Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
Speaker 2: This is Bloomberg Business Week Insight from the reporters and
Speaker 2: editors that bring you America's most trusted business magazine, plus
Speaker 2: global business, finance and tech news. The Bloomberg Business Week
Speaker 2: Podcast with Carol Masser and Tim Stenovek on Bloomberg Radio.
Speaker 3: Hi, everyone, Welcome to the Bloomberg Business Weekend Podcast. This
Speaker 3: coming week a new chapter in American politics, as Donald
Speaker 3: Trump will be sworn in as the forty seventh President
Speaker 3: of the United States, his second term, and one that
Speaker 3: the technology community will be watching, whether it's about the
Speaker 3: US China tech war and access to advanced technology, to
Speaker 3: rules around autonomous driving cars, or oversight in policies on
Speaker 3: artificial intelligence.
Speaker 4: Tim, it's a lot, There's a lot in the global
Speaker 4: tech world that could be affected. Time will certainly tell
Speaker 4: regarding what policies actually come down from the Trump White
Speaker 4: House in the meantime. Ourt take this week includes whether
Speaker 4: the pullback and autonomous driving by GM is a cautionary
Speaker 4: tale about the bigger investment play in AI.
Speaker 3: And speaking of AI, the company who's chatchipt kicked off
Speaker 3: the AI craze over two years ago. We are of course,
Speaker 3: talking about open Ai co founder and CEO Sam Altman
Speaker 3: on the company's first two years, getting fire elon and more.
Speaker 4: Plus US China relations around American technology and really advanced
Speaker 4: global technology overall have led to a US China tech
Speaker 4: war and race. A company that has found itself at
Speaker 4: the center of it all, Huaweih. We get into the
Speaker 4: secret history of China's most powerful company, and.
Speaker 3: Then later on in our second hour, the founder of
Speaker 3: Libby Wines on going all in on non alcoholic options,
Speaker 3: also what to spend your bonus on.
Speaker 4: You got a bonus?
Speaker 5: No comment?
Speaker 4: And the CEO of the experiential hospitality company Pursuit on
Speaker 4: sky Lagoon and Iceland or riding the gondola in amph Canada.
Speaker 4: We'll also talk with one of the daughters of the
Speaker 4: late Martin Luther King Junior about his legacy, Donald Trump,
Speaker 4: and the state of racial equality.
Speaker 3: All of that to come. We begin with a column
Speaker 3: by Bloomberg Business Week's Max Chafkin on the shift in
Speaker 3: the mood around self driving cars despite billions of dollars
Speaker 3: in investments.
Speaker 4: Carol, I took my first ride in a WEIMO. You
Speaker 4: were so excited back in November in San Francisco.
Speaker 6: I was blown away.
Speaker 3: You were You just couldn't stop talking about I still.
Speaker 7: Talk about it.
Speaker 4: That's like boring for our audience because I keep talking
Speaker 4: about it. Max. Have you been on Have you been
Speaker 4: in one?
Speaker 7: I have?
Speaker 8: Yes.
Speaker 4: What'd you think?
Speaker 7: I think it's very impressive. I think that there are real.
Speaker 9: Questions about just how widely we're going to see these
Speaker 9: things be deployed and.
Speaker 7: Whether it's a profitable business anywhere in the near term.
Speaker 4: So a few weeks after I took that ride in
Speaker 4: the Weimo, Mary Bara at GM basically shuts down the
Speaker 4: cruise division at General Motors.
Speaker 7: Yeah.
Speaker 9: This was the GM's version of Weimo. It was GM's
Speaker 9: robot taxi business. And the thing about this that was
Speaker 9: kind of surprising. This happened in December. Uh. There were
Speaker 9: lots of warning signs. There had been UH there had
Speaker 9: been a very serious accident involving a cruise vehicle in
Speaker 9: San Francisco. The company had been tangling with regulators. There
Speaker 9: were reasons to think something like this is coming. On
Speaker 9: the other hand, we're talking about a major AI effort
Speaker 9: at a major American company getting essentially killed just at
Speaker 9: the time when everybody in the world, You and and
Speaker 9: all the guys in Silicon Valley and everyone else are
Speaker 9: talking about how great these these self driving cars aren't
Speaker 9: and also how you know, AI chatbots are gonna be
Speaker 9: doing customer service and maybe writing news articles and taking
Speaker 9: all of our jobs. And so so you got to
Speaker 9: ask yourself, like, what is going on here? Is there
Speaker 9: is there just a sort of a unique problem at GM,
Speaker 9: which is an explanation that you've seen offered, or maybe
Speaker 9: there are things here that, despite GM's problems, signal challenges
Speaker 9: ahead for all of these companies. And that's kind of
Speaker 9: the argument that I make in this business.
Speaker 10: We call them that.
Speaker 9: Yeah, like you could look at this and say, wow,
Speaker 9: great news for weimo their main.
Speaker 7: Competitor has just given up.
Speaker 9: On the other hand, I would argue that the challenges
Speaker 9: that Cruz faced, which you know there there was, there
Speaker 9: was definitely some mismanagement.
Speaker 7: There was a very bad accident, and I think.
Speaker 9: What you know, pretty much everyone would agree was a
Speaker 9: poor response to that accident actually led to a criminal
Speaker 9: admission of criminal behavior on the part of GM, but
Speaker 9: that they also had massive losses and a pretty small fleet.
Speaker 9: I mean Cruz spent GM spent ten billion dollars over
Speaker 9: about a decade, a little less than a decade, getting
Speaker 9: a few hundred cars in a very small number of places.
Speaker 9: And if you look at Weaimo, as great as those
Speaker 9: rides are, and you know, Weymo's, especially in San Francisco,
Speaker 9: have become something of a tourist attraction.
Speaker 7: People go there.
Speaker 9: Oh yeah, and they wanted to you know, they want
Speaker 9: to like enjoy the they're in Silicon Valley. That aside,
Speaker 9: we're still talking about a very small fleet in a
Speaker 9: limited way. And Google Alphabet the parent company of Google,
Speaker 9: which also owns Waymo. They don't break out the finances
Speaker 9: of Weimo, but if you look at their other Vets division,
Speaker 9: which is of which Weimo is like the main the
Speaker 9: most famous one, probably the most substantial operation, it has
Speaker 9: burned through thirty seven billion dollars over period. So again
Speaker 9: we're talking about rides that almost certainly cost a lot
Speaker 9: more than they bring in.
Speaker 4: Mine was twenty nine dollars.
Speaker 3: Well, and you know what's kind of crazy is you
Speaker 3: are such a safety net totally and so like I thought,
Speaker 3: oh my god, you're going to be freaking out like
Speaker 3: you were in the car for half hour.
Speaker 4: Yeah, it's about half hour ride, which I didn't know
Speaker 4: you could take a half hour drive in San Francisco
Speaker 4: and still be in San Francisco.
Speaker 3: But you were totally comfortable.
Speaker 4: Yeah, totally comfortable. I was excited about it, And in fact,
Speaker 4: I was visiting a friend who lived outside of the
Speaker 4: She lived just north of the city, and she drove
Speaker 4: me back into the city, specifically to a place just
Speaker 4: after the edge where I could actually get into a
Speaker 4: Weimo and she said, we had some friends visiting recently
Speaker 4: and their kids really wanted to ride on the trolley.
Speaker 4: So we went into the city and we decided instead
Speaker 4: of riding on the trolley, we'll all get in a way.
Speaker 4: So that you're absolutely right Max about these things.
Speaker 7: It's it's like a cable car.
Speaker 9: And I mean, you're bringing up a couple of issues
Speaker 9: that I think should give people pause, especially if you're,
Speaker 9: you know, building a financial model like I think it's.
Speaker 7: Important to say that what Weimo has done.
Speaker 9: And honestly, a lot of what Creus did was very
Speaker 9: impressive technically impressive. They have managed, as you said, to
Speaker 9: take humans mostly out of the loop and drive safely
Speaker 9: in a very difficult urban environment. But doing that requires
Speaker 9: all sorts of compromises. It creates all sorts of costs.
Speaker 9: You know, these these vehicles are very expensive. They have
Speaker 9: these huge sensor arrays. You have large staffs of people
Speaker 9: making sure they don't do anything bad and then sitting
Speaker 9: around responding to customer complaints. You know, when a car
Speaker 9: gets stuck in a parking lot or something, there's a
Speaker 9: button you have to press on the WEIMO and a
Speaker 9: customer service PAS to essentially like troubleshoot your You're supposedly
Speaker 9: driverless car.
Speaker 7: So it's like, so there are a bunch of issues
Speaker 7: that are are problematic.
Speaker 9: I think if you're seeing this as some investors are,
Speaker 9: as a real replacement for like uber or lyft. On
Speaker 9: the other hand, as a thing you can do when
Speaker 9: you're done riding a cable car, it seems really really fun.
Speaker 3: So what's going on and why Mary Barr and others
Speaker 3: may be rethinking it? Expectations too high timing issue, the
Speaker 3: infrastructure not there yet, technology not completely there, So like
Speaker 3: what is it?
Speaker 7: Yeah?
Speaker 9: Absolutely so I think it's all. It's basically all the
Speaker 9: things you mentioned now. Now the most important thing is
Speaker 9: that in twenty twenty three, a cruise vehicle got into
Speaker 9: an accident, actually hit a pedestrian, ran a pedestrian over.
Speaker 9: It wasn't the initial impact was actually not really the
Speaker 9: fault of the driverless car. It was the pedestrian was
Speaker 9: hit by a human driver, knocked in the path of
Speaker 9: the cruise, the cruise breaked, and then what happened next
Speaker 9: is what was really trying bubbling. You know, a normal
Speaker 9: person hits somebody on the road, they get.
Speaker 7: Out, they make sure they're okay.
Speaker 9: Hopefully in this case, the crews just drove to the
Speaker 9: side of the road, dragging this woman twenty feet along
Speaker 9: with it. And so you're you're talking about an incident
Speaker 9: that doesn't happen in a normal car and doesn't and
Speaker 9: you know, you're there there. There have been reports on
Speaker 9: this that this led to a huge back and forth
Speaker 9: with cruise and federal regulators and California regulators. Fines were paid,
Speaker 9: as I said, so so, so there's that, and then
Speaker 9: there's the fact that GM had been making these huge
Speaker 9: promises about this thing. I mean, what was so stunning
Speaker 9: is Mary Barra at this like as recently as twenty
Speaker 9: twenty three was saying this is gonna be a fifty
Speaker 9: billion dollar a year business, and like.
Speaker 4: Just over a year later, Yeah, they pulled the plug.
Speaker 7: So so right, so and and so.
Speaker 9: Part of it, of course is the is the sense
Speaker 9: that there maybe there's a breach of faith, right, the
Speaker 9: like relationships with the regulators are really important, but also
Speaker 9: losing huge amounts of money and having already moving probably
Speaker 9: not as quickly as they wanted, and now with this
Speaker 9: latest thing having to move potentially even slower. I just
Speaker 9: think the economics here are not that great, and and so,
Speaker 9: and the accident created a bunch of pressure on the
Speaker 9: on the division that wasn't there maybe would have been
Speaker 9: able to go go along for a lot longer. WEAMO
Speaker 9: was a little different, partly because Google is a much
Speaker 9: you know, is a very profitable company and and way
Speaker 9: MOO benefits from an essentially unlimited cash uh cash cushion
Speaker 9: or or as as it's you know, it's up to
Speaker 9: the CFO of alphabet. But but you know, a relatively
Speaker 9: generous situation. WEAMO also, unlike Cruz, has moved a little
Speaker 9: bit more slowly in terms of like commercial adoption. They
Speaker 9: you know, I think I think people in the industry
Speaker 9: think that Cruz was operating somewhat more aggressively and in
Speaker 9: that sense.
