Speaker 1: From the heart of where innovation, money and power collive
Speaker 1: in Silicon Valley and beyond. This is Bloomberg technology with
Speaker 1: Emily Jay. I met Ludlow in New York in Family
Speaker 1: Chang this is Bloomberg technology. Coming up in the next
Speaker 1: hour Bloomberg's conversation with Microsoft's CEO Sacha Adela and Linkedin
Speaker 1: CEO Ryan Ross Lanski, about monitoring productivity and why Nodela
Speaker 1: is so confident about approval from Microsoft's acquisition of activision.
Speaker 1: Blizzard plus Mark Benioff is throwing dream force the biggest
Speaker 1: convention to hit San Francisco since the pandemic began. The
Speaker 1: Bloomberg Tech team was also on site and asked Benni
Speaker 1: off about his future at salesforce and the economy and
Speaker 1: impossible foods joins the climate pledge to reduce combon emissions
Speaker 1: to net zero by I'll ask CEO Pete McGuinness about
Speaker 1: the role his company's playing in the global warming battle.
Speaker 1: We'll get to that in a moment, but first let's
Speaker 1: get a look at the markets. And we had a
Speaker 1: tech tumble following Wednesday's fed rate rice. Joining us all
Speaker 1: to break it all down. Bloomberg's Katie Gryfeld. Hi Katie, hi,
Speaker 1: and well, I have good news and bad news. The
Speaker 1: good news is that I think we're on set together
Speaker 1: for the first time ever, so that's huge. The bad
Speaker 1: news is that it was a terrible day in the
Speaker 1: stock market. Like you said, that hangover from the Fed
Speaker 1: on Wednesday continued. You could see it in the NAZAC
Speaker 1: one hundred, those big tech stocks at index falling over
Speaker 1: one percent. Chips also taking a beating out, underperforming down
Speaker 1: almost three percent, and it was the riskier parts of
Speaker 1: the market that really took it on the chin the
Speaker 1: most of you look at these unprofitable tech basket down
Speaker 1: almost five percent today. All this coming in a backdrop
Speaker 1: of higher and getting higher treasury yields. You'll of the
Speaker 1: two year treasury yield right there, raising another seven basis points.
Speaker 1: Is traitor suggest to an ever more hawkish fed. And
Speaker 1: let's look what that relationship looks like. If you look
Speaker 1: at the two year yield versus stocks, you're looking against
Speaker 1: the SMP five hundred. You can see that. For a
Speaker 1: while actually these two were rising together, but now is
Speaker 1: that two year treasury yield continues and continues to climb.
Speaker 1: You're starting to see that reevaluation going on in the
Speaker 1: broader stock market and the SP five hundred nearing its
Speaker 1: lows from earlier in the summer. But let's talk about
Speaker 1: some of the specific single names you have on the
Speaker 1: board here. Some of the travel names taking a beating today.
Speaker 1: We're talking about expedia and AIRBNB, bulls falling as recession
Speaker 1: fears continue to build. You did see alphabet shares rise
Speaker 1: a little bit and activision blizzard, like you were saying,
Speaker 1: at Microsoft saying that they're still confident that that purchase
Speaker 1: will go through. All right, let's walk a little bit
Speaker 1: about more about that now. Thanks, Katie. Employee say they're
Speaker 1: productive at work, but leaders say they're not so sure.
Speaker 1: This according to new data released by Microsoft and linked in.
Speaker 1: Microsoft is also releasing a new suite of productivity tools
Speaker 1: to facilitate better interaction between workers and their bosses to
Speaker 1: combat what Microsoft CEO sat in Adel Calls the productivity
Speaker 1: paranoia paradox. Bloomberg's Emily Chang spoke with him about all
Speaker 1: this and more, along with Linkedin CEO Ryan Ross Lanski,
Speaker 1: on Wednesday. Take listen to what they had to say.
Speaker 1: This productivity paranoia, as we describe it. It's one of
Speaker 1: the things that's emerging where the managers and the leaders
Speaker 1: think that their employees are not productive, as employees feel
Speaker 1: that they're being very productive and in many cases even
Speaker 1: feel burned out. So I think one of the most
Speaker 1: important things for us in this new world of work
Speaker 1: and hybrid work is to bridge this paradox in some sense,
Speaker 1: because we have to figure out because both sides need
Speaker 1: the same thing. Employees feel that they are thriving and
Speaker 1: they need to thrive. That means they need to really
Speaker 1: feel a sense of empowerment, they need to have that
Speaker 1: sense of energy to do meaningful work. And, after all,
Speaker 1: as a leader and as a manager, what do you need?
Speaker 1: You need your employees to thrive. So I think we
Speaker 1: need both new soft skills and managerial skills to make
Speaker 1: that happen, but you also absolutely need new tools. Now, Ryan, Microsoft,
Speaker 1: speaking of those tools, is offering several products. You've got
Speaker 1: viva goals to help align workers with the business, Viva
Speaker 1: pulse to get a better sense of how employees are feeling.
