1
00:00:02,520 --> 00:00:07,040
Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

2
00:00:07,800 --> 00:00:11,160
Speaker 2: Joining us now is NASVAC chair and CEO Adina Friedman. Adina,

3
00:00:11,200 --> 00:00:13,360
Speaker 2: thank you so much for joining. It's great to be here.

4
00:00:13,640 --> 00:00:16,079
Speaker 2: So many highlights in this from IPOs, coming back to

5
00:00:16,160 --> 00:00:20,439
Speaker 2: your other fintech businesses which are find fascinating, but for

6
00:00:20,560 --> 00:00:24,480
Speaker 2: me to switching to the Nasdaq for certain companies like Walmart,

7
00:00:24,520 --> 00:00:27,280
Speaker 2: coming over your numbers a record one point two trillion

8
00:00:27,320 --> 00:00:32,599
Speaker 2: dollars enlisting transfers. With everybody wanting to become a tech company,

9
00:00:32,800 --> 00:00:35,720
Speaker 2: how many inbounds are you getting for more companies to

10
00:00:35,760 --> 00:00:38,320
Speaker 2: make a Walmart move and become listed on the Nasdaq.

11
00:00:38,400 --> 00:00:40,000
Speaker 1: Well, first of all, thank you so much. It's great

12
00:00:40,040 --> 00:00:41,519
Speaker 1: to be here. And we are really proud of the

13
00:00:41,520 --> 00:00:43,640
Speaker 1: results that we delivered for the quarter and for the

14
00:00:43,720 --> 00:00:47,480
Speaker 1: year with twelve percent growth overall and eleven percent growth

15
00:00:47,520 --> 00:00:50,599
Speaker 1: in our solutions businesses, with every part of our business contributing,

16
00:00:50,680 --> 00:00:54,720
Speaker 1: including our listening's business. And when it comes to transfers

17
00:00:54,720 --> 00:00:57,200
Speaker 1: from the New York stocking change to NASSAC, we really

18
00:00:57,360 --> 00:01:00,760
Speaker 1: focus on several different key differentiators for US. First is

19
00:01:00,800 --> 00:01:03,440
Speaker 1: we are the home to great innovative tech companies, but

20
00:01:03,560 --> 00:01:06,120
Speaker 1: innovators across every sector, and I think that's what's really

21
00:01:06,160 --> 00:01:10,440
Speaker 1: come to everyone's attention, is that everyone is becoming much

22
00:01:10,480 --> 00:01:13,280
Speaker 1: more techl enabled technology is becoming an integral part of

23
00:01:13,319 --> 00:01:17,280
Speaker 1: their innovation story. But you can innovate across industries, and

24
00:01:17,319 --> 00:01:21,080
Speaker 1: these innovative growth companies gravitate to Nasdaq, including Walmart, which

25
00:01:21,080 --> 00:01:24,160
Speaker 1: we were so excited. It's such an amazing, amazing company

26
00:01:24,160 --> 00:01:28,000
Speaker 1: with an amazing leadership. But we also have the index business.

27
00:01:28,000 --> 00:01:30,040
Speaker 1: So we closed the year with eight hundred and eighty

28
00:01:30,040 --> 00:01:33,479
Speaker 1: two billion dollars in our index business, ninety nine billion

29
00:01:33,520 --> 00:01:36,280
Speaker 1: dollars of inflos just in the year. And what that

30
00:01:36,360 --> 00:01:39,199
Speaker 1: does is it allows us, through our partners, to become

31
00:01:39,240 --> 00:01:42,759
Speaker 1: investors in these great companies through the NASOQ one hundred

32
00:01:42,800 --> 00:01:46,320
Speaker 1: Index franchise, and in the case of some companies, we

33
00:01:46,360 --> 00:01:48,840
Speaker 1: could be as much as a four percent owner of

34
00:01:48,880 --> 00:01:51,920
Speaker 1: their shares, which creates a really nice long term passive ownership.

35
00:01:52,280 --> 00:01:54,800
Speaker 1: In addition to the fact, we also have market quality.