Speaker 7: But but if you talk to experts in the.
Speaker 9: Self driving car world, right, they all expect that there
Speaker 9: will be additional incidents like this because it's just a
Speaker 9: numbers game, right. As you said, humans create a lot
Speaker 9: of car crashes. Even if robots are much much better
Speaker 9: than humans, you're still going to see some very messy
Speaker 9: situations and that's going to create further uncertainty.
Speaker 4: Enter Elon Musk has entered the chat and he's entered
Speaker 4: the White House as well as the New York Times
Speaker 4: reports he's going to have some potentially some office space
Speaker 4: at the White House where he gets things done. He
Speaker 4: has the ear of the President. The Robotaxi that he promises,
Speaker 4: he says, has built a better mouse trap for cheaper
Speaker 4: than weimo. Can he pull it off?
Speaker 7: Well? I mean the question is, Kenny, what do you
Speaker 7: want him to pull off?
Speaker 9: And I think I should say one thing Mary Barratt
Speaker 9: said when she folded the robotax thing that they were
Speaker 9: going to roll the cruise technology into their existing vehicles,
Speaker 9: which is more or less what Elon Musk has done. Right.
Speaker 9: I think if you look at Tesla, they have a
Speaker 9: great aid ass that stands for like an assistant a
Speaker 9: driver assistant system, a system where it can take control
Speaker 9: of the car, but you're there, You've got your hands
Speaker 9: ready to grab the wheel at any times.
Speaker 7: It's very much not a robot taxi.
Speaker 9: And Elon Musks bet is that they can somehow by
Speaker 9: some combination of extreme you know, hardcore Elon Musk style
Speaker 9: technical prowess and you know, putting pressure on or maybe
Speaker 9: just asking the Trump White House to change the regulator environment,
Speaker 9: they'll be able to get to you know, full robotaxis
Speaker 9: really quickly, you know, as quickly as this year. And
Speaker 9: I think when you look at where Waymo and Cruse
Speaker 9: are and how long they've spent and how many miles
Speaker 9: they've done in terms of driving without a steering wheel,
Speaker 9: you got to ask yourself, is Elon Musk being realistic?
Speaker 9: I mean, no amount of no relationship with President Trump,
Speaker 9: can you know, magically make a technology that isn't ready
Speaker 9: for primetime ready for primetime?
Speaker 4: That was Max Chafkin, columnist for Bloomberg business Week and
Speaker 4: the co host of the Elon Inc. Podcast, also the
Speaker 4: author of the contrariant Peter Teel and Silicon Valley's Pursuit
Speaker 4: of power.
Speaker 3: You know, it's kind of interesting, right in terms of
Speaker 3: really the shift that we have seen in terms of
Speaker 3: self driving cars, right. I mean it's staggering the amount
Speaker 3: of money GM. But you think about something like Alphabet right,
Speaker 3: Google that they have spent on self driving cars. It's
Speaker 3: a lot of money. And yet you are feeling a
Speaker 3: dialing down. And maybe it's just I don't know, our
Speaker 3: infrastructure not quite there. Tim, I don't know. You took
Speaker 3: a ride and we're blown away.
Speaker 4: Yeah, I thought it was amazing. But Max brought up
Speaker 4: some good points that this is a really contained environment
Speaker 4: in a small section of a city.
Speaker 6: Right.
Speaker 4: It only works in San Francisco in you know, in
Speaker 4: that area. Yes, there are way mos in other parts
Speaker 4: of the country, but can you imagine a vehicle like
Speaker 4: that here in New York City. Max also bringing up
Speaker 4: the point that Uber is really efficient. It's like cheap
Speaker 4: to get somebody up on your smartphone, ring Lyft as well,
Speaker 4: and it's quick and you know they give you a
Speaker 4: ride somewhere like that system works pretty well right now.
Speaker 3: And I will agree that all these this technology makes
Speaker 3: driving much more safer, all right? Coming up, Sam Altman
Speaker 3: on Chat GPT's first two years, Elon and artificial intelligence
Speaker 3: under Donald.
Speaker 4: Trump, Bloomberg BusinessWeek sat down with the open aa co
Speaker 4: founder for a wide ranging interview. You're listening to Bloomberg
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Speaker 3: It's more than two years since things were kind of
Speaker 3: quiet over at open a high wage back in November
Speaker 3: of twenty twenty two. Is a startup so small and
Speaker 3: sleepy that the owners didn't bother tracking their web traffic,
Speaker 3: so reminds us and writes Josh Tyrangle, who caught up
Speaker 3: with the open AI co founder and CEO Sam Altman
Speaker 3: to talk about his infamous four day firing, how he
Speaker 3: runs the company, thoughts on another co founder, e Elon Musk,
Speaker 3: of course, and the impact of a Trump presidency on
Speaker 3: AI and more. It's all in the conversation. We welcome
Speaker 3: Bloomberg BusinessWeek freelance contributor Josh Tieringele. He is, of course,
Speaker 3: former editor of Bloomberg Business week and he joins us
Speaker 3: from New York City. Hey, Gosh, great to have you
Speaker 3: here with us. I have to say, this has to
Speaker 3: be one of the most sought after individuals to talk to.
Speaker 3: When he does an interview, we all kind of sit
Speaker 3: up and listen. How did this come together and why
Speaker 3: did he want to talk now?
Speaker 11: You know, I've spoken to him a bunch of times
Speaker 11: over the last couple of years, and he reached out
Speaker 11: basically saying, look, it's been two years since GPT launched,
Speaker 11: it's been about a year since the board firing. I
Speaker 11: think he was eager to kind of put a bunch
Speaker 11: of this stuff behind him. It's probably tired of being
Speaker 11: asked questions about it, so he invited me to come
Speaker 11: out and really talk through it all and do it
Speaker 11: at some considerable length. You know, we spent two and
Speaker 11: a half hours together just really rehashing it and did
Speaker 11: a past present future.
Speaker 6: So it was really his initiative.
Speaker 4: You talked about, and I think one of the most
Speaker 4: interesting takeaways for me Josh was the drama that occurred
Speaker 4: when he was briefly outed as CEO. We're going to
Speaker 4: get to that in just a few minutes before we
Speaker 4: get there though, is the origin story of the company.
Speaker 4: Not everyone knows how it was started, who started it,
Speaker 4: who was involve what was top of mind when you
Speaker 4: sat down within to talk.
Speaker 11: You know, I think he was in a reflective mood.
Speaker 11: Anniversaries are pretty arbitrary. Some people observe them and get
Speaker 11: sentimental around them, some people don't. I think that he
Speaker 11: was feeling very much like, you know, this is a
Speaker 11: different company today than it was two years ago. You know,
Speaker 11: when we talked about the sort of founding myth, you know,
Speaker 11: companies that are successful get you know, it sort of hardens,
Speaker 11: and there's this belief that there was this kind of
Speaker 11: founding dinner at Open AI where all the founders came
Speaker 11: together declared their intent and that was the beginning. And
Speaker 11: in fact, what he wanted to correct the record on
Speaker 11: is it really started because he was a deep AI nerd,
Speaker 11: you know, a decade and a half ago when it
Speaker 11: was not particularly cool. As he was monitoring progress, he
Speaker 11: really pursued Elijah Sutzkyer, who was you know, he's co
Speaker 11: founder and who was a researcher who was really pretty
Speaker 11: deep into you know, pursuing artificial intelligence. Sam Relaid pursued him,
Speaker 11: and he just wanted to say that the first thing
Speaker 11: for him was this dinner the two of them had,
Speaker 11: and that dinner produced a lot of the sort of
Speaker 11: philosophical research driven take that's still very much at the
Speaker 11: core of Open AI.
Speaker 3: Josh did they have at that time, and as you know,
Speaker 3: if there were kind of multiple dinners these guys had
Speaker 3: and starting to think about the concept I guess of
Speaker 3: the company or what they wanted to do. But did
Speaker 3: they have any idea a kind of what they were
Speaker 3: dealing with? As you note in the story that Sam
Speaker 3: Altman said, even thinking about doing this was like cancelbal
Speaker 3: cancel the ball, So you know, it was kind of
Speaker 3: not something anybody was considering doing. But did they have
Speaker 3: any concept that two years later like this is might
Speaker 3: kind of been where we would be.
Speaker 11: It's a sort of eight year overnight success, right. I
Speaker 11: think that they felt like they could scale artificial intelligence.
Speaker 11: They didn't quite know, you know, what that journey would
Speaker 11: look like, but they were pretty confident that they were
Speaker 11: going to be able to make AI happen and make AI.
Speaker 6: Happen for ordinary consumers.
Speaker 11: Obviously there's tons of twists and turns, but yeah, they
Speaker 11: did have a pretty strong sense this is what they're
Speaker 11: going to be able to do, and they actually saw
Speaker 11: their the size of the company, which was quite small,
Speaker 11: as a distinct advantage in those days.
Speaker 4: Yeah, one of those twists and turns I promised you'd
Speaker 4: get to it was his revouster from the company explain
Speaker 4: how it went down differently than what's been reported. What's
Speaker 4: the inside story there.
Speaker 11: The key component is just that there's been complete opacity
Speaker 11: around exactly what happened. You know, there was this sort
Speaker 11: of four day hostage taking where nobody quite knew what
Speaker 11: the future of the company was going to be. We
Speaker 11: knew that the basic details, which are that he had
Speaker 11: been fired and the board had fired him for what
Speaker 11: they had termed is not being consistently candid.
Speaker 6: Didn't know what about, didn't know what they were referring to.
Speaker 6: He says, still he's not totally.
Speaker 11: Sure what they're referring to, and I think, you know,
Speaker 11: in the piece, I kind of challenge him a little bit.
Speaker 6: I think ultimately what it comes.
Speaker 11: Down to, and what he talks about is that, you know,
Speaker 11: the company was founded with this very you know, noble
Speaker 11: and pure ideas about AI research.
Speaker 6: What they determined along the way.
Speaker 11: Is that if you're going to be competitive in the
Speaker 11: field of AI, and if your product is going to
Speaker 11: be meaningful, you need to be able to pivot.
Speaker 6: You need to be able to devote.
Speaker 11: Very large sums to compute, which is the you know,
Speaker 11: the process of actually training these AI models, and that
Speaker 11: there was a divorce coming.
Speaker 6: With that board.
Speaker 11: The board was genuine in its convictions that AI needed
Speaker 11: to be monitored a certain way. There was some sort
Speaker 11: of schism coming. It feels like that schism was inevitable.
Speaker 11: Sam in the interview says he probably should have been
Speaker 11: aware that there was greater risk of that schism than
Speaker 11: he actually was. He says he doesn't have great EQ
Speaker 11: on these things. But you know what we really get
Speaker 11: out of the piece is just him telling us, moment
Speaker 11: by moment, what those four days were about. The negotiations
Speaker 11: to come back, the brief window where it looked like
Speaker 11: he was coming back and there would be no issues.
Speaker 6: Then the board named Emma Cheer.