Speaker 1: There's engaged, there's amplified to encourage interaction and communication. How
Speaker 1: do you think these tools, Ryan, are unique to the
Speaker 1: products that are already out there. Well, I think you know,
Speaker 1: on on the via side, at the end of the day,
Speaker 1: if you want the productive workforce, the most important thing,
Speaker 1: first and foremost is that you empower the individual to
Speaker 1: be productive. Secondly, do you understand that an individ vidual
Speaker 1: doesn't work alone? They need to collaborate, so ensuring they
Speaker 1: have the tools to collaborate as well. And on the end,
Speaker 1: now a new really important skill managers need is to
Speaker 1: ensure the well being of their employees and I think
Speaker 1: a lot of the Viva suite brings that together. Then
Speaker 1: obviously we're able to leverage a lot of what we
Speaker 1: see on Linkedin to help inform that. There is a
Speaker 1: ton of uncertainty obviously happening in the world. You know,
Speaker 1: the last time, I think we spoke and maybe eighteen
Speaker 1: months ago, we were seeing across the linkedin data an
Speaker 1: unprecedented amount of movement happening in the labor market. We
Speaker 1: saw employees everywhere not only questioning how and where they work,
Speaker 1: but why they work, and it was leading to what
Speaker 1: we call the great reshuffle. We're actually seeing that now
Speaker 1: start to come down a little bit. Actually, for the
Speaker 1: first time in eighteen months, the year. Your trend and
Speaker 1: people changing jobs on Linkedin is flat. So things are
Speaker 1: starting to settle right now, but it's entering into a
Speaker 1: new period of uncertainty. SATIA, in the early days of
Speaker 1: the pandemic, you expressed your concerns that we were burning
Speaker 1: social capital by spending so much time away from the office.
Speaker 1: Are you finding now, I'm curious about your personal experience,
Speaker 1: are you finding now that you were right, that that
Speaker 1: this has come at a cost to social capital and
Speaker 1: that needs to be rebuilt? Yeah, no, there's no question
Speaker 1: that Um, social capital needs to be rebuilt. But the
Speaker 1: one thing, emily, I think we all also learned is
Speaker 1: how to build social capital in a variety of ways.
Speaker 1: One of the things, even during the pandemic, I personally
Speaker 1: learned is I met more people. For example, on a
Speaker 1: team's call, I would click on the profile of every
Speaker 1: person in the meeting learned so much more about them. Uh,
Speaker 1: and now when I see them in person, I know
Speaker 1: that I feel like I know them much more deeply.
Speaker 1: So I think I picked up a new skill of
Speaker 1: how to build social capital and that's going to remain
Speaker 1: with us. But to your other point, even in fact,
Speaker 1: one of the data points that in the work trends
Speaker 1: index we talked about, is people come to work for
Speaker 1: other people, not because of some policy, and so that,
Speaker 1: I think, should teach us as leaders something which is you,
Speaker 1: as a leader now should develop the soft skill to create,
Speaker 1: essentially those events which allow you to bring people together
Speaker 1: with other people in order to be able to accomplish
Speaker 1: things that are important for your workplace. So to me,
Speaker 1: I think that social capital will always be important and
Speaker 1: I think we have learned maybe some new skills and
Speaker 1: some of the old skills that were there. I think
Speaker 1: I'm going to be really, really learned by all of
Speaker 1: us and exercised in different ways about depending on the team.
Speaker 1: There's a big debate happening right now about remote work surveillance,
Speaker 1: or at least that's what the critics call it, satia.
Speaker 1: What's your point of view on companies that think they
Speaker 1: need to track their employees through technology and whether Microsoft's
Speaker 1: products or tools should enable that? No, first of all,
Speaker 1: I think any product, including all of our products, have
Speaker 1: to be built ensuring that privacy, privacy regulation, privacy laws
Speaker 1: by country are all built right into the product. So
Speaker 1: let's start with that. But if you sort of say
Speaker 1: what are all these tools for? Ultimately, for the business?
Speaker 1: These tools are about really helping their employees thrive, because
Speaker 1: the only way of business is successful and productive is
Speaker 1: if employees feel that sense of empowerment, that sense of
Speaker 1: energy and connection for the company's mission and are doing
Speaker 1: meaningful work. And so to me it's not about surveillance,
Speaker 1: it's more about helping employees thrive. That needs to be
Speaker 1: the goal, goal of even using these tools. Satya, inflation
Speaker 1: is at a record high. We heard Ryan mentioned the
Speaker 1: word uncertainty several times. One of your executives recently at
Speaker 1: a Goldmen conference, said it's the most uncertain economic environment
Speaker 1: we've seen in decades. How would you describe the level
Speaker 1: of uncertainty you are seeing right now and how that's
Speaker 1: impacting your outlook? Yeah, I mean the constraints are real. Um,
Speaker 1: you know, inflation, Um is definitely all around us, uh,
Speaker 1: and different parts of the world have different type of
Speaker 1: economic growth, but the constraints, I think, are being felt
Speaker 1: by everyone. So to me, I always go back emily
Speaker 1: to the point that in an uncertain time, in an
Speaker 1: inflationary time, software is the deflationary force. So to me,
Speaker 1: staying super focused as a company ensuring that our customers
Speaker 1: are able to do more with less. I think is
Speaker 1: going to be the key thing that we have to
Speaker 1: accomplish in the quarters ahead. So, in terms of outlook,
Speaker 1: I am optimistic about Microsoft's value proposition helping our customers.
Speaker 1: I'm optimistic about our share, but we're not immune from
Speaker 1: anything that is a macroeconomic headwind. But we go into
Speaker 1: this with knowing that fully well that the digital skills
Speaker 1: we have, the digital products we have and software fundamentally
Speaker 1: is probably going to be the most useful tool that
Speaker 1: will help us tame inflation where because it's a deflationary force.
Speaker 1: So Tim Cook told me apple is going to be
Speaker 1: more deliberate about spending as the macro economic crisis continues.
Speaker 1: How would you describe Microsoft's strategy and if you are
Speaker 1: going to be more conservative, how much longer do you
Speaker 1: plan to be more conservative? Yeah, I mean two points.
Speaker 1: One is we've grown a lot in the sense in
Speaker 1: last year we grew seventy plus thousand people joined Microsoft.
Speaker 1: So I do think we are going to be more deliberate.
