Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: Well, let's get back to the transit lanting tech route
Speaker 2: that we saw yesterday, one trillion dollars worth of course
Speaker 2: over Deep seeks dark horse entry to the AI race.
Speaker 2: The question is it a turning point for the industry
Speaker 2: and its investors. Joining us now to discuss is one
Speaker 2: of the most prominent voices in this sphere. Kathy would
Speaker 2: found at CEO and CIO of ARC invest. Lovely to
Speaker 2: have you with us, Kathy, Thank you, Lucy, happy with
Speaker 2: you here. Big question you buying the dip.
Speaker 3: Well, we're fully invested, and we're very comfortable being fully invested.
Speaker 3: I think our confident in the ballmarket broadening out has
Speaker 3: increased in the last few days. So sure the megacaps
Speaker 3: we think will continue to do well. Maybe in Vidia
Speaker 3: there are some questions about its exalted position in the
Speaker 3: training chip market. We think inference is going to become
Speaker 3: more important with these new reasoning models, and that is
Speaker 3: a more competitive part of the market. But we think
Speaker 3: that what's happening here is the collapse in the cost
Speaker 3: of innovation.
Speaker 4: Deep Seek is adding to it.
Speaker 3: It has been happening though AI training costs have been dropping,
Speaker 3: led by Nvidia seventy five percent per year, and AI
Speaker 3: inference costs have been dropping eighty five to ninety percent
Speaker 3: per year. Deep seek is just putting those very rapid
Speaker 3: declines into a bit of overdrive here.
Speaker 1: So I wonder, if you see in Vidia falling much further,
Speaker 1: is this an attractive price to be buying it?
Speaker 3: Do you think, well, we we own it in some
Speaker 3: of our portfolios.
Speaker 4: We are not buying the dip yet.
Speaker 3: We do want to learn more about deep seek and
Speaker 3: more about how the market or the demands and for
Speaker 3: inference chips might outpace those for training chips.
Speaker 4: We think the whole area is going to be vibrant.
Speaker 3: We just think there might be a little bit more
Speaker 3: of an adjustment to this new reality.
Speaker 2: Where you say that what deep seat shows is kind
Speaker 2: of that you can do more with less kap X.
Speaker 2: Who do you think that's going to motivate in the
Speaker 2: US most as Donald Trump is kind of saying, who's
Speaker 2: going to be best at doing more with less?
Speaker 4: Well, anyone using AI.
Speaker 3: We are focused on the productivity gains for knowledge workers,
Speaker 3: which are going to be massive. That's the biggest impact
Speaker 3: of AI. But if we're looking at sectors and spaces
Speaker 3: generally where this acceleration and innovation is going to be meaningful.
Speaker 3: We think autonomous mobility, so robotaxis. We think that's going
Speaker 3: to scale from essentially nothing now to an eight to
Speaker 3: ten trillion dollar globe opportunity, including China. But the sleeper
Speaker 3: here is healthcare, and we're seeing the convergence of sequencing technologies,
Speaker 3: all kinds of sequencing technologies, artificial intelligence, and then gene
Speaker 3: editing technologies like Crisper CAST nine. That combination we believe
Speaker 3: is going to cure disease. It's already curing disease, sickle
Speaker 3: cell disease and beta thllosemia. That's Chrisper therapeutics. But we
Speaker 3: think they're aiming now for type one and type two diabetes.
Speaker 3: That would be a category killer, you know, So think
Speaker 3: about that curing disease, AI helping us decode the secrets
Speaker 3: of life, death health.
Speaker 1: Those are two areas where regulation plays a big part.
Speaker 1: You've spoken about your optimism about deregulation under Donald Trump.
Speaker 1: Do you think those are two areas we should expect
Speaker 1: to see big deregulation about what technology can get in.
Speaker 4: Yes.