Speaker 11: As a CEO, and ultimately, you know, the kind of
Speaker 11: rebellion from within the company that brought him back and
Speaker 11: I think led to changes that were probably inevitable. In
Speaker 11: the future, we may look back on this and say,
Speaker 11: you know, this was a company that could have done
Speaker 11: all of these things over the course of a couple
Speaker 11: of years, and they ended up doing them over the
Speaker 11: course of a couple of months as a result, So
Speaker 11: it may have turned out to be a blessing. At
Speaker 11: the same time, he you know, clearly it's a strange
Speaker 11: and traumatic experience to be not only fired in public,
Speaker 11: but then to be dangling for four days in public
Speaker 11: while there are reporters outside your door, reporters outside the
Speaker 11: door of your former company. So I think he was
Speaker 11: trying to put that in perspective, and I believe we
Speaker 11: got more information on it than has ever been out
Speaker 11: there before.
Speaker 6: Just put a very strange episode. Even looking back.
Speaker 3: On it now, Yeah, it's like watching you know, I
Speaker 3: feel like a streaming series when we were reading or
Speaker 3: going through it. Having said that, does he feel like
Speaker 3: Josh that the board that the company is but find
Speaker 3: is behind him, does he feel kind of comfortable or
Speaker 3: does he feel like he's sot obsessed to look over
Speaker 3: his shoulder and kind of gauge where everybody is.
Speaker 11: Well, it's a completely new bor that he had a
Speaker 11: large role in composing. I think that the brief firing
Speaker 11: was an occasion to basically say, look, are you in
Speaker 11: with the new vision or are you going to leave?
Speaker 11: They've had a bunch of attrition, some of it high profile,
Speaker 11: some of the lower profile. He seems completely at home
Speaker 11: inside the company, completely comfortable. I think that they are
Speaker 11: on the right trajectory as far as he sees it,
Speaker 11: So I don't think there's discomfort there.
Speaker 4: What about moving forward in the future, You know, the
Speaker 4: illly is not there anymore. Elon Musk, of course, isn't
Speaker 4: there anymore. Microsoft has made huge investments in open AI,
Speaker 4: but has also doing their own thing. Anthropic is out there.
Speaker 4: You got Meta Platforms doing its own thing as well.
Speaker 4: What does the landscape look like from Sam Allman's perspective?
Speaker 6: Right now?
Speaker 11: Competitive? It's super competitive. You know, there's trillions of dollars
Speaker 11: in profits to be made by AI by the identification
Speaker 11: of AI. Everybody is seeing the same thing. At some
Speaker 11: point the marketplace will diversify, but they kind of choose
Speaker 11: more of a lane. But right now they're all competing
Speaker 11: with these very large models of AI to get to
Speaker 11: the to the brass ring. You know, I think they
Speaker 11: feel very comfortable that because they were there first, and
Speaker 11: because they're pretty disciplined about what they're actually pursuing, which
Speaker 11: is as a research focused company getting to artificial intelligence
Speaker 11: and artificial general intelligence whatever may come beyond, they are
Speaker 11: able to attract talent there. You know, there are other
Speaker 11: companies have beer warchest. They are successfully getting talent. But
Speaker 11: it's going to be a battle, and I think it's
Speaker 11: going to be a three to five year battle to
Speaker 11: determine who really owns the AI space, what pieces of
Speaker 11: it do they own. And he's determined that not only
Speaker 11: does open Ay want chat cheapt to be a very
Speaker 11: successful product within it, but that that product is not
Speaker 11: the end goal. The end goal is advanced technology, even
Speaker 11: beyond what we're seeing now. So he's pretty clear what
Speaker 11: he sees for their company.
Speaker 4: What does that look like though, And that's one area
Speaker 4: that I'm having trouble envisioning. And maybe it's because I'm
Speaker 4: not in the heart of Silicon Valley, maybe it's because
Speaker 4: I'm not necessarily using chat GPT to its full potential.
Speaker 4: But what does that world of AGI look like or
Speaker 4: that world of AI in the next three to five years, Like,
Speaker 4: how are our lives going to be different?
Speaker 11: Well, look you're not wrong. I mean, this is one
Speaker 11: of the confounding aspects of being alive during AI is
Speaker 11: that the people pursuing AI are research scientists for the
Speaker 11: most part, but they speak like preachers, right, They speak
Speaker 11: with this sort of evangelizing faith about what's coming. But
Speaker 11: when you ask them, you know, as I asked Sam, like,
Speaker 11: what in your mind is artificial general intelligence? What he
Speaker 11: gave me was a sort of decent definition, and at
Speaker 11: the end of it he said, and if we achieve that,
Speaker 11: that would be AGI ish, right, And so there is
Speaker 11: a lack of precision in our terms when we talk
Speaker 11: about what AI is and what we talk about AGI,
Speaker 11: and so it's confounding, it really is. It is not
Speaker 11: on you, though, It is on the industry to ultimately
Speaker 11: come up with these definitions of what it is so
Speaker 11: that people can figure out what it means for their lives.
Speaker 11: This is not standard technology. This is way more disruptive.
Speaker 11: And I think, you know, there's a ripple between these
Speaker 11: companies and the potential consumers. I don't think it's the
Speaker 11: consumers who are to blame for that. Were not yet
Speaker 11: at a place where everybody agrees on what these things are.
Speaker 3: Josh it sounds like he thinks, based on the interview,
Speaker 3: that he thinks Elon could be continue to be trouble
Speaker 3: for them going forward.
Speaker 11: I simultaneously think Sam is very sincere and certainly not
Speaker 11: above being tactical, and so knowing full well.
Speaker 6: That our interview would be read far and wide.
Speaker 11: I'm certain that he said things knowing other people would
Speaker 11: read them, and so the idea that maybe he was
Speaker 11: creating some distance between his view of the Trump administration
Speaker 11: Elon Musk would certainly.
Speaker 6: Benefit open AI. You know, he knows Elon better than us.
Speaker 11: I think that I've heard from many people that Elon
Speaker 11: is very sincere about his concerns about artificial intelligence.
Speaker 6: Yeah.
Speaker 11: Also, I can't deny he has an artificial intelligence company
Speaker 11: that competes with open AI. So I took that answer
Speaker 11: in particular to be fairly tactical.
Speaker 3: He said he thought he could get more lawsuits and
Speaker 3: might be dropped from Elon, but he also thought he
Speaker 3: didn't think Elon would abuse his political power in the end.
Speaker 11: Yeah, and many people have told me the same thing,
Speaker 11: which is it Elon is one hundred percent sincere when
Speaker 11: it comes to technology, but that when it comes to.
Speaker 6: Competitive corporate warfare.
Speaker 11: He'll do anything, and so I think Open AI, much
Speaker 11: like everybody else in the space, is kind of prepared
Speaker 11: for anything so long as Elon is, you know, in
Speaker 11: a position to influence the Trump administration's policies.
Speaker 4: Something that Elon has talked about has been the dangers
Speaker 4: associated with AI and with AGI. What did Sam Altman
Speaker 4: tell you about dangers that could come up as a
Speaker 4: result of this technology?
Speaker 6: You know, he has been fairly consistent that he thinks
Speaker 6: in the.
Speaker 11: Short term, you know, there's biological weaponry concerns, that the
Speaker 11: ability for AI to be used in creating small time
Speaker 11: proliferation of weaponry. He thinks it's likely to happen and
Speaker 11: we need to be on the lookout for it, and
Speaker 11: that in the longer term, we don't know what AI
Speaker 11: is capable of. You know, his feeling very strongly again
Speaker 11: coincides with his self interest. Is it the only way
Speaker 11: to move this forward is to actually make a product,
Speaker 11: test it regulated, as opposed to be concerned about things
Speaker 11: that you don't know regarding AI and its capabilities. So, yeah,
Speaker 11: that's what he sees. That's it's you know, a pretty
Speaker 11: standard view from the industry. There are still people at
Speaker 11: the edges who believe that the risk of existential risks
Speaker 11: from AI is as high as twenty percent. I think
Speaker 11: that's a little bit of an outlier, but people think
Speaker 11: that we're going to be in for it for sure,
Speaker 11: as people come up with new and nefarious uses.
Speaker 6: For the tech.
Speaker 3: Josh only got about a minute left. You get into
Speaker 3: so much, including energy demands of AI and the data
Speaker 3: centers and impact climate. But I am curious in these
Speaker 3: final seconds what stood out for you in this conversation.
Speaker 6: I'm really interested in how people run companies like this.
Speaker 6: I did not know how granular he really is.
Speaker 11: You know, they now have a couple of thousand employees,
Speaker 11: they have hundreds of millions of users, and he is
Speaker 11: in on those research meetings. He's in the slack channels,
Speaker 11: and they are parts of the company that he that
Speaker 11: he really delegates other people to handle. That's interesting. It's
Speaker 11: a it's a different kind of style from other folks.
Speaker 11: He's also very reflective and analytical. You know, he came
Speaker 11: from y Combinator, which was largely this uh, you know,
Speaker 11: nurturing fund.
Speaker 6: Which scouted CEOs. It's very aware of what he's good
Speaker 6: at and bad at.
Speaker 11: As a CEO, and that kind of reflection is not
Speaker 11: common in many of the CEO interviews I've done, so
Speaker 11: you know, I was both impressed by it and I
Speaker 11: found that to be, you know, relatively abnormal.
Speaker 3: Well, thank you so much, Josh, really appreciate the time. Josh,
Speaker 3: of course, is Bloomberg BusinessWeek freelance contributor and also former
Speaker 3: editor of BusinessWeek, and you can catch the whole story
Speaker 3: in the issue current issue of Bloomberg Business Week, also
Speaker 3: online and on the Bloomberg terminal. This is Bloomberg BusinessWeek.
Speaker 2: This is the Bloomberg Business Week Podcast. Listen live each
Speaker 2: weekday starting at two pm Eastern up on applecar Play
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Speaker 2: New York station Just Say Alexa played Bloomberg eleven thirty.
Speaker 3: Our next guest says, it's quote the most powerful technology
Speaker 3: company that China has ever built.
Speaker 4: No, we're not talking about ten Cent, which this month
Speaker 4: was blacklisted by the Biden administration for alleged links to
Speaker 4: the Chinese military. Nor are we talking about Ali Baba
Speaker 4: or JD dot Com or Matswan.
Speaker 3: We're talking about Huawei, the privately held maker of telecom
Speaker 3: equipment that came into focus in twenty eighteen when the
Speaker 3: company's chief financial officer, menguan Zhou, was arrested in Canada
Speaker 3: at the request of the United States. And it's an
Speaker 3: incident that's set off a diplomatic uproar and complicated relations
Speaker 3: between the United States, China, and Canada.
Speaker 4: For a deep dive on the company, we caught up
Speaker 4: with Eva Doe, technology policy reporter at the Washington Post
Speaker 4: and the author of the new book House of Huawei,
Speaker 4: The Secret History of China's Most Powerful Company.
Speaker 12: I think to many people where they've heard of Huawei
Speaker 12: is from their smartphones, which for years has been one
Speaker 12: of the largest smartphone brands in the world. But really
Speaker 12: the reason it's become such a policy concerns it's also
Speaker 12: the largest maker of the equipment that goes into phone
Speaker 12: and internet networks around the world. And of course these
Speaker 12: networks they carry all sorts of information, you know, phone calls, emails,
Speaker 12: internet traffic, and from that perspective, it's become something that
Speaker 12: policymakers have become very concerned about. Is this one company
Speaker 12: and its global footprint. It's far head and shoulders the
Speaker 12: dominant supplier in developing nations around the world, and even
Speaker 12: in Europe is a dominant supplier in many countries.
Speaker 3: You know, one thing we want to ask you. You know,
Speaker 3: we've spent a lot of time over the last few
Speaker 3: years talking with Andy Purty, who was the chief security
Speaker 3: officer for Huawei America. You would come in every few months, Yeah,
Speaker 3: and we would talk to him about kind of the
Speaker 3: strained er growing strained relationships certainly in the tech environment.