Speaker 1: When I said what does that deliberate mean? It means
Speaker 1: wherever we need to grow, we will grow. Where we
Speaker 1: need to be more productive, which is everywhere, we will
Speaker 1: be also, in fact, taking the same medicine, which is
Speaker 1: doing more with less. So I think it's a great opportunity,
Speaker 1: quite frankly, for us at Microsoft to practice what we preach,
Speaker 1: which is to be able to make sure that we
Speaker 1: take the seventy people, make them feel part of Microsoft's
Speaker 1: purpose and mission, really help us improve our culture because
Speaker 1: of all the things that they can contribute to our workplace.
Speaker 1: And then, of course, we have many businesses that are
Speaker 1: really doing super well and we'll continue to grow. But
Speaker 1: we will also be looking at what the macroeconomic situation is.
Speaker 1: But I feel very confident that between the productivity gains
Speaker 1: as well as the growth we will have, we'll be
Speaker 1: able to navigate the waters. Bryan, tech stocks have taken
Speaker 1: a beating. You know, Microsoft, as as Satia said, has
Speaker 1: not been immune to this. This is a key way
Speaker 1: that tech companies have retained their employees by the the
Speaker 1: the attraction of equity. How do you see Microsoft and
Speaker 1: other companies coping with this? It's really about attracting people
Speaker 1: who align with the mission and vision of what it
Speaker 1: is you're trying to build. You think about Linkedin when
Speaker 1: we build great products, people get jobs, they start companies,
Speaker 1: they learn new skills. We sit at the intersection of
Speaker 1: what I call doing good and doing well and that's
Speaker 1: a very empowering thing to our employees who want to
Speaker 1: come and work on something like Linkedin that can have
Speaker 1: such an amazing, uh and productive and, uh you know,
Speaker 1: valuable impact on professionals globally. So I see you know
Speaker 1: we recently just reiterated and revisited uh and enhanced our
Speaker 1: culture and guys of our company to ensure that we
Speaker 1: have the right foundation to attract the right employees moving forward.
Speaker 1: But again, I just really feel this strong move in
Speaker 1: the world towards uh culture and values being more important
Speaker 1: than it ever has, especially to attract the right talent
Speaker 1: your company. So, Satia, one more on this and then
Speaker 1: we'll move on. But you know, we know Microsoft won't
Speaker 1: be filling some open roles. You've already said that you're
Speaker 1: eliminating some contractor positions, but give us a sense of
Speaker 1: the scope. Well, some of the key priorities like Azure
Speaker 1: or security be impacted? No, I mean our core businesses
Speaker 1: were of Microsoft cloud, whether security or our infrastructure, data
Speaker 1: and AI businesses, which is what predominantly is represented in
Speaker 1: Asia or Microsoft. Five, our dynamics. Six. Five. These are
Speaker 1: massive growth businesses on a very large base. So there's
Speaker 1: going to be growth all around them, but it's all
Speaker 1: going to be about what roles have to grow. As
Speaker 1: I said, our job nuvel one is to make sure
Speaker 1: that the growth we've had is all sort of landing
Speaker 1: in a very productive way to drive the business is
Speaker 1: going forward. Even when it comes to our consumer businesses,
Speaker 1: we want we know that. You know with windows and
Speaker 1: with our PC there was definitely a pull forward, but
Speaker 1: we just launched a new release of windows eleven because
Speaker 1: at some level now it's about being able to take
Speaker 1: that one plus billion installed base and making the experience better.
Speaker 1: So we have some fantastic opportunities. There are browsers growing share,
Speaker 1: our gamings growing share, so we're going to double down. Obviously,
Speaker 1: Ryan talked about Linkedin. Again, we're not immune to the
Speaker 1: macroeconomic headwinds, but in every one of the businesses there
Speaker 1: are pockets of growth and that's where we will double down.
Speaker 1: And you know, since you're joining us from London, on
Speaker 1: a slightly different topic, I have to ask you know,
Speaker 1: Microsoft seemed to be expecting more regulatory scrutiny of the
Speaker 1: activision deal in the UK, but they've just said they're
Speaker 1: going to escalate their investigation. Have you been surprised by
Speaker 1: the level of concern that regulators there have expressed? When
Speaker 1: I look at that, fundamentally we think that are sort
Speaker 1: of entry for us in gaming. We have one goal,
Speaker 1: which is to bring more games to more gamers on
Speaker 1: all platforms and provide more choice for publishers everywhere and
Speaker 1: developers everywhere. Uh, and so everything that we're doing with
Speaker 1: our content, with our sub our cloud and community really
Speaker 1: is about driving that choice and that opportunity, and so
Speaker 1: we feel very, very confident. Of course, any acquisition of
Speaker 1: the size will go through scrutiny, but we feel very,
Speaker 1: very confident that will come out. You know, we are
Speaker 1: number four, number five, depending on how you count, in gaming.
Speaker 1: In fact, the number one player, in this case Sony,
Speaker 1: I think, even in this period, has acquired three companies.
Speaker 1: So if this is about competition, let us have competition.
Speaker 1: That was Microsoft CEO sat in Nodella and Linkedin CEO
Speaker 1: Ryan Ris Lanski, speaking with our very own Emily Chang
Speaker 1: coming up. Millions of people turned to twitch daily to
Speaker 1: watch live stream videos. That includes predators exploiting kids through
Speaker 1: the site. Will share more that my colleagues investigation into
Speaker 1: which this is Bloomberg and eye opening. Bloomberg report is
Speaker 1: shedding light on some dangers on the popular livestream platform twitch. Twitch,
Speaker 1: which is owned by Amazon and touts thirty one million
Speaker 1: daily visitors, is one of the most popular platforms for Gamers.
