Speaker 1: From Marhard where Innovation of Money and Power Collie in
Speaker 1: Silicon Valley, NBN.
Speaker 2: This is Bloomberg Technology with Caroline Hyde and Ed loved Love.
Speaker 3: I'm Caroline Heide of Bloomberg's World headquarters in New York
Speaker 3: and I Mad Lovelow in San Francisco.
Speaker 4: This is Bloomberg Technology.
Speaker 5: Coming up.
Speaker 3: We'll talk the state of the digital consumer as inflation shoes.
Speaker 5: Some signs of moderation, with a founder of course, joining us.
Speaker 3: CEO of Mickmac, a global e commerce analytics platform.
Speaker 6: Plass will sit down for an exclusive conversation with the
Speaker 6: CEO of Data Breaks, one of the fastest growing software companies,
Speaker 6: to discuss how they're utilizing AI to power their business.
Speaker 3: And sticking with AI, we break down the earning some
Speaker 3: oracle as the AI frenzy spurs cloud demand. Plus we
Speaker 3: look at how salesforce so focusing in on artificial intelligence.
Speaker 3: But first let's focus in on these markets because we
Speaker 3: have some calling some signs of calling in inflation. If
Speaker 3: you look at not the core CPI, but look at
Speaker 3: the main overall print, we're back at four percent low
Speaker 3: as that we've had since March twenty twenty one. So
Speaker 3: we are seeing some optimism the FED will holds and
Speaker 3: stand steady for the month of June. We're seeing Na's
Speaker 3: that cup about five tens percent, benefiting from that risk
Speaker 3: on feel. But look, this inflationary pressure is being felt elsewhere.
Speaker 3: We think about the UK at the moment, yields absolutely
Speaker 3: spiking and I want to show what asset is still
Speaker 3: trading there, the pound versus the US dollar, higher versus
Speaker 3: US dollars. We think the FED might pause, but all
Speaker 3: eyes on maybe even a six percent level when you're
Speaker 3: thinking of central bank policy over at the Bank of England.
Speaker 3: Interesting of course, moves coming from China. They're going to
Speaker 3: the opposite direction. Instead of curtailing inflation, they're looking to
Speaker 3: speed up their economy. They're cutting rates that were surprise
Speaker 3: overnight that really boid some of the commodities markets. We're
Speaker 3: seeing up more than three percent in oil. But moving
Speaker 3: on to one of our favorite more risk assets in
Speaker 3: the world of technology, let's look at what's happening in
Speaker 3: the world of crypto. Look, not dramatic moves, but ill
Speaker 3: pressure remaining on bitcoin. We're atwred and seventy seven right now.
Speaker 3: This is even with a weaker dollar ed so clearly
Speaker 3: some of this regulatory our anxiety is still pressuring the
Speaker 3: main crypto asset ed.
Speaker 6: Yeah, when it comes to individual movers, that CPI print
Speaker 6: and the idea around the FED is having some impact here.
Speaker 6: But there's one name I'm looking at, which is Tesla,
Speaker 6: up for a thirteenth consecutive session, longest streak of gains
Speaker 6: on record trading at a September high. One of the
Speaker 6: kind of news events of the last twenty four hours
Speaker 6: was all those charging names coming out all at once,
Speaker 6: basically Yessay afternoon saying yep, you know what, we're going
Speaker 6: to adopt the NCACS standard, kind of pivoting to profressure
Speaker 6: and momentum in that space. A few stories that we're
Speaker 6: going to cover throughout the show playing out in equity markets.
Speaker 6: When it comes to movers as well, you mentioned Oracle
Speaker 6: and Salesforce. Oracle moving to the upside one point three percent.
Speaker 6: AI is driving cloud momentum. We'll get deep into those
Speaker 6: numbers with bion this Anna Ragrana, but interesting AI story
Speaker 6: with Salesforce as well, it's moving to the downside one
Speaker 6: and a half percent. They had this event where they
Speaker 6: kind of explained in real terms how their work in
Speaker 6: AI is going to better their existing suite of products.
Speaker 6: Remember there was also a referendum essentially on Mark Benioff's
Speaker 6: popularity with investors, which we can talk about. We're about
Speaker 6: to go to Miami to Florida and talk about Trump.
Speaker 6: So I just note this stock rumble. The conservative or
Speaker 6: right leaning social platform down four and a half percent.
Speaker 6: With the president in focus, and what's happening in court?
Speaker 3: Yeah, former President Donald Trump is in focus. Let's go
Speaker 3: straight there, just for an update really on what's happening.
Speaker 3: We're expecting the appearance in the Miami court today after
Speaker 3: being indicted on thirty seven counts of allegedly mishandling classified documents.
Speaker 3: As of course, after leaving the White House, Bloomberg's Kaylee
Speaker 3: Lines is outside the courthouse. And when are we anticipating
Speaker 3: in arrival Kayley.
Speaker 7: Well, three pm Eastern time is when he is due
Speaker 7: to report here at the Federal Courthouse. We may not
Speaker 7: actually see him arrive, though, it's expected that he will
Speaker 7: enter the Fort House via the underground garage, but once
Speaker 7: inside he will be arrested and processed just like anyone
Speaker 7: else who has been indicted on federal criminal charges. Its
Speaker 7: potential that he could have his fingerprint and mugshot taken.
Speaker 7: He may even need to surrender his passport. Then he
Speaker 7: will go up to the thirteenth floor of this building
Speaker 7: behind me a pear before a judge and is expected
Speaker 7: to plead not guilty. Of course this this indictment came
Speaker 7: down last week. The president has maintained that he is innocent,
Speaker 7: said that this is a witch hunt, election interference at
Speaker 7: the highest level, and that is likely the kind of
Speaker 7: messaging he is likely to take with him from Miami
Speaker 7: back up to Bedminster, New Jersey this evening, where he
Speaker 7: will be speaking at his golf club at eight fifteen
Speaker 7: pm Eastern Time, addressing his supporters, supporters and holding a
Speaker 7: donor event. His campaign expects that he could raise two
Speaker 7: million dollars at that event tonight, which is taking place
Speaker 7: just hours after he will become the first former president
Speaker 7: in history ever to be arranged on federal criminal charges.
Speaker 6: Kaylee, local police, one of which has just walked past
Speaker 6: you in that shot, and authorities preparing for some demonstration
Speaker 6: right what's the scene like on the ground right now
Speaker 6: where you are? Well?