Speaker 4: About Huawei not being a security risk to the United States.
Speaker 3: Right exactly. And so I am wondering in this environment
Speaker 3: access to an administration you've got Elon Musk, you know,
Speaker 3: a certainly high profile member of the tech community. I mean,
Speaker 3: what are your expectations of Huawei having a strong communication
Speaker 3: line with the incoming Trump administration and maybe it's future
Speaker 3: changing in a more favorable way here when it comes
Speaker 3: to the United States.
Speaker 12: I think if that happens, that they make this kind
Speaker 12: of rebounding communications in the United States, that would be
Speaker 12: defying expectations in that the incoming Trump administration. If you
Speaker 12: look at who is in Trump's team, there's there there's
Speaker 12: a lot of security hawks, a lot of people have
Speaker 12: been vocal critics of China for many years, and so
Speaker 12: I think what we can expect is for policy to be,
Speaker 12: you know, even more stringent than it has been in
Speaker 12: recent years as far as control of technology being transferred
Speaker 12: to China. And from that point of view, I would
Speaker 12: say it's it's hard to see where the bright spot
Speaker 12: is for Huawei in the US market and the foreseeable future.
Speaker 6: Oh that's interesting, okay.
Speaker 4: So I have a few questions around this, one of
Speaker 4: them being the opportunity for Huawei outside of the US,
Speaker 4: because you know, we've talked a lot in the past
Speaker 4: few years about China's growing influence with the Belton Road initiative,
Speaker 4: and I'm wondering from a cybersecurity perspective, from a telecom
Speaker 4: infrastructure perspective, are they able to use that as a
Speaker 4: lever in any way?
Speaker 12: Well, I think so, And part of that is just
Speaker 12: there have been so few alternatives in this market. There's
Speaker 12: very few players, and so the question is if you
Speaker 12: don't use Huawei, what do you use for these developing countries.
Speaker 12: And so that's sort of been what officials in many
Speaker 12: of these countries have been saying, which is, you know,
Speaker 12: the United States wants US to take Huawei equipment out,
Speaker 12: but what do we do then? Sort of the only
Speaker 12: comparable vendors for the most part have been European companies
Speaker 12: whose equipment is far more expensive, and that's just outside
Speaker 12: of the budget for many countries to do. So. Part
Speaker 12: of the US policy under the Biden administration has been
Speaker 12: to programs to develop new competitors making this kind of
Speaker 12: gear so that countries do have an alternative if they
Speaker 12: if they actually want to switch EVA.
Speaker 3: I am curious, you know, you really get into the
Speaker 3: details of the history of this company that I think
Speaker 3: most people didn't even think about until we had the
Speaker 3: problems and the issues right of a few years ago.
Speaker 3: Why is it important to understand the history of this
Speaker 3: company in light of the security considerations that many global
Speaker 3: leaders are concerned about when it comes to this company.
Speaker 12: Yeah, I think part of it is just understanding how
Speaker 12: we got to this point where the US and China
Speaker 12: are so acrimonious and there's so much distrust, especially regarding
Speaker 12: the technology industry now, and so I think Huawei is
Speaker 12: such a good case and that it was one of
Speaker 12: the very first private tech companies founded in China in
Speaker 12: the early eighteen hundreds, and it's been on the front
Speaker 12: waves of these changing sentiments. You know, China's globalization, that
Speaker 12: heady period where China was very much embraced by the
Speaker 12: world and these tech companies were embraced by the world
Speaker 12: and moving towards you know, this current moment when you know,
Speaker 12: the fear that China is a real rival and adversary,
Speaker 12: capable adversary to the United States is so on the
Speaker 12: front forefront of policy decision making today.
Speaker 4: Okay, So bring us to twenty eighteen. When the company
Speaker 4: CFO Menguanzhou was arrested in Canada. It set off that
Speaker 4: unprecedented diplomatic uproar. She was held for years as this
Speaker 4: played out in the courts. What happened there?
Speaker 12: Yeah, So that that was the moment and the rubber
Speaker 12: kind of hit the road. So for years there have
Speaker 12: been these concerns bubbling up in the United States and
Speaker 12: other Western countries about Huawei, but it really was that
Speaker 12: moment when the CFO was detained and at the same
Speaker 12: point the Trump administration put these sort of unprecedented sanctions
Speaker 12: on Huawei that sort of moved us to a new
Speaker 12: sort of Cold War esque era.
Speaker 7: In a sense.
Speaker 4: It's a big part of the story is about the
Speaker 4: shift in China over the years that Huawei has existed. Listen,
Speaker 4: you did a ton of research on this, interviews, archival research,
Speaker 4: You have reported from China, You've reported from Taiwan during
Speaker 4: your career. Can you answer the question for us whether
Speaker 4: or not Huawei is a security risk to the United States?
Speaker 12: A security risk, I would say probably, and that's something
Speaker 12: that's outside strictly the company's control, and that what we've seen.
Speaker 12: I think the clearest evidence we've seen has come out
Speaker 12: in Edward Snowden's leaks, which is that tech company's equipment
Speaker 12: can be used by and is used by intelligence agencies
Speaker 12: who find backdoors or build back doors into them even
Speaker 12: without the company's knowledge. So in a way, it's not
Speaker 12: entirely in Huawei's executives' hands. They can say, you know,
Speaker 12: our equipment is safe. We're doing everything that we can,
Speaker 12: but it's not entirely the company's control.
Speaker 3: I am curious just for size and scope, something we're
Speaker 3: very into certainly here at Bloomberg. What are the capabilities?
Speaker 3: I mean, how should we be thinking about them? In
Speaker 3: terms of Huawei surveillance systems, which are used by governments
Speaker 3: all over.
Speaker 12: So this has very much become something that's part like
Speaker 12: a new business line, these sort of citywide survey lens systems.
Speaker 12: That has to do with you know, data networks becoming
Speaker 12: fast enough that you can transmit huge amounts of data,
Speaker 12: so you can have video cameras and other sorts of
Speaker 12: sensors all across the city that are just streaming all
Speaker 12: sorts of information. And there's a number of governments around
Speaker 12: the world that are using these systems from Huawei. Yeah,
Speaker 12: and it's very controversial. Huawei is not the only company
Speaker 12: that supplies them. IBM was actually the US company was
Speaker 12: actually the first company that started supplying these kinds of systems.
Speaker 12: But yeah, it's very much a debate, ongoing debate about
Speaker 12: just how much data governments should be collecting and to
Speaker 12: what degree citizens have privacy or not.
Speaker 3: You know, Tim and I we spend a lot of
Speaker 3: time I'm sure you do too, as we know, talking
Speaker 3: about large language models, generative AI. What's next in terms
Speaker 3: of the impact continuing to track, So I think about
Speaker 3: what you are saying, what you have learned in the
Speaker 3: context of Huawei. You know, their role, whether it come,
Speaker 3: whether it's five g in terms of communications. Are AI
Speaker 3: technologies the AI races on. We know that. So I'm
Speaker 3: just wondering, how are you thinking about that next chapter
Speaker 3: and the concerns that we should have considering Huawei's dominance.
Speaker 12: Yeah, so Huawei is going to continue to be in
Speaker 12: the in the conversation for this AI era. So they
Speaker 12: are China's most advanced company for designing these chips that
Speaker 12: drive these AI systems, and so China has been importing
Speaker 12: huge amounts of US chips for years to build you know,
Speaker 12: their big data centers for large language models, and US
Speaker 12: sanctions have really been tightened in the past couple of years,
Speaker 12: which means they're more reliant on Huawei tips than ever before.
Speaker 3: So are they being hurt by these restrictions and maybe
Speaker 3: not having access and you know, we continue to see
Speaker 3: headlines about what this means for Nvidia being able to
Speaker 3: share you know, it's higher and technology. I mean, are
Speaker 3: they is China is Huawei being hurt as a result
Speaker 3: of all of this or does it just make them
Speaker 3: double down? From what you have learned, does it just
Speaker 3: make China and Huawei double down to make sure that
Speaker 3: they have the best and greatest.
Speaker 12: Well certainly they've very much been hurt in that. If
Speaker 12: you look at their trajectory before these sanctions began, they
Speaker 12: were growing year after year at enormous clip, and now
Speaker 12: that growth has stopped. I think the question during the
Speaker 12: first Trump administration was, you know, can they survive? And
Speaker 12: so the question, so the answer to that is clear
Speaker 12: now that you know they're too important to China that
Speaker 12: China is not going to let this company die. It's
Speaker 12: going to do everything possible for it to survive. That
Speaker 12: being said, yeah, they've very much been sort of hurt
Speaker 12: and slowed down by by these growing restrictions from the
Speaker 12: United States.
Speaker 4: It's interesting too, because it's not a publicly held company.
Speaker 4: It's a privately held company. Ownership structure, what is it?
Speaker 4: Who owns it? And do they remain Does it remain
Speaker 4: a private company for the foreseeable future.
Speaker 12: Yeah, so it's privately held, but with the shares dispersed
Speaker 12: among numerous current and former Huawei employees. And that for
Speaker 12: years has been a major part of the incentive program
Speaker 12: of how Huawei's founder and they got engineers to work
Speaker 12: incredibly hard towards this cause, which was part of their compensation.
Speaker 12: Was in the dividends they would receive even from the
Speaker 12: company's performance. Since it's privately owned, that means it does
Speaker 12: not have much of the scrutiny of a publicly owned company.
Speaker 12: There's definite, definitely limitations of what they have to disclose
Speaker 12: to the public. And they also aren't at the winds
Speaker 12: of the stock market. And so that's been actually part
Speaker 12: of their success and that they've been able to execute
Speaker 12: really long term plans and sort of long term expensive
Speaker 12: investments that you know, short term investors would not necessarily
Speaker 12: be on board with. And so at at this point,
Speaker 12: it's hard to see why Huawei would go public. They
Speaker 12: have plenty of funding China's state policy banks are very
Speaker 12: supportive when they need funding for their projects, and so
Speaker 12: it's probably going to remain private for the foreseeable future.
Speaker 3: I think about you know, people who are listening. I
Speaker 3: mean when the Bloomberg audience, right, there's obviously investors, there's consumers,
Speaker 3: you know, and they continue to look at their goods
Speaker 3: and their security breaches and so on and so forth, pecially
Speaker 3: when it comes to telecom. How I mean the consumer
Speaker 3: based do they they need to be concerned right? And
Speaker 3: they I assume you're going to say they want their
Speaker 3: governments to make sure that they're overseeing global technology because
Speaker 3: this is the new world order. And to be fair,
Speaker 3: I mean, can we say that US companies I mean,
Speaker 3: I mean, obviously I would assume the US government is
Speaker 3: not involved in those technologies. I mean, it's not apples
Speaker 3: to apples. It's different, right when it's China and the
Speaker 3: Chinese government when it comes to some of their big companies,
Speaker 3: particularly tech companies.
Speaker 12: So one thing is just that technology systems are hacked
Speaker 12: all the time, and probably hacked more than the average
Speaker 12: consumer would would realize. And so to an certain extent,
Speaker 12: it is just what is your risk level if you
Speaker 12: work for the government, if you work for you know,
Speaker 12: certain sensitive industries, Yeah, you probably want to think twice
Speaker 12: about exactly what kind of equipment you're using. And in fact,
Speaker 12: your employer probably has already guidelines in place. For the
Speaker 12: average consumer, you know, there is a certain risk that
Speaker 12: your data could be hacked, but that probably existed whether
Speaker 12: you knew it or not.