36
00:01:55,160 --> 00:01:58,520
Speaker 1: We've invested so much in our technology to drive market

37
00:01:58,560 --> 00:02:01,720
Speaker 1: modernization shows up in the quality of our markets and

38
00:02:01,720 --> 00:02:04,760
Speaker 1: their level participation we have, which is actually become a

39
00:02:04,800 --> 00:02:08,680
Speaker 1: real differentiator for US and particularly these megacap companies. And

40
00:02:08,720 --> 00:02:10,200
Speaker 1: then of first last week, we have all these great

41
00:02:10,200 --> 00:02:12,960
Speaker 1: marketing assets that we do to help promote their brand

42
00:02:13,040 --> 00:02:15,480
Speaker 1: as an innovative growth company. And so all of those

43
00:02:15,480 --> 00:02:18,560
Speaker 1: things combined has really created a great opportunity for us

44
00:02:18,600 --> 00:02:22,480
Speaker 1: to talk to Shopify talk and to Kimberly Clark and

45
00:02:22,520 --> 00:02:25,160
Speaker 1: to Thompson Writers in addition to Walmart and bring them

46
00:02:25,200 --> 00:02:26,919
Speaker 1: to NAZAC in twenty twenty five.

47
00:02:26,800 --> 00:02:30,840
Speaker 3: So your first time over five billion dollars in revenue.

48
00:02:30,840 --> 00:02:38,000
Speaker 3: It's a record solutions sales growth, record index inflows. And

49
00:02:38,720 --> 00:02:41,720
Speaker 3: the one part that I keep thinking about is the concentration.

50
00:02:41,800 --> 00:02:44,680
Speaker 3: I've been thinking about it since I read your piece

51
00:02:44,720 --> 00:02:49,200
Speaker 3: on LinkedIn. Actually more is that a risk that you're

52
00:02:49,240 --> 00:02:52,400
Speaker 3: worried about that there's so much concentration risk and these

53
00:02:52,440 --> 00:02:54,880
Speaker 3: aiivy companies.

54
00:02:54,480 --> 00:02:56,040
Speaker 1: Well, I think the first thing is what we have

55
00:02:56,120 --> 00:02:59,000
Speaker 1: to actually seen is returns start to come be more

56
00:02:59,000 --> 00:03:03,040
Speaker 1: broad based. With interest rates coming down, small cap companies

57
00:03:03,320 --> 00:03:05,160
Speaker 1: over the last couple of years, they've had as much

58
00:03:05,160 --> 00:03:07,840
Speaker 1: as forty percent of their data income have to be

59
00:03:07,880 --> 00:03:11,000
Speaker 1: spent on interest expense. So as the interest rates are

60
00:03:11,000 --> 00:03:13,000
Speaker 1: coming down, the cost of capitals coming down. It is

61
00:03:13,040 --> 00:03:15,240
Speaker 1: allowing them to invest more in their business and deliver

62
00:03:15,320 --> 00:03:17,640
Speaker 1: more for their shareholders. And you are seeing a broader

63
00:03:17,680 --> 00:03:22,040
Speaker 1: based return profile with large cap and small cup companies

64
00:03:22,080 --> 00:03:24,679
Speaker 1: as we go into twenty twenty six, which we're encouraged by.

65
00:03:25,040 --> 00:03:28,280
Speaker 1: But we also do have these great megacap companies that

66
00:03:28,360 --> 00:03:32,120
Speaker 1: are delivering the future of technology to every industry, and

67
00:03:32,200 --> 00:03:34,640
Speaker 1: I think that as a result, the investment that they've

68
00:03:34,639 --> 00:03:40,040
Speaker 1: been making is critically important, very large still though not

69
00:03:40,200 --> 00:03:41,960
Speaker 1: even it's about you know, if you look at all

70
00:03:42,040 --> 00:03:44,839
Speaker 1: of the hyperscalers and the semiconductor companies that I've really

71
00:03:44,840 --> 00:03:48,800
Speaker 1: been investing heavily here, it represents about less than seventy

72
00:03:48,840 --> 00:03:52,040
Speaker 1: percent of their annual cash flows and aggregate, so imagine

73
00:03:52,040 --> 00:03:54,080
Speaker 1: how cash arts of these companies are. So there's a