Speaker 7: The police chief ahead of today has sent from five
Speaker 7: thousand up to as many as fifty thousand demonstrators could
Speaker 7: be here today and as a result, there is a
Speaker 7: pretty heavy security presence. There is a lot of police,
Speaker 7: There are perimeters set up all around, and there have
Speaker 7: been I would say several dozen of both pro Trump
Speaker 7: and anti Trump demonstrators here today. There is a lot
Speaker 7: of Trump flags, people wearing Make America Great Again gear,
Speaker 7: a couple that have T shirts on that indicate Trump
Speaker 7: is not guilty, that Trump won the election, but there
Speaker 7: are some anti Trump people as well, holding up signs
Speaker 7: like lock him Up. So far, though, it does seem peaceful.
Speaker 7: President Trump, of course, had called for his supporters to
Speaker 7: show up and peacefully protest. It doesn't seem like there
Speaker 7: is too much disruptive activity that is taking place here
Speaker 7: today at this point.
Speaker 6: All right, Bloombergs Katie Lines will be bringing us the
Speaker 6: latest throughout the day from Miami, Florida. But just gave
Speaker 6: us the latest here on Bloomberg Technology. Thank you so much.
Speaker 6: Now elsewhere in the world of eco head line CPI
Speaker 6: numbers inflation easing to the lowest levels since March with
Speaker 6: twenty twenty one. Let's get to the view from the
Speaker 6: founder of mickmac a global e commerce enablement and an
Speaker 6: analytics platform for multichannel brands showing us now Rachel Tippograph,
Speaker 6: who is the MICKMAC founder and CEO, at the street
Speaker 6: level or the online level, what does that inflation print
Speaker 6: tell you about the direction of travel right now?
Speaker 4: Rachel?
Speaker 8: Yeah, And you know, with the results just coming out,
Speaker 8: it's really interesting to think about why we're saying inflation
Speaker 8: might be going down. If we look at food and
Speaker 8: consumer good categories like appliances, those have been relatively flat.
Speaker 8: But when we remove that from the equation, inflation is
Speaker 8: still going up. And the reason why we're seeing categories
Speaker 8: like food and appliances stay relatively flat is that for
Speaker 8: the last few quarters, brand manufacturers have been raising praises,
Speaker 8: and the reason why they've been reached prices is that
Speaker 8: it's more extensive than ever before to bring consumer goods
Speaker 8: to market, to keep them on the shelf, and to
Speaker 8: market them to consumers. To offset those margins, they've been
Speaker 8: raising prices, which is why at NCKMAC we feel core
Speaker 8: inflation is more indicative of what's happening in the general economy,
Speaker 8: and when we look at that inflation continuing to go
Speaker 8: up against e commerce conversion rates. What we're seeing at
Speaker 8: Mickmac is that year over year e commerce conversion rates
Speaker 8: have been declining since twenty twenty And to put it
Speaker 8: into context, in twenty twenty one, the average e comm
Speaker 8: conversion rate we saw at Mickmac was seven point four percent.
Speaker 8: We're now halfway through twenty twenty three and the average
Speaker 8: e comm conversion rate is at four point eight percent.
Speaker 8: So it's showing that consumers are more trepidacious to buying
Speaker 8: right now.
Speaker 3: Yeah, what does that mean in terms of companies trepidation
Speaker 3: about marketing? An interesting headline just across the Brimberg is
Speaker 3: going to open a pop up restaurant of Parery call
Speaker 3: Netflix bytes in La. I mean, of course that's a
Speaker 3: marketing focus. It's itself a company that's taking in advertising,
Speaker 3: in fact dolos from other companies. Now, how willing and
Speaker 3: able are companies to experiment in this environment if the
Speaker 3: conversion rates up pretty low?
Speaker 9: Yeah?
Speaker 8: I think for most big brands and brands that understand
Speaker 8: what it takes to stand the test of time, you
Speaker 8: have to advertise during trying economic times. Look in Procter Gamble,
Speaker 8: they've proven that over one hundred years that being said,
Speaker 8: every dollar is being scrutinized right now by folks that
Speaker 8: hold the title like CFO, and they're holding the marketing
Speaker 8: teams accountable to driving business results, which has created a
Speaker 8: perfect tailwind for the rise of retail media. Meaning meta's
Speaker 8: biggest competitor isn't just Snap or TikTok, it's also Amazon,
Speaker 8: Target Walmart. And what the retailers have at their advantage
Speaker 8: is consumer purchase data and their ability to monetize that
Speaker 8: data and say, hey, we know who needs to replenish
Speaker 8: diapers right now, So if you have one dollar to
Speaker 8: spend to market diapers, you should give it to us
Speaker 8: over a platform that may not know that. So from
Speaker 8: a marketing standpoint, we're continuing to see brands spend, but
Speaker 8: they're spending in more strategic channels that have more visibility
Speaker 8: into the end sales data so they can understand marketing effectiveness.
Speaker 6: Rachel, we're showing on the screen, you know, the difference
Speaker 6: in direction of travel between goods and services inflation, and
Speaker 6: you learn in a recessionary and in inflation re environment that.
Speaker 4: Who is leading who.
Speaker 6: You know that there's a response to the consumer and
Speaker 6: their change in behavior, but there's also the reaction from
Speaker 6: the retailers themselves based on what you see.
Speaker 4: In the market.
Speaker 6: Who moves more quickly, you know, the consumer to change
Speaker 6: habits or the online retailer to respond to them.
Speaker 8: Yeah, it's it's a given a take per your point.
Speaker 8: But right now, what we're seeing into in terms of
Speaker 8: how consumers are spending is they're really spending on essentials.
Speaker 8: At Nickmac, we have over three thousand retailers in the
Speaker 8: network and we collect basket level sales data, and so
Speaker 8: we can tell you right now what America's buying bottled water,
Speaker 8: granola bars, teeth whitening kits, press on nails, and weed killers.
Speaker 8: And what that shows you is, hey, these are essential items.
Speaker 8: But when it comes to things like beauty, for example,
Speaker 8: you could go to the salon to get your nails done,
Speaker 8: or you could buy on press on nails at Walmart.
Speaker 8: And so in some of these discretionary categories, we are
Speaker 8: seeing consumers be more choosy with the things that they're
Speaker 8: willing to do on their own versus go to a
Speaker 8: more service oriented place.