Speaker 1: Bloomberg reported that a network of child predators have used
Speaker 1: the platform to track children. Bloomberg Cecilia Denastasio, covers the
Speaker 1: video game industry and broke this story. Cecilia, what did
Speaker 1: you learn in the course of your reporting? Twitch says
Speaker 1: it doesn't allow children under thirteen to use the platform. However,
Speaker 1: unlike streaming competitors, there are relatively few barriers preventing children
Speaker 1: from getting on the APP. Bloomberg found that there are
Speaker 1: people out there, over two thousand of them, who stramatically
Speaker 1: follow accounts that seem to belong to children on the platform,
Speaker 1: and around two dred and eighty thousand accounts that apparently
Speaker 1: belong to children were targeted this way, according to our research.
Speaker 1: Sec I want to bring up the statement from the company,
Speaker 1: from twitch, and I'll read it to you. Preventing child
Speaker 1: harm is one of our most fundamental responsibilities as a society.
Speaker 1: We do not allow children under thirteen to use twitch
Speaker 1: and preventing our service from being used for harm is
Speaker 1: one of our biggest priorities. We know that online platforms
Speaker 1: can be used to cause harm to children and we
Speaker 1: have made extensive investments over the last two years to
Speaker 1: better stay ahead of bad actors and prevent any users
Speaker 1: who maybe under thirteen from accessing twitch. So they underline
Speaker 1: the policy, which is no one under the age of
Speaker 1: thirteen can use the platform. What do we know about
Speaker 1: how twitch moderates that monitors the use of the platform?
Speaker 1: Sure so. Twitch is a live streaming platform and, unlike
Speaker 1: platforms like youtube, where videos are recorded, it's very challenging
Speaker 1: to moderate live video because it's happening in real time,
Speaker 1: especially for child sexual abuse material Um. Twitch is figuring
Speaker 1: out solutions to a problem on the fly, and it's
Speaker 1: a problem that not a lot of other platforms face
Speaker 1: at the scale that twitch does, and so twitch has
Speaker 1: quadrupled its Law Enforcement Response Team over the last two years.
Speaker 1: Twitch has done a lot of resources into preventing Um
Speaker 1: children from getting on twitch and from streaming however, Bloomberg's
Speaker 1: report has found that these solutions have fallen short and
Speaker 1: the problem has been exacerbated over the pandemic exaspected over
Speaker 1: the pandemic this this is an issue that we've covered
Speaker 1: in the show. Across the industry, social media platforms, online
Speaker 1: platforms generally speaking, what are regulators doing, I suppose at
Speaker 1: federal level, to tackle this issue? It's a very challenging
Speaker 1: issue to tackle. One thing that is being paid at
Speaker 1: ten shoot attention to right now, of course, is advertising
Speaker 1: to children on these platforms. There's a lot of resources
Speaker 1: being dedicated to preventing children from UM receiving messages from
Speaker 1: companies when they are not age appropriate to receive those messages.
Speaker 1: When it comes to moderation, it's a multi pronged issue
Speaker 1: that is highly technical and a lot of the time
Speaker 1: tech companies are the ones left in charge of moderating
Speaker 1: their own platforms. Your pole is out. What happens next?
Speaker 1: What's the response? The response has been very large from
Speaker 1: the twitch community Um and from people who, you know,
Speaker 1: watch their favorite gamers livestream on the platform, and some
Speaker 1: of these gamers themselves have commented that this Um, that
Speaker 1: this is unacceptable for the company Um, through which they
Speaker 1: make a living. However, twitch itself has not made a
Speaker 1: move to change some of the features that have enabled
Speaker 1: predators to find and target children on the platform, so
Speaker 1: it's to be seen whether that will happen. All Right, Bloomberg,
Speaker 1: Cecilia Denis Sassio, thank you. Meta platforms has been sued
Speaker 1: for Skirting Apple Privacy rules in a proposed class action
Speaker 1: lawsuit filed in San Francisco Federal Court to facebook. Users
Speaker 1: claim the company built a secret workaround two apples privacy
Speaker 1: rules and violated state and federal laws limiting unauthorized collection
Speaker 1: of personal data. Bloombergs learned that the Securities and Exchange
Speaker 1: Commission is set to let Wall Street keep payment for
Speaker 1: order flow deals. According to sources, the practice can involve
Speaker 1: one brokerage routing retail stock trade orders to another firm
Speaker 1: for execution rather than onto a brokerage or exchange. Backers
Speaker 1: say it's led to commission free trading, championed by Robin Hood,
Speaker 1: but critics question whether the trade is actually get the
Speaker 1: best price. All this is part of an SEC overhaul
Speaker 1: of stock trading rules. Amazon's first Thursday night football game
Speaker 1: of the season drew an audience of thirteen million viewers.
Speaker 1: That's according to data from measure measurement firm Nielsen, which
Speaker 1: suggests that NFL fans across the US could find the
Speaker 1: game last Thursday. That's despite it not being available on
Speaker 1: TV nationwide. Amazon's guaranteeing advertisers it's exclusive coverage will reach
Speaker 1: more than twelve million viewers per game, but that's down
Speaker 1: from the sixteen point four million tuning in on Thursday
Speaker 1: nights last year across Fox, the NFL network and Amazon.
Speaker 1: Welcome back to Bloomberg Technology. I'm Ed Ludlow in New York.
Speaker 1: Dream Force is back in San Francisco and it's the
Speaker 1: biggest convention to hit the tech capital since the pandemic era.