Speaker 3: I think in both safety first and I think anyone
Speaker 3: moving into this market or these markets would agree with that,
Speaker 3: so sensible regulation. But in the US, the robotaxi field
Speaker 3: is regulated by fifty states. We think that will change
Speaker 3: to one regulator, the federal government. After all, transportation does
Speaker 3: cross states, so that makes sense. In the healthcare realm,
Speaker 3: that is where the thicket of regulations has really strangled
Speaker 3: the industry. And even more than the outright regulations, it
Speaker 3: was the FTC, the Federal Trade Commission not allowing mergers
Speaker 3: and acquisitions and therefore not allowing strategic buyers big biotech companies,
Speaker 3: not allowing them to the smaller companies, so that we
Speaker 3: had price discovery. Now we're going to see price discovery.
Speaker 3: How much are these companies that are curing disease worth
Speaker 3: to these large strategic buyers now and saying that I
Speaker 3: don't necessarily want our companies to be taken out. We
Speaker 3: think they have miles to go, but we do want
Speaker 3: price discovery back in the market.
Speaker 2: Where you talk about your excitement about autonomous vehicles. Of course,
Speaker 2: your biggest holding is Tesla, I think, and we've call
Speaker 2: Elon Musk's first earnings call tomorrow since Trump's returned to
Speaker 2: the White house January. Typically a call that's a look ahead.
Speaker 2: What do you need to hear from muskue.
Speaker 3: We need to hear a continuation of we're about to
Speaker 3: launch our autonomous driving system. I mean, in effect, they've
Speaker 3: launched it. I have a full self driving I know
Speaker 3: it's not allowed here in the UK or in Europe, but.
Speaker 1: You feel safe.
Speaker 3: But oh yes, yes, yes, yes, Weymo really has broken
Speaker 3: through a lot of barriers. I feel even though a
Speaker 3: Waymo vehicle is not safer than a human driven vehicle,
Speaker 3: it knows its roads. It's narrow roads, meaning there are
Speaker 3: narrow territories. I think Tesla is going to go national.
Speaker 3: That's going to be and we'll be able to do
Speaker 3: so because it has effectively seven million robots roaming the roads.
Speaker 3: Right now, I have two of them, a Y and
Speaker 3: A three, and they're learning all about Connecticut and Florida
Speaker 3: worlds roads. So it has a huge competitive advantage in
Speaker 3: terms of proprietary data that nobody else has about the roads,
Speaker 3: not only in the US, but in many places around
Speaker 3: the world.
Speaker 1: Do you worry that Elon Musk is taking on too much?
Speaker 1: If he's got his new job in the US government,
Speaker 1: he's got you know, sharp developments coming in Tesla, lots
Speaker 1: going on with those other businesses as well. Is he
Speaker 1: spreading himself too thin?
Speaker 3: If you look at the way Elon Musk behaves as
Speaker 3: a CEO, he's a sharpshooter. He looks for pain points
Speaker 3: and he solves those right. And he's for example, right now,
Speaker 3: where was in twenty eighteen, where was the biggest pain point?
Speaker 3: It was manufacturing the Model three, scaling the Model three.
Speaker 3: He slept famously on the factory floor. He's not doing
Speaker 3: that anymore. He's not on the factory floor now. It's
Speaker 3: all about autonomous. He is the first what we would
Speaker 3: call CEO who really understands the convergence among technologies taking
Speaker 3: place right now, really catalyzed by artificial intelligence each one
Speaker 3: of his businesses. And he also understands how critically important
Speaker 3: proprietary data is. And think about this, Each of those
Speaker 3: companies is generating proprietary data that no one else has.
Speaker 2: Well, maybe you should out to his plate. Should he
Speaker 2: buy us TikTok ah?
Speaker 4: Yes?
Speaker 3: I mean, I know there have been rumors about that
Speaker 3: and about the government sharing half, and that's kind of
Speaker 3: anathema to the United States, you know, the government getting.
Speaker 4: Involved like this. I'd be surprised if that happens.
Speaker 3: But I will also say the Trump administration is full
Speaker 3: of surprises.