Speaker 3: A boy, if I served one more press on nail
Speaker 3: kit Instagram marketing, I'm going to explode, so clearly that's
Speaker 3: the place this is right now, mus you got them
Speaker 3: all on Rachel Pohograph. Thank you so much spending some
Speaker 3: time with us. I think mac founder and CEO really interesting.
Speaker 3: Their weekkiller sexy stuff. Meanwhile, coming up and we're going
Speaker 3: to be sitting down for an exclusive conversation this year
Speaker 3: of Data Bricks as they acquire Rubicon to stealth infrastructure startup.
Speaker 5: It's focusing on storage systems that's key for AI. So
Speaker 5: that's the CEO. Meanwhile, watching shares of Apple.
Speaker 3: The company's stock is been downgraded to neutral from buy
Speaker 3: by UBS, which.
Speaker 5: The analysts is citing soft demand.
Speaker 3: Outlook for the iPhone and in particular for services growth
Speaker 3: as well. And it's notable that this downgrade is pushing
Speaker 3: bullish analysts ratings on the stock to a two year
Speaker 3: low of three ten percent. Remember it was a record
Speaker 3: high yesterday.
Speaker 9: This's Atlmberg.
Speaker 6: Data Bricks is announcing it's acquired Rubicon, a stealth infrastructure
Speaker 6: startup focusing on storage systems for AI. Data Bricks is
Speaker 6: used by more than nine thousand organizations worldwide who rely
Speaker 6: on the companies lake House platform to unify their data,
Speaker 6: analytics and AI. The startup also hit key milestones for
Speaker 6: revenue and top line growth. Joining us now Data Brick
Speaker 6: CEO Ali Godzi a lot to go over.
Speaker 4: I'm learning a lot.
Speaker 6: About data breaks this morning. Let's start with the top line.
Speaker 6: You've just closed out a financial year at the end
Speaker 6: of jen hit a billion dollars of revenue, which is
Speaker 6: a milestone. But the growth is really interesting. That makes
Speaker 6: you one of the fastest growing software names out there.
Speaker 4: What's driving it?
Speaker 2: Yeah, it's really tailwinds.
Speaker 10: By the way, it's the fastest growing software if according
Speaker 10: to our records. But what is driving it is really
Speaker 10: we're seeing tailwinds. One around AI. Everyone wants AI now one.
Speaker 10: We've been saying it for ten years that data innai
Speaker 10: is going to be the future, that in every industry
Speaker 10: the winners are going to be data ANAI companies. But
Speaker 10: something happened in November last year and everyone kind of
Speaker 10: realized after chat GPT that this is the future. And
Speaker 10: the second thing is tcoor reduction. People want to cut
Speaker 10: down their costs of data spend and our Lakehouse platform
Speaker 10: helps that.
Speaker 6: Data warehousing SQL is the product. You also sharing some
Speaker 6: financials on that particular product. So I remember when you
Speaker 6: announced it, you know, it's a domain you compete with
Speaker 6: snowflake in. What's driving this growth? Is this a market
Speaker 6: share gain for you?
Speaker 10: Yeah, So we've announced that we now passed one hundred
Speaker 10: million ARR on our data warehousing product that we just
Speaker 10: frankly launched just a year ago. So what's going on
Speaker 10: here is that this Lakehouse paradigm helps organizations cut down
Speaker 10: their cost of data warehousing significantly. And you know, there's
Speaker 10: a tale of two cities. On the one hand side,
Speaker 10: everybody wants AI and they want to spend on AI.
Speaker 10: On the other hand, everyone wants to reduce their cost
Speaker 10: and they want to reduce the spend on data warehousing.
Speaker 10: So it's really that cost tco optimization that's driving that
Speaker 10: tail went behind data.
Speaker 6: Warehousing spent caroline from organic growth to inorganic growth. Ali,
Speaker 6: godseeing data breaks who have been outshot.
Speaker 3: Yeah, I'm interested in that deal, Rubicon. This is all
Speaker 3: about storage systems. You say, it's the backbone of AI. Ali,
Speaker 3: did you have to pay up? I mean, this isn't
Speaker 3: a cheap time to be trying to buy a company
Speaker 3: related to AI.
Speaker 5: Right now?
Speaker 10: Yeah, right now, you have to pay up. That's just
Speaker 10: as simple as it is. And everyone that's doing anything
Speaker 10: with AI. And this was a team that can build
Speaker 10: storage for all kinds of unstructured data. This is the
Speaker 10: oil that fuels AI.
Speaker 2: You know, those are not cheap right now. And this
Speaker 2: is the team that.
Speaker 10: Actually has built it previously at drop.
Speaker 2: Box and before that at Google.
Speaker 10: So this is a team that really knows how to
Speaker 10: build this kind of sort of data systems for AI.
Speaker 10: You know, Sergay and team are really really experienced. So
Speaker 10: we're excited to have them as part of Data Bricks.
Speaker 3: Of course, you, as you said, for the last decade,
Speaker 3: have been telling people the future is data, it's AI.
Speaker 3: Your own well experience two decades in this particular field
Speaker 3: and in particular with deep routes not only in R
Speaker 3: research ALI, but also in open source software, and I'm
Speaker 3: interested in your take and just sort of theoretically at
Speaker 3: the moment, as everyone Warren debates as to whether open AI,
Speaker 3: Microsoft Google going to eat the entire lunch when it
Speaker 3: comes to large language models when it comes to application,
Speaker 3: and whether the open source is actually already showing that
Speaker 3: they aren't any modes.
Speaker 5: Where do you stand on this divide?
Speaker 2: Yeah, I would say two things. I would say. On
Speaker 2: the one hand, We absolutely.
Speaker 10: Want open source to flourish because as AI becomes more
Speaker 10: and more powerful, we want the researchers around the world
Speaker 10: to understand this technology. We don't want just one or
Speaker 10: two companies to sit on top of this and there
Speaker 10: are only ones that know if.
Speaker 2: It's going wrong or right.
Speaker 10: We want researchers the whole world to understand the models.
Speaker 10: What can go around well, you know, how do we
Speaker 10: align them with US US one. The second thing is
Speaker 10: I actually think it's impossible for one or two companies
Speaker 10: to keep up with the competition. Every university on the planet,
Speaker 10: every researcher now in the data field, in the tech field,
Speaker 10: is focused on llm's generative AI.