Speaker 1: Thousands heading to the annual salesforce conference, including Bloomberg Technologies
Speaker 1: Emily Chang. She sat down with salesforce chair and CO
Speaker 1: CEO Mark Nil Stalk about his next steps. To have
Speaker 1: forty folks here in San Francisco in the new mascony
Speaker 1: center is beautiful. Every hotel is sold out from here
Speaker 1: to San Jose. Every AIRBNB is sold out. It's amazing
Speaker 1: and they're all having such a good time and and
Speaker 1: learning about technology. And learning about how to connect with
Speaker 1: our customers in a new way using sales worth. We're
Speaker 1: gonna talk a little bit about the state of the
Speaker 1: city in a moment. At first, you announced new profitability
Speaker 1: goals yesterday, long term profitability, aiming for adjusted operating margin
Speaker 1: in what makes you feel so ambitious in a downturn? Well,
Speaker 1: you probably saw this quarter we delivered seven point seven billion.
Speaker 1: It was larger than in an S A P, a
Speaker 1: company that you know we both admire so greatly. But
Speaker 1: now we're the largest enterprise APPS company in the in
Speaker 1: the world. That's very exciting, and so we have the
Speaker 1: highest revenue and now we want to have very strong
Speaker 1: margins and we've taking a goal that when we get
Speaker 1: to fifty billion, which is right around the corner, we
Speaker 1: will have operating margin. So you're also doing these carbon offsets,
Speaker 1: which is fairly unique, more net zero offerings. Do you
Speaker 1: see this as philanthropy or do you see real revenue
Speaker 1: generated from the carbon accounting market? Well, I think that
Speaker 1: when you think about a modern business today, you have
Speaker 1: to have great revenue, you have to have a great margin.
Speaker 1: You also have to look at your overall capital allocation.
Speaker 1: We're buying back ten billion dollars of our stock. We
Speaker 1: just promoted our lead director, Robin Washington. But when you
Speaker 1: think about the values of a company today, trust, customer success, Innovation, quality.
Speaker 1: We've spoken about all of those emily for a decade
Speaker 1: or more. Now we're talking about sustainability. Everybody has a
Speaker 1: personal story about the environment. Everybody knows what's happening. So
Speaker 1: every company needs to go net zero, and so we
Speaker 1: have a new net zero cloud, we have a net
Speaker 1: zero market play, we have the ability to help all
Speaker 1: of our customers go net zero. This is extremely important
Speaker 1: and we even started, you know, our trillion tree program
Speaker 1: one t dot Org. We made phenomenal progresses. Is Very
Speaker 1: important that we get a trillion trees. We need to
Speaker 1: sequester two gigatons of carbon and we need to energize
Speaker 1: an EGO Preneura Revolution. And we can do all that
Speaker 1: and we are doing it here at dream. Worse meantime,
Speaker 1: the economy is in a major slop. You've got record inflation,
Speaker 1: rising rate hikes and ongoing war. How concerned are you
Speaker 1: about the outlook and your level of uncertainty? What do
Speaker 1: you see? Well, what I see is that we just
Speaker 1: went through a pandemic. Uh, and, I know we talked
Speaker 1: a lot during the pandemic for a couple of years
Speaker 1: and it was tough for a lot of folks, including
Speaker 1: me and you were at home a lot of the
Speaker 1: time trying to run our daily businesses and make things happen,
Speaker 1: and the government invested a lot into the market. And
Speaker 1: now we're coming out of the pandemic and I think
Speaker 1: those e commerce charts that we see a lot are
Speaker 1: great metaphors, you know, the ones that go like in
Speaker 1: the pandemic, out of the pandemic. But if you connect
Speaker 1: e commerce from ten years ago to today, the chart
Speaker 1: is still quite up until the right. It's just that
Speaker 1: you had two years in the pandemic. So I think
Speaker 1: the economy is normalizing, the world is normalizing, currencies are
Speaker 1: quite aggressively fluctuating. We've been talking about that since May
Speaker 1: and uh, I think, look, what do I know? This
Speaker 1: is my first pandemic, but in the future I know
Speaker 1: that after a pandemic you're gonna have some adjustment period.
Speaker 1: Meta and Google are just the latest companies cutting jobs.
Speaker 1: I spoke to Tim Cook. He said apple is going
Speaker 1: to be more deliberate about spending. Adela just told me
Speaker 1: today we're going to do more with less. I know
Speaker 1: sales force slowed hiring a bit earlier in the year,
Speaker 1: but are you expecting any job cuts or cost cuts?
Speaker 1: What's your strategy to navigate them? I think what you're
Speaker 1: seeing for all of these companies, including ours, as we
Speaker 1: all invested aggressively in the last two years and we
Speaker 1: are absorbing those investments into our businesses now. So we
Speaker 1: have a lot online and moving forward and we need
Speaker 1: to enable that and energize it and motivate it. So
Speaker 1: you're right, we did slow slightly our hiring, but do
Speaker 1: I see other changes? You know, who knows what's going
Speaker 1: to happen? Is Not certainly not our intention. Our intention
Speaker 1: is to continue to get the fifty billion dollars in
Speaker 1: revenue by F Y last year we did twenty six billion.
Speaker 1: This year we're gonna do thirty one billion and by
Speaker 1: fiscal year twenty six, we want to do fifty billion.
Speaker 1: You're Cocyo, Brett Taylor's chair of twitter. I know he's
Speaker 1: probably been a living little busy with that. I saw
Speaker 1: probably a little. I saw you in Brent on stage
Speaker 1: and bunny years. Yes, I want to know how it's
Speaker 1: going like? How is it going to have a co CEO?
Speaker 1: Are you spending a little less time on the day
Speaker 1: to day now that he's here? Well, as you know,
Speaker 1: I love Brett. I've loved him for a long time.