Speaker 3: Even just one last question, got about a minute and
Speaker 3: a half here, what was the most revealing thing to
Speaker 3: you in writing this book, doing the deep dive, going
Speaker 3: into the archive, talking to so many different voices. What
Speaker 3: was again the most revealing thing in this process for you.
Speaker 12: I think one of the most fun parts for me
Speaker 12: was just seeing all the places and all the historical
Speaker 12: moments where Huawei popped up while I was sort of
Speaker 12: researching in archives in the US and China and around
Speaker 12: the world, and it really gave me an appreciation of
Speaker 12: companies like this just all plugged in how they are
Speaker 12: affected and how they affect events going on around the globe.
Speaker 12: You know, in China, for the Hong Kong the historic
Speaker 12: Hong Kong Handover, when Hong Kong was returned from being
Speaker 12: a British colony to China, Huawei was there and helping
Speaker 12: to do the service of video surveillance for it. You know,
Speaker 12: for the Arab Spring, the Iraq War, uh, Huawei.
Speaker 5: Was on the ground.
Speaker 9: Uh.
Speaker 12: So they were there far more than a consumer company.
Speaker 12: When you supplied the phone and internet networks, it was
Speaker 12: our crucial and the first thing that you're you're expected
Speaker 12: to be furred on the ground with anything big happening.
Speaker 3: Listen, great stuff, and so glad we got so much time.
Speaker 3: Even though she's take Dnology policy reporter at Washington Post.
Speaker 3: Her new book House of Wahwei.
Speaker 2: You're listening to the Bloomberg Business Week podcast. Catch us
Speaker 2: live weekday afternoons from two to five pm Eastern Listen
Speaker 2: on Applecarplay and Android Auto with the Bloomberg Business app,
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Speaker 3: Plenty Ahead in our second hour of the weekend edition
Speaker 3: of Bloomberg Business Week, including the CEO of Attractions and
Speaker 3: hospitality company Pursuit on the demand and costs of outdoorsy experiences.
Speaker 4: Plus a daughter of Martin Luther King Junior on her
Speaker 4: father's legacy, racial equity, and the upcoming Trump presidency.
Speaker 3: First up this hour, you or your friends maybe partaking
Speaker 3: in the trend known as dry January. That's where you
Speaker 3: put down booze for the month last weekend. You might
Speaker 3: recall our Bloomberg Pursuits team even gave us some of
Speaker 3: the best mocktails to try, and we are already seeing
Speaker 3: declines in alcohol consumption. We've talked about those trends a
Speaker 3: lot on air and at the same time arise in
Speaker 3: non alcohol options.
Speaker 4: Two years after launching low alcohol products, the California based
Speaker 4: wine maker Libby Wines is now shifting its entire focus
Speaker 4: to non alcoholic beverages. Grant Hemingway is co founder and
Speaker 4: CEO of Libby Wines. He stopped by it to chat
Speaker 4: a share a glass or two about Libby's latest offerings.
Speaker 13: John my now co founder, and I actually were connected
Speaker 13: through some mutual friends and yes, a beer guy and
Speaker 13: a winemaker getting together. John did cut his teeth in
Speaker 13: that sessionable category, but I think it was one of
Speaker 13: those early indicators for him and for me watching from afar,
Speaker 13: that this moderation wave was was forthcoming and we really
Speaker 13: wanted to lean into my way.
Speaker 3: Did you really see this moderation.
Speaker 10: Wave coming one hundred percent?
Speaker 3: What were you seeing specific?
Speaker 13: I mean, the crystal ball that we saw was which
Speaker 13: we couldn't have predicted was going to be this self
Speaker 13: regulating meaning there are a lot of people out there
Speaker 13: and there's these buzzword terms zebra striping or bookending.
Speaker 3: Which is what that means.
Speaker 13: So a session, it's like a drinking session or a
Speaker 13: socializing session in which you have a full fledged cocktail
Speaker 13: or a glass of wine and then you mix over
Speaker 13: to a non alcoholic.
Speaker 10: Okay, So it seems to me that this.
Speaker 13: Is the consumption pattern happening for those that still are
Speaker 13: consuming not the abstainers, which seem to be growing also
Speaker 13: by the day.
Speaker 3: What can I ask you while you I know you
Speaker 3: had talked about it because you don't really drink. You
Speaker 3: used to drink some alcohol.
Speaker 4: Yeah, and even you know, to be fair, I did
Speaker 4: have a sip of like a really nice stout that
Speaker 4: my wife opened the other night. I get really bad
Speaker 4: headaches when I drank, and when what I found was
Speaker 4: that the less I drank when I did drink, the
Speaker 4: worse the headaches got. With less alcohol. Yeah, and I
Speaker 4: thought to myself, you know, it's not worth after drinking
Speaker 4: one beer to wake up and have my my day
Speaker 4: the next day completely ruined. So I don't know if
Speaker 4: it's like an allergy or something, but it was. Unfortunately,
Speaker 4: it was very easy for me to stop drinking because
Speaker 4: I wasn't drinking that much anyway. But what I noticed
Speaker 4: grant and maybe it's just kind of like a bias
Speaker 4: of where I am in life, but a lot of
Speaker 4: my friends were having kids, they were getting into their forties.
Speaker 4: They were like, if I, you know, if I need
Speaker 4: to be up early, I can't be staying out late.
Speaker 4: I need to be prioritizing rest and sleep and this
Speaker 4: was how they were dealing with that, and.
Speaker 10: That's our exact experience. To my wife and I.
Speaker 13: We have two kids back in California, and really started
Speaker 13: to almost like this self awareness or observation that we
Speaker 13: were just not drinking wine as much and it was
Speaker 13: a lifestyle thing.
Speaker 10: We know, had young kids and we were.
Speaker 13: Managing careers and alcohol was kind of getting in the
Speaker 13: way of that. And so it was kind of that
Speaker 13: moment that light bulb were kind of set out and
Speaker 13: surveyed the competitive set and nothing was really enticing from
Speaker 13: a qualitative perspective. But I had been eighteen years in
Speaker 13: wine making and this was a big loss, Like, why
Speaker 13: am I not drinking.
Speaker 10: The product that's supporting our career?
Speaker 4: Well, what are your friends in the wine industry say,
Speaker 4: Because they're getting hit hard right now.
Speaker 8: We're getting hammered.
Speaker 13: It's concerning, I mean the downward and you just reported
Speaker 13: on the Surgeon General like that's there's an anti alcohol movement,
Speaker 13: which I don't know that I'm all for in our business,
Speaker 13: I would say I'm four, But generally speaking, this moderation
Speaker 13: is a cultural movement, and I think the wine is
Speaker 13: she's really waking up to it and look no further
Speaker 13: than the results at the register.
Speaker 3: Yeah, and you know it's funny to watch, you know,
Speaker 3: kind of old television where people are constantly smoking and
Speaker 3: had a cocktail. I even think of like my dad
Speaker 3: coming up from work and had kind of a serious
Speaker 3: you know, spirits and cocktail, you know, fairly regularly when
Speaker 3: we were younger, and then eventually all of that stuff
Speaker 3: started to go away, even with his generation and easing
Speaker 3: of it.
Speaker 4: Have you heard of California sober?
Speaker 6: What is it now?
Speaker 3: What is it?
Speaker 10: California?
Speaker 4: And so yes, California fairly California sober as you abstained
Speaker 4: from alcohol, but you partake in to see.
Speaker 10: Or everything else, everything else?
Speaker 3: Wait wait is he flushing?
Speaker 8: No?
Speaker 13: Well no, this is just the bronzing that I get
Speaker 13: from being a California.
Speaker 3: So let's let's talk about because you brought us a
Speaker 3: couple of sparkling You brought us a sparkling white and
Speaker 3: a sparkling Rose, and I'm curious about I'm going to
Speaker 3: pour some and you can kind of walk us through it.
Speaker 3: But like, tell us, because Tim and I have actually
Speaker 3: tried some non alcoholic beverages and some better than others,
Speaker 3: we can say, so tell us about how what went
Speaker 3: into making this.
Speaker 10: I think that was shared around.
Speaker 13: Yeah, the biggest white space for me was was trying
Speaker 13: to take a wine maker's perspective with a wine drinking expectation.
Speaker 10: Please, it's our expert.
Speaker 13: And so I really tried to deconstruct the whole wine
Speaker 13: making process. So where the grapes growing, when are we
Speaker 13: picking them, how are we fermenting them, making sure that
Speaker 13: the non alcoholic was the end result, and so the
Speaker 13: whole process.
Speaker 3: Oh, do you have a glass? Do you already have
Speaker 3: or did you ready past the glass? Folks, you're the sausage,
Speaker 3: the sausage and non alcoholic wine is being made great,
Speaker 3: so go ahead, please.
Speaker 13: So the whole process for me was trying to appeal
Speaker 13: to a wine drinker's expectations. And so the dealcalization or
Speaker 13: alcohol removal process is very aggressive. It's not as exact
Speaker 13: as we'd like, and hopefully technology keeps improving. But you
Speaker 13: remove a lot of the aromatics, the texture, and certainly
Speaker 13: the alcohol, which is a massive component to the integration
Speaker 13: of the overall wine experience. So you're limiting, eliminating fourteen
Speaker 13: roughly fourteen percent.
Speaker 8: Of your product.
Speaker 4: That's the thing that really interesting. We spoke to Duncan
Speaker 4: far earlier, not yet of Bloomberg Intelligence. He's a consumer
Speaker 4: products analyst, and he talked about this at the top
Speaker 4: of our program today, that the technology to remove alcohol
Speaker 4: has gotten so much better in recent years. He mentioned
Speaker 4: caliber when he was a kid being a terrible alternative
Speaker 4: to like it was like the alcohol freak Guinness. He
Speaker 4: called it drain back up what I don't know what
Speaker 4: he can right now, like it was draino or something,
Speaker 4: And so what is the technology and how has it
Speaker 4: gotten so good? Like how do you do it?
Speaker 13: It's a filter or there are various ways that you're
Speaker 13: doing alcohol removal, but it basically is a molecular weight.
Speaker 3: It's pretty nice.
Speaker 7: Thank you, This is good.
Speaker 10: I appreciate it.
Speaker 3: And we're a tough craft.
Speaker 13: The process though, it's very extracted on weight and it's selective,
Speaker 13: but it's not perfect. And so the the the imperfections
Speaker 13: are the removal of aromatics and then removal of varietal character.
Speaker 13: And so that's why some of you know, some of
Speaker 13: the early entrants you might have seen are adding a
Speaker 13: lot back to try and replace, but it's not adequate.
Speaker 10: And so with this like it's very bright, it's very refreshing.
Speaker 4: I gotta be honest. When Grant walked in with it,
Speaker 4: I saw it and you opened it up. I was
Speaker 4: thinking to myself, Am I going to be drinking Martin
Speaker 4: Ellie's right now?
Speaker 10: Yeah?
Speaker 14: That's what it?
Speaker 7: Right?
Speaker 4: Yeah, and I'm not.
Speaker 8: I mean, this is.
Speaker 3: Martin Ellie's the apple juice right.
Speaker 4: That we get your your kid New Year's Eve? Yeah,
Speaker 4: this is not the sparkling apple juice. This is something different.
Speaker 4: It is closer to wine for sure.
Speaker 3: So is it essentially and forgive me because I was
Speaker 3: kind of running around pouring and stuff, but so is
Speaker 3: it wine just with the alcohol pulled out one hundred percent?