Speaker 2: I've never seen anything like it before.
Speaker 10: So it's going to be very hard for one company
Speaker 10: to keep a proprietary model that they say is ahead
Speaker 10: of everybody else, and it's ahead of open source. So
Speaker 10: and we've seen this every day we're having new results
Speaker 10: in open source. You know, I follow it very closely.
Speaker 10: It's no longer months, it's no longer weeks, it's every day,
Speaker 10: multiple times a day, there's a new breakthrough result. So
Speaker 10: I think it's going to be very hard for proprietary
Speaker 10: closed companies to say, ahead, what is.
Speaker 6: The Alley Gods view on when and why data breaks
Speaker 6: would go public?
Speaker 4: And I just want to caveat that.
Speaker 6: You know, there's reports that you kind of trim the
Speaker 6: valuation on the company. Didn't slash the trimmed, but what
Speaker 6: would push you to do that?
Speaker 10: Yeah, So look, I've always said that IPO is something
Speaker 10: we will do in the future for us. We think
Speaker 10: that we're going to be a really successful, sustainable business
Speaker 10: in the long run, in you know, next decade or so.
Speaker 10: So this is just a milestone right now. The markets
Speaker 10: are shut down, We're not over optimizing for this IPO event.
Speaker 10: We'll get there, you know, whenever the time is right.
Speaker 10: There's just so much demand for our business right now.
Speaker 10: And Frank, we want to be able to invest in AI.
Speaker 10: We want to be able to do the investment set
Speaker 10: we're allowed to do us private companies. It would be
Speaker 10: actually hard to do that as a public company. So
Speaker 10: actually right now it's really helping us to stay for
Speaker 10: private data.
Speaker 3: Brix CEO, Annie Gods there, We thank you for bringing
Speaker 3: us the update on some of the revenue numbers and
Speaker 3: the acquisition.
Speaker 5: Time Now for.
Speaker 3: Talking tech Kathy Wood is making new bets on other
Speaker 3: tech stocks after of course, dropping in video from her funds. Largely,
Speaker 3: two Ark invest funds purchased roughly one hundred and seventy
Speaker 3: five thousand shares Meta, while the Ark Autonomous Technology and
Speaker 3: Robotic etf IT picked up more than ninety eight thousand
Speaker 3: shares the chip maker TSMC. Meanwhile, TSMC also regaining it's
Speaker 3: five hundred billion dollar market cap as investors buy into
Speaker 3: artificial intelligence and looks sift through which stock's the best
Speaker 3: place to thrive during this AI boom. While TSMC toilted
Speaker 3: its potential role within AI, has expressed some caution over
Speaker 3: the outlook for the smartphone market, in particular that of course,
Speaker 3: comprises a significant chunk of its revenue so far. And
Speaker 3: let's look at arm So software back chip designer. It's
Speaker 3: in talks with potential investors, including Intel, to be an
Speaker 3: anchor in its New York listing later this year. Sources
Speaker 3: are saying that the company has held talks with other
Speaker 3: firms about funding. The IPO was expected to be one
Speaker 3: of the most significant IPOs of the year.
Speaker 6: Ed Yeah, let's chip away all this story further Bloomberg
Speaker 6: Deals reporter Katie Ruth joining us from Los Angeles. An
Speaker 6: anchor investor, you and I have been across many IPOs
Speaker 6: in years. An anchor investor gives you a bit of
Speaker 6: confidence appear in your industry.
Speaker 1: That's very interesting, Yeah, exactly, And investors like this SoftBank
Speaker 1: stock traded up on the news. Yes, a lot of
Speaker 1: times you'll see an anchor investor of about one hundred
Speaker 1: to two hundred million in size to help shore up confidence.
Speaker 1: You know, it's a vote of confidence, a bit you know,
Speaker 1: from a competitor and also a partner that shows that
Speaker 1: they're serious and excited about arms technology.
Speaker 3: I mean they have a relationship already a technical one.
Speaker 3: The fact that it would become a financial one, I
Speaker 3: mean remind us of in the past when this has
Speaker 3: happened because sort.
Speaker 5: Of Qualcomm is underpin previous listings as well.
Speaker 1: Yeah, yeah, it's happened with Qualcom and then Mobile I.
Speaker 1: There have been other anchor investors in the past. Mobile
Speaker 1: I was spun out from Intel last year, and so
Speaker 1: not just in this category, but in general. It's something
Speaker 1: that you sometimes see with IPOs ahead of the roadshow,
Speaker 1: ahead of drumming up interest from institutional investors to have
Speaker 1: this strategic anchor investor to shore up confidence.
Speaker 6: So Katie, you are the name on the Deals newsletter
Speaker 6: publishing this morning. A big focus on all the talk
Speaker 6: out in LA and LA Tech Week and Karen and I,
Speaker 6: you know, we look at each of these tech Weeks LA,
Speaker 6: New York, San Francisco. Sometimes a lot comes out of it,
Speaker 6: sometimes very little does. What did you learn on the ground, Well.
Speaker 1: I had fun?
Speaker 2: What what did I learn?
Speaker 1: I chatted with Mantis, the Chainsmokers, the band. They have
Speaker 1: a venture fund and they they threw events uh uh
Speaker 1: djayed by Travis Barker. I mean, it wouldn't be LA
Speaker 1: Tech Week without participation from Hollywood. I spoke to Will
Speaker 1: i Am, who my editor joke should be called will
Speaker 1: A i Am, because he's been into interested in AI
Speaker 1: for uh really the past decade. He's had multiple AI startups.
Speaker 1: He has a new one, and he spoke to me
Speaker 1: about you know, why he's excited about AI, but also
Speaker 1: how he thinks that you know, it could provide an
Speaker 1: opportunity for there to be a reset, uh for for
Speaker 1: new jobs. And you know he's going back to his
Speaker 1: home community to help, you know, prepare them for the
Speaker 1: changing job market. There were you know a lot of
Speaker 1: different events, sometimes at Hollywood mansions and you know, sometimes
Speaker 1: featuring pizza robots. But you know, it's exciting to catch
Speaker 1: up with the LA's tech industry.
Speaker 3: I'm not sure there's any tech reporter that hasn't spoken
Speaker 3: to me. I have now, I think you've aired you.