Speaker 1: We've had a great relationship, a multi decade relationship. When
Speaker 1: he's started his company, I invested in it. I always
Speaker 1: wanted to acquire it. We're so lucky. We did acquire
Speaker 1: it and I moved him up slowly on the company,
Speaker 1: Chief Product Officer, Chief Operating Officer, now co CEO. I
Speaker 1: think we've got a fantastic leader of the company. Look,
Speaker 1: you have to understand these are big jobs. CEO, these CEOS,
Speaker 1: I know them all. There's no s under here. If
Speaker 1: I take my shirt off and I'm just skin and bones,
Speaker 1: there's no s and I think that having a partner
Speaker 1: like Brett Taylor to help me is incredible and I
Speaker 1: could not be more grateful. Yeah, it's so much value
Speaker 1: and it's so impressive in a work are you going
Speaker 1: to be doing this co CEO thing? Well, as long
Speaker 1: as you know. Everybody wants me to do it. So
Speaker 1: far it seems to be working. You're giving another huge
Speaker 1: education grant. This is the Tenth Year of it. I
Speaker 1: actually interviewed you, I believe, the very first year. You
Speaker 1: were very skeptical. You're like, there's no way you're going
Speaker 1: to do this for ten years, and we did it.
Speaker 1: We're given over a hundred million dollars toward San Francisco
Speaker 1: and Oakland public schools. This has been very important for them,
Speaker 1: especially as our exiting the pandemic. They're getting another million.
Speaker 1: This is not the end of the program it's set
Speaker 1: up to go in perpetuity. Very exciting the state of
Speaker 1: the US education system right now and is the government
Speaker 1: doing enough? I think that our public education system has
Speaker 1: to be at the top of every leader's mind and
Speaker 1: you cannot delegate it to the government. You as a
Speaker 1: CEO or as a business leader or in another part
Speaker 1: of your organization. You need to go down to your
Speaker 1: local public school three blocks away from your house. You
Speaker 1: know where yours is, knock on the door, introduce yourself
Speaker 1: to the principle and say how can I help? I
Speaker 1: built a new playground. Partner Harris painted the buildings. You know,
Speaker 1: we installed technology, we did volunteerism and mentorship. Everybody can
Speaker 1: do something. We cannot do everything. Companies have a lot
Speaker 1: of resources. We have some of the best, most exciting
Speaker 1: companies in the country. These companies need to be supporting
Speaker 1: our local public schools and also our local public hospitals.
Speaker 1: You know we've done a lot with UCS AF here
Speaker 1: in San Francisco and public parks as well. We just
Speaker 1: open a massive, hundred million dollar public park called tunnel tops.
Speaker 1: You know that my wife is the chairman of it.
Speaker 1: It's incredible. These are the things that CEOS and companies
Speaker 1: should have their eyes on, figure out how to put
Speaker 1: a light on it, bring their customers in and bring
Speaker 1: all stakeholders together. That was salesforce chair and co CEO
Speaker 1: Mark Benioff, along, of course, with Bloomberg's Emily Chang. You
Speaker 1: can watch the full interview at Bloomberg Dot Com or
Speaker 1: on Youtube. Coming up with seeing an exodus of executives
Speaker 1: at crypto firms. More than that in a moment. This
Speaker 1: is Bloomberg, time for it to early CRYPTO report. A
Speaker 1: number of cryptocurrencies, including Bitcoin, and lingering near two year lows.
Speaker 1: Is the Fed's inflation fight takes a toll on risky assets.
Speaker 1: Bloomberg's Katie Greifeld is here to discuss. How are you
Speaker 1: by the way, I'm so great being on set with you.
Speaker 1: I thought you were a deep fake for the longest. Well,
Speaker 1: it's for context of the global audience. I'm visiting from
Speaker 1: San Francisco, but it's been a long week, the highlight
Speaker 1: which has been the Fed. Yes, and digital assets essentially
Speaker 1: did not escape the volatility that we saw across financial
Speaker 1: markets post fed, not at all. So you actually saw
Speaker 1: bitcoin outperform traditional socks a little bit on Thursday. But
Speaker 1: if you zoom out, and people on twitter will always
Speaker 1: tell you to zoom out, it's just been a brutal
Speaker 1: stretch for Bitcoin. Down Fifty eight percent, almost fifty year
Speaker 1: to date. You compare that to the NASTAC One d
Speaker 1: these two tend to trade in lock step, but the
Speaker 1: magnitude of losses and Bitcoin so much greater. The NASAC
Speaker 1: one hundred down only only in votes, or so y're
Speaker 1: to date. I'm going to ask you the most question
Speaker 1: I can. Whatever happened to bitcoin being an inflation hedge? Well,
Speaker 1: it's a bit of a tortured answer that I'm going
Speaker 1: to give you because again, if you posted torturing me,
Speaker 1: it's torturing the audience. So if you posted a chart
Speaker 1: of Bitcoin. On twitter everyone will always tell you to
Speaker 1: zoom out, and that's sort of the answer that I
Speaker 1: have to give about bitcoin as an inflation hedge. Advocates
Speaker 1: will still say in the grand fullness of time, it
Speaker 1: is an inflation hedge when you have central banks really
Speaker 1: printing money. Is The answer you would get. I feel
Speaker 1: that right now we are at the test of that thesis,
Speaker 1: because now you have central banks around the globe removing stimulus,
Speaker 1: tightening liquidity, hiking central bank rates. We haven't seen this
Speaker 1: environment with Bitcoin as a mainstream asset. This has really
Speaker 1: never happened before, so we're watching that experiment. It's kind
Speaker 1: of funny because it's the first time in our lifetime
Speaker 1: at least, where we've had a pandemic but we've also
Speaker 1: had inflation. So been a lot, a lot volatility in
Speaker 1: digital currencies, digital assets, volatility in the industry. There's been
Speaker 1: a lot of, you know, well known founders CEOS of
Speaker 1: some of the more well known crypto related startups departing
Speaker 1: absolutely of course, the big headline, which this program covered
Speaker 1: well yesterday, Jesse Palell, the crack and CEO and Co founder,
Speaker 1: stepping down from the exchange, from that role of course
Speaker 1: chief operating officer, David Ripley is going to succeed him,
Speaker 1: but they're just that's just part of a trend that
Speaker 1: we're seeing. To your point, of course, Michael Sailor stepping
Speaker 1: down as micro strategy CEO in August really kicked this off.