Speaker 13: It's it's fully fermented grapes from California, right, that we
Speaker 13: reduce or eliminate the alcohol from and then go through
Speaker 13: the uh you know, flavor composition or formula and then
Speaker 13: carbonated up to basically a prosecco level. So it's it's
Speaker 13: really meant to replace that spark perseco level.
Speaker 8: Yep.
Speaker 3: Yeah, what does.
Speaker 4: Your consumer research told you about when people buy this
Speaker 4: and they drink it, if they drink more than they
Speaker 4: drink of the counterpart with alcohol in it?
Speaker 13: I mean, my own consumer research is telling me I
Speaker 13: drink much more of it because there's not the guilt
Speaker 13: or the shame of knowing like oh I have to
Speaker 13: be tempered or tall it like temper my consumption on
Speaker 13: this because of what I have on the horizon. So
Speaker 13: there's I think what you mentioned athletic at the top
Speaker 13: of the call. They have done such a phenomenal job
Speaker 13: on matching quality that people don't have to compromise anymore
Speaker 13: on what they want for a beer occasion. That needs
Speaker 13: to happen in the wine category, and I think there
Speaker 13: is a massive wake up call. We talked about the
Speaker 13: downtick in wine sales.
Speaker 10: Please, I'm gonna, I'm gonna.
Speaker 3: I'm gonna start pouring the rose. So what's the different
Speaker 3: same process for.
Speaker 13: The same exact process, just different grapes produced in a
Speaker 13: kind of in a rose style. You hear that clanking,
Speaker 13: that's the swing top we've got on the bottle so
Speaker 13: that you can so you.
Speaker 3: Can put a close it, pop it back in the fridge.
Speaker 13: Would you like, I'm okay, you're good, Yeah, ok I've
Speaker 13: got a drive very funny.
Speaker 3: So you close it, pop it back in the fridge,
Speaker 3: and it stays.
Speaker 13: Yes, that was one of our learnings from Like I
Speaker 13: think in terms of trying to be innovative around the
Speaker 13: wine category is like, you're never going to see a
Speaker 13: champagne bottle with a swing top on it or a
Speaker 13: proscco bottle.
Speaker 10: They're etched in tribution.
Speaker 13: This is nice to try this, and so with the
Speaker 13: addition of the swing top, we wanted to really do preservation.
Speaker 3: Can you do can you softer touch a little bit?
Speaker 8: Right? Yeah?
Speaker 7: Nice?
Speaker 3: Yeah?
Speaker 4: Are you planning to do any non carbonated versions?
Speaker 13: Absolutely? Yeah, R and D. I'll admit sparkling was more
Speaker 13: in my repertoire and our wheelhouse easier to do.
Speaker 7: I would say it's easier.
Speaker 10: To replicate or replace a sparkling.
Speaker 13: But the still wine category, I think is very It's
Speaker 13: a huge opportunity for the category if we're to nail
Speaker 13: a Chardonnay or a savingon Blanc or a pan and
Speaker 13: a war a lot of drinkers out there, and you
Speaker 13: talked about who is this consumer, It is definitely the
Speaker 13: wine consumer that is self moderating.
Speaker 4: What I'm also finding is bars, restaurants, parties, social events,
Speaker 4: professional events have increasingly non alcoholic options that are not soda.
Speaker 13: Huge real estate being being garnered by the mocktails and
Speaker 13: commanding quite a price. But I think it's about, you know,
Speaker 13: more options for inclusive occasions, making sure that everyone is
Speaker 13: able to participate and not feeling sheepish or needing to
Speaker 13: you go with the line in a Seltzer water as
Speaker 13: the chameleon.
Speaker 3: All right, So you introduce this October?
Speaker 10: Is that October?
Speaker 3: All right? So I know this, but we're bloomberg. So
Speaker 3: give us any indications of the kind of demand you're
Speaker 3: anticipating or maybe already seeing.
Speaker 13: So in eighteen years in wine and this would be
Speaker 13: the fifth startup for me, I've never seen something like this.
Speaker 13: And to your point, October, we didn't have a lot
Speaker 13: of data behind us. Yeah, but we have gotten so
Speaker 13: many fortunate retail programs in anticipation of dry January. Big
Speaker 13: moment and timing could not be you know, we're blowing
Speaker 13: aware goals and obviously the proof will be in the
Speaker 13: pudding with repeat business and velocity. But the early adoption
Speaker 13: has been through the.
Speaker 4: Roof funding, self funded, raised money, have you done it?
Speaker 13: Raised? A fair bit of money, went to the outside
Speaker 13: for the first time, but John and I actually self funded.
Speaker 13: The initial wine is very capital intensive business. You guys
Speaker 13: likely know this, but we feel like the.
Speaker 10: Category is not a fad. This thing is here to stay.
Speaker 10: It's going to keep growing.
Speaker 13: The retailers are now starting to get behind it, which
Speaker 13: is a massive win.
Speaker 3: Well, Happy Drid January. Yes, promised to come back soon
Speaker 3: and listen. Thos are going grant having co founder and
Speaker 3: chief executive officer of Libby Wines. This is Bloomberg.
Speaker 1: This is the Bloomberg Business Week Podcast. Listen live each
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Speaker 1: Auto with the Bloomberg Business App. You can also listen
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Speaker 1: Just say Alexa play Bloomberg eleven thirty.
Speaker 4: How does a trip to Banff to do some gondola
Speaker 4: riding or cycling sound or visiting fjords in Alaska to
Speaker 4: gaze upon Glacier's wales and sea lions.
Speaker 3: It sounds amazing. How about also maybe a whitewater rafting
Speaker 3: trip in Montana. Got to say yep, sign us all
Speaker 3: up for all of it, and you can experience all
Speaker 3: of them courtesy of a company known as Pursuit. The
Speaker 3: company calls itself a pure play hospitality and attractions company.
Speaker 4: David Berry is president and CEO of Pursuit. He stopped
Speaker 4: by our studio to talk about the demand and the
Speaker 4: growing demand for outdoor travel.
Speaker 15: What's unique about our business in sites, seeing and attractions
Speaker 15: and hospitality is everyone in the world loves a beautiful view.
Speaker 8: Doesn't matter where you're from.
Speaker 15: It doesn't matter what language you speak, doesn't matter whether
Speaker 15: you can ski or golf, or you have any athletic
Speaker 15: ability at all.
Speaker 8: All you have to do is love a beautiful view.
Speaker 3: Well, it's interesting, what does the environment the you know,
Speaker 3: for tourism. We've talked about coming off the pandemic. All
Speaker 3: people want to do is experience things and go out
Speaker 3: and do things. They want to get out of their
Speaker 3: house to do things. Is that continuing or give us
Speaker 3: some perspective versus what you've seen over the last couple
Speaker 3: of years.
Speaker 15: Well, what's everyone looking for? And then my opinion, they're
Speaker 15: looking for authenticity. So no one goes to Iceland to
Speaker 15: experience Alaska. They're going for very unique things around the world,
Speaker 15: and so buy less stuff, do more things.
Speaker 8: Life is precious. This is no dress rehearsal Right.
Speaker 15: You might as well go and see and do the
Speaker 15: amazing things that you would like to do. And that's
Speaker 15: really what makes our business model work, and that you know,
Speaker 15: we're in a rather unique position. We have a ten
Speaker 15: year head start, a ten year track record of great
Speaker 15: investments that have driven shareholder value, and it's a way
Speaker 15: for us to position ourselves into the future, continue to
Speaker 15: grow and think of iconic, unforgettable and inspiring experiences.
Speaker 3: So, David, the demand though, continues at the pace you've
Speaker 3: seen over the last year or two, like, give us
Speaker 3: an idea in terms of what consumers are up to.
Speaker 8: I think consumers are excited.
Speaker 15: And yes, there are certain segments of the consumer base
Speaker 15: that are more pro sensitive, but in the markets that
Speaker 15: we're dealing with, folks are ready to go and spend
Speaker 15: money on great experiences, and you've just got to work
Speaker 15: hard to deliver to people's expectations.
Speaker 4: Fourteen attractions around the world, twenty eight lodges, fifty one
Speaker 4: restaurants and other dining experience. You've got fifty one retail stores.
Speaker 4: How do they all come together to offer sort of
Speaker 4: a package. Because when I see some of these experiences,
Speaker 4: I say, Okay, this is a good one off here.
Speaker 4: But how do you get to control the entire experience
Speaker 4: with these assets?
Speaker 15: So think of pursuit as a house of brands, not
Speaker 15: a branded house. So think of human behavior. And you
Speaker 15: had mentioned Banff. Might you know you're planning a cycling
Speaker 15: trip to BAMF with your buddies. Sounds good, you're planning
Speaker 15: there common so he knows Tim a little bit, do
Speaker 15: some searching and upcoms, and you search BAMF as a destination,
Speaker 15: and then the next thing you enter in the search
Speaker 15: bar is great things to do in bamp Damn Up
Speaker 15: it comes Lake Minlwauka, boat tours or the BAMF gondola
Speaker 15: or any of our different experiences.
Speaker 8: So we're lucky.
Speaker 15: We get to surf behind the power of the destination,
Speaker 15: which drives search results and drive.
Speaker 4: But all those things are your assets that you mentioned. Correct, Okay?
Speaker 4: So I want to bring in Elizabeth Sedrin's comment from
Speaker 4: a little earlier today.
Speaker 3: She was one of our producers.
Speaker 7: Here's one of our producers.
Speaker 4: She said, are they trying to compete with a company
Speaker 4: like Veil Resorts? And I said to myself, Oh, I
Speaker 4: said to Elizabeth, I don't think they are. But now
Speaker 4: after hearing you say that, you remind me of what
Speaker 4: happened over the last twenty years. And I think Elizabeth
Speaker 4: was right when Vale Resorts bought Colorado Mountain Express and
Speaker 4: now rebranded at Epic Express, or especially Sports Ventures, the
Speaker 4: chain of rental shops where you rent skis and stuff,
Speaker 4: so then they control every different aspect of a tourist
Speaker 4: dollar that comes out.
Speaker 15: So I spent three decades in skiing in a former life,
Speaker 15: and I can tell you the one thing that's very
Speaker 15: different in our world is we're not getting involved in skiing.
Speaker 15: So I don't need snow and I don't need anyone
Speaker 15: with an ability to ski. So all you have to
Speaker 15: do to enjoy our experiences is enjoy a beautiful view.
Speaker 15: And so we have a simple strategy refresh, build, buy,
Speaker 15: So refresh existing experiences, build things that are unique and
Speaker 15: connected for guests to visit and enjoy, and then buy
Speaker 15: things that we think fit our platform.
Speaker 3: But the idea is you want a customer to go
Speaker 3: to one of your locations or one of your experiences
Speaker 3: and hopefully continue to do other experience.
Speaker 15: It's correct, Yeah, you want a guest to really think
Speaker 15: about when they're visiting a destination. How do they connect
Speaker 15: with what is authentic in that destination and what is
Speaker 15: unique and different because so much of the world is
Speaker 15: the same when you travel, So if you can create uniqueness,
Speaker 15: a guest then enjoys going from one experience to another.
Speaker 3: Okay, not apples to apples. Our Charlie Pellett is a
Speaker 3: big cruiser, a lot of cruise ships. We talked to
Speaker 3: the Carnival CEO. I'm like, I'm saying, not apples to apples.
Speaker 3: But there are often repeat customers and I've done pieces
Speaker 3: where I'm on a cruise ship and they're like, yeah,
Speaker 3: this is my thirteenth cruise or my twentieth cruise. If
Speaker 3: you will, how many of the people who do some
Speaker 3: one of your experiences come back and do others.