74
00:03:54,160 --> 00:03:57,600
Speaker 1: huge ballast of cash capabilities in addition to having very

75
00:03:57,680 --> 00:04:01,400
Speaker 1: large scale investors like Blackstone be an underwriter of these

76
00:04:01,400 --> 00:04:05,080
Speaker 1: types of investments, and I do think the public capital

77
00:04:05,120 --> 00:04:07,760
Speaker 1: markets are going to play a bigger role. This investment

78
00:04:07,880 --> 00:04:11,000
Speaker 1: is a change in the infrastructure of our economy, and

79
00:04:11,040 --> 00:04:12,960
Speaker 1: more and more of the industry experts are going to

80
00:04:13,040 --> 00:04:16,520
Speaker 1: be coming in and delivering against that opportunity. So we

81
00:04:16,560 --> 00:04:18,480
Speaker 1: see the capital markets playing a bigger and bigger role

82
00:04:18,480 --> 00:04:18,839
Speaker 1: going forward.

83
00:04:18,839 --> 00:04:21,520
Speaker 3: Can I just follow up on your LinkedIn piece, which

84
00:04:21,560 --> 00:04:25,800
Speaker 3: I thought was fascinating. I think your core argument is

85
00:04:25,800 --> 00:04:28,520
Speaker 3: that this is not some kind of flimsy stock bubble.

86
00:04:28,680 --> 00:04:33,640
Speaker 3: This is a generational sea change like the railroads or

87
00:04:33,960 --> 00:04:39,120
Speaker 3: the Internet. But with the Internet it was both, you know,

88
00:04:39,240 --> 00:04:43,760
Speaker 3: an industrial shift and a bubble, right, Because I was

89
00:04:43,760 --> 00:04:46,400
Speaker 3: looking at the Nasdaq high March of two thousand and

90
00:04:46,400 --> 00:04:48,600
Speaker 3: it took fifteen years to get back there. Okay, now

91
00:04:48,600 --> 00:04:52,680
Speaker 3: we're six x that, But is it possible that we

92
00:04:52,760 --> 00:04:56,080
Speaker 3: have the same kind of delayed, you know, revenue problem

93
00:04:56,120 --> 00:04:56,800
Speaker 3: that we had then.

94
00:04:57,160 --> 00:04:59,960
Speaker 1: So first I would say I was at NASAK back then,

95
00:05:00,000 --> 00:05:03,880
Speaker 1: and so I've actually lived through that experience. And a

96
00:05:03,920 --> 00:05:07,640
Speaker 1: big difference here is that the companies that are underwriting

97
00:05:07,800 --> 00:05:10,760
Speaker 1: the risk and the opportunity are very large scale, well

98
00:05:10,800 --> 00:05:13,640
Speaker 1: capitalized companies. Number Two, when you look at certainly the

99
00:05:13,720 --> 00:05:16,360
Speaker 1: Nasaka one hundred today, the minimum market cap on the

100
00:05:16,440 --> 00:05:19,520
Speaker 1: Nazak one hundred today is about thirty to forty billion dollars,

101
00:05:19,560 --> 00:05:23,040
Speaker 1: whereas back then it was like five billion dollars. And also,

102
00:05:23,400 --> 00:05:25,840
Speaker 1: as you said, the revenue generation. If you look at

103
00:05:25,839 --> 00:05:29,800
Speaker 1: companies that are coming public, these are revenue generating, very

104
00:05:29,920 --> 00:05:33,960
Speaker 1: strong companies that have strong business momentum. KPIs all of

105
00:05:34,000 --> 00:05:36,640
Speaker 1: those things. And so as much as I do think

106
00:05:36,640 --> 00:05:39,080
Speaker 1: that there's going to be a lot of investment here,

107
00:05:39,160 --> 00:05:40,960
Speaker 1: I also think that they're going to be winners and

108
00:05:40,960 --> 00:05:44,400
Speaker 1: losers of course, or as these trends come through. I

109
00:05:44,520 --> 00:05:48,400
Speaker 1: believe that the underpinning of this investment cycle has much

110
00:05:48,400 --> 00:05:52,120
Speaker 1: more capital and much more ballast that underpins it as

111
00:05:52,160 --> 00:05:54,880
Speaker 1: we move forward, and it's a long term trend. It's

112
00:05:54,960 --> 00:05:57,400
Speaker 1: the future of our economy that we are underwriting right now.