Speaker 1: A few weeks later you had Michael Morrow from Genesis
Speaker 1: do the same. So it's this interesting moment in the
Speaker 1: industry where you are seeing a lot of upheople in
Speaker 1: the C suite, a lot of transition ends. It seems
Speaker 1: like the face of WHO's actually leading the industry right
Speaker 1: now is changing. Of course, we do have a lot
Speaker 1: of stalwarts such as Sam Bankman reads, such as Michael
Speaker 1: Novegrad's still in their positions. So it's not completely new,
Speaker 1: but definitely a time of transition. I'll go to my question,
Speaker 1: but you know, is somebody that's covered Silicon Valley startups forget,
Speaker 1: you know, necessarily crypto. A lot of this is like
Speaker 1: a changing of the God. Right. Sometimes they're pushed out exactly,
Speaker 1: sometimes they've had enough, sometimes investors get involved. Right. This
Speaker 1: is a really critical time for the industry. Talk to
Speaker 1: us kind of about that changing of the God and
Speaker 1: the moment. It falls in to your experience to put
Speaker 1: this in your world covering Silicon Valley. It's hard to
Speaker 1: transition away from a founder leaving the company, and we
Speaker 1: are seeing a little bit of that. Of course, it
Speaker 1: will be really interesting to see where kracking goes from here,
Speaker 1: because the founder has become really the identity of the company.
Speaker 1: So it's gonna be interesting to see how the crypto
Speaker 1: industry handles this moment. Who's going to step up to
Speaker 1: the plate and who ultimately continues to hang around in transition?
Speaker 1: Who becomes sort of the Mark Zuckerberg of the crypto
Speaker 1: industry in just the sense that he's been there? Hey,
Speaker 1: real quick, did the merge matter? Merge matter? That's a
Speaker 1: really good question. It turned. It mattered in that it
Speaker 1: looks like it turned to sell the news event. Obviously
Speaker 1: ether rallied so heavily into the merge. It doesn't much
Speaker 1: matter for the end experience of your holder of ether.
Speaker 1: It's going to be important to see whether it does
Speaker 1: lead to this sort of influx of development in terms
Speaker 1: of the APPs on the ethereum blockchain. Uh, and we
Speaker 1: still have a few more tests to go through when
Speaker 1: it comes to the merge it's not completely over yet,
Speaker 1: but the bulk of it is out of the way.
Speaker 1: Did the merge matter? Bloom bows, Katie Roifeld, thank you
Speaker 1: very much. At impossible foods to the list of nearly
Speaker 1: four hundred organizations that pledge this week to make their
Speaker 1: operations more sustainable. As part of climate week, impossible has
Speaker 1: joined e commerce giant Amazon's the climate pledge. Each company
Speaker 1: that signs the pledge commits to taking responsibility for decarbonizing
Speaker 1: their businesses and reaching net zero by twenty forty. Here
Speaker 1: with a Bloomberg exclusive interview is impossible food CEO, Peter McGinnis. Peter,
Speaker 1: welcome well, thanks to be here. It's a pledge, right,
Speaker 1: it's a pledge. Fulfill the pledge. How do you make
Speaker 1: this happen in real, substantive steps? First of all, having
Speaker 1: the consciousness as a company. Secondly, your business practices. Thirdly,
Speaker 1: your business model. So for us, climate has been at
Speaker 1: the center of impossible from the very, very beginning and
Speaker 1: if you look, if we sold fifty million pounds of
Speaker 1: impossible beef um we would, we would avoid one point
Speaker 1: three billion pounds of C O two, because you're doing
Speaker 1: a light for like with animal beef with real beef, right, Um,
Speaker 1: four point five billion gallons of water, thirty seven million
Speaker 1: trees of fifty million pounds of plant baste beef displacing
Speaker 1: the animal prod right. So we're unique in the sense
Speaker 1: that it's central and core to omission and the better
Speaker 1: the company does, the more good it does for the planet.
Speaker 1: So if you put the comparatives to one side, forget
Speaker 1: animal products, focus on plant how do you improve your
Speaker 1: performance in that respect? Yeah, it's also how you run
Speaker 1: your facilities and your distribution network and your supply chain network,
Speaker 1: and we all need to do better. Right, whether you're
Speaker 1: business is inherently better for the planet or not, we
Speaker 1: can all improve upon our operations over time. We've tech
Speaker 1: with technology will enable that improvement. Always right. So I
Speaker 1: always find it's fascinating one of your mission statements or
Speaker 1: at your core you are a food technology company. What
Speaker 1: is the technology that makes impossible different from any competitor?
Speaker 1: There are lots of generic names out there now, right,
Speaker 1: making a plant based meat products? Sure, I mean, in
Speaker 1: the end we have four hund intend patents around how
Speaker 1: we make our food and I'm not going to get
Speaker 1: into all four tents, but no, no, no, no, but
Speaker 1: I mean technology enables us to make great food and
Speaker 1: we're biased, but we think we have the best plant
Speaker 1: based food in the market and that is enabled by
Speaker 1: technology and many, many patterns around that technology and some
Speaker 1: of our ingredients, like Hem. I want to know how
Speaker 1: you grow sales. If I walk down to starbucks, I can,
Speaker 1: if I'm start in clients, try an impossible breakfast sandwich
Speaker 1: and it's kind of alongside an animal based products breakfast sandwich.
Speaker 1: You know, how do you boost sales? Not just through distribution?