Speaker 3: He turned up a Mercedes events for you. I think
Speaker 3: I interviewed them Mobile Will Congress or Viva Tech or something. Meanwhile,
Speaker 3: these events are going thick and fast, and think gets
Speaker 3: London Technik on at the moment. So maybe he's over
Speaker 3: there right now. Katie Ruth, we thank you so much for.
Speaker 5: Telling us about all the NA parties so she has.
Speaker 3: Been at as well as all the deals that are
Speaker 3: being done there. Go check out her MNA deals discussion.
Speaker 3: It's in the latest newsletter on the Bloomberg terminal. Welcome
Speaker 3: back to Bloomberg Technology. I'm Caroline Hyde.
Speaker 6: In New York and I Mad Ludlow in San Francisco.
Speaker 6: It's going to check in on the market. Stocks pushing higher,
Speaker 6: including the technology sector, driven by the inflation print.
Speaker 4: That we got.
Speaker 6: The idea being that the chances of a hike in
Speaker 6: twenty four hours time at the FED meeting increasingly lower.
Speaker 6: That's not to say the market thinks that the FED
Speaker 6: is done, but we are now a little more certain
Speaker 6: about a June meeting pause or however you want to phrase.
Speaker 6: It's SP five hundred and seven tens to one percent,
Speaker 6: the tech heavy NAZDA one hundred slightly underperforming that, but
Speaker 6: basically in line that's HISS yields push higher, the US
Speaker 6: ten year three point seven eight percent, up by about
Speaker 6: five basis points. And we talked about our sort of
Speaker 6: favorite risk asset that Bitcoin actually did start to move
Speaker 6: a little lower, down just three tens percent in the
Speaker 6: session to twenty five eight hundred and nine.
Speaker 4: US dollars per token.
Speaker 6: Two kind of mover stories out there this Tuesday morning,
Speaker 6: Oracle and Salesforce, Oracle and earning story where cloud momentum
Speaker 6: being driven by compute demand for AI. Also kind of
Speaker 6: granularity coming from Larry Ellison, the chairman, about two billion
Speaker 6: dollars of bookings fueled by LA compute demand. And then
Speaker 6: Salesforce demonstrating its competence CARO in the field of generative AI,
Speaker 6: how the work they're doing there is going to boost
Speaker 6: their existing offerings in the world of CRM and other
Speaker 6: software suite and tools. But of course we also had
Speaker 6: this kind of soft referendum on Mark Benioff's popularity, which
Speaker 6: he did better on this year than last.
Speaker 3: And it's worth reminding ourselves just how far both of
Speaker 3: these stocks have rallied this year.
Speaker 5: I think Oracle's up more.
Speaker 3: Than fifty percent salesforce giving away a little bit today,
Speaker 3: but at more than sixty percent on the year. Let's
Speaker 3: dive deeper into just what's behind the share price momentum,
Speaker 3: and of course it's cloud momentum, mainly across both Anna
Speaker 3: Ragranaz with us Bloomberg Intelligence senior tech analyst, and let's
Speaker 3: start on Oracle because a lot of notes coming out
Speaker 3: that they loved, in particular Oracle's cloud infrastructure that they
Speaker 3: seem to be seeing a key highlight for you as
Speaker 3: well as for Jeffries.
Speaker 9: Yeah, this is I mean it was.
Speaker 11: The acceleration in infrastructure as a service was a bit
Speaker 11: surprising to us.
Speaker 9: It was quite a bit sharper.
Speaker 11: Only because in the whole world is slowing down right
Speaker 11: now in terms of consumption, and here is Oracle, even
Speaker 11: though it's a smaller base, you know, but improving their
Speaker 11: growth rates. Now this is where we you know, wrote
Speaker 11: this morning that this is going to do, you know,
Speaker 11: get some work done from both Amazon and Microsoft in
Speaker 11: terms of explaining to the market that they are not
Speaker 11: losing market share and everybody is going to benefit from
Speaker 11: both the AI boom and people moving more workloads to
Speaker 11: the cloud. Now, remember, Oracle is very good at marketing itself,
Speaker 11: and I think they did a phenomenal job over the
Speaker 11: last few quarters and we can see the results of that.
Speaker 6: Speaking of marketing oneself, Salesforce set out, it's still in
Speaker 6: terms of what it's doing in the field of generative AI.
Speaker 6: Where does Salesforce sit in the AI wars from the
Speaker 6: BI perspective an RAG.
Speaker 11: So one of the things that we have talked a
Speaker 11: lot about is when you look at generative AI, consumer
Speaker 11: applications are going.
Speaker 9: To be the first one to embrace this.
Speaker 11: And we have seen that already with our GPT and
Speaker 11: you know being including some of that stuff.
Speaker 9: You're going to get more of that in the coming months.
Speaker 11: A large portion of that is because the data, the
Speaker 11: consumer data is a little bit easier to get than
Speaker 11: enterprise data. When you look at a company like Salesforce,
Speaker 11: the number one concern for corporations right now is are
Speaker 11: they going to use my data to come up with
Speaker 11: some new algorithm and then you start divulging those data
Speaker 11: sources out there.
Speaker 9: And I think what.
Speaker 11: Salesforce data yesterday was very smart. They're there to explain
Speaker 11: to people that your personal data will remain private.
Speaker 9: As a company, we're not going to use it.
Speaker 11: If you're going to use it, it's only going to
Speaker 11: be for you. So I think it's a first good
Speaker 11: step in explaining to people what it means. I think
Speaker 11: Salesforce is a big beneficiary in the long run because
Speaker 11: at both their cloud products, whether it's Sales Cloud or
Speaker 11: Customer Relationship Management or the Customer Service Cloud, both are
Speaker 11: three times bigger than the nearest rival in the cloud.
Speaker 11: And I think they are sitting on top of a
Speaker 11: lot of data and they're going to benefit from that.
Speaker 6: All right, Oh, thanks to Ana rag Rana or Bloomberg
Speaker 6: Intelligence reacting to what's been a busy twenty four hours
Speaker 6: in newsflow, let's get more perspective on AI and cloud
Speaker 6: software from Manny Medinao Outreach. Outreach is a Salesforce partner
Speaker 6: and an AI driven sales platform which is used by
Speaker 6: thousands of enterprises to increase sales rep productivity. And it's
Speaker 6: a great place to start because the question Caroline and
Speaker 6: I constantly pose Nanny is how does the introduction of
Speaker 6: generative AI tools not just change sales function but does
Speaker 6: it eliminate some as well.