113
00:05:57,400 --> 00:05:59,640
Speaker 2: One of the things that's also really transformed in markets.

114
00:05:59,800 --> 00:06:02,120
Speaker 2: I think how much your index business has grown is

115
00:06:02,160 --> 00:06:04,680
Speaker 2: also a testament to this. It's just a wider participation

116
00:06:04,800 --> 00:06:07,279
Speaker 2: of investors, more retail investors, more.

117
00:06:07,160 --> 00:06:08,440
Speaker 1: Happy to jump in the market.

118
00:06:08,640 --> 00:06:11,200
Speaker 2: But a strange kind of like I don't know, step

119
00:06:11,320 --> 00:06:14,320
Speaker 2: child has arisen with it, and that is the prediction markets.

120
00:06:14,360 --> 00:06:16,920
Speaker 2: We had a guest on Amy We've Silverman of RBC

121
00:06:17,279 --> 00:06:19,960
Speaker 2: who framed it as a threat that maybe prediction markets

122
00:06:20,000 --> 00:06:22,920
Speaker 2: grow and people go into there unless into equity markets.

123
00:06:22,960 --> 00:06:26,040
Speaker 2: How are you viewing kind of the booming. I guess

124
00:06:26,040 --> 00:06:27,760
Speaker 2: asset class. I don't know what we want to call it.

125
00:06:27,920 --> 00:06:29,080
Speaker 2: Of prediction markets.

126
00:06:29,279 --> 00:06:31,800
Speaker 1: Well, I think first of all, we are very clear

127
00:06:31,880 --> 00:06:35,960
Speaker 1: that we view regulation as an important ballast and an

128
00:06:35,960 --> 00:06:39,360
Speaker 1: important underpinning of markets really just for the purpose of

129
00:06:39,360 --> 00:06:42,160
Speaker 1: investor protection and all the things that it comes with,

130
00:06:42,320 --> 00:06:45,120
Speaker 1: the guardrails that are really necessary to make sure that

131
00:06:45,200 --> 00:06:49,039
Speaker 1: investors have a sustainable, lasting experience. When you are putting

132
00:06:49,080 --> 00:06:52,160
Speaker 1: your savings to work and you are a true investor,

133
00:06:52,600 --> 00:06:57,520
Speaker 1: the equities markets are an amazing opportunity to find to

134
00:06:57,560 --> 00:07:00,680
Speaker 1: find returns. When you are looking at this more as

135
00:07:00,720 --> 00:07:03,719
Speaker 1: a way to spend your afternoon, that's a different you know,

136
00:07:03,760 --> 00:07:05,839
Speaker 1: it's a different investor type, it's a different use of capital.

137
00:07:05,920 --> 00:07:09,640
Speaker 1: But also even then, the rules have to be clear,

138
00:07:09,680 --> 00:07:12,760
Speaker 1: and I think that's where we've been engaging with regulators

139
00:07:12,800 --> 00:07:15,480
Speaker 1: to understand, you know, how are they thinking about shaping

140
00:07:15,520 --> 00:07:17,640
Speaker 1: the rules. The safety c and the SEC are working

141
00:07:17,680 --> 00:07:20,440
Speaker 1: together better than we've ever seen before, because a lot

142
00:07:20,480 --> 00:07:23,000
Speaker 1: of these prediction markets te kind of in between, and

143
00:07:23,080 --> 00:07:24,720
Speaker 1: so it's a really a matter of how do we

144
00:07:24,760 --> 00:07:26,840
Speaker 1: make sure that the rules of a road are clear so.

145
00:07:26,840 --> 00:07:29,480
Speaker 3: That investors are protected Adeena, great having you with us

146
00:07:29,480 --> 00:07:31,920
Speaker 3: on set today. Really appreciate you joining us Adena. Friedman

147
00:07:31,920 --> 00:07:34,760
Speaker 3: there the CEO of the Nasdaq,