Speaker 1: How do you get those new products in the face
Speaker 1: of consumers? Yes, so we're tech enabled food company, right.
Speaker 1: So we also have to behave like a food company.
Speaker 1: Were on grocery shelves, were on Menus at restaurants, and
Speaker 1: so consumers have to understand our food better and why
Speaker 1: it's better for them and why it's better for the planet.
Speaker 1: So one piece of it is distribution and accessibility, and
Speaker 1: we have a lot of room to go. You know,
Speaker 1: we have four TDPS. We could go up to four thousand.
Speaker 1: We're in forty locations. We could go up to well
Speaker 1: over a hundred thousand locations. So accessibility and distributions a
Speaker 1: piece of it, but there's low awareness around plant based
Speaker 1: meat and there's very low understanding of what it is,
Speaker 1: and I think the category in and of itself has
Speaker 1: done a pretty lousy job of communicating it and we
Speaker 1: haven't done a great job either. So look to us
Speaker 1: to explain it to consumers so that they're more attracted
Speaker 1: to it. resums would say, actually, if you look at it,
Speaker 1: the ingredients, the caloric content, it's not healthy and you know,
Speaker 1: quote unquote. What would you say to those consumers? Say, well,
Speaker 1: this isn't not healthy? Yeah, I mean so you're get
Speaker 1: in that processed argument right, and to me process is
Speaker 1: a twinkie, okay, and it's artificial ingredients. So we do
Speaker 1: have many ingredients to improve texture, taste flavor so that
Speaker 1: it mirrors the animal product, but they're all plant based,
Speaker 1: they're natural. So I think the definition of processed is
Speaker 1: another thing that's misunderstood and there's a lot of myths
Speaker 1: around it and that needs to be directly communicated and
Speaker 1: cleared up. We talked about the relationship with starbucks. You
Speaker 1: have a relationship with Burger King and you've tried other
Speaker 1: products kind of broader change. Yes, some of them have not.
Speaker 1: Stock what's your assessment of that? Now we've we haven't.
Speaker 1: So the original whoppers still available nation. Right of Burger King.
Speaker 1: We've added the King Burger and we've added a southwest
Speaker 1: seasonal burger and now we're testing a chicken patty. So
Speaker 1: in some marks we have four menu items. So we
Speaker 1: continue to expand burger. How will that go? How will
Speaker 1: that rollout go? Expansion go? Depending on the test results,
Speaker 1: it will go national and so so far, so good.
Speaker 1: So we feel great about the Burger King Um partnership
Speaker 1: and it's expanding. Inflation, how are you dealing with it? Listen,
Speaker 1: I think inflation is a really hard thing for most
Speaker 1: businesses and certainly for consumers right Um, for us it
Speaker 1: hasn't really affected our business growing at we've had a
Speaker 1: lot of fixed cost absorption, a lot of operating leverage
Speaker 1: off of that growth. That's the first thing. The second
Speaker 1: thing is we have long term contracts from with all
Speaker 1: of our key ingredient suppliers Um and so we haven't
Speaker 1: had that pass cost to us and so therefore we
Speaker 1: have not passed it on to the consumers. So we've
Speaker 1: kept flat prices. As meat prices have gone up, depending
Speaker 1: on chicken beef pork anywhere from eighteen to so our
Speaker 1: gap to the animal product has never been tighter and
Speaker 1: the history of our country cut prices to be more competitive.
Speaker 1: We could cut prices from well, we'll look at everything.
Speaker 1: I think everything is on the table to make it
Speaker 1: more available and more accessible and displace the animal product
Speaker 1: so we can maximize our mission. A reverse and climate change.
Speaker 1: You told about the messaging one of your competitors. Your
Speaker 1: meat is facing a number of challenges. Do you kind
Speaker 1: of zero in on them? Do you take a wide
Speaker 1: of you you know, how do you get on top
Speaker 1: of a busy field? Yeah, I think. Look, I think
Speaker 1: that will be consolidation in our category. I see one
Speaker 1: or two brands per press climate label moving forward. I
Speaker 1: don't look at him beyond meats playbook. We have our
Speaker 1: own playbook. Um and again, we're trying to displace the
Speaker 1: animal we're not trying to displace other plant based meat companies.
Speaker 1: In fact we celebrate other plant based meat companies because
Speaker 1: we're doing right by the environment. So so our goal
Speaker 1: is not to steal share from other plant based meat
Speaker 1: companies really quick. You don't seem in any hurry to
Speaker 1: I p o what are the conditions for that. We're
Speaker 1: in no hurry because we don't need to write because
Speaker 1: our balance sheet is strong and our cast position is good, Um,
Speaker 1: and so we will I P O when we want
Speaker 1: to end or need to, and the market is better
Speaker 1: than it is today. So we'll keep you posted on that.
Speaker 1: In a sentence. What will the next meat be? Plant
Speaker 1: based meat? We already have chicken, beef pork, right. So
Speaker 1: there's a lot of experimentation with seafood, where the be
Speaker 1: tuna or salmon? Right, Um. But we cover breakfast, lunch, dinner, chicken,
Speaker 1: beef pork, so we're good. I cannot wait to see
Speaker 1: impossible food. CEO, Pizza McGinnis, thank you so much for
Speaker 1: being with us. Thanks for having me. That does it
Speaker 1: for this edition of Bloomberg Technolog G. Friday we have
Speaker 1: Bain capital Global Tech Practice David Crawford. He'll discuss how
Speaker 1: web three can rewrite the rules of digital user identity
Speaker 1: and disrupt some of today's largest tech platforms. So don't
Speaker 1: get to check out our podcast. You can find it
Speaker 1: on the terminal as well as online on Apple, spotify.
Speaker 1: And this is Bloomberg