Speaker 15: I do think we have less frequency than the cruise
Speaker 15: industry in terms of that really devoted, participative type visitor.
Speaker 15: But what we do have is folks that really enjoy
Speaker 15: an experience, say in the Canadian Rockies, and the next
Speaker 15: year they're looking to go to Alaska and experience that,
Speaker 15: or they've somehow gotten onto the Pursuit website through a
Speaker 15: variety of different things, and they realize we have an
Speaker 15: amazing attraction in Iceland called sky Lagoon, And so they
Speaker 15: weren't really planning to go to Iceland through US, but
Speaker 15: all of a sudden they're going to Iceland and have
Speaker 15: an experience that they know, Wow, the BAF Gondola is
Speaker 15: so much fun. I'm pretty sure sky Lagoon's going to
Speaker 15: be fun.
Speaker 4: Do people know that the Jasper Skytram or that BAMF
Speaker 4: Gondola is owned by Pursuit?
Speaker 8: Some do, some don't.
Speaker 15: We brand everything sort of an experience by Pursuit, but
Speaker 15: we want the experience in Jasper to be very unique
Speaker 15: and connected to Asper.
Speaker 8: Jasper is a very unique place.
Speaker 15: If you told a citizen in Jasper that we want
Speaker 15: you to be like BAMF, you know they would come
Speaker 15: for you with the pike and the muskets. Right, It's
Speaker 15: not what they want. They want their experience in Jasper
Speaker 15: to be truly unique. So uniqueness and authenticity is.
Speaker 8: The order of the day.
Speaker 3: Is expansion of where you offer up new locations, David,
Speaker 3: are you thinking very carefully about You want to make
Speaker 3: sure that while it's a different experience, the level is
Speaker 3: the same, so that people understand the Pursuit brand stands
Speaker 3: for something.
Speaker 15: Yeah, I can cover our criteria for acquisition and growth
Speaker 15: really quickly. So one, is it iconic, is it unforgettable?
Speaker 15: Is it inspiring? Does it have perennial demand? Are there
Speaker 15: big barriers to entry? Is it an ebitdal margin that's attractive?
Speaker 15: So we run at thirty percent ebadal margin before public
Speaker 15: company costs, which a great margin.
Speaker 8: Do we want to go down to fourteen? Well? No,
Speaker 8: it's got to be something.
Speaker 15: That we think is going to be able to be improved.
Speaker 15: And then finally we look for good neighborhoods. What I
Speaker 15: mean by that is Gudrula law, good property protection, good
Speaker 15: places to do business in that our investments will be
Speaker 15: well protected.
Speaker 4: Where you thinking about expanding to or buying assets in.
Speaker 15: So firstly, I mean we're very lucky and that we've
Speaker 15: identified a couple of growth leavers. One is internally within
Speaker 15: the business where we can invest and make things better,
Speaker 15: and we've put about two hundred million dollars aside for
Speaker 15: that growth over between now and twenty twenty nine. But
Speaker 15: on the acquisition side, what are we looking for. It's
Speaker 15: got to be iconic, it's got to be unforgettable, got
Speaker 15: to be inspiring. So Dona's pretty iconic place, a good example.
Speaker 4: Well, what could you acquire in a place like that
Speaker 4: that would add to your portfolio?
Speaker 15: You know, I'm not sure I would say even if
Speaker 15: I knew, but I think the opportunities we have are
Speaker 15: really global in nature. We're very concentrated North America Q
Speaker 15: two Q three, So the benefit of being doing something
Speaker 15: counter seasonal if we could. You know, we're very weighted
Speaker 15: to the calendar of Q three in North America, so
Speaker 15: we've got opportunity counter seasonally and that leads you to
Speaker 15: different locations around the world. So yeah, if we could
Speaker 15: be busy December to April, that'd be even better.
Speaker 3: Soolobal acquisitions at some point absolutely.
Speaker 15: Now, I mean the benefit of this transformation of the
Speaker 15: sale of GS and the repositioning of Pursuit and our
Speaker 15: new clean, strong balance sheet is guess what, We've got
Speaker 15: a great pipeline, we've got a great plan, we've got
Speaker 15: a great strategy, and now we've got great drive powder
Speaker 15: to go do somethings.
Speaker 8: So we're excited.
Speaker 3: So I'm going to say yes, global acquisitions, man, So
Speaker 3: talk to us about pricing. David. I'm just curious, and
Speaker 3: I know we talked a little bit in the break
Speaker 3: before we got back here live on air, but I'm
Speaker 3: just curious, what is give us an idea of range
Speaker 3: kind of things. So we have an idea.
Speaker 15: It really depends on the experience. So we have some
Speaker 15: attraction products that are very accessible for people, and you
Speaker 15: can do that based on time of day, tim how old.
Speaker 4: Are kids two and six?
Speaker 15: Let's say, all right, so you travel from the East
Speaker 15: Coast to Banff and at eight o'clock in the morning,
Speaker 15: your kids are wide away because it's ten o'clock New
Speaker 15: York time, and they're bouncing around the hotel room looking
Speaker 15: for something to do. You, my friend, are a prime
Speaker 15: character to take a breakfast program and a gondola ride
Speaker 15: with little kids.
Speaker 4: Yeah, that sounds about it like Carol, maybe a little
Speaker 4: more relaxed.
Speaker 8: As Yeah.
Speaker 15: So there's the sleeping crowd, and there's the early morning crowd,
Speaker 15: my friend, and you're part of the early morning crowd.
Speaker 15: So there's a good example of your pricing and providing
Speaker 15: an experience that's well suited to someone at that particular
Speaker 15: time of day is part of.
Speaker 3: The business strategy to make sure that you've got different
Speaker 3: price points.
Speaker 15: You bet and your price dynamically, and you also work
Speaker 15: hard to provide value. So we get asked all the time,
Speaker 15: you're going to continue to take price. Real question is
Speaker 15: are you going to continue to improve experiences? Because when
Speaker 15: you improve experiences, you have pricing power. It's not just
Speaker 15: taking price and making everybody angry.
Speaker 3: Work something on sale or offering a discount or something
Speaker 3: like that.
Speaker 15: You're always going to have channels a distribution where you're potentially,
Speaker 15: if you have a time of day that you want
Speaker 15: to move more folks into, you're going to price that advantageously.
Speaker 15: But can you create an amazing product that people are
Speaker 15: going to feel comfortable paying a fair price.
Speaker 4: For I I You said earlier that the a big
Speaker 4: difference between you and the ski industry and the big
Speaker 4: conglomerates out there now is that you're not focused at
Speaker 4: all on skiing. Does that make you less concerned about
Speaker 4: climate change?
Speaker 15: Well, I think the benefit for us is where we're
Speaker 15: not focused on any particular athletic skill that you need
Speaker 15: to enjoy a product. All you need to do is
Speaker 15: enjoy a beautiful view. So in our summer destinations, climate
Speaker 15: change is less of a factor, but we're very sensitive
Speaker 15: to We have one planet, and we want to make
Speaker 15: sure that we do everything we can to protect this.
Speaker 8: Planet and be mindful.
Speaker 15: And if you go to our website, you'll see a
Speaker 15: thing called Promise to Place where we talk about sustainability,
Speaker 15: respect and community. Those are the three things we spend
Speaker 15: a lot of time on. We report very candidly. Sometimes
Speaker 15: it makes us uncomfortable, but we tell the truth about
Speaker 15: what we're doing and what's working and what's not working,
Speaker 15: and what we're going to do to make it better.
Speaker 3: So I am curious in terms of running a business,
Speaker 3: labor like hospitality, we talk about it a lot, and
Speaker 3: access to enough workers. Do you guys have all the
Speaker 3: workers that you need?
Speaker 8: We do.
Speaker 15: And what makes that happen is people want to voice.
Speaker 15: They want to work in a place where their opinion
Speaker 15: is respected and heard. They want to understand what is
Speaker 15: the greater purpose of this organization. We do multiple team
Speaker 15: member surveys in a year. The amount of comments we
Speaker 15: get are incredible. I do a live town hall broadcast
Speaker 15: every month where people can ask questions anonymously, and they do.
Speaker 15: And so it's all those things that work to create culture.
Speaker 15: So a culture of respect, a culture of innovation, a
Speaker 15: culture of great leadership and genuine interest in others will
Speaker 15: drive great hospitality experiences.
Speaker 4: Okay, what's an experiential trend that you're seeing happen right
Speaker 4: now that you haven't tapped into yet, Like, what what
Speaker 4: do you see out there? Like I want to go
Speaker 4: do that because that looks really cool. I've never done
Speaker 4: it before. We don't offer it.
Speaker 15: I think that there are things that involve winter product
Speaker 15: in exotic destinations that people are experimenting with, and so
Speaker 15: that might be any gluo in the northern lights, and
Speaker 15: you know in Iceland at sky Lagoon, we will get
Speaker 15: complaints every once in a while, like I came for
Speaker 15: the northern lights and they did not appear.
Speaker 8: Can you make that happen?
Speaker 3: Nay, Mother Nature?
Speaker 15: You just smile and you know, I'm only God's assistant.
Speaker 15: I can only do so much. But the benefit of
Speaker 15: looking at how do you continue to innovate? And we're
Speaker 15: lucky we work in a vibrant, relentless, restless culture that
Speaker 15: always wants to innovate, and so we have teams. Every
Speaker 15: day they're waking up with a great idea. So there's
Speaker 15: not one thing, specifically, tim that I would say. I
Speaker 15: would just say There's a thousand things the team's working
Speaker 15: on right now that are exciting.
Speaker 3: Starting out as a ski instructor, it worked out pretty well.
Speaker 10: You're pretty happy, right.
Speaker 15: I'm pretty like somehow I made it here, I don't
Speaker 15: know on your show, so I'm could cross my fingers
Speaker 15: and try not to say anything dumb.
Speaker 3: Well really fun. Let us know has the year progresses,
Speaker 3: and let us know how things are going.
Speaker 8: You bet, Thank you so much.
Speaker 3: Love to hear back from you. David Barry, He's president
Speaker 3: and CEO of Pursuit, joining us right here in studio.
Speaker 1: This is the Bloomberg Business Week Podcast. Listen live each
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Speaker 1: Just say Alexa play Bloomberg eleven thirty.
Speaker 4: Well, as all of you know, Monday is Martin Luther
Speaker 4: King Junior Day, a federal holiday that celebrates the life
Speaker 4: and legacy of Martin Luther King Junior.
Speaker 3: Right, And just a reminder, of course, Martin Luther King
Speaker 3: Day also happens to fall on January twentieth, which is
Speaker 3: the day that President elect Donald Trump will be inaugurated
Speaker 3: this Monday. We Tim and I will be doing a
Speaker 3: special edition of Bloomberg BusinessWeek that afternoon looking at the
Speaker 3: new incoming administration and all the policies that may come down.
Speaker 3: So we want to get into that and more with
Speaker 3: our next guest, who has a certain very personal story
Speaker 3: and attachment of course to Martin Luther King Day. We
Speaker 3: are joined by Reverend doctor Bernice King. She's the chief
Speaker 3: executive officer of the Martin Luther King Junior Center for
Speaker 3: Nonviolent Social Change, which is also known as the King Center.
Speaker 3: She is the daughter of Martin Luther King, Junior and
Speaker 3: her mom, Coretta Scott King, founder of the King Center.
Speaker 3: Doctor King, so nice to have you here with us.