Speaker 1: It certainly is, and we're only a weekend to it.
Speaker 1: You're here with us in London and we're delighted to
Speaker 1: see you. What has you in London? What opportunities are
Speaker 1: you excited about when you come to the UK. Is
Speaker 1: this a good place to put your money?
Speaker 3: Well, we have launched three funds. Our Europe has launched
Speaker 3: three funds here. One is our flagship that is focused
Speaker 3: on all five innovation platforms, so robotics, energy storage, artificial intelligence,
Speaker 3: multiomic sequencing and blockchain technology. So that's the flagship AARKK
Speaker 3: a special one for Europe which we do not have
Speaker 3: in the US because of overlaps with other funds, But
Speaker 3: we have an AI and robotics fund and that is ARKI.
Speaker 3: We think this convergence of robotics and AI is going
Speaker 3: to lead to humanoid robots and you know, not just
Speaker 3: millions of them, but perhaps billions of them longer term,
Speaker 3: which is going to be a key productivity driver in
Speaker 3: both the home. You know, right now we're not paid
Speaker 3: for house cleaning let's get a robot. Let's pay a
Speaker 3: robot to do it, and in the manufacturing plants around
Speaker 3: the world.
Speaker 1: Kathy, the Prime Minister was in the building earlier. Kara Starmer,
Speaker 1: you're exactly the sort of person that he wants to
Speaker 1: meet because he wants investments going into those sorts of
Speaker 1: businesses in this country. Have you spoken to what sort
Speaker 1: of advice would you be giving him if he's trying
Speaker 1: to grow the economy.
Speaker 3: Well, half the solution is understanding the problem. And just
Speaker 3: making that statement suggests to me that he's saying, why
Speaker 3: hasn't this happened? And I also over the weekend heard
Speaker 3: one of the finance ministers or maybe the Finance Minister
Speaker 3: say the same thing. This is a mantra, and I
Speaker 3: think it has been catalyzed by artificial intelligence as well.
Speaker 3: If you think about the UK, you produced two of
Speaker 3: the most important AI companies in the world, Deep Mind,
Speaker 3: which Alphabet now owns, an arm which SoftBank primarily owns.
Speaker 3: By all rights, you should be developing a deep venture
Speaker 3: capital pool here, feeding startups and nourishing them and deepening
Speaker 3: your listed equity markets. And so I think that's what
Speaker 3: they're going to do, which is fantastic, fantastic for the UK.
Speaker 2: Absolutely, they talk very ambitiously the UK leadership, but so
Speaker 2: too do the European government's leadership. And Donald Trump, as
Speaker 2: you say, is very passionate about deregulation. So yes, everybody's
Speaker 2: on the same page. But it is a race. Is
Speaker 2: the UK keeping up enough with the EU and the
Speaker 2: US when it comes to deregulation for you to be
Speaker 2: really confident, Kathy putting your money here.
Speaker 3: I think that Europe is more tied up in regulatory
Speaker 3: nuts than the UK is. And in fact, some of
Speaker 3: our companies, Pallenteer has been very vocal, for example, and
Speaker 3: we think that's one of the most important AI platform
Speaker 3: companies out there. Alex Krp, the CEO, has said, I
Speaker 3: am pulling employees out of Europe because you know, we're
Speaker 3: running into all of these obstacles that could really harm us,
Speaker 3: you know, being hit by a four percent fine, four
Speaker 3: percent of revenue or and that's global revenue or seven
Speaker 3: percent of revenue I heard recently.
Speaker 4: That's crazy.
Speaker 3: So I think Europe is going to be held back
Speaker 3: until it gets its regulatory act together. I think the
Speaker 3: UK is more progressive from a regulatory point of view,
Speaker 3: and as I said, I really believe that half the solution.
Speaker 3: The fact that your Prime Minister, your Finance Minister in
Speaker 3: the same week are saying, you know, we've got to
Speaker 3: figure this out. I think that's a very good thing
Speaker 3: for the UK.