,
Speaker 1: it's just so behind even R and D, and it's
Speaker 1: just amazing. Even I don't want to do a blanket
Speaker 1: statement about professionals in the field, but I just hear
Speaker 1: over and over again women who go in and it's
Speaker 1: just things are ignored said, it's not anything, and things
Speaker 1: that turn out to be things. So how do we, like,
Speaker 1: how can you, through VC venture and investing kind of
Speaker 1: change some of that?
Speaker 16: Yeah.
Speaker 9: Absolutely.
Speaker 16: I think it's a little known fact that we only
Speaker 16: have thirty four years of women's health research. We were
Speaker 16: only included in clinical trials since nineteen ninety three on
Speaker 16: NIHU manity, it's insane. So when we go into the
Speaker 16: doctor's office, it actually it's actually just lack of education
Speaker 16: on MD's front. I mean, they only get four hours
Speaker 16: of menopause training in their entire you know, eight years
Speaker 16: of training, So some of it is not actually their fault,
Speaker 16: but the research just has to catch up and the
Speaker 16: education of the system has to catch up.
Speaker 9: So it's a.
Speaker 1: Shocking Can I just ask you them, is that research
Speaker 1: being hurt by what's been going on in the government
Speaker 1: and cuts.
Speaker 16: The We are like very much looking at the cuts, yeah,
Speaker 16: because I think if they're they did initially say that
Speaker 16: they were going to cut a longitudinal study that has
Speaker 16: been going on for thirty years. They reinstated that until
Speaker 16: at least January twenty twenty six, so we're now watching
Speaker 16: that and if they cut it, then you know, we're
Speaker 16: going to lose thirty years of launchitudel data that we've
Speaker 16: been collecting over you know, with women over the course
Speaker 16: of their lifetime.
Speaker 9: So we are looking at that from a research perspective.
Speaker 16: But I think what's amazing and where tech comes into
Speaker 16: play is that these tech companies, especially with AI, are
Speaker 16: now creating their own data sets to help empower these researchers.
Speaker 4: So how would it change your opportunities as a venture
Speaker 4: capitalist if those cuts were to happen, And if we
Speaker 4: do see a pullback in funding from Washington, we've already
Speaker 4: seen a pullback in funding at least to university to research.
Speaker 4: We talk to a lot of venture capitalists in the
Speaker 4: biotech space about this. Does that make your job more
Speaker 4: difficult because there will be fewer founders out there chasing
Speaker 4: opportunities or does it shut opportunities shut opportunities off for you?
Speaker 16: I think one main, one major concern in the research
Speaker 16: in biotech world and also VCS is just a brain
Speaker 16: drain like these. You know, the tech companies are built
Speaker 16: on the research that has been created over the last
Speaker 16: thirty years or so. Now that we have AI, they
Speaker 16: can finally do something with that data, create personalized care plans,
Speaker 16: et cetera. But if the underlying data is not there
Speaker 16: and that doesn't progress, then it's a lot harder to
Speaker 16: build on top of it.
Speaker 9: And.
Speaker 16: Funding research is not really in the VC model, So
Speaker 16: we can only fund the companies that are built on
Speaker 16: top of that research, and we have to rely on
Speaker 16: federal funding on other rants, on philanthropy to fund the
Speaker 16: actual research that's underline. So my concern is that if
Speaker 16: we're funding companies that are going to be great ten
Speaker 16: years from now, then like what do I fund ten
Speaker 16: years from now? If that if that research doesn't continue
Speaker 16: at the clip it is today.
Speaker 1: We're tied with Jessica Kamada, founder and managing partner at
Speaker 1: Swizzle Ventures. You initially said it's divided into kind of
Speaker 1: three buckets, right, you chalked about healthcare, you talk about
Speaker 1: caregiving and check financial health. Where are you finding the
Speaker 1: most kind of entrepreneurs doing things? Is it equal? Are
Speaker 1: there certain buckets that are you know, people that are
Speaker 1: starting different companies? What do you find it.
Speaker 16: We've funded twenty portfolio companies in this current fund and
Speaker 16: they're pretty split evenly among the three sectors. I would
Speaker 16: say that in the caregiving sector, we're finding the most
Speaker 16: opportunities in eldercare right now.
Speaker 9: Just because of the population progression play.
Speaker 16: I feel like with everything, it's a huge play's and
Speaker 16: it's also something that is just undoubted. It's a bipartisan issue.
Speaker 16: No one is gonna, you know, say, like argue that
Speaker 16: the population is not aging, right, So it's something that
Speaker 16: everyone agrees on and knows that the healthcare system will
Speaker 16: be overwhelmed if we do not do something about it.
Speaker 4: But that's very employee intensive, that's very human intensive. And
Speaker 4: there's been a lot of commentary about the immigrant labor
Speaker 4: that actually does a lot of the caregiving of elders
Speaker 4: in the United States and potentially how that will be affected.
Speaker 4: Can this be solved with technology? I mean what it's
Speaker 4: same with child like with with with caregiving for children,
Speaker 4: like you need people to do that. How do you
Speaker 4: how do you take a venture capitalist approach to this stuff?
Speaker 16: Yeah, part of it is trying to fix the system
Speaker 16: and finding business models that are aligning all the incentives
Speaker 16: at play, because a lot of it is just like incentives, right,
Speaker 16: And the issue with human caregivers is that it's a
Speaker 16: ruthless job. There's a lot of high turnover in it.