Speaker 3: You know, Monday for many it's a holiday. Well, nice
Speaker 3: to have you here. For many more, it's also a
Speaker 3: reminder of our difficult past around race relations and discrimination.
Speaker 3: What does the day mean to you? Honoring your dad?
Speaker 14: Well, it's an opportunity, obviously for us to not just
Speaker 14: commemorate his life, but to really look further into his teachings.
Speaker 14: He was not just a civil rights leader, he was
Speaker 14: a teacher. He left us a blueprint as to how
Speaker 14: to create a just, humane, equitable, and peaceful world.
Speaker 5: And every year.
Speaker 14: One of the things that I encourage is that we
Speaker 14: study him more because he spoke about things that we
Speaker 14: as a nation and world needed to do to fight
Speaker 14: against what he saw as a trip with poverty, racism,
Speaker 14: and militarism as a threat to our humanity. And so
Speaker 14: here we are once again this year, and as we
Speaker 14: inaugurate a new president.
Speaker 5: Those teachings don't change, they stay the same. What we
Speaker 5: have to.
Speaker 14: Do is to connect to them and to connect to
Speaker 14: the spirit of that movement so we can continue to
Speaker 14: move our nation and world forward.
Speaker 3: I was going to ask you just to follow up.
Speaker 3: You said, you know, your dad leaving us a blueprint.
Speaker 3: How would you think he's doing how we are doing
Speaker 3: today with that blueprint?
Speaker 5: Well, you know, he said to us, and where do
Speaker 5: we go from here?
Speaker 14: Chaos the community in nineteen sixty seven, the book that
Speaker 14: he published then that we must find a way to
Speaker 14: live together as brothers, and he meant humanity as brothers
Speaker 14: and sisters, or together we would be forced to perish
Speaker 14: as foods.
Speaker 5: And I think we've not found the way to do that.
Speaker 14: I think he further divided around different ideologies instead of
Speaker 14: trying to spend time learning in spite of our differences.
Speaker 5: How do we live together?
Speaker 14: How do we create a coexistence where we don't co
Speaker 14: annihilate one another?
Speaker 5: You know?
Speaker 14: How do we create a world where everyone has decent
Speaker 14: and affordable housing and access to healthcare?
Speaker 5: You know?
Speaker 14: How do we ensure that people who may end up
Speaker 14: in the homeless population, how do we ensure that that
Speaker 14: is short lived and we create a pathway to people
Speaker 14: to reclaim their lives. How do we create a fair
Speaker 14: distribution of wealth in this nation? He talked about having
Speaker 14: a radical redistribution of wealth. He didn't talk about it
Speaker 14: in the sense that we just have to remove wealth
Speaker 14: from someone else, but we have to figure out how
Speaker 14: do we balance our economy so that people can have
Speaker 14: enough to do well. And then, of course he talked
Speaker 14: about how do we respect who we are from different
Speaker 14: cultures and different backgrounds. We'll never all agree on everything,
Speaker 14: and will never all like each other, We'll never all
Speaker 14: think alike, but we certainly can spend time learning how
Speaker 14: to live together. So that takes a lot of listening, curiosity,
Speaker 14: It takes a lot of courage, It takes a lot
Speaker 14: of humility.
Speaker 5: It takes compassion.
Speaker 14: These are all the things that he taught us through
Speaker 14: the spirit and the heart of nonviolence that he led
Speaker 14: that movement in.
Speaker 4: Well, it's that last point that I want to talk about,
Speaker 4: doctor King, because we've been talking about over the last
Speaker 4: few months the dismantling of DEI programs at many companies.
Speaker 4: If I just look at the stories that are one
Speaker 4: of our reporters, Jeff Green, has written in recent months,
Speaker 4: here's some headlines. Walmart under fire from investors for cutting
Speaker 4: DEI programs, Meta retreats from diversity and inclusion, appeasing Trump.
Speaker 4: Amazon is halting some of its diversity and inclusion programs.
Speaker 4: McDonald's walks back DEI goals in the latest corporate retreat.
Speaker 4: Other companies including Deer and more.
Speaker 3: And we talked about Corporate America, you know, did hire
Speaker 3: more black workers for a while and then it stopped.
Speaker 4: How do you like, how do you in an environment
Speaker 4: such as this where seeing things seem to not necessarily
Speaker 4: be going in that direction? How do you have optimism?
Speaker 14: Well, always have optimism because there are always people, you know,
Speaker 14: like Target and Costco and others who who choose to
Speaker 14: follow the pathway that we all know is for the
Speaker 14: best of our nation and our world. But if we
Speaker 14: don't have an inclusive economy as a nation, then we're
Speaker 14: not going to survive in the global economy.
Speaker 5: And so I think there are going to be some.
Speaker 14: Hard realities we're going to be faced with in a
Speaker 14: few years. If what those who have ought to remove
Speaker 14: DEI have done, you know.
Speaker 5: It's going to show certain results.
Speaker 14: I think it's up to certain courageous leaders to combine forces.
Speaker 5: And stand against this.
Speaker 14: It really, at the end of the day, it's really
Speaker 14: not about the language anyway, you know, It's about who
Speaker 14: we are as a people. Do we have a love
Speaker 14: centered way of leading our cultures? In corporate America, you know,
Speaker 14: in our educational institutions when we look a lot around
Speaker 14: at our different cultures, do we have everyone that's needed
Speaker 14: in terms of representation at the table. You know, whether
Speaker 14: you call it DEI, you call it representation, or you
Speaker 14: call it a belonging culture or for us, the beloved community.
Speaker 14: How do we create beloved community cultures? Because at the
Speaker 14: end of the day, it's about the outcomes. So if
Speaker 14: they remove the names, they remove what they call DEEI,
Speaker 14: But then they are still committed to getting to certain outcomes.
Speaker 5: Then maybe there's no problem.
Speaker 14: But if removing it also means that we're not going
Speaker 14: to ensure that we have cultures that reflect who we
Speaker 14: are as a nation and even as a world, then
Speaker 14: it just means those of us who practice non violence
Speaker 14: are going to have to organize and stratle our chives
Speaker 14: and come up with plans to put pressure where is needed.
Speaker 3: Doctor King, what do you think white Americans still don't
Speaker 3: understand about Black America today and what do you believe
Speaker 3: it will take to achieve true racial equality.
Speaker 14: Well, the first thing is Black America is not trying
Speaker 14: to take anything from anybody.
Speaker 5: I think that's the first thing people need to understand.
Speaker 14: There's this threat, like you know, if Black America were
Speaker 14: in charge, they will remove.
Speaker 5: Us and nothing to be further from the truth.
Speaker 14: If you study the history of our race, we've always
Speaker 14: been holistically. It doesn't mean there are exceptions in every
Speaker 14: racial grouping, but if you study as a whole, we're
Speaker 14: very forgiving people.
Speaker 5: We are very inclusive culture.
Speaker 14: We tend to stand, you know, with what is right
Speaker 14: and what is fair and what is just. And I
Speaker 14: think there's a misnomer that if we are in these roles,
Speaker 14: we may do what others do. I think there's a
Speaker 14: misnomer as to who we are that you know, we
Speaker 14: just get jobs or we get opportunities just because we're black.
Speaker 5: No, we're very qualified.
Speaker 14: If you spend any time on social media, you see
Speaker 14: the number of young children out of the black community
Speaker 14: who are finishing college and getting PhD degrees when they're
Speaker 14: not even fifteen yet.
Speaker 5: They're not even fourteen yet.
Speaker 14: So we have a very intelligent, very skilled community. And
Speaker 14: it doesn't take anything away from anybody else's community who
Speaker 14: has intelligent and skilled individuals. And so the biggest thing
Speaker 14: Daddy says a little very powerful. He said, people hate
Speaker 14: each other because they don't know each other.
Speaker 5: They don't know each other because they don't communicate with
Speaker 5: each other.
Speaker 14: They don't communicate with each other because they're separated from
Speaker 14: each other. And so as long as we keep division
Speaker 14: and separation, then the myths can continue to be the truth.
Speaker 14: So we have to find a way, as I said,
Speaker 14: to learn to live together and cross some of these
Speaker 14: boundaries and not allow whatever every other commentary may say
Speaker 14: about you know, any community to rule the day.
Speaker 5: I need to come and connect with you. I need
Speaker 5: to learn more about it.
Speaker 14: I need to spend time with you, I need to
Speaker 14: experience your culture. It doesn't mean I may embrace all
Speaker 14: of it, but I have a greater understanding of it.
Speaker 14: And I think that's what a love centered person, a
Speaker 14: compassionate person, a curious person. Right, we're doing a person
Speaker 14: more importantly, who wants to see a better world.
Speaker 3: Well, you know, we we think about We've only got
Speaker 3: about a couple of minutes left here, but we are
Speaker 3: thinking about Martin Luther King Day on inauguration Day, incoming
Speaker 3: President Donald Trump and what his administration might bring in
Speaker 3: terms of policies and what it means for Black Americans
Speaker 3: in equality in the United States. You know, we kind
Speaker 3: of get the sense that your dad, you know, tried
Speaker 3: to engage power to influence change. She seemed very pragmatic
Speaker 3: and yet took those risks. Do you think your father
Speaker 3: would try to engage with the right, the conservative right,
Speaker 3: to get them to better understand the implications of their
Speaker 3: positions or is that not even possible? And again, only
Speaker 3: about a minute and a half here.
Speaker 14: Oh, it's always possible. Non violence believes in the impossibility.
Speaker 14: Non violence actually can help overcome what seems to be impossible.
Speaker 5: So through strategy and plan.
Speaker 14: When he went to see Johnson and Johnson said, look,
Speaker 14: I've done as much as I come the civil rights
Speaker 14: Right now, I can't get the votes on voting rights.
Speaker 14: Daddy went back and said, well, we're gonna have to
Speaker 14: get him some power. We're going to have to help
Speaker 14: him figure that out. So in this administration, we got
Speaker 14: to figure out where are the connection points. You know,
Speaker 14: who are the people in the administration we might be
Speaker 14: able to have access to who may understand that can
Speaker 14: then translate the message.
Speaker 5: It's about strategy, and nonviolence helps you with that.
Speaker 3: Do you have faith in the Trump administration helping out?
Speaker 3: I have the Black community.
Speaker 14: I have faith in God, and I believe in the
Speaker 14: power of a collective conscience that is committed to freedom,
Speaker 14: justice and quality.
Speaker 5: And I believe it is possible.
Speaker 14: That's why our theme is, you know, mission Possible, protecting freedom,
Speaker 14: justice and equality. Excuse freedom, justice and democracy through the
Speaker 14: spirit of non violence three sixty five, which is Kingy
Speaker 14: and non violence is taught and demonstrated by my father.
Speaker 5: That's what I have faith.
Speaker 3: In, doctor King. Just twenty five seconds left here, What
Speaker 3: do you hope every American kind of thinks about when
Speaker 3: it comes to our country here.
Speaker 14: I want them to remember that as a humanity, we
Speaker 14: have been to these places before. Maybe not literally us,
Speaker 14: but human beings have been in difficult, challenging times. We
Speaker 14: come from those individuals, and we too have the capacity
Speaker 14: to rise to the occasion and meet the challenges and
Speaker 14: move our nation and worl for.
Speaker 3: Thank you so much for finding time for us. Our
Speaker 3: thoughts with you, certainly as we prepare for the holiday
Speaker 3: and to mark his memory and his legacy on Monday.
Speaker 3: That is Reverend Doctor Bernice King, chief executive Officer of
Speaker 3: the King Center, joining us from Atlanta. This is Bloomberg.
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