Speaker 12: Let's think I step back, so where are the very
Speaker 12: early innings of what jenai and JIAI in.
Speaker 9: General can do for a sales rep and for a
Speaker 9: sales manager.
Speaker 12: And the winners of this race are going to be
Speaker 12: called out in the next two years, if you would.
Speaker 12: But what's important is that if you go to the future,
Speaker 12: can you imagine you know what is it non negotiable?
Speaker 12: So if you think for first principles back and what's
Speaker 12: going to happen in the future, that we need to
Speaker 12: do today is that in the future, there is no rep.
Speaker 12: There's no manager that doesn't have an AI dedicated to
Speaker 12: their work. That is not helping them, you know, close
Speaker 12: deals faster, That is not helping them prioritize their day,
Speaker 12: that is not helping them figure out what accounts to pursue,
Speaker 12: what accunts not for to pursue, who who to follow
Speaker 12: up with and sort of get the aggregate of those
Speaker 12: reports to a manager and making sure that the team
Speaker 12: is moving forward and delivering. So in that future, if
Speaker 12: you work it back to today, the things that are
Speaker 12: important is how do you lay.
Speaker 9: Out that data?
Speaker 12: How do you make you know your your your partner
Speaker 12: in the enterprise trustworthy, which is what seales for today.
Speaker 12: How do you make sure that you are accumulating data
Speaker 12: and processing in such a way that you are increasingly
Speaker 12: helping the reps work close and making them more successful.
Speaker 9: Now will doubt this displaced jobs?
Speaker 12: I doubt it because people, you know, organizations will get
Speaker 12: greedy and they will see that with higher efficiency they
Speaker 12: can actually drive higher results.
Speaker 9: So they will continue to hire reps that use GENI
Speaker 9: as part.
Speaker 12: Of their day to day workflow and that will continue
Speaker 12: to drive you know, efficient returns and efficient compounding outcomes
Speaker 12: for organizations.
Speaker 9: So it's a very exciting time right now.
Speaker 3: Exciting as long as you're happy to be augmented, as
Speaker 3: long as you're ensuring you're up in your skill set
Speaker 3: to work alongside this AI manny, What did you hear
Speaker 3: that was different out of salesforce? That ultimately is being
Speaker 3: said by everyone else who's trying to help you with
Speaker 3: your CRM, with your interactions with your customers, with marketing
Speaker 3: when it comes to AI.
Speaker 12: I think what we're seeing right now is an even
Speaker 12: played in field among all the systems of record players.
Speaker 12: So you're seeing Dynamics in Microsoft coming out with a
Speaker 12: setup announcements. You see an Oracle coming up with a
Speaker 12: setup announcements. You seeing Salesforce coming up with sort of announcements.
Speaker 9: Three weeks ago.
Speaker 12: Service now layout there rotema for AI and I gonna
Speaker 12: mean for IDSM and the rest of the year.
Speaker 5: Differct maney manny. That's really overwhelming for me.
Speaker 3: I mean, as the journalists, you're speaking to, all these
Speaker 3: companies getting you onto, and it feels as though there's
Speaker 3: too many announcements, everyone suddenly trying to make themselves out
Speaker 3: to be some AI efficient company. How can you discern
Speaker 3: which one's doing the right things?
Speaker 5: And when.
Speaker 12: There is no way to go wrong? Right now, see
Speaker 12: that players who are going to win. They set out
Speaker 12: the AI strategy ten years ago. So if you read
Speaker 12: you know the sell sorces of full service announcement, they
Speaker 12: actually have been working on a number of things for
Speaker 12: a while. And this is just the culmination and the
Speaker 12: and the and another turn of the flywheel.
Speaker 9: Of getting their AI on on the onto the market
Speaker 9: now with the help of Generative AI.
Speaker 12: So General VII is just another flavor of a bunch
Speaker 12: of AI that has been built over the past ten years.
Speaker 9: It's the same thing for outreach.
Speaker 12: We've been working with workflows and we've been looking at
Speaker 12: what the what is the rep doing or the manager doing,
Speaker 12: what is the outcome of the workflows and fitting that
Speaker 12: into models so that we can make people more productive.
Speaker 12: General VAI is just another gear into that, into that
Speaker 12: flight wheel. So everyone is going to have enhancements to
Speaker 12: the user experience on their platforms and that is just
Speaker 12: good news for everybody.
Speaker 6: MANNY to the enterprises you work with have the technical
Speaker 6: expertise and the personnel necessary to understand what's happening and
Speaker 6: then implement it on their end.
Speaker 9: That is exactly the right question to ask.
Speaker 12: So the main the main funnel through which AI is
Speaker 12: going to have to go through the main uh, the mechanism,
Speaker 12: but which AI gets deployed and gets useful is through
Speaker 12: the human being. It's through the worker, it's through the
Speaker 12: project and through the workflow. And we need to spend
Speaker 12: more time thinking about how does that AI impact, the
Speaker 12: rep impact, the customer success manager impact, the support UH
Speaker 12: person or professional and managers out there to make sure
Speaker 12: that we are fitting the AI to the benefit of
Speaker 12: the human being, because only then you're going to get
Speaker 12: the compound and effect of AI plus human delivers drastic results.
Speaker 12: So we need to spend more time a locating that
Speaker 12: our team members and the and the recipients into the
Speaker 12: new into the new workflows, into the new possibilities that
Speaker 12: i I bring to the table.
Speaker 9: Without it, you're not going to get adoption.
Speaker 12: So that that is the part that we all need
Speaker 12: to be talking about, is what are you doing to
Speaker 12: drive adoption of AI out your customer's point, not in
Speaker 12: the technology delivery.
Speaker 9: Now, your delivery is very easy right now is customer
Speaker 9: after right?
Speaker 2: All right?
Speaker 6: Thanks to our reco Manny Medina, who's reacting carried to
Speaker 6: salesforce setting out what they're doing in the field of
Speaker 6: AI in the last twenty four hours. Now coming up
Speaker 6: the state of the venture industry and what will be
Speaker 6: the next big thing enabled by AI. More on that
Speaker 6: with four runners Brian O'Malley, that's next.
Speaker 4: This is Bloomberg all right, Time for the VC roundup.