Speaker 16: For example, one company that's here Ruby, well they enable
Speaker 16: family caregivers to get paid through Medicare benefits that already exist.
Speaker 16: So it's really about helping people navigate the system that's.
Speaker 9: So tricky and gate kept to figure out.
Speaker 16: But those dollars are there, they just can't They just
Speaker 16: need help accessing them. And they work with the basically
Speaker 16: staffing agencies, the home healthcare agencies that.
Speaker 11: Do that work.
Speaker 1: How easy is it for you to get capital and
Speaker 1: create funds? She laughs?
Speaker 16: It was not as challenging as I had expected. However,
Speaker 16: this was the first environment that I have raised a
Speaker 16: fund in versus being in marketing in market in twenty
Speaker 16: twenty one when I have heard that dollars were falling
Speaker 16: from this guy. So one of the things about my
Speaker 16: thesis is that it's very relatable. Every single human has
Speaker 16: struggled through a personal pivotal life.
Speaker 9: Stage, be a man or woman, right, And.
Speaker 16: I think that relatability has helped me to for investors
Speaker 16: to understand what I'm trying to build.
Speaker 1: But even women specifically, like is there always it's it's
Speaker 1: a little trickier, right, when it's it's a little trick
Speaker 1: these issues, I feel like it's a.
Speaker 16: Little trickier until you dig in to say, to explain
Speaker 16: the economic opportunity, I mean, investing in women's health is
Speaker 16: a one trillion dollar market, three hundred and twenty billion
Speaker 16: in the US alone, So when you really uncover the
Speaker 16: numbers behind the opportunity, it's far larger than people expect.
Speaker 16: And that people typically what I lead with. Yeah, and
Speaker 16: from a help and from a wealth perspective when we
Speaker 16: think about the great wealth transfer already in play.
Speaker 9: Yeah, go ahead.
Speaker 4: Well I don't mean to sound glib, but if you
Speaker 4: were to sort of look at the categories that might
Speaker 4: be the least challenging to disrupt through venture capital and
Speaker 4: through funding companies, it wouldn't be these categories. I mean,
Speaker 4: these are these are categories that are ripe with regulation. Yes,
Speaker 4: there are categories that aren't necessary. It's not like you're
Speaker 4: creating an app, you know, there are sometimes you are
Speaker 4: human capital intensive though, like this is this is a
Speaker 4: really challenging space I think is that is am I
Speaker 4: am I wrong about that? Like I know, but like
Speaker 4: all venture capital stuff, thanks Carol, but like you know,
Speaker 4: all all all that, this is really tough stuff. But
Speaker 4: it's like you see the way money is flowing for
Speaker 4: like AI agents and like companies that are built on
Speaker 4: chat GPT, that that seems to be the path of
Speaker 4: least resistance right now.
Speaker 16: So I was at a consumer AI summit and a
Speaker 16: lot of the companies were creating like shop like connecting
Speaker 16: you to the right clothes, and like things that are
Speaker 16: really fun, and there does need to be fun in
Speaker 16: consumer AI does need to be fun to use, but
Speaker 16: it also needs to be helping, like very foundational human things,
Speaker 16: and it can do that as well. Like sometimes I
Speaker 16: think in these categories it doesn't actually need to be flashy.
Speaker 16: It just needs to solve a problem. Like for instance,
Speaker 16: we have some companies that are not that high tech.
Speaker 16: It's you know, a mental health company where they're just
Speaker 16: providing access to mental health professionals after you have a baby,
Speaker 16: which is a leading cause of maternal death. And it's
Speaker 16: like it's not that hard or a concept, and it
Speaker 16: doesn't really require AI. It's just filling a need that
Speaker 16: didn't exist before. And there are so many more of
Speaker 16: those in women's health and these categories because they've been
Speaker 16: so overlooked and underinvested in. So yes, we have fancy
Speaker 16: AI companies like investment platforms directed at gen z.
Speaker 9: Or like hormone hormonal monitors.
Speaker 16: That you can you at home, but some of them
Speaker 16: are not as high tech and they don't need to be.
Speaker 1: What would surprise somebody about investing in this space. I
Speaker 1: know you talked about the economics, which I thought was
Speaker 1: really kind of telling some of the numbers right, because
Speaker 1: when people see I'm sure hear that, they're like, oh,
Speaker 1: I get it right, this is a really untap marketplace.
Speaker 9: Why aren't we doing more?
Speaker 1: But I'm just curious, as you've been like talking to
Speaker 1: entrepreneurs thinking about you know, initiatives specifically that fall into
Speaker 1: you know, women's fields.
Speaker 16: I think people are surprised at how much deal flow
Speaker 16: there actually is and how many people are building in
Speaker 16: these spaces.
Speaker 9: Because they're building for themselves.
Speaker 16: Typically, they're building because they see a need of their
Speaker 16: own in their own life that was un through one
Speaker 16: of these pivotal life stages, right, and they don't see
Speaker 16: anyone else tackling it, and so they go forward themselves.
Speaker 3: It's funny.
Speaker 1: That's what Bill Harris said formally of PayPal, and he
Speaker 1: said his current investment firm, it was something he wanted,
Speaker 1: he needed, and that's what he created, Like makes most
Speaker 1: sense for entrepreneurs to be doing that. That's Jessica Kamad,
Speaker 1: a founder and managing partner at Swizzle Venture. As you
Speaker 1: can hear all of our conversations from the event, just
Speaker 1: head to Bloomberg dot com or check out our podcast feed,
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