Speaker 6: First up, Insight Partners has cut the target size of
Speaker 6: its latest fund to fifteen billion dollars from the earlier
Speaker 6: target of twenty billion dollars. Is it sees quote a
Speaker 6: great reset in tech. That's according to the Financial Time,
Speaker 6: citing a letter to institutional investors. The firm is so
Speaker 6: far raised about two billion dollars for its thirteenth fund. Similarly,
Speaker 6: Technology Crossover Ventures or TEAC has raised fifty to seventy
Speaker 6: five percent less capital for his flagship fund, down from
Speaker 6: the planned five point five billion target set last year.
Speaker 6: That's according to the Information, citing securities filings and a
Speaker 6: document compiled by one of tcb's A limited partners. TCV
Speaker 6: has raised one point four billion for its flagship fund. Finally,
Speaker 6: wafer producer Cubic PV says it secured over one hundred
Speaker 6: million dollars in new firm equity commitments for its US
Speaker 6: factory plans and product ROMAC, SCG, Hunt Energy, and break
Speaker 6: Through Energy all committed capital, with the first thirty three
Speaker 6: million dollars to be released immediately.
Speaker 4: Caroline, let's stick.
Speaker 3: With this world of VC. We're very pleased to welcome
Speaker 3: to the show. Brian and Valley, managing partner at four
Speaker 3: Run Adventures two billion dollars in assets under management and
Speaker 3: really ran you state your claim, and some of the
Speaker 3: key companies you back before are very consumer focused. I'm
Speaker 3: thinking in the glossiers him and hers Aura. At the moment,
Speaker 3: you seem to be looking at a lot at the
Speaker 3: platforms that empower gig economy workers, and I'm interested as
Speaker 3: to how much time is currently helping your portfolio companies
Speaker 3: basically ensure that they're empowered with AI, then they're not
Speaker 3: having their lunch, eat and elsewhere.
Speaker 2: Yeah.
Speaker 13: Absolutely, I think AI is on everyone's mind these days.
Speaker 13: It's something that I've been hearing you guys talk about
Speaker 13: all morning. It's something we're talking about in our offices
Speaker 13: all day long. And so we did a survey recently
Speaker 13: of our portfolio to really understand where they're exploring. And
Speaker 13: it's not surprising that about eighty to ninety percent of
Speaker 13: the portfolio companies are already leveraging AI in some fashion
Speaker 13: and the rest are thinking about it and starts with marketing,
Speaker 13: it starts with their product, and then they're really thinking
Speaker 13: about internal processes and how they can automate internal processes
Speaker 13: as well.
Speaker 6: Full your portfolio companies and the founders you invest in.
Speaker 6: What is the single biggest factor that would push them
Speaker 6: to invest in AI?
Speaker 4: Why do they need it?
Speaker 13: Well, everyone is trying to be both more efficient as
Speaker 13: well as provide more value to their end customers. And
Speaker 13: we're finding ways where if they can put their people
Speaker 13: first and then enable some of the back end processes
Speaker 13: to be leveraged through AI, that enables them to have
Speaker 13: more human element even though they're taking advantage of these
Speaker 13: new technologies.
Speaker 6: I think it poses the question Carrie, going back to consumer,
Speaker 6: because I was getting ready for this segment and I
Speaker 6: was kind of looking forward to not talking about AI,
Speaker 6: and we're two and a half minutes in and we've
Speaker 6: already ruined that. But traditionally, for vcs, the consumer segment
Speaker 6: is risky. You're against giant global conglomerates who are also innovating.
Speaker 6: Why do you want to focus there in more consumer
Speaker 6: facing startups in their platforms.
Speaker 2: Sure?
Speaker 13: Well, we believe that when you focus at something, you
Speaker 13: can be the best in the world at it, and
Speaker 13: that's what we're trying to do in terms of understanding
Speaker 13: both what consumers want. Right now, we spend a lot
Speaker 13: of our time not pontificating, but really listening. So we
Speaker 13: do a fair amount of focus groups, a fair amount
Speaker 13: of surveys. I understand what is top of mind for people.
Speaker 13: And even though there's all this innovation, people are still
Speaker 13: left wanting more. They've got challenges in their personal lives,
Speaker 13: looking for community and connection, and they're also thinking about
Speaker 13: how they can get better purpose, better self reliance. And
Speaker 13: so we feel like as much as there's dollars going
Speaker 13: into the ecosystem, there's a lot of needs still being
Speaker 13: unmet for consumers, and we believe the founders we work
Speaker 13: QUI can help solve those needs.
Speaker 6: You know, Caroline, We've had vcs and founders on the
Speaker 6: show that are making something for the consumer, and valuing
Speaker 6: that offering is really hard.
Speaker 3: Yeah, I mean, Brian, I'm having a lot of conversations
Speaker 3: with vcs who've primarily backed consumer focused companies and at
Speaker 3: the moment they say they're not touching them with a
Speaker 3: barge pole.
Speaker 5: In terms of new checks to be written.
Speaker 3: How much is the valuations the companies that you currently
Speaker 3: have had and just having to write size still at
Speaker 3: the moment.
Speaker 13: Sure, Well, there's a combination that portfolio, as there always is,
Speaker 13: and the ratio may change a little bit, but our
Speaker 13: best companies are still finding dollars available to them, they're
Speaker 13: still raising capital, and they're able to do what they
Speaker 13: need to do. The companies that are struggling, they continue
Speaker 13: to struggle, and a lot of that comes down to
Speaker 13: just this question around whether they found product market fit
Speaker 13: and whether they're timing is right for what they're ultimately offering.
Speaker 13: And so we look at a time where a lot
Speaker 13: of other consumer we're investors or left scratching their head
Speaker 13: because they found themselves chasing some of these shiny objects.
Speaker 13: We find that when we're grounded talking to people, talking
Speaker 13: about what their needs are and looking at how that
Speaker 13: is juxtaposed against new business models and new technologies, we
Speaker 13: find that there's more than an opportunity to invest in.
Speaker 13: It's just about finding the right ones, where we have
Speaker 13: the right founder fit based on our ambition and based
Speaker 13: on what they're trying to.
Speaker 5: Do talk to us about the founder fit.
Speaker 3: Of course, there was a lot of concern that as
Speaker 3: you know, that sucking feeling, sucking noise started to happen
Speaker 3: in terms of the money coming out of the situation,
Speaker 3: it was going to leave particularly diverse founders.
Speaker 5: Sort of most hard hit.
Speaker 3: But then now what I'm hearing is actually the diverse
Speaker 3: founders have been used to being scrappy ultimately, and they're
Speaker 3: actually better at weathering these sorts of downturns because they
Speaker 3: know how to have a sort of nimble business. And
Speaker 3: you're seeing that how much you were able to continue
Speaker 3: to support founders who perhaps wouldn't have had checks previously.
Speaker 13: Yeah, absolutely, we're looking for founders today to be scrappier
Speaker 13: than they've ever been before.
Speaker 2: But scared city is.
Speaker 13: An important trait for these startup companies. When you have
Speaker 13: too many things going on, it enables you took to
Speaker 13: lose your focus. And when there's less resources, when there's
Speaker 13: less people on the team, it's easier to pick what's
Speaker 13: the one priority we need to get accomplished now. And
Speaker 13: that's what we're working with our teams on to help
Speaker 13: them pick that priority and help them execute against it.
Speaker 6: Brian, what's your exit strategy when you're in this space?
Speaker 13: Our access strategy is really simple. We try to build
Speaker 13: great businesses, and those great businesses tend to have lots
Speaker 13: of opportunities come towards them, and that window might be.
Speaker 4: Changing a little bit.
Speaker 13: It might be harder to sell a company, I'd be
Speaker 13: harder to take a public right now. But if you're
Speaker 13: building a durable, sustainable business where the customers love what
Speaker 13: you're doing, time is actually your friend versus your enemy,
Speaker 13: and that's.
Speaker 4: What we're trying to help our companies do.
Speaker 6: All right, full run Avenches managing partner Brian O'Malley, thank
Speaker 6: you very much. Federal Prosecutes is in the Fharaanos case.
Speaker 6: They're asking for Elizabeth Holmes to pay two hundred and
Speaker 6: fifty dollars every month in restitution once she's released from prison.
Speaker 6: Lawyers for the former Pharaoh CEO say she has quote
Speaker 6: limited financial resources and should not have to make the
Speaker 6: monthly payment. Holmes had said she can't afford to pay
Speaker 6: the nine figure sum demanded by the US over four
Speaker 6: hundred and fifty two million dollars. Twitter's former CEO, Jack
Speaker 6: Dorsey says authorities had threatened the platform during the farmer
Speaker 6: protests unless Twitter removed certain politically sensitive posts. Now India's
Speaker 6: Minister of State for Electronics and it fired back at Dorsey, saying, quote,
Speaker 6: that's a lie. Bloomberg's Technology editor Sarah Fryer joins US
Speaker 6: on set with more.
Speaker 4: Let's start.
Speaker 6: I guess with the retort, what is it that that
Speaker 6: India is saying Twitter is lying or Jack Dorsey specifically
Speaker 6: is lying about.
Speaker 14: Well, they're saying that they never shut Twitter down and
Speaker 14: then nobody went to jail. That's not what Dorsey was saying.
Speaker 14: He was saying that there were threats that the company
Speaker 14: would be shut down and that employees would be threatened. So,
Speaker 14: I mean, what you're seeing here this is just a
Speaker 14: microcosm of what's happening with Twitter across the world, which
Speaker 14: is governments are realizing that they can ask for the
Speaker 14: company to do certain things to take down a posts
Speaker 14: from dissidents, from people who are criticizing the government and
Speaker 14: say they're in violation of law, and if they don't comply,
Speaker 14: they could lose their market power in that country. And
Speaker 14: that is something that I think is going to be
Speaker 14: even more difficult under the new CEO, Lindia Karino and
Speaker 14: new owner of Twitter, Elon Musk. We're talking about with Dorisy.
Speaker 14: Happened in twenty twenty one, and now Twitter has so
Speaker 14: many fewer of those global legal policy employees who really
Speaker 14: understand a local government and enlarge governments like India, how
Speaker 14: to navigate those different political stumbling blocks that come about.
Speaker 3: I mean, I'm thinking of Linda Acarino's recent tweet thread,
Speaker 3: and she really wants to make Twitter the open place
Speaker 3: for discussion, and ultimately certain countries are going to find
Speaker 3: that difficult. We know India, of course, does tend to
Speaker 3: fight back against social media. I mean they've banned TikTok,
Speaker 3: for example, one of the any key countries to do that.
Speaker 5: How do you think you can navigate that?
Speaker 6: So, Cara, I'm going to jump in here because I
Speaker 6: think Sarah lost you in her ear. But basically the
Speaker 6: question is what do we know about how Twitter is
Speaker 6: now handling it's global relationships with regulators in different jurisdictions.
Speaker 14: What we know is that a lot of the executives
Speaker 14: who were in charge of trust and safety at Twitter,
Speaker 14: who are in charge of ensuring that the side is
Speaker 14: complying with laws is taking down hate, reature, misinformation and
Speaker 14: violent content that they are, you know, losing a lot
Speaker 14: of the top executives who were in charge. And I
Speaker 14: think that that makes it very difficult because when you're
Speaker 14: working with governments and negotiating with governments, basically this is
Speaker 14: against the law Twitter, you used to fight those cases,
Speaker 14: they used to fight Turkey, they used to fight in
Speaker 14: Egypt and say like no, like we're gonna we're gonna
Speaker 14: keep those posts up. We're not going to give you
Speaker 14: information on those people. What's going to be really interesting
Speaker 14: is to see how how Twitter's changes and fights adjusts.
Speaker 14: Given that their owner, Elon Musk, also has other business
Speaker 14: interests in the countries where Twitter is operating with Tesla,
Speaker 14: with SpaceX was with Starlink, it could get very complicated.
Speaker 6: All right, Bloomberg, Sarah Fryer, thank you here on SF
Speaker 6: all thanks Twitter, Carrot.
Speaker 3: Yeah, notable that that town square that the New York
Speaker 3: from talks about currently talking about, well a football club
Speaker 3: close to our home and at the moment when it
Speaker 3: comes to Manchester United. But we don't have time to
Speaker 3: talk about that because it's the end of this edition
Speaker 3: of a New Bow Technology.
Speaker 4: It's second day of the week.
Speaker 6: Busy week so far, so don't forget you recap with
Speaker 6: the podcast wherever you get your podcasts, Apple, Spotify, iHeart
Speaker 6: and of course on all of the core Bloomberg platforms.
Speaker 6: From New York and from San Francisco. This is Bloomberg technology,